Page 56 - RusRPTApr24

limits, still offering a likely material advantage over Ukraine for the year, per UK intelligence.
The Russian defence industry significantly increased its production output in 2023. This was achieved by expanding the workforce to roughly 3.5 million people, increasing shift patterns and expanding existing production lines, coupled with bringing idle production capacity back into service.
A significant proportion of this increased output comes from refurbishment and modernisation of existing stocks rather than new production. For example, the vast majority of main battle tanks produced in 2023 consisted of refurbished vehicles.
Artillery munition production rose sharply in 2023 and will likely increase further in 2024. However, munition production is likely to peak in the next 12 months due to capacity constraints.
Although the defence industry is unable to fully meet the demands of Russian operations against Ukraine, it is almost certainly capable of delivering a materiel advantage over Ukraine throughout 2024.
In late 2023, the British Defense Ministry reported, based onapparently leaked Russian finance documents, that the country’s 2024 defense budget would jump to about $112 billion, around 6% of GDP and a 68% increase, as the country was preparing for extended fighting.
Earlier this month, the UK Defense Ministry said Russia’s 2024 budget relies on optimistic 22% revenue growth to fund 26% higher expenditure, but projected oil and gas revenue gains may fall short, with government having to weigh measures like less National Wealth Fund contributions or more taxes and debt.
Russian imports of nitrocellulose, a highly flammable cotton product central to gunpowder and rocket propellant manufacture, surged 70% in 2022, the first year of Moscow’s full-scale invasion of Ukraine, and midway through 2023 had amounted to 3,039 tons of the product, nearly double the 2021 level. Defense companies around the world have been grappling with ways to source nitrocellulose amid a shortage that has seen prices rise and created chokepoints for production. Only a few countries around the world produce nitrocellulose, since its primary use is in munitions and it is subject to international trade restrictions. Russia produces little nitrocellulose, the main ingredient in smokeless gunpowder used in artillery,
56 RUSSIA Country Report April 2024 www.intellinews.com