That's just the range the display will show. Obviously, if the sensor (Defined elsewhere) doesn't have such a long range capability, the screen simply won't display any contact at all.
In any case, according to my tests the game in stock trim will not show radar contacts beyond 35.000 metres or so. Therefore, the radar is probably limited to 40000 metres, or may be the game simply won't spawn other units beyond that range (A matter of engine design).
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One day I will return to sea ...
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