China is the main supplier of dual-use goods needed to run Russia’s military machine

China is the main supplier of dual-use goods needed to run Russia’s military machine
China has emerged as by far Russia's biggest supplier of dual-use inputs to supply the military machine, but has shied away from selling the Kremlin lethal weapons. / bne IntelliNews
By Ben Aris in Berlin November 16, 2023

Last month, Russian President Vladimir Putin visited Beijing to meet with his Chinese counterpart, Xi Jinping, as Ukraine's counteroffensive against Russian invaders stalled. Beijing has been a mainstay of support for Russia and while Xi has been very careful not to cross the red line of supplying the Kremlin with lethal aid, the torrent of machines, equipment, and manufactured goods crossing the border into Russia has been vital for the Russian military machine.

Open-source trade data indicates a surge in imports of Chinese-manufactured goods with crucial military applications. This material has played a significant role in Russia's ability to fortify its positions on Ukrainian soil and maintain its military's equipment and supplies for resisting counteroffensives, the Atlantic Council said in a report.

Most of these imports are classed as legitimate trade and not restricted by international sanctions against Russia, according to the report.

Chinese-made construction equipment has aided Russia in fortifying its positions in Ukrainian territory, especially during the construction of defensive fortifications in the early days of the war.

“Chinese vehicle exports to Russia may have prevented a catastrophic defeat for Russian military forces. During August and September 2022, Ukraine enjoyed successes in rolling back the Russian invasion, especially around the city of Kharkiv. Facing disaster, Russian forces began to assume a defensive posture. They constructed the so-called “Surovikin Line” (named for the Russian general who led the effort) of trenches and other defensive fortifications,” the Atlantic Council writes.

“Chinese excavator exports to Russia more than tripled in September 2022 when compared to prior-year levels and coincided with the construction of the Surovikin Line.”

A significant increase in the imports of Chinese vehicles, including super-heavy trucks, has likely supported Russia's military industry in producing vehicles essential for maintaining its combat capabilities and logistical lines.

A surge in imports of ball bearings from the PRC has potentially facilitated the production of tanks in Russia. Russian annual tank production has doubled from pre-war levels and now stands at 200 tanks, according to recent reporting from the New York Times. 

Chinese year-to-date total exports of ball bearings to Russia are up 345% from the same period in 2021. Chinese ball bearing exports to Kyrgyzstan, meanwhile, are up 2,492%, according to the Atlantic Council.

“While Chinese-made ball bearings are of lower quality than their Western equivalents, they are sufficient to sustain Russia’s armed forces in this phase of the war. Russia’s tanks are being employed for less demanding tactical tasks than earlier in the war, limiting their need for premium components,” the report states.

“Whereas tanks in the first phase of the conflict were employed for rapid and sustained offensive maneuvers over long distances, they are now being employed primarily for largely static defensive purposes and local counterattacks, reducing maintenance strain,” according to the report.

Chinese-made drones have also found their way into service in the Ukrainian campaign, and the PRC has provided high-tech components with military applications, such as avionics and fighter-jet engine parts.

Large-scale Chinese imports of trucks, essential for supplying Russian occupation forces, have been critical in maintaining Russia's war effort as rail and seaborne transit for resupply is largely unavailable.

The PRC's export of integrated circuits to Russia has also substantially increased, contributing to Russia's ability to sustain its war production despite international sanctions. As bne IntelliNews has reported, the technology sanctions on Russia have largely failed and it is importing more microchips now than before the war, via myriad intermediaries in the so-called friendly countries.  

China also indirectly facilitates the import of Western-made components with military applications into Russia, primarily by serving as the intermediary for Russian imports of semiconductors manufactured elsewhere.

According to the Kyiv School of Economics Institute’s research cited by the Atlantic Council, Western-made components account for most of the dual-use technology Russia imports from the PRC, and China is the dominant intermediary for Russian imports of semiconductors manufactured elsewhere.

While other countries also export materials to Russia, none match the scope and scale of China's contributions to sustaining Russia's war effort. One effect of this has been to accelerate mutual trade turnover, which has ballooned since the war started and is on course to top $200 billion this year.