Defense Drives Russia’s Industrial Growth as Civilian Production Contracts
Defense Drives Russia’s Industrial Growth as Civilian Production Contracts

Defense Drives Russia’s Industrial Growth as Civilian Production Contracts

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Diverging Reports Breakdown

Defense Drives Russia’s Industrial Growth as Civilian Production Contracts

Russia’s industrial sector grew by 1.6% in May and 1.8% over the last year after accounting for seasonal factors, state statistics service Rosstat has reported. Results come as civilian industries have reported widespread contractions, leading analysts to warn that Russia’s economy has become disproportionately driven by the military-industrial complex.

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Russia’s industrial sector, fueled by the defense sector, grew by 1.6% in May and 1.8% over the last year after accounting for seasonal factors, state statistics service Rosstat has reported.

The results come as civilian industries have reported widespread contractions, leading analysts to warn that Russia’s economy has become disproportionately driven by the military-industrial complex in the fourth year of its invasion of Ukraine.

Tverdye Tsifr (“Hard Numbers”), a Telegram channel that reports on financial data, noted a 42% surge in the output of “miscellaneous transport equipment” and a 14% increase in finished metal products over the last month, compensating for weaker performance in March and April.

Clothing production increased by 12%, and production of electronic and optical products, computers and pharmaceuticals rose by 9%.

Analysts at Raiffeisenbank estimated that the machinery-building sector expanded by 7%, while all the other parts of the industrial sector contracted by a combined 0.4%.

Analysts from Russia’s largest private bank Alfa-Bank described the May results as evidence of a highly segmented economy.

Previously, “when civilian growth was weak and defense growth was robust, all sectors expanded to some degree,” wrote MMI, a Telegram channel that analyzes Russian and global microstatistics, of the new divergence between military and civilian industry.

“Now, all civilian industries have recorded declines, while defense output has accelerated. There are not enough resources to go around for everyone, so someone has to cut back,” it said.

Source: Themoscowtimes.com | View original article

Source: https://www.themoscowtimes.com/2025/06/27/defense-drives-russias-industrial-growth-as-civilian-production-contracts-a89587

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