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Jan 15, 2019 | 21:29 GMT

3 mins read

Russia: Procurement Plans Reflect the Military's Modernization Struggles

(Stratfor)
The Big Picture

Russia, along with China, is locked in a great power competition with the United States. In keeping with its goal of protecting domestic and foreign interests, Moscow must overhaul its military capability — gradually replacing out-of-date Soviet-era weapons systems with modern equipment. Low oil prices and Western sanctions, however, are complicating the Kremlin's task. 

What Happened

Russia will shell out billions of dollars on military hardware this year, but when it comes to defense spending, the devil is in the details. On Jan. 15, the country's Defense Ministry announced that it would spend 1.44 trillion rubles ($21.5 billion) on military procurement in 2019 as part of a larger program to modernize outdated equipment within the armed forces. Given the expenditure, Moscow claims that the share of new equipment in the Russian military is expected to reach 67 percent, just 3 percent short of its stated goal for 2020. The predicted numbers, however, may not reflect reality.

Why It Matters

The 1.44 trillion ruble allocation actually represents a significant drop in expected annual procurement — the government initially planned to spend twice that amount as part of a 2011-2020 modernization drive. Faced with plummeting oil prices, though, Russia had little choice but to slash its defense budget starting in 2017, when it cut expenditures for the ministry by 5 percent

The lack of funds has forced Russia's military planners to make some hard decisions on where to allocate the Defense Ministry's precious rubles as part of coordinated efforts to modernize the country's large number of outdated, Soviet-era weapons systems. So far, the Russian military's overwhelming priority — its nuclear forces — have received the lion's share of attention in terms of modernization, with 82 percent of the fleet's equipment now up to date. Likewise, the air force has also benefited from the ministry's largesse, attaining a modernization rate of 74 percent. Straggling further behind, however, are the navy and the land forces, which boast modernization rates of 55 and 46 percent, respectively. 

In the longer term, the Kremlin is expected to begin gradually increasing its defense budget in 2020 — though not at a rate that would permit an immediate return to pre-2017 levels.

Background

After years of decline, Russia has been striving to rebuild its military power, but the fall in oil prices, as well as the punishing sanctions that the West imposed on the country over the Ukraine crisis, has hindered the Kremlin's efforts. And even if Russian officials claim they are on track in their modernization program, the figures for the 2019 budget suggest that military planners will have to make those 1.44 trillion rubles go a long way if they are to attain the Kremlin's goals.

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