November 26, 2012:
China has revived, in part, a 2005 deal to buy Il-76 transports from Russia. The new arrangement only involves China buying ten refurbished Il-76s. Back in 2005, China placed a $1.5 billion order for 38 Il-76 transport planes and Il-78s (tanker versions of the Il-76). A year later China cancelled the deal when Russia tried to up the price 27 percent. China went looking elsewhere, including urging its domestic aircraft manufacturers to come up with something. That process is still underway, but in the meantime China needs some more jet powered military transports.
Similar to the older American C-141, the Il-76 was originally only manufactured in Uzbekistan. That's because one of the Russian aircraft plants moved east during the German invasion of 1941, and ended up in Central Asia, a part of the Soviet Union that became independent Uzbekistan in 1991. Over the last decade Russia has been moving Il-76 production from Uzbekistan to Russia.
Over 900 Il-76s were manufactured over the last thirty years, most by what is now the Chkalov Tashkent Aircraft Production Company in Uzbekistan. Nearly a hundred Il-76s were exported, so far, mainly to Cuba, Iraq, China, India, Libya, and Syria. However, until the 2005 Chinese order came along, Chkalov was surviving by manufacturing wings and other components for the An-124, An-70, and An-225 transports. In addition, it made replacement parts for the Il-76 and Il-114 aircraft.
Russian commercial aircraft survived during the Cold War partly because they had a captive market (the former Soviet Union, the East European nations the Soviets dominated) and were attractive to a few other nations looking for cheap, often free, and rugged aircraft. While many old Soviet transports still serve on in secondary markets, these designs are no longer competitive. Western models, while more expensive, are cheaper and easier to operate. The old Soviet era aviation firms have tried hard to compete, but that competition will eventually kill off most of the Soviet era producers, leaving only a few who managed to catch up with the rest of the world or found a specialized niche.
China is no longer interested in buying 38 Il-76/78s but is willing to work with Russia in developing a Chinese replacement for the Il-76. China has a design for such an aircraft, which needs Russian engines and much more Russian aviation technology as well. The Russians are interested but wary (because of how often the Chinese steal Russian military technology).