ECONOMY
Ukraine War only Accelerating Long-Term Decline in Russian Defense Exports
June 3, 2025
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Maxim Starchak
Russia defense correspondent, fellow at the Center for International and Defense Policy at Queen’s University (Canada)
Military expert Maxim Starchak argues that despite talk that Russian arms exports remain strong, sanctions, unspectacular performance and production issues have hit already-declining demand for Russian weapons. Longtime buyers like India and Egypt are balking, while even traditional clients are turning to China and other suppliers.
A Russian T-14 Armata tank. It cost $5.0-7.1 million in 2022. Source: Wiki Commons
Speaking at a meeting of Russia’s Commission for Military-Technical Cooperation with Foreign States in May, President Putin stressed that this area is a way to strengthen Russia’s overall position in global markets. The fact is, however, Russia is increasingly losing ground.
Declining arms exports
According to the Stockholm International Peace Research Institute, whereas as of end-2021 Russia was the second-largest exporter of arms globally with a share of 19.0%, by end-2024 it had slid to third place, its share having more than halved, to 7.8%. This is a long-term trend: as of end-2014, Russia held 27.0% of the global arms market.
Putin is putting a brave face on a bad situation. At the abovementioned commission meeting, he noted that Russia remains a top-five player in the global arms market and retains its leading export positions in many areas. Representatives of Russian defense corporations like to say the advantages of Russian weapons have been proven on the battlefield, leading to growing demand.
Officials involved in defense exports report mythical successes. Ahead of the 2025 International Exhibition of Arms and Military Equipment in Minsk, Rostec CEO Sergei Chemezov said his company had concluded more than 20 contracts worth about $7 billion and delivered military products to more than 15 countries since the start of the year.
In total, according to Chemezov, Rostec’s export order portfolio exceeds $60 billion, a record in the company’s 25-year history. Yet the Kremlin’s current priority is arming its own military. Foreign Minister Sergei Lavrov has said, given the circumstances, Russia is not always able to fulfill its export obligations on time. In other words, many contracts go unfulfilled and are included in the Rostec order portfolio.
Declining arms exports
According to the Stockholm International Peace Research Institute, whereas as of end-2021 Russia was the second-largest exporter of arms globally with a share of 19.0%, by end-2024 it had slid to third place, its share having more than halved, to 7.8%. This is a long-term trend: as of end-2014, Russia held 27.0% of the global arms market.
Putin is putting a brave face on a bad situation. At the abovementioned commission meeting, he noted that Russia remains a top-five player in the global arms market and retains its leading export positions in many areas. Representatives of Russian defense corporations like to say the advantages of Russian weapons have been proven on the battlefield, leading to growing demand.
Officials involved in defense exports report mythical successes. Ahead of the 2025 International Exhibition of Arms and Military Equipment in Minsk, Rostec CEO Sergei Chemezov said his company had concluded more than 20 contracts worth about $7 billion and delivered military products to more than 15 countries since the start of the year.
In total, according to Chemezov, Rostec’s export order portfolio exceeds $60 billion, a record in the company’s 25-year history. Yet the Kremlin’s current priority is arming its own military. Foreign Minister Sergei Lavrov has said, given the circumstances, Russia is not always able to fulfill its export obligations on time. In other words, many contracts go unfulfilled and are included in the Rostec order portfolio.
“Rostec has had a portfolio of $50 billion for years – now, counting undelivered orders, it is said to be $60 billion.”
This is the sum of contracts, options and memorandums of intent, Pavel Luzin, a military expert at the Center for European Policy Analysis, has told your author.
Factors reducing demand for Russian arms
Many experts consider the mooted good advertising of Russian weapons in the war in Ukraine to be an exaggeration. Economist Igor Lipsits, along with Luzin and fellow military expert Tomas Malmlöf, has pointed out in conversations that many weapons have demonstrated less than outstanding performance characteristics. Western weapons have hit many Russian missiles, ships and aircraft more easily than expected.
In addition, due to sanctions, Russia has lost access to foreign components and equipment, resulting in delays in the implementation of major projects. This is another factor reducing interest in Russian weapons. At the St Petersburg International Economic Forum in 2024, officials confirmed several other such factors, primarily problems with payments on contracts and the unwillingness of a number of governments to conclude contracts with Russia for fear of sanctions from the US and other Western countries.
As military expert Dmitri Smirnov has told your author, Indonesia, Morocco, Egypt and Nigeria have backed off relying on Russian weapons for these reasons, while India, the largest buyer of Russian weapons, has refused to sign new contracts. In particular, New Dheli refused to purchase Russian Su-30MKI fighter jets, T-90 tanks and Ka-226T helicopters, as well as jointly constructed submarines. Due to payment problems, the contract for the supply of Russian S-400 air defense systems to India has been put on hold. As a result, since 2014, Russia’s share in Indian arms imports has decreased from 58% to 36% and continues to decrease.
Factors reducing demand for Russian arms
Many experts consider the mooted good advertising of Russian weapons in the war in Ukraine to be an exaggeration. Economist Igor Lipsits, along with Luzin and fellow military expert Tomas Malmlöf, has pointed out in conversations that many weapons have demonstrated less than outstanding performance characteristics. Western weapons have hit many Russian missiles, ships and aircraft more easily than expected.
In addition, due to sanctions, Russia has lost access to foreign components and equipment, resulting in delays in the implementation of major projects. This is another factor reducing interest in Russian weapons. At the St Petersburg International Economic Forum in 2024, officials confirmed several other such factors, primarily problems with payments on contracts and the unwillingness of a number of governments to conclude contracts with Russia for fear of sanctions from the US and other Western countries.
As military expert Dmitri Smirnov has told your author, Indonesia, Morocco, Egypt and Nigeria have backed off relying on Russian weapons for these reasons, while India, the largest buyer of Russian weapons, has refused to sign new contracts. In particular, New Dheli refused to purchase Russian Su-30MKI fighter jets, T-90 tanks and Ka-226T helicopters, as well as jointly constructed submarines. Due to payment problems, the contract for the supply of Russian S-400 air defense systems to India has been put on hold. As a result, since 2014, Russia’s share in Indian arms imports has decreased from 58% to 36% and continues to decrease.
“The overall decline in Russian arms exports also comes as such traditional Russian clients as India and China have already developed or are completing the development of their own military-industrial complex. Indeed, this a long-term risk for Russian arms exports.”
Meanwhile, sanctions have forced Russia to use lower-quality components and materials in its weapons, leading to malfunctions. India is abandoning Russian aircraft due to their poor quality, while Serbia and Iraq are doing the same, citing problems with operation and spare parts. Similarly, Kazakhstan has voiced doubts about the exploitation of Russian weapons.
There may still be buyers for Russian weapons, according to Luzin, such as Myanmar and Iran. However, even in Russia, many experts believe Iran, owing to its desire to stabilize relations with the EU, will not be interested in buying weapons from Russia and will prefer a “safer” supplier like China.
Competition in new and old markets
Russia would like to enter the large weapons market of Pakistan, but it faces competition from China and would risk its privileged relations with India. Meanwhile, the Russian Foreign Ministry is trying to build constructive relations with Pakistan, but there is opposition within Russia to cooperation with Islamabad, as it has supplied weapons to Ukraine, according to Russian military experts.
Said Gafurov, a board member of the Novy Trud independent trade union and an associate professor at Moscow State Linguistic University, Russia is trying to enter new arms markets such as Mali and Niger to replace lost ones, but these African countries are small. Russia does not benefit from contracts under $10 million – the costs are too high. In these cases, arms deliveries are part of package deals, where Russia gets access to develop raw material deposits in return.
Moreover, competition has increased even in small markets. Sanctions mean Russia will increasingly lose out to France and Germany in Southeast Asia and the Middle East, and to Turkey, Poland and Iran in other markets.
In terms of cheap weapons, China and India are increasingly replacing Russia, many experts say. During the war in Ukraine, for example, even traditional post-Soviet clients like Kazakhstan and Uzbekistan have turned to China, the former for military drones and the latter for JF-17 Thunder fighter jets, surface-to-air missiles and reconnaissance drones. Turkmenistan and Tajikistan are also buying Chinese weapons. Armenia has begun to develop military cooperation with India, which will now supply it with anti-tank missiles and many other munitions.
Russia’s export potential is further reduced because it refuses to supply weapons to countries that have supported sanctions, as well as to those that re-export weapons to third countries.
As a result, according to estimates by pro-government experts, Algeria is the only country that looks set to continue to increase its demand for Russian weapons.
Outlook
At the Commission for Military-Technical Cooperation with Foreign States meeting described at the beginning of this article, Putin said Russia must actively boost the volume of export deliveries. The pro-Kremlin Center for Analysis of World Arms Trade estimates in the four years after a Russia-Ukraine ceasefire, Russia’s military exports may grow from the prewar $15 billion to $17-19 billion per year and possibly more. However, there are no objective possibilities for this.
The war in Ukraine and new sanctions have accelerated the decade-long trend of Russia’s declining position in the global arms market. If and when a ceasefire is reached and some sanctions are lifted, Russia, in a best-case scenario, may manage to recover a portion of its lost exports. But given the need to replenish its own stockpiles of weapons, external, more challenging contracts will not be a priority for the Russian defense industry for a long time.
There may still be buyers for Russian weapons, according to Luzin, such as Myanmar and Iran. However, even in Russia, many experts believe Iran, owing to its desire to stabilize relations with the EU, will not be interested in buying weapons from Russia and will prefer a “safer” supplier like China.
Competition in new and old markets
Russia would like to enter the large weapons market of Pakistan, but it faces competition from China and would risk its privileged relations with India. Meanwhile, the Russian Foreign Ministry is trying to build constructive relations with Pakistan, but there is opposition within Russia to cooperation with Islamabad, as it has supplied weapons to Ukraine, according to Russian military experts.
Said Gafurov, a board member of the Novy Trud independent trade union and an associate professor at Moscow State Linguistic University, Russia is trying to enter new arms markets such as Mali and Niger to replace lost ones, but these African countries are small. Russia does not benefit from contracts under $10 million – the costs are too high. In these cases, arms deliveries are part of package deals, where Russia gets access to develop raw material deposits in return.
Moreover, competition has increased even in small markets. Sanctions mean Russia will increasingly lose out to France and Germany in Southeast Asia and the Middle East, and to Turkey, Poland and Iran in other markets.
In terms of cheap weapons, China and India are increasingly replacing Russia, many experts say. During the war in Ukraine, for example, even traditional post-Soviet clients like Kazakhstan and Uzbekistan have turned to China, the former for military drones and the latter for JF-17 Thunder fighter jets, surface-to-air missiles and reconnaissance drones. Turkmenistan and Tajikistan are also buying Chinese weapons. Armenia has begun to develop military cooperation with India, which will now supply it with anti-tank missiles and many other munitions.
Russia’s export potential is further reduced because it refuses to supply weapons to countries that have supported sanctions, as well as to those that re-export weapons to third countries.
As a result, according to estimates by pro-government experts, Algeria is the only country that looks set to continue to increase its demand for Russian weapons.
Outlook
At the Commission for Military-Technical Cooperation with Foreign States meeting described at the beginning of this article, Putin said Russia must actively boost the volume of export deliveries. The pro-Kremlin Center for Analysis of World Arms Trade estimates in the four years after a Russia-Ukraine ceasefire, Russia’s military exports may grow from the prewar $15 billion to $17-19 billion per year and possibly more. However, there are no objective possibilities for this.
The war in Ukraine and new sanctions have accelerated the decade-long trend of Russia’s declining position in the global arms market. If and when a ceasefire is reached and some sanctions are lifted, Russia, in a best-case scenario, may manage to recover a portion of its lost exports. But given the need to replenish its own stockpiles of weapons, external, more challenging contracts will not be a priority for the Russian defense industry for a long time.
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