Russian army supplyers despite sanctions

Despite western sanctions, Russian arms industry is getting developed. Its production of crucial weapons for its war effort in Ukraine has dramatically increased since the start of the fighting. By the start of this year the monthly capacity for long-range missiles, for example, was thought to have more than doubled. The growth is made possible by new international suppliers, who provide parts, electronics and tools.

Military goods are often traded via a complex network of shell companies. Many of the imports lead back to one country.

Asian manufacturers have provided Russia with semiconductors that are crucial for making various weapon systems. They have also provided navigation equipment, parts for jets, and more generic products such as ball bearings, used in artillery pieces and other equipment.

Transaction records suggest that Russia’s imports of precision manufacturing equipment used for critical hardware, known as computer numerical controlled, largely come from Asia as well. In period of March to July of 2023 there were more than 10,000 transactions a month from Asia to Russia involving these tools. Each record could contain multiple goods, so the actual number of machines provided is likely to be much higher.

Russian import of such goods began to rise after a partial mobilisation announced in September 2022. But the surge in deliveries from Asia came in March 2023. The export of small items confirms that it is contributing much else to the Kremlin’s war machine. Antony Blinken, US secretary of state, has already warned China for not being the “primary contributor” to Russia’s “defence industrial base”.

Trade with Asia is not the only problem for Western countries trying to hobble Russia’s defence industry. Despite extensive export controls, Russia still received many

Western-made components in 2023. Goods from France, Germany and Japan, for example, made their way to Russia through third countries, such as Turkey and the United Arab Emirates, who have not signed up to Western sanctions. A study by the Royal United Services Institute think-tank published in December found that Compel JSC, one of Russia’s leading microelectronics distributors, had imported huge volumes of Western microelectronics through not just Hong Kong, but also Germany.

Enforcing stricter rules is not easy. For one thing, Russia is increasingly using lower-grade equipment, partly because it has depleted stocks of more advanced systems. This means that Russian arms manufacturers are seeking technology that is also used for civilian purposes, the flow of which is harder to restrict in international supply chains.

Another complication is that Ukraine also depends partly on Asian manufacturers for some machine parts (though these shipments are much smaller than those Asian supplies to Russia). Anyone designing and enforcing Western sanctions has to consider whether imposing further restrictions on some Asian firms may also impede Ukraine’s military procurement.

For now, Russia’s production boom looks set to continue. Its defence spending is expected to reach $115bn in 2024, an increase of 68% from 2023. Still, even with help from Asia, Russia cannot keep up the push indefinitely. The explosive material needed to make artillery rockets and other munitions is in short supply. In some areas, Soviet-era stocks that the Russians have been refurbishing will run out within the next couple of years. In the meantime, Western countries can put their efforts into closing the loopholes in current sanctions—and boosting their own production capacity to help Ukraine.

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