Most NATO members continue to reduce their defence budgets, in spite of Russia’s assertiveness, continued aggression against Ukraine and the risk of conflict spill over. Russia, pretending that the West is its worst enemy, is doing quite the opposite, having adopted in 2010 an ambitious programme to modernize at least 70% of the equipment of its armed forces by 20201.
The Kremlin keeps this fairly expensive modernization programme (22 trillion RUB or more than $400 billion over 10 years) mostly hidden away, offering occasional boastful comments, while President Putin seems absolutely determined to proceed with it, whatever it takes. Russia’s shrinking economy (GDP projected to decrease by at least 4.6% in 2015), low oil prices (about twice lower than Russia’s expected $100/bbl) and Western sanctions have induced Putin to accept a 10% cut in overall government expenses, including a similar reduction in Russia’s huge Ministry of Interior personnel (around 100,000 people will reportedly lose their jobs). Nevertheless, Putin seems adamantly opposed to diminishing defence expenditures (3.3 trillion RUB or $60 billion, an estimated 5.4% of Russia’s GDP), as well as pensions (which would obviously condemn millions of elderly Russians to face a new Holodomor). Astonishingly, the Russian Federal Treasury reported in April 2015 that defence expenditures actually reached 9% of Russia’s quarterly GDP, in what seems a desperate effort to speed up modernization well beyond the 30% marker (whatever that means), that was supposedly achieved by the end of 2014.
Russian defence contractors are making record profits, due to unprecedented sales ($13.2 billion in 2014) of air defence systems, tactical missiles, fixed and rotary wing aircraft among others, mostly to non-Western markets (Algeria, China, India, Venezuela etc.). Their business seems, for now, to go on successfully, despite the on-going conflict in Ukraine and overall economic pressure, and is contributing to Russia’s military modernization effort. However, most Western, but also quite a few Russian military observers seriously doubt that Russia will be able in the long run to afford military expenditures and modernization on such a scale.
Still, why is the military modernization plan so important for Putin and the Russian elite that it has to be implemented at all costs, sacrificing almost everything else?
Without mentioning several military modernizations in Russia’s history following periods of weakness and decline, the current plan has several critical internal and external aspects. It keeps Russia’s huge defence industry running and hundreds of thousands of people employed. It also makes Russian military exports more competitive (mostly in non-Western markets) and provides highly needed hard currency. Besides, defence products are amongst Russia’s most lucrative export articles in financial and political terms. Most importantly, modernization does much to increase the morale, loyalty and combat readiness of the Russian armed forces.
Therefore, the more Russia is successful in rapidly implementing the modernization plan of its armed forces, to which some Western allies readily offered their support (until EU sanctions were enforced), the more imminent the threat of Russian aggression in Europe – in Ukraine, in the Nordic-Baltic region and/or elsewhere. Significantly improved Russian naval and coastal defence assets, coupled with largely increased air and air defence, missile strike and heavy armour capabilities, will pose an immediate and much more serious threat (than at present) to the littoral countries around the Baltic Sea and the Black Sea. Furthermore, Russia seems to be busy developing unmatched weapons (e.g. the HGV mentioned above), in addition to simulating a Soviet-era-like nuclear global reach, in order to blackmail Western powers, including the US, and prevent them from countering possible Russian military actions in these regions that are critical to European defence and security.
In light of these considerations, Westerners cannot simply sit idle and keep their fingers crossed, hoping that Russia will ultimately lack the finances, technology and organizational skills to fulfil its military modernization plan. It seems that EU sanctions are a non-negligible factor in this equation. Russia has reportedly attempted to by-pass the sanctions, and acquire through the back door (e.g. Cyprus) critical Western military technology (e.g. US produced night vision cameras, good for T-14s). Any further discussion of the sanctions should also keep these aspects in mind. France has bravely set an excellent example by ultimately refusing to sell to Russia two Mistral-class amphibious assault ships (although Russia may have already copied these, and now enjoys the refund).
The author has made reference to certain data from:
http://russiamil.wordpress.com...
http://thediplomat.com
http://www.nato-pa.int/default...