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12 August 2022

SILICON LIFELINE


On the evening of 29 July, Russian rockets hit the southern Ukrainian city of Mykolaiv, killing five people and injuring another seven. The Ukrainian military states that the city came under attack from the Tornado-S multiple rocket launcher system.

Images of the aftermath show damage to a number of residential buildings. The control module from one of these 300mm rockets was discovered relatively intact in the middle of a children's playground.

Earlier this year, RUSI staff conducting fieldwork in Ukraine inspected a recovered control module from the same rocket system, which possesses a sophisticated onboard satellite-guidance system to ensure that the rocket is accurate up to a range of 120 km. A close examination of the satellite-guidance system revealed that several of its critical microelectronics were produced by US companies.

RUSI staff and partners inspected 27 Russian weapons systems and pieces of military equipment lost or expended since the beginning of Russia’s full-scale invasion of Ukraine in February 2022.

In partnership with Reuters, RUSI identified at least 450 unique microelectronic components inside these systems that were produced by companies based in the US, Europe and East Asia.

The preponderance of foreign-made components inside these systems reveals that Russia’s war machine is heavily reliant on imports of sophisticated microelectronics to operate effectively.

This is despite persistent efforts by the Russian government to replace imports – in all aspects of its economy, including the military sector – with domestically produced materials in order to withstand international sanctions.

Of the 450 components found by RUSI in Russian military systems, 318 appear to have been made by US companies. Components from Japan, Taiwan, Switzerland, the Netherlands, Germany, China, South Korea, the UK, Austria and others were also present in the equipment examined by the research team.

RUSI’s analysis of these microelectronic components reveals that the vast majority appear to have been designed and manufactured by 57 US-based companies. However, over 200 of the components appear to have been manufactured by only 10 of these companies.

The possibility that some components bearing the logos of well-known Western and Asian microelectronics brands are counterfeits cannot be discounted. Yet, Russia’s well-documented historical dependence on Western technology, and the critical role that some of the components play in the effective operation of the systems in which they were found, has led the research team to assume that the components are likely genuine.

Products bearing the logo of Dallas-based microelectronics producer Texas Instruments were the most numerous among the US-made components reviewed by RUSI. In total, 51 unique Texas Instruments components appeared in the Russian military systems and equipment examined by the research team.

Components apparently produced by Texas Instruments were discovered in the KUB-BLA ‘kamikaze’ UAV, an E95M target drone, an Orlan-10 UAV, and a number of radio sets used by the Russian Army.

Among the 450 components, approximately 18% are covered by the US export control regime for their possible application in military systems.

Such export-controlled components have potential military applications and are assigned an Export Control Classification Number (ECCN). Items with an ECCN would have required a US government license for export to Russia, even before the 2014 invasion of Crimea.

Items that were not considered dual-use would have fallen under an EAR99 classification, meaning they did not require a license for export to Russia before the 2022 invasion.

However, exporters would still have been required to ensure that these items were not being deployed for military end use. The presence of a large number of EAR99- and some ECCN-classified items in Russian military equipment suggests that these components were either purchased by military equipment manufacturers from distributors in Russia, that they were procured under fake end-user certificates, or that they were diverted for military applications at a later point.

But Russia – and the Soviet Union before it – has a long history of illicitly procuring Western technology for integration into its military systems, with operations often involving Russian intelligence and security services.

Russian and Soviet intelligence and security services have been engaged in efforts to acquire sophisticated Western technology for decades. The KGB’s Line X – part of Directorate T, which was responsible for the agency’s collection of scientific and technical intelligence – is one example of these efforts. Operating out of embassies of the Soviet Union, hundreds of Line X officers were tasked specifically to acquire Western technology, including microelectronics.

With support and data from the Altana Atlas, RUSI examined nearly one million instances of microelectronics and microelectronic-related imports into Russia between 2017 and 2022. In some instances, it appears that Western components may have been manufactured in – or transshipped through – third countries.

Countries identified in the trade data as exporters of microelectronic-related products include China, the US, Germany and the UK.

The practice of transshipping goods through third countries is a common tactic used by procurement agents to obfuscate the real receiver of sensitive and controlled goods.

In June 2022, the US Treasury sanctioned three individuals and a Hong Kong company named EMC Sud Limited for allegedly operating as part of a covert procurement network linked to the Russian FSB. One of the sanctioned individuals was reportedly covertly sourcing electronics for the Russian defence industrial base from the US, Japan and Europe.

Russia’s invasion of Ukraine has not gone to plan, and the country’s military is having to expend large volumes of its weapons and equipment for small gains. Considering the preponderance of components manufactured in the West and East Asia in these systems, Russia does not have a clear alternative for the production of analogous components domestically, nor would import substitution be enough to offset the volumes required to replace those expended or lost in Ukraine.

As a result, the country may have to either design or produce less capable replacements, or engage in sanctions evasion activities to acquire the necessary components. Understanding how Russia evades sanctions to import critical technology provides the opportunity for a multinational effort to curtail the replacement of Russia's tools of military aggression.

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