Despite the unprecedented restrictions and international sanctions, Russia managed to procure the necessary goods for its military industry. Who is helping Russia wage war and why?
Change of partners
Following Russia’s initiation of a large-scale invasion of Ukraine, the international community swiftly responded by imposing sanctions on the aggressor. One of the primary objectives of these sanctions was to curtail access to military goods. This led to a halt in selling various critical products to Moscow, including microelectronics, semiconductors, and high-tech equipment, as many companies opted to cease their business dealings with the Russian capital. Consequently, the disruption of supply chains resulted in a notable decrease in the influx of goods. By 2023, compared to the period preceding the full-scale invasion, Russia experienced a decline of 9.1% in imports of military components and a staggering 28.5% reduction in imports of dual-use goods. However, as highlighted in a report by the American Center for Strategic and International Studies (CSIS), Russia has largely managed to adapt to the sanctions regime, ensuring the continued provision of necessary goods to its military-industrial complex (MIC) for uninterrupted operation.
In 2023, Russia made significant strides in diversifying its channels for importing military products. Its primary suppliers shifted away from the EU and the USA towards friendly nations in the Middle East and East Asia. According to Valery Gerasimov, Chief of the General Staff of the Russian Federation, the Russian Ministry of Defense expanded its international cooperation in the military-technical sphere through over 600 crucial intergovernmental events conducted in 2023.
According to CSIS, China stands as the aggressor’s largest direct partner, facilitating over half of import transactions. Substantial volumes of direct supplies also originate from Iran and North Korea. Moreover, countries like Turkey, India, Kazakhstan, and Vietnam host well-established networks of intermediary companies, enabling Russia to bypass sanctions and gain access, notably to Western technologies.
How and why do various states continue to cooperate with Moscow? Let’s explore the motivations of the key players.
China
Throughout 2022-2023, economic ties between Russia and China witnessed a significant strengthening. The total trade volume surged by 26.3% to reach $240 billion, while transportation volumes from China to Russia soared by 64.2% over the span of two years. China emerged as the primary supplier meeting most of Moscow’s technological needs, encompassing electronics such as drone components, semiconductors, aircraft parts, and more. Notably, in November 2023, China’s bearing sales to Russia spiked by 345% compared to November 2021.
Interestingly, certain Chinese companies are concurrently supplying drones to both Russia and Ukraine. In the first half of 2023, the aggressor received direct drone component shipments worth $14.5 million from China, whereas Ukraine received a mere $200,000. However, as the New York Times reported, Ukrainians obtained a significantly larger share through European intermediaries. This scenario poses a challenge to the sanctions strategy, as restrictions on specific companies may impact the supply of goods to Ukraine.
However, China’s role as Russia’s primary partner in security and defence has significantly escalated over the past two years. With Beijing’s support, Moscow is now capable of sustaining a prolonged war of attrition, offsetting the loss of the Western market and mitigating the impact of sanctions.
For Xi Jinping and his administration, the conflict between Russia and Ukraine is a component of the broader global power struggle against the United States. It’s conceivable that Beijing’s decision regarding a potential attack on Taiwan will hinge on Washington’s preparedness to confront Putin’s aggression. If the US’s faltering stance in Afghanistan in 2021 provided Moscow with a favourable opportunity, their reluctance to support Kyiv might sway Xi towards a military occupation of the island.
Islamic Republic of Iran and North Korea
Unlike other allies of Russia, Tehran and Pyongyang directly supply the aggressor with arms shipments. By the end of 2023, North Korea had delivered around 5,000 containers of weapons to Russia, comprising roughly 2.3 million 152-millimetre shells, 400,000 122-millimetre shells, and ballistic missiles. Iran furnished Moscow with thousands of Shahed-type strike drones, with over 3,700 deployed over Ukrainian territory. Additionally, Reuters reported in February that Iran had supplied Russia with at least 400 Fateh-110 ballistic missiles.
The deepening bonds among Russia, Iran, and North Korea present a grave challenge to the existing global security architecture. With China’s implicit support, these nations are forging an autonomous military and economic collaboration network, diminishing the collective West’s sway. The “axis of evil” nations make no secret of their aspirations, whether regionally or globally. As they fortify their positions amidst NATO’s and its allies’ waning influence, the stage is set for potential large-scale conflicts on a global scale.
Turkey
Ankara has adopted its most ambivalent stance since the onset of the full-scale conflict. While this NATO member consistently voices diplomatic support for Ukraine, denounces the annexation of Crimea, and facilitates maritime traffic from Ukrainian ports, it has refrained from joining the sanctions regime. Instead, Turkey has emerged as one of the largest purchasers of Russian oil and a key supplier of essential goods to the aggressor.
Between 2022 and 2023, Turkey notably escalated its export of sanctioned goods, not only to Russia but also to five former Soviet republics: Georgia, Azerbaijan, Kyrgyzstan, and Kazakhstan. Evidence suggests that these nations serve as conduits, allowing the aggressor to circumvent sanctions. For instance, from January to September 2023, Turkey reported $66 million in exports to Kazakhstan, whereas Kazakhstan’s own records showed imports from Turkey totalling only $6.1 million. Evidently, the surplus eventually found its way into the hands of the occupying forces.
In December 2023, Washington threatened sanctions against financial institutions engaged in trade with Russia. This resulted in a 39% decline in Turkish exports to Russia in January 2024 compared to the same period in 2023, with imports experiencing a 20% decrease. Subsequently, in February, Joe Biden imposed new restrictions on 93 companies, including 16 Turkish firms. The lasting impact of these measures remains uncertain, given Russia’s adeptness at adapting to constraints.
The presence of nations like Turkey and Hungary underscores the discord within NATO. Like China, Turkey aspires to compete against the United States, asserting its interests in the Middle East and the Western Balkans. Clearly, Washington must collaborate more closely with the Erdogan administration, which openly undermines the collective Western endeavour on the sanctions front.
India
One cannot ignore another significant ally of the USA, which lent support to Moscow during challenging times. Between 2022 and 2023, trade between Russia and India, previously negligible, surged to $50 billion. Out of this, Indian acquisitions of Russian oil amounted to over $30 billion. Consequently, within two years, New Delhi emerged as the second-largest importer of Russian energy resources, trailing only China.
Furthermore, India supplies automotive components, electronics, and other items with military or dual-use applications to Russia. Indian exports of these goods to Russia soared by 88% over the same period. Reports also indicate that Russia repurchases military equipment previously sold to India.
The surge in Indian oil purchases from Russia coincided with the imposition of price restrictions, suggesting that Indians gained substantial benefits from procuring energy resources at a discounted rate. Despite the extent of this discount, it provided significant support to Russia at a critical juncture when it urgently sought new markets for oil sales amidst dwindling supplies to Europe.
Similarly to Turkey, a NATO ally of the USA, India stands as a strategic partner of Washington in Asia, combating China’s economic expansion. The Biden administration should foster closer collaboration with its allies to ensure they do not undermine its initiatives. However, as with the Turks, there are expectations regarding the efficacy of secondary US sanctions targeting Indian firms engaged in transactions with Russians. Ultimately, irrespective of the advantages of conducting business with Russia, the American market holds incomparable significance for New Delhi.
The silent World War Three
Russia’s war against Ukraine has showcased the true influence of major global actors and their determination to uphold their status. While the Western alliance hesitates in its engagement in Ukraine, the ‘Axis of Evil’ is seizing the initiative in Israel, Yemen, Africa, Latin America, and beyond. The ease with which Russia has adapted to the sanctions regime underscores the rapidity of this shift, enabling Moscow not only to sustain its long-term military campaign against Ukraine but also to pursue its ambitions in regions like Africa.
Despite the USA, the EU, and their allies boasting significantly stronger economies, their military sectors have failed to match the ammunition output of North Korea, a nation significantly smaller in scale, supplied to Russia over the past two years. Ukraine’s partners must make immediate investments in securing their own borders; otherwise, the silent third world war currently unfolding globally may escalate into something even more dire than past world conflicts. Nevertheless, their foremost priority should be ensuring the success of the defenders on the Ukrainian front lines.
