Procurement: Mobilizing Russian Industry For War


November 17, 2022: Russia is having problems mobilizing its economy to support the war effort in Ukraine. Russia’s problems mobilizing more soldiers for the war were widely reported while the industrial mobilization received little attention. This mobilization is complicated by the fact that Russia no longer has a market economy. Over the last two decades the government has taken control of most of the major industries. That should have made it easier to mobilize Russian firms for wartime levels of production. That has not happened, in large part because the many economic sanctions imposed on Russia after the February invasion of Ukraine caused chaos in many key Russian industries. At first the Russian government was not aware of how thoroughly sanctions had disrupted production of military equipment. There was no centralized control of the industries that produced items the military needed. Finally, in October Russia established the GCC (Government Coordination Council) to organize available resources to get the military what it needed. The GCC quickly discovered that a lot of what defense manufacturers were missing was components imported from the West. Most of these items were no longer available and the best alternative supplier, China, would not help because that would violate the sanctions on Russia and subject China to similar sanctions.

The GCC quickly discovered this widespread lack of key components and that came as a surprise to senior Russian leaders who were more prone to suspect corruption or deliberate sabotage. Suddenly it became clear that the production problems were not the fault of inept management or a shortage of qualified workers, but the lack of key components. It made sense that this parts problem would cripple efforts to produce more guided missiles, but now it was clear that even the program to upgrade 800 1960s vintage T-62 tanks was quickly stalled because of the shortage of imported components and problems with finding any local substitutes. The T-62s had been kept in reserve and were in running condition but lacked modern fire control and communications capabilities. Their engines could use an upgrade as well. These tanks were urgently needed in Ukraine where most of the more modern Russian T-72 and T-90 tanks sent since February had been destroyed or captured by the Ukrainians. Currently the Ukrainians have more operational tanks than the Russian forces do inside Ukraine. That’s one reason why the Ukrainians have been on the offensive for the last three months and steadily taking more terrain from Russia.

The GCC was able to organize accommodations, training facilities and basic combat equipment (uniforms, protective vests and helmets) for recently mobilized troops. Even this ran into problems because the government did not carry out this troop mobilization itself, but instead assigned provincial authorities the responsibility for obtaining (by force if necessary) new recruits as well as training and equipping them. Most provincial governments were not prepared to handle this because they had no experience or administrative capabilities for it. These were problems that complicated the work of the GCC because the federal government was trying to impose “taxes” on the provinces by demanding that they pay for equipping and training the new troops as well as providing cash to local defense manufacturers so they can produce military supplies the federal government can’t afford to pay for. While the mobilization angered many Russian families with military age men subject to this new form of conscription, the GCC was turning provincial officials into enemies. These officials are appointed by the federal government, a change made by Vladimir Putin to ensure the loyalty and cooperation of provincial officials. Before that these people were elected and tended to take responsibilities to the locals seriously.

These growing demands by the federal government are putting the provincial officials in a difficult position. The people they govern are angry and some are refusing to cooperate or using violence against efforts to comply with the demands of the federal government. Some provinces are worse off than others and are reporting these problems to the federal government. There is not much the federal officials can do except ignore provinces that are unable or unwilling to meet the new demands. The GCC has put this crisis into focus but is unable to solve it. In the end the GCC did not solve the problems with mobilizing military production, but did confirm the problems were real and largely unsolvable.




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