Impact of the economic crisis on Russian military modernization

The Cipher Brief asked me to write a short piece on the impact of Russia’s economic downturn on prospects for the Russian military, as part of a series on Russian military modernization.

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The drop in Russian state revenues has affected Russian military modernization to some extent, though the Russian government has made an effort to insulate the military from budget cuts. Although the 2015 military budget was cut by five percent mid-year, the total allocation was still 25 percent higher than the previous year’s budget. This allowed the military to continue its modernization process, conduct operations in Syria, and fulfill its training and exercise programs.

With oil prices remaining low, the military is facing a more difficult financial picture in 2016. In November, the Finance Ministry announced that the total 2016 defense budget would be largely the same as in 2015. However, last month, an additional five percent cut was announced, which will result in the first annual net decline in Russian defense spending since Vladimir Putin became president in 2000.

As a result of the deteriorating financial outlook, the fulfillment of the 2011-2020 State Armament Program is now in question.

Click here to read the rest of the article.

5 thoughts on “Impact of the economic crisis on Russian military modernization

  1. Here is what I posted on the russiadefence forums regarding this article and why it is not worthy of a post:
    http://www.russiadefence.net/t2358p250-state-armaments-program-2011-2020#162701

    Essentially the article in question is a series of “hunches” with no concept of reality. As well, here is another issue: https://www.yahoo.com/news/putin-russian-arms-upgrade-wont-affected-budget-cuts-150657283.html?ref=gs

    The budget has not hit the SAP2020 program which these procurement’s fall under. Instead, it hits at the finances of various departments, pay, and other services in the military. Total cut is 5% from the previous 10%. Not aimed at the SAP2020 program that still sits at roughly 20T Rubles.

    And no one purchases equipment in large numbers especially when it is brand new and fresh off the new tooled assembly line. T-50 gets 12 aircraft instead of 55 because a unit in the airforce is 12 aircrafts. Ever notice why Su-30SM was ordered by 36? 12 aircraft 3x. Essentially, 12 aircrafts of T-50 will go to a unit that will test the aircraft of production model to see if it will work essentially for its needs.

    As for your comment regarding the Russian helicopter carrier, it was actually in January this year that (Kret (Rostec Holding) http://kret.com/en/news/10258/) stated the equipment for it will be built in 2018. So yes, there is a lot of time going to be needed to produce such a vessel since well, you know, they have not built one.

    As for delays – that has nothing to do with procurement budget. Once the item is paid for, it starts development. This is what Borisov stated regarding about delays:

    ” Deputy Defense Minister Yuri Borisov told the meeting that arms plants have missed delivery schedules on 15 warplanes, eight navy ships and 240 armored vehicles among other weapons systems.

    Borisov said that some of the delays were linked to subcontractors going out of business and missing technology.

    He claimed that the Western ban on the sales of weapons and arms technologies to Russia and Ukraine’s decision to halt military industrial cooperation with Russia “had no significant impact” on Russian arms production.”

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