UP IN ARMS: THE CONSEQUENCES OF GLOBALIZATION ON THE RUSSIAN DEFENSE INDUSTRY

Abstract

Globalization has allowed national defense industries to thrive in a post-Cold War context as it frees up resources for nations to consolidate their manufacturing capabilities and specialize in the production of certain equipment. However, the Russian invasion of Ukraine has exposed some of the consequences of globalization; integrating a national defense industry to the point of dependency loses its benefits when a nation engages in a hostile act or direct conflict with its suppliers. As Russia moves farther from the West, its dependencies are continuously revealed. In this thesis, I argue that global integration of its defense industry has backfired on Russia for three main reasons. First, Russia has failed to fully modernize its military, instead operating with a limited production capacity and relying on obsolete technology. This works for short-term sales that follow Russia’s traditional “cheap and easy-to-use” appeal for less advanced and more cost- restricted clients, but it demonstrates a long-term inability to meet clients’ growing demand for more sophisticated weaponry. Second, Russia has become overly reliant on foreign components in its equipment. This creates key vulnerabilities in its production line despite the dual-use nature of many of these parts due to tightening sanctions. Third, the nature of Russia’s arms exports is changing, as are its clients. As nations such as China and India have used Russian technology transfers and offsets to help build their own indigenous production capacity, they now have less demand for Russian products. Set in the context of already stagnating arms exports, I determine that because of these enduring challenges, Russian arms exports will likely decline over the next decade. I conclude with three policy implications of my research: to exploit Russia’s weaknesses on the battlefield in its war with Ukraine, improve and tighten sanctions, and ensure a reasonable level of self-sufficiency domestically. These recommendations provide insight as to how the United States and its allies should approach the global arms industry given recent and predicted developments.