equipment used to counter the Soviet threat.

Second, the USSR uses its relatively high rates of production to maintain modern equipment in Soviet forces and regularly transfers older weapons to the forces of its allies. This results in a high degree of standardization and compatibility within the Warsaw Pact. Third, sustained high production rates give the Soviets flexibility in transferring modern armaments to client states on short notice in an emergency. Fourth, differences in tactical doctrine influence production rates.

For example, the Soviets may produce a large number of T-72 tanks during 1978. The T-72 has better accuracy, better protection, greater agility, higher rates of fire and greater lethality than U.S. and NATO tanks now in the field. The XM-1 and Leopard 11, scheduled for deployment in the early 1980s, will provide a qualitative edge to NATO on a tank-for-tank basis over any Soviet tank currently being produced.

High production rates for Soviet artillery are a reflection both of doctrine which emphasizes this capability and of the large deployments of Soviet and Warsaw Pact units. Current Soviet artillery provides mobility improvements and significantly greater sustained-fire throwweight over longer ranges than its U.S. counterparts in Europe. The U.S. lead in munitions, target acquisition and fire control technologies has not yet been exploited fully in terms of deployed weapons.

The Soviets currently lead the U.S. in deployed attack

helicopter firepower and this lead appears to be increasing. The Soviets deployed the HIND helicopter in 1972 as their first attack

helicopter.

The HIND D was introduced into the field in 1976 with

improved fire control and armament.

Soviet acquisition rates are now

higher than those of the U.S.

The Soviets also lead the U.S. and our NATO allies in deployed
Their CW munitions stockpiles and

chemical weapon (CW) systems.

delivery systems appear to be sufficient for sustained operations on

a large scale, and their forces are better prepared to conduct chemical warfare than any other nation. By FY 1982, the U.S. will have a substantially improved capability to withstand a limited CW attack, but probably an insufficient capability to defend against sustained CW operations on a scale currently within Soviet capability.

Since the end of the Vietnam War, Soviet tactical aircraft acceptances have been about double the U.S. total. The introduction of new Soviet tactical aircraft (FITTER C, FLOGGER and FENCER) has brought a significant increase in the offensive capabilities of the Soviet Frontal Aviation force. This force is now highly flexible and its ordnance delivery capability in terms of aggregated rangepayload measures is comparable to U.S. tactical air forces in Europe. We expect the Soviet tactical aircraft modernization rate to continue to lead that of the U.S. during the next five years.

In battlefield air defenses, the Soviets and their Pact allies have deployed many more low- and medium-altitude SAMs and anti-aircraft artillery systems than NATO. The Pact air defense systems enjoy superior mobility, salvo capability and survivability (most have crew protective armor), and the diversity of types of systems in the field

makes effective countermeasures more difficult. U.S. systems generally have greater engagement envelopes and superior lethality, although we will not deploy a system comparable to the four-year-old Soviet SA-8

until the early 1980s.

Two factors must be considered in assessing the impact of relative U.S./USSR production rates on naval force capabilities. First, the NATO allies make a substantial contribution to the naval balance in terms of both numbers of ships and combat capabilities relative to the Soviets and their Pact allies. This contribution would be important in NATO-related conflicts, e.g., in operations in the Atlantic and Mediterranean Oceans and the Baltic and North Seas, and is not reflected in comparisons of U.S. and Soviet naval production

rates alone.

On the other hand, the U.S. Navy also has worldwide missions to which our NATO allies would not be expected to contribute. In this context, the relative U.S./USSR naval production rates indicate the dimensions of the serious problem we will face in the out years--how to procure the number and mix of capabilities sufficient to maintain open-ocean sea control and to selectively project power globally when confronted by a Soviet naval force which already possesses a significant sea denial capability and whose strength is growing qualitatively. The USSR now outbuilds the U.S. by a three-to-one margin in numbers of all types of combatant ships, although the U.S. leads in total displacement because we build larger ships than the Soviets. We note in particular that recent Soviet naval deployments have raised the

complexity of the threat to our surface units and required us to build

more sophisticated counters into our platforms. This, in turn, has raised the cost of individual platforms and correspondingly decreased the numbers of units procured for our forces.

The Soviets have achieved a large output of highly capable military weapons in all mission areas by constructing an extensive and growing military industrial base. However, the quality of the Soviet industrial base is uneven. In some high priority areas the Soviets have mastered the very demanding manufacturing technology involving forming, fabrication of materials that are difficult to work with, and assembly of components requiring precision techniques and extremely close tolerances. In other areas, such as semiconductor devices and very high temperature resistant turbine blades, we have in the past seen evidence of a deficiency in translating technology into the mass production of high quality products. While deficiencies still exist, the Soviets may be in a "break-out phase," permitting them soon to close some of the more glaring weaknesses in this area.

Three points must be emphasized in our net assessment of U.S. and Soviet production capabilities. First, the Soviets are well aware of the advantages accorded to the U.S. by its superior production capability. Their weapons designers seem to establish less stringent specifications and standards. Second, the Soviets are investing heavily in the development of new production technologies and are placing a high priority on obtaining production "know-how" from the

West, particularly in those areas of large Soviet deficiencies. Third, the long-standing capability of the U.S. industrial base to mass-produce high quality end products rapidly and efficiently in many areas can no longer be taken for granted.

We have already lost our superiority in several areas of production technology to allied nations and to Pact countries, and our lead in others is perishable. Obsolescence is a severe problem in a number of heavy industries. Further, the responsiveness of our industrial base to military requirements has declined. For example, attempts to

increase tank production were delayed due to a lack of key component

The Soviet drive for military superiority will continue to increase their requirements for certain classes of high technology, particularly in areas where their deficiencies are growing relative to the West. Overt Soviet efforts to acquire advanced technologies through trade have already focused on areas where the large U.S. lead has given us important weapons performance advantages. We expect these efforts to continue, and the Soviets will attempt to supplement them with a deliberate program to acquire critical technologies through covert means. Controlling the diffusion of technology is a complex issue, requiring a balanced assessment of political factors, potential economic benefits--including the impact of controls on incentives for further technological advances in the U.S.--and national security considerations in the long run. The DoD recognizes that technological diffusion is

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