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As 2017 drew to a close, Russia’s political-military leadership staged various events and public discussions emphasizing some of the achievements of the year and outlining priorities for 2018. Few surprises came out of these reflections, with the overall defense priorities well established. Still, those meetings and President Vladimir Putin’s visit to the newly built Academy of the Strategic Rocket Forces in Balashikha, near Moscow, afforded opportunities to amplify the message that military modernization is progressing—as well as to remind various audiences of the potential dangers facing the Russian State. Indeed, progress was evident throughout the year in terms of the quantity and quality of the modernization, with the State Armaments Program to 2027 (Gosudarstvennaya Programma Vooruzheniya—GPV) being fine-tuned based on lessons from the conflicts in Ukraine and Syria (see EDM, April 25, 2017; December 12, 2017).

In pole position among the state defense priorities is the continued and long-term effort to modernize the nuclear triad. Putin’s visit to Balashikha, on December 22, reinforced this while tying it to the need for asymmetric capabilities to counter the United States’ ballistic missile defense. The Russian president characterized the defense strategy of the US and the North Atlantic Treaty Organization (NATO) as “aggressive” or “offensive” in relation to Russia. He expressed well-known objections to US missile defense as a potential threat to Russia’s nuclear deterrence capability, based on the possibility that components of the missile defense systems could be moved or enlarged in such a way as to undermine Moscow’s second-strike capacity. He further objected to alleged US plans to deploy a mobile ground-based cruise missile in 2018 with a range of up to 5,500 kilometers, which would violate the 1987 Intermediate-Range Nuclear Forces (INF) treaty; Putin made no comment on Moscow’s own violations of this largely defunct Cold War agreement (Kommersant, December 23, 2017).

Putin also selected Balashikha as the venue for the annual defense ministry collegium. Its highlight was the address by Defense Minister Sergei Shoigu, whose speech offered few surprises but provided interesting details on Russian military development. Shoigu stated that the Russian Armed Forces gained invaluable combat experience in Syria. This has involved more than 48,000 military personnel, with 14,000 decorated for their service in the campaign. Eighty percent of the Aerospace Forces’ (Vozdushno Kosmicheskikh Sil—VKS) operational and tactical crews benefited from combat experience in Syria and 90 percent of army aviation. The air grouping deployed in Syria conducted more than 34,000 sorties. Moreover, the Syrian intervention provided opportunity to extend combat experience well beyond the VKS. Moscow deployed high-precision strike systems in Syria, including X-101 and X-55 cruise missiles, and used both Tochka-U and Iskander-M operational-tactical missile systems. The Navy launched high-precision strikes from submarines and surface platforms, while on-the-ground operations against terrorists were conducted by Special Operations Forces. Air defense systems, such as the Pantsir-S1, destroyed 16 enemy unmanned aerial vehicles (UAV). And indeed, the Syria campaign enabled Russia’s Armed Forces to deploy and test a broad range of systems (Nezavisimoye Voyennoye Obozreniye, December 23, 2017).

On the issue of implementing the GPV to 2020, Shoigu offered impressive statistics on the advances in modernizing the weapons and equipment in the military inventory. He noted that the share of “modern” arms and equipment in the Ground Forces and Navy has reached 59.5 percent. This rises to 79 percent in the Strategic Rocket Forces (Raketnye Voyska Strategicheskogo Naznacheniya—RVSN); while the VKS has attained 73 percent, the Navy 53 percent and the Ground Forces figure was presented as 45 percent (Nezavisimoye Voyennoye Obozreniye, December 23, 2017). Though Shoigu’s statistics are impressive, no doubt calibrated to shore up support for further modernization, there was a sense that his speech specifically showcased his own achievements since appointed as defense minister in November 2012. In particular, he highlighted the re-creation of seven divisions since 2012, with no reference to brigades or the reform carried out under his predecessor.

The priorities for Russia’s Armed Forces have already been defined but were adjusted based on lessons drawn from the conflicts in Syria and Donbas; the absence of acknowledgement of the latter warzone cannot conceal its importance to the defense ministry and the General Staff (Mil.ru, December 26, 2017). The restructuring of military infrastructure in Russia’s Western and Southern Joint Strategic Commands (Obedinonnye Strategicheskoe Komandovanie—OSK) obviously relates to the lessons from Donbas and highlights a long-term commitment to maintaining or escalating the conflict as required. Syria has offered greater and more diverse opportunity to train forces and experiment with approaches to warfare, boosting the demand for high-precision strike systems and UAVs. Donbas is driving the localized restructuring of the Ground Forces and the need for improvements in artillery and armor.

Such restructuring offers the Russian Armed Forces increased strike force and firepower operating along a broader “front.” Essentially, this is the argument in favor of divisions over brigades. In late December, Colonel General Oleg Salyukov, the commander-in-chief of the Ground Forces, noted that both divisions and brigades will be retained in the future for these reasons, but he made no mention of the continued reliance upon battalion tactical groups or explained the circumstances in which an entire division would be deployed (Mil.ru, December 25, 2017). According to the leadership of the Western OSK, modernization in this command in 2017 procured 40 aircraft and helicopters and 190 armored vehicles, as well as various air-defense assets and high-precision systems; the highlight of the training year was Zapad 2017, and internal assessments of this exercise will further refine procurement needs in the year ahead (Armstrade.org, December 26, 2017).

Shoigu announced that the military budget in 2018 will be 2.8 percent of GDP, or around $46 billion. This will facilitate the share of modern or new weapons and equipment in the Armed Forces to reach 61 percent and 82 percent in the RVSN. The Ground Forces will receive up to 3,500 units of new or modern weapons (Nezavisimoye Voyennoye Obozreniye, December 23, 2017).

As already noted, many of these features of military development are unsurprising, and the official statements from the military leadership suggest confidence has been boosted by exploiting Russia’s involvement in Syria. At the same time, reports of damage inflicted on Russian air platforms at its airbase in Latakia on December 31 may incline the military to be more circumspect and convey to the political leadership the dangers of premature declarations of “victory” (Lenta.ru, January 5, 2018). The anti-US and anti-NATO rhetoric in Moscow remains high, but the strategic-operational exercise and highlight of the 2018 training year will be Vostok 2018, and its location, focusing upon the Eastern OSK, may provide a chance for all sides to soften their political tones.

 

–Roger McDermott

 
 

A Year in Review: For the North Caucasus in 2017, Old Problems Remain While New Ones Arise

 

At the end of December and following Vladimir Putin’s premature declaration of victory in Syria (see EDM, December 14, 2017), Russia’s Federal Security Service (FSB) announced that the militant underground in the North Caucasus had been liquidated—a claim even less justified than the president’s pronouncement about Syria (Vz.ru, December 19, 2017). Over the following weeks, the conflict in the North Caucasus has continued. But although it is certainly true that the fight between the government and the anti-Moscow underground Islamist movement did not end, it is also the case that, during 2017, it was overshadowed by a variety of other developments in the region.
 
Official assertions that the conflict was over were contradicted not only by experts but by the actions of both the militants and the Russian forces. Indeed, the former have been attacking in places where they had not been active before, such as Stavropol and Karachaevo-Cherkessia, as well as in Dagestan, where the militancy has continued throughout the year. Meanwhile the latter imposed “counter-terrorism regimes” in more places in 2017 than they had earlier, albeit in many cases for shorter periods of time. Nonetheless, there is no reason to think that the militants have been defeated or that peace has come to the region (Kavkazsky Uzel, accessed January 9, 2018).
 
In fact, the authorities—both local and from Moscow—appear fearful that there will be an upsurge in violence now that several hundred North Caucasians who had gone to Iraq and Syria to fight have returned to their homelands. The authorities have arrested a large fraction of these people and set up special filtration programs for the others to try to prevent such an outcome. And in Dagestan, they have appointed military personnel to administrative positions normally occupied by civilians, an indication of particular concern (see EDM, October 13, 2017). Given that many of those who went to the Middle East to fight for Syria did so circuitously and without the knowledge of the authorities, it is likely that the ranks of the militants swelled at the end of 2017 and that these groups will make themselves known with acts of violence in the year to come.
 
Underlying these fears is recognition that the Putin government has failed to improve the economy in the region. Poverty has dramatically increased, and the government has failed to build needed infrastructure. Despite Moscow’s promises, many schools in Dagestan and across the region, for example, are still forced to operate two or even three shifts a day. Moreover, in many places, anger about social problems is being invested with ethnic meaning into a highly combustible mix.
 
For the North Caucasus as a whole, the most important event of the year was the replacement of Dagestan’s governor, Ramazan Abdulatipov, with Vladimir Vasiliyev, an outsider who pledged but has not yet acted on his promise to ignore ethnicity in making career appointments. Abdulatipov was forced to resign for a number of reasons: he had signally failed to suppress the militants, rein in corruption, or end the conflicts over land that increasingly spring up as the republic’s numerous ethnic groups change in relative size and therefore make demands for territorial adjustments in their regions (see EDM, November 14,21, 2017).
 
Moscow clearly decided that only an outsider like Vasiliyev, who is of mixed Russian and Kazakh nationality and who has made his career primarily at the center, could bring about positive change. But there are two reasons why that strategy may not be working. On the one hand, the ethnic clans who have long run things in Dagestan are deeply entrenched, and any serious attack on them would plunge the republic into chaos, possibly blocking the key land route between Russia and Azerbaijan. (Long lines at border crossings between the two may in fact be the work of the ethnic clans.) And on the other, Vasiliyev’s appointment has spread fears in other republics across the region that they are going to have outsiders imposed on them, fears that are powering demands in several places for the restoration of the direct election of governors rather than their appointment by Moscow.
 
Chechnya’s Ramzan Kadyrov remained outside of Moscow’s full control during 2017. Over the past year, he oppressed his subjects even more than Russians are elsewhere, dispatched his agents to attack those he does not like far beyond the borders of his republic, and staked out policy positions often at odds with and to the detriment of Moscow. He attracted most attention in 2017 for his attacks on members of the LGBT community there. On the one hand, he denied this group even existed in Chechnya; but on the other hand, his government created special re-education camps and looked the other way at murderous attacks on gay Chechen men. Moreover, Kadyrov demanded and extracted apologies both from those under his control and the Moscow media for attacks on Chechens he considered unacceptable—an Orwellian approach within the republic and one that has led other non-Russians there, including most recently the Kalmyks, to demand the same from the central media. That in turn has generated a Russian backlash, with nationalists demanding that the media not apologize for jokes about ethnic groups.
 
But despite these moves and other independent and hyperbolic statements, Kadyrov remains Putin’s man in the Caucasus, either because the Kremlin leader is happy to have him test the waters for even more repressive actions elsewhere or because Putin fears that ousting Kadyrov could restart a new and even broader Chechen war. Clearly, the North Caucasus is still a major threat to Russia more generally. Ever more Russians say that what has happened since Putin came to power has not been the restoration of Russian control over Chechnya but rather “the Chechenization of Russia.” These critics point to the enormous subsidies Moscow sends Grozny and other North Caucasus capitals in the hopes of buying their loyalty or at least their acquiescence to Russia’s continuing military operations there.
 
However, perhaps the most important development to come out of the North Caucasus this past year had little or nothing to do with the militants or with these local regimes. It came in the form of the strike by long-haul truckers against the Platon pay system. Drivers from Dagestan, Ingushetia, and Karachaevo-Cherkessia played a central role in this strike both in the spring and summer and again in December (see Commentaries, December 14, 2017). All this is a reminder that the North Caucasus is not just about Islamism and nationalism but also about poverty and the quest for justice—difficult issues that guarantee the year ahead is likely to be hotter and more uncomfortable for Moscow than the one just past.

 

–Paul Goble

 
 

Ukrainian Government and Ukroboronprom Deadlocked Over Debt and Production Problems at Mykolaiv Shipyard

 

Where there is bureaucracy and waste, inevitably there has been the opportunity for on-going corruption. And such a situation is only aggravated by misplaced state secrecy. In Ukraine, there perhaps has been no greater symbol of on-going poor decision making, planning, bureaucracy and waste than the Ukrainian naval vessel Ukrayina.

The Ukrayina, a Slava-class missile cruiser, formerly known as the Admiral Flota Lobov, or Project 1164, was laid down in 1983 and launched in 1990, as the Soviet Union imploded. Docked in the Mykolaiv North Shipyard, formerly known as the 61 Communards Plant, this Soviet cruiser was designed to accommodate anti-ship, anti-submarine, anti-air and electronic fire control systems (Flot2017.com, February 1, 2011).

In 1993 The Russian Navy disavowed claims to the cruiser, passing it to the Ukrainian Navy at a time when neither country was in a financial position to complete and commission the vessel. Project 1164 was thus never completed. It remains docked at the Mykolaiv Shipyard in a state of permanent preventative maintenance (Flot2017.com, February 1, 2011).

In February 2015 the Ukrainian Ministry of Defense disavowed the Ukrayina, a vessel that it had never requested and that had no place in the plans for a post-Crimean-annexation, new Ukrainian Navy. Consequently, financing for the maintenance, ecological management, and fuel to turn the engines over during the winters has been absent. Wages, too, have not been paid. The current debt is estimated at 58–60 million hryvna (approximately $2.3 million) (Rian.com.ua, August 23, 2017).

Overbearing bureaucracy tends to attract waste and corruption, leading to the absence of external investment (UkraineAlert, January 4, 2018) as well as inevitable delays. And regarding the Ukrayina, since February 2015, the Mykolaiv Shipyard claims to have written to its parent company (the state-owned military industry enterprise Ukroboronprom) 13 times, President Petro Poroshenko 6 times and Prime Minister Volodymyr Groysman 7 times relating to funding to maintain the vessel and unpaid wages—to no avail (Rian.com.ua, August 23, 2017).

Meanwhile, Ukroboronprom also claims to have repeatedly approached the Ukrainian Cabinet of Ministers seeking a decision over funds to resolve the debt issue and the future of the cruiser Ukrayina. And on October 30, 2017, the state-owned defense firm appealed to the secretary of the National Security and Defense Council (NSDC), Oleksandr Turchynov, to bring about a solution (Niknews.mk.ua, October 31, 2017).

The following day, October 31, Ukroboronprom announced the suspension of all works at the Mykolaiv Shipyard due to its accruing debts of 58 million hryvna (UAProm, October 31, 2017). The facility produces and repairs both military and civilian vessels (Shipyard61.com.ua, accessed January 9, 2018). Notably, according to its website, this shipyard’s main naval products include two armored gunboat classes (the 20-meter Gyurza and the slightly larger Cayman-80), a Universal-300-class patrol boat, and two corvette types (the Mistral-1500T- and the Mirage-class). These smaller vessels are precisely the kinds of ships the Ukrainian Navy is looking to acquire quickly and in large numbers in order to fulfil its goal of developing its “Mosquito Fleet” concept while money is tight and Russian presence in Ukrainian littoral waters remains high (see EDM, March 9, 2017; April 12, 2017).

In November, Prime Minister Groysman expressed confidence that Ukroboronprom would resolve the 58 million hryvna debt. However, Ukroboronprom stated it was unable to meet such a request until the Cabinet of Ministers decided upon the future of the cruiser Ukrayinaand agreed upon a formal plan. On December 13, the Cabinet instructed Ukroboronprom to pay the wage arrears before December 25. But this did not happen. In response, at a December 27 Cabinet meeting, Prime Minister Groysman stated he would apply to President Poroshenko to remove Roman Romanov as CEO of Ukroboronprom. “At one of the previous government meetings, the issue of debt at the Mykolaiv Shipyard was discussed. I instructed the government to sign a debt agreement with the head of Ukroboronprom. The deadline is December 25, today is the 27th. The debt is not repaid. I heard feedback that they cannot do it. I do not understand this. Therefore, today I will sign a presentation addressed to the president, but I advise the head of ‘Ukroboronprom’ to resign independently today,” the prime minister said. Groysman concluded, “A new manager will come, he will find a solution to repay the debt to working people. So today, I will raise this issue and I hope that the president will very quickly make a decision” (Kyiv Post, YouTube, December 27, 2017).

That same day, in reply, Ukroboronprom published on its website numerous letters to the Cabinet of Ministers, written over several months, drawing certain issues to the government’s attention (Ukroboronprom.com.ua, December 27, 2017). In one of these letters, Ukroboronprom CEO Roman Romanov writes, “ ‘Ukroboronprom,’ in accordance with the Statute, which was approved by the Cabinet of Ministers, has no right to redistribute funds between participating enterprises. If you withdraw funds from other defense industry enterprises such as Antonov, Khmelnytskyi KMB, Morosov, Malyshev Plant, or Artem and others [which also fall under Ukroboronprom], Ukraine will be left without airplanes, tanks and other weapons.” In short, Romanov claims he has no legal scope to smudge or manipulate budget headers and bottom lines and thus cannot and will not comply with the prime minister’s instruction.

Needless to say the outcome has been that the workforce at the Mykolaiv North Shipyard entered 2018 with their wages still unpaid since February 2015. It is unclear whether they will be paid before February 2018, which would mark three years without wages.

The fate of the cruiser Ukrayina is also unknown. It has never been completed. It is not part of the current Ukrainian naval plan. It has been disowned by the Ministry of Defense since 2015. What awaits it? Is it still deemed “military?” Can it be sold? Can it somehow be converted to commercial use? Is it headed for scrap (Kyiv Post, September 18, 2015)?

As a result of the public spat between Ukroboronprom CEO Romanov and Prime Minister Groysman, it remains to be seen how President Poroshenko will deal with the matter. Both men hold their positions due to presidential influence and their perceived loyalty to him. Public and private balancing acts will be necessary to achieve or maintain on all sides, with elections scheduled for March 2019. Moreover, there are unpaid voters at Mykolaiv Shipyard to consider. Against this background, it is difficult to see how restructuring and reform of Ukroboronprom will actually proceed, if at all.

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