PONARS Eurasia
  • About
    • Contact
    • Membership
      • All Members
      • Core Members
      • Collegium Members
      • Associate Members
      • About Membership
    • Ukraine Experts
    • Executive Committee
  • Policy Memos
    • List of Policy Memos
    • Submissions
  • Podcasts
  • Online Academy
  • Events
    • Past Events
  • Recommended
  • Ukraine Experts
Contacts

Address
1957 E St NW,
Washington, DC 20052

adminponars@gwu.edu
202.994.5915

NEWSLETTER
Facebook
Twitter
YouTube
Podcast
PONARS Eurasia
PONARS Eurasia
  • About
    • Contact
    • Membership
      • All Members
      • Core Members
      • Collegium Members
      • Associate Members
      • About Membership
    • Ukraine Experts
    • Executive Committee
  • Policy Memos
    • List of Policy Memos
    • Submissions
  • Podcasts
  • Online Academy
  • Events
    • Past Events
  • Recommended
  • Ukraine Experts
DIGITAL RESOURCES
digital resources

Bookstore 📚

Knowledge Hub

Course Syllabi

Point & Counterpoint

Policy Perspectives

RECOMMENDED
  • The Russia Program at GW (IERES)

    View
  • The Evolving Concerns of Russians after the Invasion | New Voices on Eurasia with Sasha de Vogel (March 9)

    View
  • PONARS Eurasia Spring Policy Conference (March 3)

    View
  • Ukrainathon 2023 (Feb. 24-25)

    View
  • How Putin has shrugged off unprecedented economic sanctions over Russia’s war in Ukraine – for now

    View
RSS PONARS Eurasia Podcast
  • The Putin-Xi Summit: What's New In Their Joint Communique ? February 23, 2022
    In this week’s PONARS Eurasia Podcast, Maria Lipman speaks with Russian China experts Vita Spivak and Alexander Gabuev about the February meeting between Vladimir Putin and Xi Jinping, and what it may tell us about where the Russian-Chinese relationship is headed.
  • Exploring the Russian Courts' Ruling to Liquidate the Memorial Society January 28, 2022
    In this week’s PONARS Eurasia Podcast, Maria Lipman chats with scholars Kelly Smith and Benjamin Nathans about the history, achievements, and impending shutdown of the Memorial Society, Russia's oldest and most venerable civic organization, and what its imminent liquidation portends for the Russian civil society.
  • Russia's 2021 census and the Kremlin's nationalities policy [Lipman Series 2021] December 9, 2021
    In this week’s PONARS Eurasia Podcast, Maria Lipman chats with social scientist Andrey Shcherbak about the quality of the data collected in the recent population census and the goals of Vladimir Putin's government's nationalities policy
  • Active citizens of any kind are under threat [Lipman Series 2021] November 5, 2021
    In this week’s PONARS Eurasia Podcast, Maria Lipman chats with Alexander Verkhovsky about the Kremlin's ever expanding toolkit against political and civic activists, journalists, and other dissidents.
  • Russia's Legislative Elections followup [Lipman Series 2021] October 4, 2021
    In this week’s PONARS Eurasia Podcast, Maria Lipman chats with Tanya Lokot and Nikolay Petrov about the results of Russia’s legislative elections and about what comes next.
  • Why Is the Kremlin Nervous? [Lipman Series 2021] September 14, 2021
    In this week’s PONARS Eurasia Podcast, Maria Lipman chats with Ben Noble and Nikolay Petrov about Russia’s September 17-19 legislative elections, repressive measures against electoral challengers, and whether to expect anything other than preordained results.
  • Vaccine Hesitancy in Russia, France, and the United States [Lipman Series 2021] August 31, 2021
    In this week's PONARS Eurasia Podcast episode, Maria Lipman chats with Denis Volkov, Naira Davlashyan, and Peter Slevin about why COVID-19 vaccination rates are still so low across the globe, comparing vaccine hesitant constituencies across Russia, France, and the United States.  
  • Is Russia Becoming More Soviet? [Lipman Series 2021] July 26, 2021
      In a new PONARS Eurasia Podcast episode, Maria Lipman chats with Maxim Trudolyubov about the current tightening of the Russian political sphere, asking whether or not it’s helpful to draw comparisons to the late Soviet period.
  • The Evolution of Russia's Political Regime [Lipman Series 2021] June 21, 2021
    In this week's episode of the PONARS Eurasia Podcast, Maria Lipman chats with Grigory Golosov and Henry Hale about the evolution of Russia's political regime, and what to expect in the lead-up to September's Duma elections.
  • Volodymyr Zelensky: Year Two [Lipman Series 2021] May 24, 2021
    In this week's episode of the PONARS Eurasia Podcast, Maria Lipman chats with Sergiy Kudelia and Georgiy Kasianov about Ukrainian President Zelensky's second year in office, and how he has handled the political turbulence of the past year.
  • Commentary | Комментарии

The Future of Oboronservis

  • January 4, 2013
  • Dmitry Gorenburg

 

The most recent issue of Moscow Defense Brief has an interesting article (gated) by Vedomosti journalist Aleksey Nikolsky on the future of Oboronservis after Serdyukov’s ouster. Oboronservis was set up in 2008 as an integrated holding  company that would run the Russian military’s non-core operations, including logistics, repairs, and maintenance. It gradually became a major player in the sale of surplus (or ostensibly surplus) military property, and it was allegations of corruption in this area that launched the scandal that was used as a pretext to fire Serdyukov last fall.

The official purpose of Oboronservis was to allow the MOD to outsource non-critical functions. Nikolsky notes that while many thought that these functions would be contracted out to civilian contractors in a manner similar to models used in Western militaries, the Russian MOD chose instead to transfer its non-critical operations to Oboronservis subsidiaries. These subsidiaries then in turn were authorized to use private contractors for their operations, though the only areas where outsourcing was fully implemented were catering and cleaning. However, even in these areas, the subsidiaries have run up large debts to the contractors, at least in part as a result of the embezzlement of allocated funds by employees of Oboronservis or its subsidiaries. Nikolsky believes that the major subsidiaries will most likely be split off from the company or else the MOD will take over their assets and return to the old system. Opponents of outsourcing have claimed that living conditions in compounds run by the subsidiaries have deteriorated, even as spending on outsourced functions such as catering has increased substantially. Other critics note that outsourcing is problematic because it cannot be relied upon in times of war. Since the military would have to rely on its own mobile support units when troops are in the field, it is difficult to generate efficiencies that could be available if such units could be eliminated. The Oboronservis proposal to solve this problem by making commercial contractors part of the Russian military reserve and mobilizing them in the event of military action does not (to me) seem very realistic, given that most of the cooks and servers that provide the catering are middle-aged women and would not have a particularly easy time fitting into the Russian military structure.

The second (and much less publicized) goal of Oboronservis was to provide the MOD with a channel for importing modern Western weaponry independent from Rosoboronexport and Rostekhnologii. According to Nikolsky, this function was to become gradually more prominent. There are two arms import programs currently being run by Oboronservis. The first is the licensed assembly of 3,000 Iveco LMV M65 armored vehicles in Voronezh at a cost of $1.5 billion. The second program is for Rheinmetall to build an army training center in Mulino, Nizhny Novgorod oblast at a cost of $100 million. Nikolsky believes that while the second program is unlikely to be modified by the new regime, the Iveco contract may be reduced. Two other potential deals — for Israeli UAVs and for helicopters from Eurocopter have not gone forward, in part because of lobbying by opponents in the domestic arms industry. Nikolsky believes that Sergei Shoigu, the new defense minister, is largely supportive of the idea of importing military equipment from abroad. The Emergencies Ministry, which Shoigu headed until last spring, was the first Russian government agency to buy foreign helicopters. Shoigu has repeatedly complained about excessively high prices charged by Russian aircraft manufacturers and has suggested that foreign competition may be a way to force them to lower their prices.

Finally, Nikolsky argues that Oboronservis is likely to keep the former MOD repair plants, which have been consolidated under the Aviaremont and Remvooruzheniye subsidiaries. Just the aircraft repair component provided one quarter of the company’s total revenues in 2011. Shoigu has already indicated that outsourcing of repairs and maintenance is likely to continue, with an emphasis on awarding contracts to the original manufacturers whenever possible.

It seems to me that this article implies that the new regime will make only limited changes to the outsourcing model. While changes in logistics services, and especially catering, may be contemplated, I don’t think the military is particularly eager to bring back conscript cooks and the low quality food they used to produce. Most likely, there will be an effort to limit the company’s ability to sell property, as part of an effort to reduce corruption. As usual, this will  result  in a shift in illicit financial flows, rather than their elimination.

Dmitry Gorenburg is a Senior Analyst at CNA blogging for PONARS Eurasia on military and security affairs in Russia and Eurasia. This comment is also available on Russian Military Reform.

 

Related Topics
  • Gorenburg
Previous Article
  • In the News | Hовости

Why Russia Won’t Help on Syria

  • January 1, 2013
  • Samuel Charap
View
Next Article
  • Recommended | Рекомендуем

От федерации корпораций к федерации регионов

  • January 7, 2013
  • Nikolay Petrov
View
You May Also Like
View
  • Commentary | Комментарии
  • Recommended | Рекомендуем

The Desire to Possess: Russia’s War for Territory

  • Irina Busygina
  • February 8, 2023
View
  • Commentary | Комментарии
  • Recommended | Рекомендуем

Kyiv-Washington Relations in Times of Colossal War: The Ultimate Test of a Strategic Partnership

  • Volodymyr Dubovyk
  • January 11, 2023
View
  • Commentary | Комментарии
  • Recommended | Рекомендуем

Prevailing Soviet Legacies

  • Irina Busygina and Mikhail Filippov
  • December 27, 2022
View
  • Commentary | Комментарии
  • Recommended | Рекомендуем

In Russia’s Nuclear Messaging to West and Ukraine, Putin Plays Both Bad and Good Cop

  • Simon Saradzhyan
  • December 23, 2022
View
  • Commentary | Комментарии
  • Recommended | Рекомендуем

Ukraine’s Asymmetric Responses to the Russian Invasion

  • Nurlan Aliyev
  • July 28, 2022
View
  • Commentary | Комментарии
  • Recommended | Рекомендуем
  • Territorial Conflict

Dominating Ukraine’s Sky

  • Volodymyr Dubovyk
  • March 5, 2022
View
  • Commentary | Комментарии
  • Recommended | Рекомендуем

Russian Anti-War Protests and the State’s Response

  • Lauren McCarthy
  • March 4, 2022
View
  • Commentary | Комментарии

Путин и Лукашенко

  • Konstantin Sonin
  • August 29, 2020

Leave a Reply Cancel reply

Your email address will not be published. Required fields are marked *

PONARS Eurasia
  • About
  • Membership
  • Policy Memos
  • Recommended
  • Events
Powered by narva.io

Permissions & Citation Guidelines

Input your search keywords and press Enter.