Russia - Defense and Security: Modernization measures to drive expenditure (Strategy, Performance and Risk Analysis)
In terms of levels of conflicts and militarization, Russia was ranked second globally but fourth in terms of societal safety and security. Due to an increase in the number of attacks by rebels from the Chechen Republic, conflicts with Georgia, and escalating tensions with Ukraine, levels of conflict have grown. The Russian defense budget stood at US$52.0 billion in 2016, and will post a forecast-period CAGR of 7.3% to reach US$78.4 billion in 2021 due to modernization plans aimed at replacing obsolete equipment and aging fleets.
MarketLine’s premium reports provide a comprehensive overview of each market within a country’s defense industry; benchmark key performance indicators against regional and global peers; review industry trends and drivers; evaluate the competitive landscape and innovation potential of singular markets; and conduct data-driven SWOT analysis to ascertain a structured assessment of the performance of each territory represented.Key Highlights
Growing homeland security expenditure:
Russia’s expenditure on homeland security stood at US$17.0 billion in 2016, and will post a forecast-period CAGR of 4.3%, to reach US$40.0 billion in 2021 due to an emphasis on the prevention of terrorist activities, securing national borders, safeguarding cyberspace, and the protection of its natural resources.
Growing demand for Russian weapons to enhance its customer base:
Russian weapons and equipment are in high demand due to affordability and performance standards. Russia is one of the world’s leading arms exporters, supplying weapon systems to 51 countries. Major customers include India, China, Algeria, Vietnam, Azerbaijan, Venezuela and Syria.
Strong support for R&D:
Russia has enhanced its R&D budget for defense, encouraging domestic equipment manufacturers to upgrade arms and ammunitions technology in order to gain a competitive edge in the global market. Russia has also increased its defense budget allocation towards R&D as part of its strategy to enhance its technological capabilities and emerge as the leading supplier of weapons to the Middle East. It aims to offer modernization and maintenance services alongside its systems and other related equipment.
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