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Australia and UAE to explore deeper defence ties, A$1 bln in sales

Abu Dhabi, Feb 19 (Reuters) - Australia and the United Arab Emirates (UAE) will explore closer defence ties after a meeting on Sunday between a senior Australian government minister and Abu Dhabi Crown Prince Sheikh Mohammed bin Zayed al-Nahyan.

Australia's Defence Industry Minister Christopher Pyne and Sheikh Mohammed, who is also Deputy Supreme Commander of the UAE Armed Forces, met on the sidelines of the biennial International Defence Exhibition and Conference (IDEX) in Abu Dhabi.

The two agreed to consider a 10-year defence plan that could include more than 1 billion Australian dollars ($767 million) in sales to the UAE, Pyne told Reuters.

"What the Crown Prince is talking about is a more mature long-term relationship built around security and procurement," he said.

Australia has military personnel stationed in the UAE, taking part in the United States-led campaign against Islamic State.

A final agreement has yet to be reached but could include a transfer of knowledge from Australian to UAE companies.

"They are looking for genuine partners, not just foreign military sales, and that suits Australia's attitude extremely well," Pyne said.

Sales could include everything from ammunition to large items such as "high-speed support vessels", he said.

"We have very significant capabilities, particularly around coastal protection and surveillance, which I think we should be sharing with our Middle Eastern partners."

Australian companies could finalise hundreds of millions of dollars in defence sales to the UAE at IDEX this week, Pyne added.

The UAE, a federation of seven emirates on the Arabian Peninsula, has invested heavily in its domestic defence manufacturing capabilities through international partnerships.

It is also a close U.S. ally and a global trade, transport and tourism hub. The development of its defence industries has been led by Abu Dhabi, the UAE's main petroleum-exporting emirate, to boost the non-oil economy.

"I think potential here for defence procurement partnerships as well as security partnerships is very significant," Pyne said, calling the UAE one of Australia's "closest friends in the Arab world".

The UAE is part of the Saudi Arabia-led military coalition fighting in Yemen against the Iran-allied Houthi movement in support of the country's internationally recognised government.

It has also taken part in the United States-led effort against Islamic State.

IDEX opened on Sunday with a military demonstration watched by Sudan President Omar al-Bashir alongside Sheikh Mohammed bin Rashid al-Maktoum, who is vice president and prime minister of the UAE and ruler of Dubai, and Abu Dhabi's Sheikh Mohammed bin Zayed. ($1 = 1.3040 Australian dollars) (Reporting by Alexander Cornwell; Editing by Noah Browning and David Goodman)