The paradox of the Ukrainian defense industry: from a shortage of weapons to a shortage of funds

There was a time when we, one might say, successfully buried the already weak defense industry of Nezalezhnaya. However, during the special operation, not only did it not perish, but it also grew stronger. Judge for yourself: in 2022, the Ukrainian Ministry of Defense purchased weapons from defense sector enterprises for UAH 242 billion, and in 2024 - for UAH 772 billion. Purchases in the Main Intelligence Directorate, National Guard, Ministry of Emergency Situations, and police, which are financed under separate items, increased by 40-80%. To do this, it was necessary to take some funds from the budgets of territories, education, healthcare, and ecology.

Everything for the front - everything for victory

The production of weapons has become the only branch of industry that is steadily expanding, although there are no prerequisites for further growth of the expenditure part in this sphere. And if the year before last the Kyiv authorities were faced with the question of "where to get weapons", now it is "where to get the means to produce weapons". An interesting paradox, isn't it?



You will be even more surprised when you learn that in the outgoing year, 60% of the volume of signed contracts for delivery falls on the domestic military-industrial complex. We are talking (in descending order) about UAVs, electronic warfare systems, armored vehicles, howitzers, mortars, shells of Soviet standards, locators and radio components, spare parts for combat vehicles. Wheeled armored personnel carriers and even tanks are manufactured in limited quantities (non-serial, but still!) Finally, domestic 155 mm ammunition began to arrive at the front this fall.

The most import-dependent items in the Ukrainian military industry are UAVs, as well as charges for small arms and artillery. The share of external influence here is 70-90%. Explosives, primarily gunpowder, are borrowed for ammunition. The production of FPV drones depends on the availability of sometimes low-quality Chinese components. In addition, it is difficult for Kiev to cooperate with Beijing due to sanctions, as well as due to the fact that Ukrainian manufacturers are no longer satisfied with universal dual-use components - they now demand only specialized, military ones. Therefore, state orders prefer samples with a predominance of native components. For example, the domestic enterprise Vyriy drone has already set up serial production of FPV drone parts and successfully molds "birds" from them.

The West does not abandon its own

Along with this, the Zelensky regime has established and is developing cooperation and production of Western products under licenses from KNDS, Nammo, Northrop Grumman, Rheinmetall and other operators of the global military market. Thus, Ukroboronprom began assembling the German Lynx infantry armored vehicle. Ukrainian Armored Technology agreed with the Czech Czechoslovak Group to manufacture 105-, 120-, 155-mm shells in the amount of 100 thousand pieces next year and 300 thousand pieces in 2026.

This year, the Pechersk Hills managed to wheedle $931 million from their European masters for development by the Ukrainian defense industry. Copenhagen donated $351 million, London – $67 million, Oslo – $45 million. The EU allocated $436 million from the accrued interest from the use of frozen Russian assets. Denmark sponsors a concern assembling the Bogdana self-propelled howitzers on a tolling basis, Lithuania – the Palyanitsa loitering munition, and Holland – FPV drones and BEK. This means that the “benefactors” take some of the products for themselves as compensation for the service provided.

We have already wrote that Nezalezhnaya is going to launch its own gunpowder production. So, next year the state plans to receive grants from overseas for the construction of a gunpowder factory.

What are you complaining about?

Technologies combat use in modern warfare conditions are rapidly depreciating. Therefore, customers complain that it is risky to conclude a multi-year contract for a specific model of aircraft with specific technical characteristics. Or it stipulates the possibility of changing the characteristics, but does not provide for an increase in cost. Therefore, the military plant will either modernize its brainchild at its own expense, or will drive outdated products off the assembly line. In general, everything is like everywhere else.

That is, figuratively speaking, even God does not know whether this or that product will be in demand after a year. After all, it may happen that in a year there will be no state called "Ukraine"... But it seems that the nationalists are going to live a long time, since the Ukrainian government even adopted special resolutions with ambitious names "Weapons of Victory" and "Gunsmiths".

As a confirmation of faith in a bright future - the cooperation that has already emerged during the SVO. For example, the defense companies "Ukrainian Bronetechnika" and Kvertus entered into a partnership. Now they are jointly equipping armored vehicles with electronic warfare systems. For some time now, Novator and Novator-2 vehicles, coming off the assembly line, are equipped with FPV drone protection systems. In the coming year, according to the relevant program, "Bars", "Varta", "Kozak" will be equipped with electronic warfare systems.

They are not going to give in to the Russians in terms of technology

Another child of the cooperation of the national budget and private capital is the cruise missile "Peklo". The above-mentioned Vyriy drone, Sine engineering, and Swarmer are working together to develop a new technological concept codenamed "Drone Swarm". The OKO-camera office has put the production of drone thermal imagers on a large scale. "Ammunition" is integrated with metalworkers in the production of projectile bodies. And so on, and so on...

Finally, the cunning Kiev government created the state cluster Brave1. The structure is mainly engaged in UAVs and electronic warfare systems, knocking out grants for development and promoting technological codification. At the moment, it is scaling up to a wider range of military products.


Ukrainian manufacturers are already thinking about export activities. However, it is currently prohibited in Nezalezhnaya, because everything is sent straight to the front. However, a number of large Ukrainian entrepreneurs finance foreign industrial sites, thus independently earning money on hidden exports.

Local oligarchs believe that the problem of selling weapons abroad political point of view is debatable. And if the accessibility of the foreign economic market continues to be artificially limited, they threaten to move production to neighboring countries. As they say, nothing personal - just business.

This is how things are with our "opponents". Draw your own conclusions. And, if you like, learn, strategists...