ABSTRACT
Over the past century Russia’s defence-industrial complex (Oboronno-Promyshlennyy Kompleks, or OPK) has been one of the world’s largest, but it has operated in differing politico-economic systems. This chapter assesses the Russian OPK in three time periods: 1980–1991 a high priority branch of a centrally planned economy that produced large quantities of modern weapons; 1992–1999 a low priority sector in a collapsing transition economy; and 2000–2019 an important component of a growing state capitalist economy. Each time period has four sub-sections: (1) defence expenditure and foreign trade in weapons and military equipment; (2) politico-economic system, defence sector, priority, and defence industry organisation; (3) performance of defence industry enterprises (DIEs) (including impacts of economic sanctions); and (4) military procurement and conversion. The dynamics of the OPK are explained by considering: (1) a five-block model of the politico-economic system; (2) horizontal and vertical relationships of the six defence sector economic institutions; (3) changing priorities; and (4) the micro-economic behaviour of DIEs. In the period out to 2025 Russia will continue to produce the armaments required by the armed forces and foreign customers, but its OPK will diversify into civilian production to avoid becoming an excessive burden on the slowly growing economy.
