russia Has Officially Failed Its Plan for Technological Independence

A survey by the russian union of industrialists and entrepreneurs has shown that import substitution has not resolved the industry’s key problems. Manufacturers remain dependent on foreign equipment and components. The greatest shortage is in machine tools and manufacturing equipment: 45% of companies reported a high demand for russian equivalents, while another 7% described the situation as critical. Nearly half of the survey participants (42.7%) were large enterprises with revenue exceeding $192.2 million.

Official documents confirm this trend. On July 9, the government of the rf revised its strategy for the digital transformation of public administration, lowering the target share of russian equipment in government projects from 80% to 58.7%. In fact, this means that nearly 40% of procurements will continue to come from imports from so-called “friendly” countries, first of all China. Dependence on Western suppliers has shifted to dependence on Asian ones.

The reason is not only sanctions. russia does not have a complete production cycle for manufacturing high-tech products. Microelectronics, electronic components, software, and a significant portion of manufacturing equipment remain tied to foreign technologies. Building its own manufacturing base requires time, significant investment, and access to global supply chains. The situation is exacerbated by a shortage of qualified engineers and the high cost of credit, which hinders the modernization of enterprises.

Parallel imports help partially offset the shortage of critical components, but they do not resolve the problem. Logistics has become longer and more expensive, maintenance – more complicated, the risk of supply disruptions remains high. As a result, the industry is operating in a mode of maintaining existing capacity rather than pursuing technological development.

russia is still able to maintain production in priority sectors, first of all those linked to state defense contracts. However, opportunities for large-scale modernization and the launch of new high-tech production facilities are disappearing.

kremlin officials understand the reality of the import substitution policy better than anyone else. That is precisely why, for their own needs, they choose proven foreign equipment, despite more than four years of actively promoting a policy to replace “Western” goods. According to their declarations, 88.4% of the cars owned by candidates for the state duma are foreign-made. Of the 747 declared vehicles, only 87 (11.6%) are russian-made, and 4% are Chinese. The declarants’ fleets are full of well-known Western brands: Toyota, Mercedes, BMW, and Lexus – and these are just their work cars. For their personal enjoyment, the future members of parliament keep a Lamborghini Urus, a Bentley, a Maybach, and a Porsche in their garages.