On March 19, 2022 Anonymous commented on Russia’s high military costs in Ukraine. Such costs are unsustainable.
Components of military budget include operations/maintenance, military personnel [4], R&D (including testing & evaluation) and so on [1]. Russia has already spent nearly 5% of yearly military budget [2, 3], which adversely effects Russia’s R&D program. If Russia continues the Ukraine invasion for another month, its design bureau such as Rubin [5] for diesel electric submarines might be seriously damaged. Illegal technology transfer from Russia to third countries will be inevitable. Russia may have also lost US$5 Billion in military equipment [6] such as tanks and aircraft.
[1] https://en.wikipedia.org/wiki/Military_budget_of_the_United_States#By_title
[2] According to Professor Takahashi, the estimated operation cost during the Iraq War was from US$100 to 150 million per day. Russia had already spent between US$2.4-3.6 Billion million USD (4-6% of its yearly military budget (US$61.7 Billion)) after 24 days invading Ukraine.
[3] https://jp.knoema.com/atlas/%E3%83%AD%E3%82%B7%E3%82%A2%E9%80%A3%E9%82%A6/%E8%BB%8D%E4%BA%8B%E8%B2%BB%E7%8F%BE%E5%9C%A8%E3%81%AE%E7%B1%B3%E3%83%89%E3%83%AB Russia’s 2020 Financial Year military budget was US$61.7 Billion.
[4] Numbers of Russian military personnel are 900,000 and
average monthly payment for each is US$900. Then annual payment of Russian
military personnel is 900,000 x 900 x 12 month = US$9.7 Billion.
[5] https://en.wikipedia.org/wiki/Rubin_Design_Bureau
[6] https://www.thedefensepost.com/2022/03/14/russia-military-equipment-ukraine/
Hello!
ReplyDeleteRubin is also working on strategic nuclear submarines and big-sized drones like Vityaz
Regards
Thanks Anonymous [at Mar 20, 2022, 8:08:00 PM]
ReplyDeleteIndeed Russia's Rubin Design Bureau and below "Halliburton"
1. http://ckb-rubin.ru/en/projects/naval_engineering/conventional_submarines/project_877/
and
https://en.wikipedia.org/wiki/Rubin_Design_Bureau#Present_day is designing: "nuclear submarines [including the] Borey class"
and up until anti-Russia sanctions?
"also works with outside companies (including Halliburton) on the production of oil platforms"
and
2. "big-sized drones like Vityaz" at http://ckb-rubin.ru/en/projects/robotics/vityaz_d/
and https://en.wikipedia.org/wiki/Vityaz-D_Autonomous_Underwater_Vehicle :
"The Vityaz-D is the first full-ocean depth, fully autonomous deep submergence vehicle.
This Russian Autonomous Underwater Vehicle (AUV) was designed and developed by the Rubin Central Design Bureau for Marine Engineering in St. Petersburg, Russia under contract to the Advanced Research Foundation (Russian acronym: FPI, Fond Perspektivnyh Issledovaniy). The development of Vityaz-D began in September 2017. The keel-laying ceremony of the AUV was held at Rubin's assembly plant for experimental production in November 2018."
Regards Pete
Thanks Pete. I don't doubt all this is true. I think in the long term the economic effects of sanctions and energy and trade policy changes against Russia will be much worse. The term "biting the hand that feeds you" is clearly not familiar to Putin.
ReplyDeleteIran is probably the best example of the effect of long term sanctions. The sanctions being placed on Russia are going to be long term, because they are being accompanied by policy changes like Germany switching its gas and energy supply. It is hard to imagine Europe relying on Russian gas again while Putin is alive. Even the German Greens have agreed to give up utopian dreams of integration. Additionally, many private companies are now abandoning business in Russia altogether as too risky.
Oil and gas are Russia's two largest exports, worth over $215 billion out of total exports of $380 billion. It will take them years to build the infrastructure to export oil and gas to China (all the pipelines now flow west). Even then, the Chinese will know they can drive a hard bargain, because the Russians will have no other buyer.
Without oil and gas, Russian exports would rank with Indonesia (2/3 of Australia's total). Russia will become a comparatively poor country. It will be back to the 1990s again. They can forget about expanding the military or building a modern navy. They will be lucky to be able to pay their remaining troops.
From an economic viewpoint, the invasion is folly for the Russians. It would not shock me if one or more oligarchs tried to remove Putin.
Thanks Anonymous [at Mar 21, 2022, 10:57:00 AM
ReplyDeleteIndeed Russia's loss of a gas pipeline market to Europe won't be substituted with flows to China for years.
Although it seems SOME Russian gas is piped (from whatever direction and means) to China. I'm unsure how much Russian gas goes by ship to China.
See https://en.wikipedia.org/wiki/Power_of_Siberia#History "The [Russian] pipeline was filled with gas in October 2019.[1][14] Deliveries to China started on 2 December 2019.[15][16]"
and
Global Times, Aug 11, 2021, https://www.globaltimes.cn/page/202108/1231246.shtml
"The China-Russia east route natural gas pipeline project has delivered a total of 10 billion cubic meters of imported Russian gas as of Wednesday, since gas imports started in December 2019, customs data showed.
The pipeline is scheduled to provide China with 10 billion cubic meters of Russian gas in 2021 and the amount is expected to increase to 38 billion cubic meters annually from 2024, according to the 30-year, $400 billion contract signed by Russian gas giant Gazprom and China National Petroleum Corp in 2014.
Russian natural gas has been used in Northeast China's Heilongjiang Province, Beijing and Tianjin. The pipeline system is the largest long-distance intelligent natural gas transmission system in China, according to the Harbin customs in Heilongjiang.
The full China-Russia east route is a pipeline system spanning more than 8,000 kilometers. It transmits natural gas from Siberia to nine provincial-level regions in China.
It has been divided into three sections: the northern section from Heilongjiang's Heihe to Changling in Northeast China's Jilin Province, the middle section from Changling to Yongqing in North China's Hebei Province, and the southern section from Yongqing to East China's Shanghai.
The northern section was put into use in December 2019 and the middle section in December 2020. The southern section is under construction and is expected to be completed and put into operation in 2025. By then, the daily gas transmission capacity will exceed 50 million cubic meters, nearly three times higher than the current capacity.
In 2020, China imported 101.6 million tons of natural gas, of which nearly 8 percent came from Russia, customs data showed.
China imported natural gas from 24 countries last year. The top five sources of imported pipeline gas are Turkmenistan, Uzbekistan, Kazakhstan, Myanmar and Russia, according to statistics from the Ministry of Commerce."
Regards Pete
Pete
ReplyDeleteThanks. I wasn’t aware of that China pipeline (my figures were from 2019) but nevertheless it remains small. Total Russian gas exports were 199 billion m3 per year. So that 10 billion m3 to China is 5% of total Russian gas exports.