The Daily Telegraph - Saturday
From scones to drones: inside Putin’s new arms race
Roland Oliphant Joe Barnes, James Rothwell James Kilner
simply not keeping up. “It is f-----insane,” one UK defence insider said, referring to institutional barriers to expanding Western arms production in response and asking for anonymity to speak frankly.
The secrecy of Russia’s defence industry, and the tendency of officials to massage figures for propaganda purposes, make it difficult to assess the exact extent of Russia’s shift to the war economy.
But almost all experts agree it is real, dangerous, and well underway.
Officially, Russia has increased military spending from 2.7 per cent of GDP in 2022, to 3.9 per cent in 2023 to 6 per cent – or around a third of all government spending – in 2024.
That probably masks a much larger figure that includes spending on reconstruction in occupied parts of Ukraine and redirection of private sector wealth to the war effort.
In 2023, Russia produced 1,530 tanks and 2,518 armoured fighting vehicles, Sergei Shoigu, the Russian defence minister, said in a report to parliament in December.
He said that that represented increases in tank production of 560 per cent since February 2022. Production of infantry fighting vehicles was up 360 per cent and armoured personnel carriers by 350 per cent.
That would only be enough to replenish what Russia has already lost on the battlefield, rather than expand its army.
Western officials told
this month that Russia is on track to manufacture two million artillery shells a year – double the amount Western intelligence services ‘If we do not ramp up our support of Ukraine, there is no guarantee that Russian aggression will not spread to other European states’ had initially estimated Russia could manufacture before the war.
Add in deliveries of shells, missiles and drones from Iran and North Korea, and Russia is already reasserting the fire superiority it had at the beginning of the war.
The battlefield impact is immediate and obvious.
In a five-day barrage at the end of December, Russia fired 500 missiles and drones at Ukraine, according to Volodymyr Zelensky, the president.
Research published by security think tank RUSI this month showed that Ukraine was firing 7,000 artillery rounds a day during its summer counter-offensive, much more than Russia’s 5,000.
By this month, the Russians were firing 10,000 and the Ukrainians were down to 2,000.
That doesn’t just limit Ukraine’s ability to launch fresh offensives.
It means artillery units are struggling to suppress the Russian guns with counter-battery fire, and leaves infantrymen in the trenches without desperately needed fire support in the face of Russian assaults.
By February 2023, a year into the war, European production was estimated at 300,000 rounds per year.
In November, Boris Pistorius, the German defence minister, admitted that an EU pledge to provide Ukraine with a million shells by March this year would not be met.
Dmitri Alperovitch of the Silverado Policy Accelerator think-tank, said: “You have to look at the specifics. Is Russia able to outproduce the West in terms of building submarines or frigates? No, but is it able to outproduce the West in artillery shells? Yes.
“It has had a lot of capacity in that area, which the West has not had because of the prioritised artillery for many decades. And it very quickly put itself on a war footing when it comes to defence industrial production, which the West has not done.
“And, you know, it makes sense, we’re not at war and this war is not existential for us like it is for Ukraine.
“We’ve been slow with long-term contracts, we’ve been slow in ramping up manufacturing production, particularly Europe.”
So far, Russia’s output is unlikely to deliver enough material for it to return to the general offensive in 2024. It has taken too much of a mauling in the previous two years to generate a credible attacking force.
But the Kremlin is thinking beyond the end of this year.
“They are talking about mobilising their defence industry over the next three years, which implies they are looking to fight the war for at least three to four years,” said a defence insider.
“We are at a moment where the Russians are vulnerable because production does not meet their demands. But they will turn a corner,” he added.
The implication is clear: if the West does not act, Ukraine may lose the war. And what comes after that, no one knows – but there have been some alarming signals from Moscow about further land grabs in Europe.
Mr Pistorius has warned that a Nato-Russia war could potentially break out in the next five to eight years.
The German tabloid recently revealed that one theoretical scenario being considered by German military chiefs is a potential Russian attack on the Suwalki Gap, a strategically sensitive land corridor on the PolishLithuanian border. The two countries are preparing to hold joint exercises in the area in the spring.
“We need to recognise the fact that Russia has succeeded in firing up its military-industrial complex and adjusted to a wartime economy.
“With North Korea and Iran, Putin has reliable suppliers of military equipment that don’t care the slightest for their own people’s needs,” said Norbert Röttgen, a former chairman of the Bundestag’s foreign affairs committee.
“If we do not manage to decisively ramp up our support of Ukraine so it can militarily win the upper hand against Russia, there is no guarantee that Russian aggression will not spread to other European states. Supporting Ukraine now is our best defence against Russia.”
The frustration for people like Mr Röttgen is that although the problem is obvious, it seems almost politically impossible to address.
Part of the reason for the West’s slow response is political and cultural, points out Sabine Fischer, a senior foreign policy analyst at the German think tank SWP.
Although a war economy will have terrible long-term effects on quality of life, it also “generates rents and benefits for parts of the elite and also the population”, she said.
With a de facto dictatorship, remaining discontent can easily be suppressed.
(The Italmas and Stalitsa shopping centres in Izhevsk are a good example of how war economy rents can benefit the elite. The company that bought them, Areoscan, officially belongs to one Nikita Zakharov. He is the son of Alexander Zakharov, a co-owner of Zala Aero which produces the
Lancet drones).
That is different for countries with a boisterous free press, credible political opposition, and a cost of living crisis.
Downing Street publicly rejected Gen Sir Patrick Sanders’ public call this week for an expanded army. Labour has also promised to observe careful spending rules if they win the next general election – a policy that would probably preclude the massive capital investments needed to build new arms production lines.
Then there is the economics, Mr Alperovitch points out. While Russia retains a largely state-controlled arms industry, Britain and most other Western countries rely on contracts with private-sector defence firms.
“You have to invest a significant amount of CapEx into starting up new production lines or expanding existing ones, and you want to make sure that initial investment will be recouped.
“It will take a certain number of years to make that economical and profitable. So it’s completely understandable that the defence contractors don’t want to be left holding the bag, particularly when you’re talking about some of these munitions like artillery shells,” he said.