Saudi Arabia and Türkiye’s drone pioneer have signed a strategic agreement to localize the manufacturing of unmanned aerial vehicles (UAVs) in the kingdom, the sides said on Sunday, building on a historic deal signed last month.

The agreement with Baykar "will enhance SAMI’s (state-owned Saudi Arabian Military Industries) role in supporting the national defense industry and strengthening our local capabilities," it posted on messaging platform X, formerly known as Twitter.

The deal also includes technology transfer, Anadolu Agency (AA) reported.

The ceremony hosted by Saudi Arabia’s Defense Ministry in Riyadh also saw other leading Turkish defense contractors, including Aselsan and Roketsan, sign new agreements, AA said.

Aselsan and Roketsan signed a memorandum of understanding with NCMS, which conducts studies to localize technology in the kingdom, it added.

The agreement marks a new chapter that strengthens the cooperation between Türkiye and Saudi Arabia, Baykar General Manager Haluk Bayraktar said, addressing the signing ceremony. He suggested that the countries that develop new technologies not only gain advantages but also establish stronger ties with their allies.

"Our friendship bond is getting stronger. Historic steps are being taken for regional and global stability," Bayraktar later wrote on the X platform, sharing a post of SAMI featuring photos from the signing ceremony.

The agreements follow Baykar’s deal last month to sell drones to Saudi Arabia, in what is said to mark the biggest defense contract in Türkiye’s history that came on the sidelines of President Recep Tayyip Erdoğan’s three-country Gulf tour, which included stops in Jeddah, Doha and Abu Dhabi.

The value of the deal that entails cooperation in technology transfer and joint production has not been made public. Baykar said the deal included exporting its landmark Akıncı unmanned combat aerial vehicle (UCAV), the larger sibling of its battle-proven Bayraktar TB2.

Bayraktar said the project was not only a business opportunity for Baykar but also a basis for promising opportunities in line with the interests of the country and said that they are ready for the continuation of the project.

"We have and will continue to share innovative technologies, including Bayraktar Akıncı. The development of a high-tech platform such as Bayraktar Akıncı is undoubtedly invaluable," he noted.

He stressed the drone "is not an ordinary weapon or aircraft" but a "flying intelligent robot equipped with dozens of computers, tens of thousands of lines of code and artificial intelligence."

Marking the most advanced and sophisticated drone built by Türkiye, Akıncı was first delivered to the Turkish security forces in late August 2021. The drone has been sold to six countries to date, according to Baykar.

It is more advanced than Baykar’s TB2, which has been widely used and sold to various countries, including Ukraine, Qatar, Azerbaijan and NATO-member Poland.

The TB2 has made a name for itself globally and demand for the drone soared after it featured in conflicts in Syria, Libya and Azerbaijan. Interest increased further following its use by Ukraine’s military to thwart Russian forces.

Baykar has signed deals to sell TB2 to at least 30 countries to date, including four NATO and two European Union member states. It lastly signed a contract worth $367 million with Kuwait for TB2s last month.

"Baykar is aware of the magnitude of the project and is mobilizing all its capacity to guarantee a success story that is a harbinger of many years of strategic cooperation," said the company’s general manager.

The deal with Saudi Arabia came after Erdoğan secured reelection in late May and builds on Ankara’s diplomatic efforts since 2021 to normalize strained ties with Saudi Arabia and the United Arab Emirates (UAE).

Investments and funding from the Gulf have helped relieve the Turkish central bank and markets. Ankara has secured some $28 billion in currency swap deals in recent years with the UAE, Qatar, China and South Korea, most of which are believed to be in the Turkish central bank’s reserves.

Türkiye’s defense industry breakthrough and localization drive have prompted the development of multiple homegrown air, land and marine platforms, which eventually helped Türkiye seal billions of dollars worth of deals in recent years.

The capabilities of its vehicles, spearheaded by its combat drones, triggered unprecedented demand that saw Türkiye’s defense industry exports hit a record of more than $4.4 billion in 2022.

Erdoğan last month said exports hit a new record totaling nearly $2.4 billion in the first half of the year, setting a year-end goal at about $6 billion.

Bayraktar said the latest developments would help pave the way for new exports and business cooperation "for hundreds of our companies that produce subsystems in the Turkish defense and aerospace industry."

"Aselsan and Roketsan, with whom we work together in many fields, will also use their experience and experience in this context for the development of the Saudi Arabian defense industry," he added.