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The State of the State Armaments Program

By Russian Defense Policy

From the “better late than never” file…

On January 11, Aleksey Nikolskiy published an article on the next GPV for Vedomosti. He laid out the state of the battle over state armaments program 2018-2025.

What Will They Spend?

According to Nikolskiy, the new GPV will be only half of what Russia’s Defense Ministry wants, if the Finance Ministry gets its way.

The GPV covers ten years, but the Russian government adopts one every five years. So the new program was due to be adopted and implemented last year.

The next GPV was being prepared in 2014-2015. But with the poor economic forecast, Western sanctions, and the need for import substitution, the Kremlin elected to delay launching the new arms program until the first half of 2017, a former MOD official told Nikolskiy.

The new arms program is also late because industry’s initial promises on import substitution for Western as well as for Ukrainian products turned out to be too rosy, CAST director Ruslan Pukhov tells Nikolskiy. But, he adds, it’s impossible to drag this out longer because industry needs to know the fiscal parameters of its work in the long-term.

The current program for 2011-2020 was approved in late 2010. It contained 19.1 trillion rubles for the MOD. That was more than $630 billion at the exchange rate of the day. But, according to Nikolskiy, not more than 40 percent of this amount had been spent by the start of 2017.

Forty percent is 7.6 trillion, or roughly 1.3 trillion per year for the first six years of a ten-year program. Leaving so much backloaded implies that Russian defense industry was unable to absorb and use more money, at least without massive graft and waste. So the new arms program might continue a similar annual rate of investment in acquisition.

Nikolskiy …read more

From:: Russian Defense Policy

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