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Russian tanks rehearse for Russia's May 9 'Victory Day' celebrations in Moscow, April 2022.
EPA-EFE/Yuri Kochetkov

Ukraine: the problem with Russia’s sanctions-busting arms industry

The UK government has reportedly launched an enquiry into how British-manufactured components have made their way into Russian weapons systems, despite an arms embargo being in operation since Russia annexed Crimea in 2014.

Russian material captured by Ukrainian forces has revealed a significant dependence on western-made components. Multiple UK-manufactured high-frequency transistors – “dual use” electronics that can be used for both military and civilian purposes – were found inside a Russian Borisoglebsk-2 mobile jamming system.

My research into illicit procurement by sanctioned states for their weapons programmes shows a long history of Soviet and Russian dependence on western technologies. It also suggests that states can be highly adaptive in finding ways around barriers to the acquisition of technology from overseas and that more than just export controls are required to prevent illicit procurement.

A recent report by the Royal United Services Institute (RUSI) has suggested that the Russian arms industry uses more western-origin components in its weapons systems than previously thought. The report notes that: “Russia’s latest weapons are heavily dependent upon critical specialist components manufactured abroad.” It found that Ukraine’s scientific establishments noted “a consistent pattern” across major Russian weapons systems recovered from the battlefields.

Many of the western components that have found their way into Russian systems are, like the UK-made transistors, classed as “dual use”, meaning they can be used in both military and civil applications. Civil goods are subject to lesser regulation than military goods, which has been a loophole. The UK only banned the export of dual-use goods to Russia after the current invasion had begun.

Other evidence also suggests that Russia has benefited from access to foreign technology without government consent over the past decade. This has included weapons, from British sniper rifles used on the frontlines of the Donbas region, to goods for the country’s nuclear and missile complex, sourced from Sweden.

The British government’s export licensing system is used to implement the embargoes to Russia and to prevent undesirable exports. There are no specific allegations of breaches of the controls by British companies.

These restrictive measures put in place by Britain – alongside those by many other states – do seem to have had some potentially significant effects. Ukrainian government sources suggested in March that Russia’s armoured vehicle plants were struggling to obtain western components. In April, Ukrainian sources also suggested that similar challenges were being encountered by Russian factories producing radars and surface-to-air missiles.

Long history of illicit procurement

When faced with arms embargoes – or other less legally formalised barriers to acquiring arms or components – sanctioned states always look for ways to circumvent them. Russia (and its predecessor, the Soviet Union) have a long history of finding ways to access western technologies.

From the 1920s, Soviet agents sought to openly acquire manufacturing equipment from western markets, as well as covertly acquiring military secrets through espionage. During the second world war, Soviet spies obtained nuclear secrets from the Manhattan Project, despite extensive security measures taken to prevent such leaks.

A Russian gunner stands on the back of an armoured car marked with the 'Z' symbol.
A report has found that a significant amount of Russian military equipment uses components made by western companies. EPA-EFE/Sergei Ilnitsky

There is evidence of continuing Soviet interest in western technology throughout the cold war as the Soviet Union sought to compete with the US. In 1985, as cold war high-tech competition reached its peak, a CIA report noted a “massive and well organised campaign” to acquire western technology illegally. The report went as far as to suggest that:

The assimilation of western technology is so broad that the United States and other western nations are thus subsidising the Soviet military buildup.

Closing loopholes

Putin has doubled down on his war in Ukraine, despite significant troop and equipment losses by the Russian military. Hindering the Russian military-industrial complex’s access to international markets will help to prevent destroyed and captured equipment from being replaced, expended munitions from being replenished and damaged vehicles from being repaired.

Export controls can play an important role to this end. Governments, intelligence agencies and law enforcement bodies will undoubtedly increase their efforts towards preventing Russia’s illicit procurement. But, as history shows, the adaptive and deceptive nature of Russia’s illicit procurement networks is challenging to contend with. Those seeking to halt the supply will need to go further than merely putting in place the embargoes.

The US and allies should closely work with international partners and neutral states to counter Russia’s use of “third-country” hubs to evade controls. Fully halting the flow of components could require engaging a wide range of states with varying chances of success. Re-export risks are posed by countries like India, with whom Russia has ongoing defence equipment projects, large markets like China that have long been sources for sanctioned programmes in the past, and even pariah states like Iran that continue to face international sanctions.

Efforts to engage and inform industry at home – those who have to comply with export controls but lack intelligence on Russian evasion methods – will be key to the ability of the restrictions to bite.

Russia is only one of many states that have long pursued illicit procurement. The open-source information, tools and approaches used by researchers outside of government to understand the illicit supply chains and sanctions-busting networks of Iran, North Korea and others should be applied to shine a light on Russia’s networks.

Government enquiries following goods ending up in enemy hands are not uncommon in Whitehall. The most extensive, the Scott enquiry, lasted for four years in the 1990s following the “arms to Iraq” scandal and led to a shake up of the British export control system.

One of the common takeaways from these scandals is that those inside government and those outside – industry, researchers and academics – must work together if export controls and embargoes are to be rendered effective. Only these collaborative approaches will ensure that export controls can help to undermine Putin’s war machine.

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