Wednesday, May 28, 2008

Not Quite Ready for the Ash Heap

In the current issue of the Weekly Standard, Reuben F. Johnson writes of Russia’s collapsing military-industrial complex. Despite recent shows of military force–including bomber flights off the coast of northern Europe and Alaska—Moscow’s research and development base is in bad shape, according to Mr. Johnson, creating dire consequences for the Russian armed forces.

But for all of the bluster, Russia's military hardware is aging and decaying before our eyes, whether it is chugging through Red Square or flying at 2,000 feet above a U.S. carrier's flight deck. Defense attachés and intelligence officers assigned to Moscow used to live for these military parades, which sometimes gave them a chance for a first glimpse of some new weapon system. But there was certainly nothing to get excited about in the latest parade.

The steep decline of the Russian military began in the 1990s when orders for Russia's defense screeched to a halt during the Yeltsin era. But the "happy days are here again" era of $100 per barrel oil under Putin has not brought a cornucopia of new orders from the Russian ministry of defense. Procurement of new fighters and other systems has been anemic; most of the budget allocated for aerospace R&D has been diverted from military projects to the development of the Sukhoi Superjet 100, a regional passenger airliner.

Most weapons systems in the Russian arsenal today are warmed over versions of designs that were made in the Soviet period. Remarkably few innovations have been turned out since then, and almost none that are anywhere close to production status. This is a direct result of Moscow--despite all of its new-found wealth--turning off the investment spigot to the R&D centers of the defense industry.

In fairness, there is an element of truth in Johnson’s analysis. Russia’s defense industry experienced a period of severe contraction in the 1990s, with the cancellation of scores of projects, and the deferral of others. Some of the nation’s premier design bureaus, including Mikoyan (the leading builder of fighter jets), Tupolev and Ilyushin (which specialized in bomber and transport aircraft) and were forced into mergers. Others simply disappeared, throwing thousands of scientists, engineers and trained technicians into the unemployment line.

Recently, one retired Russian general described his country’s armed forces as a “bad copy of the Soviet Army,” a quote that Johnson eagerly incorporates into piece. But, is Russian military R&D at a near-standstill (as he would have us believe) with no hope for recovery?

However, it would be ill-advised to consign Moscow’s military base to the ash heap of history. Truth is, Russian design bureaus and their personnel have demonstrated a remarkable resiliency since the early 1990s, overcoming years of under-funding, political cronyism, bad management and ill-conceived consolidations. Russian defense contractors still produce advanced weaponry that competes successfully in the global market, and their prospects are not as dim as Mr. Johnson suggests.

Consider Sukhoi, once an also-ran to Mikoyan as a producer of Russian fighters. The latest models of its SU-27/30 Flanker are as capable as fourth-generation western jets, including the U.S. F-15 and F-16. Over the past 15 years, Sukhoi has sold more than 400 Flankers around the world, many of those to India and China. With those acquisitions, Beijing and New Delhi have gained a qualitative edge over their primary foes (Taiwan and Pakistan), which fly smaller numbers of early-model F-16s. Venezuela’s recent Flanker purchase is making its neighbors nervous in South America, and it’s likely that Iran and Syria will acquire them as well.

Moscow also does well in the air defense business, selling advanced surface-to-air missiles (notably the SA-10 and SA-20 to customers ranging from Greece and Armenia, to China and Vietnam. Current versions of the SA-20 (dubbed the S-300) offer greater range than the U.S.-made Patriot system, and are capable of engaging aircraft, cruise missiles and ballistic missiles. Russian firms have also had success in selling short-range SAM systems (Iran’s recent acquisition of the SA-15 comes to mind), and upgrading older models. Moscow has also found a number of customers for shoulder-fired SAMs like the SA-18, comparable to our own Stinger.

Russian firms are also selling a variety of other weapons systems, ranging from anti-ship missiles and helicopters, to diesel submarines and medium-range bombers. All told, Moscow sold over $7 billion worth of arms in 2006 (the last year for which data is available). While Russia still trails the United States in arms exports, its sales have increased steadily over the past decade, and the total for this year will approach $8 billion.

Moreover, with oil prices well over $100 a barrel, Russia can invest money in more advanced weaponry. Sukhoi is working on a fifth-generation fighter, designed to compete with the U.S. F-22 Raptor and F-35 Lightning II. While the Sukhoi project (nicknamed PAK FA) won’t enter service until the next decade, it will be cheaper that its American counterparts, and available to states that can’t afford (or can’t access) U.S. technology.

In fact, PAK FA may be something of a template for future Russian defense efforts. India is already a partner in the project and Brazil signed on last month. Foreign participation will give Moscow even more capital to pursue advanced weapons, while ensuring an export market for its finished products. Countries like India and China are also attractive because of their educated workers and technological expertise. If Russia’s defense workforce is aging, then some of the manufacturing job can be farmed out to partners in Bombay or Shanghai—the same approach being used by western firms.

Obviously, we’ll never see a return of old Soviet military-industrial complex. But the Russian design bureaus of today are not exactly peddling junk. Many of their “warmed-over” designs (as Mr. Johnson describes them) are quite good and attractive to foreign buyers.

More disturbingly, Moscow’s resurgence in the arms market creates problems for the U.S. and its allies. Advanced anti-ship missiles in a place like Iran pose hazards for oil tankers (and American carrier groups) operating in the Persian Gulf. Likewise, Iran’s eventual the purchase of the S-300—to complement to SA-15—would complicate the task of targeting that country’s nuclear facilities. Similar deployments along the China coast are forcing us to rethink plans for defending Taiwan.

To be sure, Russia’s military-industrial complex still faces stiff challenges. But writing off Moscow’s defense base (at this point) would be both premature and imprudent.

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