This photograph taken on 21 October 2015 shows the Vietnam Air Force's Russian-made Sukhoi Su-30MK2 multirole fighter aircraft. (Photo: Flickr)

Long Reads

The Russia-Ukraine War and its Potential Impact on Russia’s Arms Sales to Southeast Asia


Russia has been the largest exporter of arms to Southeast Asia over the past two decades but the value of its defence sales to the region has fallen sharply since its annexation of Crimea in 2014. Russia’s invasion of Ukraine will only exacerbate this downward trend.


Since President Vladimir Putin took office in 2000, Russia’s defence-industrial sector (DIS) has played a key role in the country’s military modernisation programme, enabling the Kremlin to pursue a more assertive foreign policy in the post-Soviet space, Europe and the Middle East. In addition, Russia’s DIS provides employment for over a million workers and generates foreign currency revenues through the sale of military hardware to overseas customers.

Today, Russia is the world’s second largest arms exporter after the US. In Southeast Asia, however, it ranks number one. Between 2000 and 2021, the value of Russia’s arms exports to the region was US$10.87 billion, followed by the US (US$8.4 billion), France (US$4.3 billion), Germany (US$2.94 billion) and China (US$2.9 billion).

Russia’s most important defence customers in Southeast Asia are Vietnam, Myanmar, Malaysia and Indonesia (see Table 1). Russia has offered for sale to these countries a full range of military equipment (from fighter jets and submarines, to tanks and small arms) at prices which are cheaper than those manufactured in the US and Europe. In addition, Russian defence companies have been willing to accept part-payment in commodities, pursue joint production, and, unlike the US and European countries, they do not take into consideration a country’s human rights record when selling arms. Moreover, some countries, such as Vietnam until 2016, and Myanmar, Cambodia and Laos to date, have been unable to procure Western-manufactured arms due to sanctions, leaving them little choice but to buy from Russia or China.

Figure 1 shows arms exports to the region by the top five country suppliers over the past 21 years. While the value of sales from all five countries has fluctuated, Russia’s arms sales to Southeast Asia have declined sharply over the past seven years―from US$1.2 billion in 2014 to just $89 million in 2021. Four main reasons account for this.

First, Moscow’s annexation of Crimea and support for separatist forces in the Donbass region of Ukraine in 2014 led the US and European countries to impose sanctions and export controls on Russia’s DIS. In addition, the conflict brought to an abrupt end longstanding and extensive cooperation between Ukrainian and Russian defence companies, especially in the production of engines for surface ships, helicopters and aircraft. As a result of Moscow’s actions in Ukraine, the DIS’ manufacturing processes were disrupted and its reputation for quality and timeliness of deliveries was negatively affected.

Second, Russia’s biggest customer in Southeast Asia, Vietnam, has paused its military modernisation programme, partly because of concerns over Moscow’s ability to fulfill orders but also due to an anti-corruption drive. Vietnam’s last defence orders with Russia were in 2016 (for 64 T-90 tanks) and 2019 (for 12 Yak-130 training/light combat aircraft). To make up for falling orders in Vietnam, Russia’s DIS has tried to penetrate new markets, including US allies Thailand and the Philippines, but with limited success. Following the February 2021 coup in Myanmar, Russia moved quickly to strengthen relations with the junta, with a view to increasing defence sales to the country and displacing China as its primary arms vendor. Although the junta has responded positively to Moscow’s overtures―Myanmar was the only ASEAN member to explicitly endorse Russia’s invasion of Ukraine ― it has yet to place any major defence orders with Russia since the coup. Myanmar’s government has alluded to the potential problems the Ukraine conflict may cause to future Russian arms exports to the country. If Russia cannot fulfill the junta’s military requirements, Myanmar may be forced to increase its reliance on China.

Third, in 2017 the Trump administration signed into law the Countering America’s Adversaries Through Sanctions Act (CAATSA). CAATSA allows the US government to impose sanctions against individuals or countries that have commercial dealings with Russia’s DIS, although the President can ask Congress for a waiver on national security grounds. The Trump administration used CAATSA selectively, sanctioning only entities in China and Turkey. However, the threat of CAATSA sanctions appears to have been the decisive factor in the Philippines’ decision not to pursue a defence contract with Russia for the provision of two submarines in 2020, and Indonesia’s decision to cancel an order for 11 Russian-made SU-35 Flanker fighter jets in December 2021 in favour of US and French fast jets.

Fourth, Russia’s DIS has faced growing competition from American and European defence corporations, as well as relative newcomers from countries such as China and South Korea.


Russia’s invasion of Ukraine on 24 February 2022 will make it difficult for the country’s DIS to revive sales, and will in all likelihood lead to a reduction in Moscow’s arms exports to Southeast Asia. This is due to the imposition of tighter sanctions and export controls by a number of countries, the reputational damage caused by the poor performance of Russia’s armed forces in Ukraine, and its need to replenish battlefield losses. Over the long term, if Russia becomes more dependent on China, Beijing may pressure Moscow to reduce sales of certain kinds of weaponry to Vietnam.

Sanctions and Export Controls

Following Moscow’s invasion of Ukraine, the US, European Union (EU) and Britain tightened economic pressure on Russia by imposing new and more wide-ranging economic sanctions and stricter export controls on dual-use technologies. They were soon joined by several advanced industrial economies in Asia including Japan, South Korea, Taiwan and Singapore. These measures are designed to punish Russia for its military aggression in the hope that economic hardship will force the Kremlin to withdraw its forces from Ukraine. These measures will impact Russia’s DIS in two important ways.

First, sanctions on Russian banks, and their exclusion from the Society for Worldwide Interbank Financial Telecommunication (SWIFT) international payment network, will make it harder for the country’s DIS to conduct financial transactions with overseas clients. An early indication of the problems faced by Moscow became clear when the majority of Russian defence companies―including state-run Rosoboronexport which is responsible for the country’s defence sales― were forced to withdraw from the 17th Defence Services Asia (DSA) Exhibition and Conference held in Kuala Lumpur from 28 to 31 March because they could not pay the exhibition fees. At the 2018 DSA, 14 Russian defence companies had exhibited their products. For the same reason, no Russian defence firms participated in the Asian Defense And Security (ADAS) exhibition in Manila in late April.

Regarding CAATSA, as yet, there is no indication that the Biden administration will apply CAATSA sanctions more extensively against countries that buy arms from Russia, including Vietnam. At this point in time, it seems unlikely that Washington would impose CAATSA sanctions against Vietnam. The Biden administration has made improving ties with Vietnam, and upgrading their relationship to a strategic partnership, a priority in Southeast Asia. In addition, as noted earlier, Vietnam has not placed any major orders with Russia over the past few years, though it is reportedly interested in buying additional Russian-made fighter aircraft such as the SU-35 and possibly even fifth-generation SU-57 or SU-75 ‘Checkmate’ stealth fighters. However, Washington may use the prospect of CAATSA sanctions to persuade Hanoi to procure non-Russian arms, as it did with Indonesia. But even if Vietnam does decide to proceed with further arms purchases from Russia, the Biden administration could request a congressional waiver in view of Hanoi’s disputes with Beijing in the South China Sea.

The war in Ukraine is a public relations disaster for Russia’s DIS. Images of wrecked and abandoned vehicles call into question the quality and reliability of Russian-manufactured military hardware.

Second, export controls imposed on Russia will restrict its DIS access to advanced technologies critical in the manufacture of modern military hardware and which Russia itself does not produce and cannot easily purchase from other countries. These include semiconductors, microelectronics, machine tools and software. This will not only affect the production of military equipment for use by Russia’s armed forces and overseas buyers, but also the provision of spare parts, munitions and upgrade packages to existing customers. As a consequence, foreign buyers may decide to switch to more reliable sources of military hardware. 

Reputational Damage and Recapitalising Russia’s Armed Forces

Contrary to the expectations of Western analysts―and presumably the Kremlin itself―Russia’s military campaign in Ukraine has to date gone very badly. In the opening stages of the conflict, Russia’s armed forces failed to capture the capital Kyiv and replace the government of President Volodymyr Zelenskyy with a pro-Moscow regime. Russia’s air force failed to destroy Ukraine’s air defences and gain air superiority. Moscow failed to anticipate the strong resistance of the Ukrainian armed forces and people, and the Zelenskyy government has gained the upper hand in the information war. Russian tanks, armoured vehicles and trucks have been destroyed in large numbers. Estimates of Russian military personnel killed in action range from 10,000 to 20,000, plus tens of thousands of battlefield casualties.

The poor performance of Russia’s armed forces can be attributed to a number of factors, including poor planning and leadership, inadequate training, low morale among Russian troops and weak logistical support which has left soldiers on the frontlines without food, fuel and munitions. The Russian army’s high attrition rate of military vehicles is partly the result of the Ukrainian army’s effective use of Western-supplied shoulder-fired missiles (such as US-made Javelins and the Anglo-Swedish Next Generation Light Anti-tank Weapon) and Turkish-manufactured Bayraktar TBT drones. Russian vehicles also appear to have been poorly constructed and maintained. On 14 April the Ukrainian armed forces used anti-ship cruise missiles to sink the guided-missile cruiser Moskva in the Black Sea, the largest naval vessel to be destroyed since World War Two. Endemic corruption within the armed forces―resulting in modernisation funds being misappropriated― may also have been a factor in its poor performance.

Russia would be loath to reduce military sales to Vietnam as it is the Kremlin’s closest defence partner in Southeast Asia and pressure by Beijing to do so might open a potential fault line in Russia-China relations. If Moscow does reluctantly agree to Beijing’s requests, it would be a major blow to Vietnam as over 80% of its military hardware is manufactured in Russia …

The war in Ukraine is a public relations disaster for Russia’s DIS. Images of wrecked and abandoned vehicles call into question the quality and reliability of Russian-manufactured military hardware. In addition, much of the equipment deployed by Russia is based on Soviet-era designs (such as the T-90 tank which is based on the 50-year old T-72) and highlights the lack of innovation within the country’s DIS. Some of the military equipment which has been destroyed on the battlefield has been purchased by Southeast Asian countries. These include tanks (Vietnam and Laos), infantry fighting vehicles and armoured personnel carriers (Indonesia), military attack and transport helicopters (Indonesia, Malaysia, Myanmar, the Philippines and Vietnam) and air defence systems (Myanmar). Russia’s most lucrative defence export to the region is combat aircraft, including SU-27/30 Flankers and MiG-29 Fulcrums. The reputation of Russian manufactured jets took a hit on 7 April when one of its most advanced fighters, a fourth-generation-plus SU-35, was shot down by an anti-aircraft missile over Ukraine.  As mentioned previously, Vietnam has reportedly considered purchasing the SU-35, though to what extent this incident will influence its procurement decision remains to be seen.

The high attrition rates of equipment suffered by Russia’s armed forces may have other implications for the country’s defence exports. To replenish its heavy losses, Moscow may direct the DIS to divert military equipment manufactured for export to recapitalise its own armed forces. This will result in delivery delays and possibly cancellations, further damaging the DIS’ reputation for reliability.

The China Factor

China has refused to condemn Russia’s invasion of Ukraine and instead blamed the conflict on NATO’s eastward expansion. As the war looks set to drag on for months and possibly years, and sanctions increasingly disrupt Russia’s economy, Moscow’s dependence on Beijing may deepen. Although Russia’s invasion violates a number of China’s cherished core foreign policy principles (including respect for the sovereignty, territorial integrity and independence of states), Beijing will probably provide Russia with economic support and military assistance in the form of equipment and munitions. In return, China will seek quid quo pros, probably including discounted energy imports, increased access to the Russian DIS’ most sensitive military technology and greater support for its ‘core interests’ in Asia such as Taiwan and the South China Sea. On the South China Sea, Beijing may prevail upon Moscow to draw-down its commercial energy operations in Vietnam’s exclusive economic zone (as Russia’s biggest energy company Rosneft has already done) and phase out sales of offensive weaponry to Hanoi that complicate China’s irredentist aims in the South China Sea. Russia would be loath to reduce military sales to Vietnam as it is the Kremlin’s closest defence partner in Southeast Asia and pressure by Beijing to do so might open a potential fault line in Russia-China relations. If Moscow does reluctantly agree to Beijing’s requests, it would be a major blow to Vietnam as over 80% of its military hardware is manufactured in Russia and its armed forces will be dependent on Russia’s DIS for spare parts, upgrades and munitions for many years to come. Although changing suppliers would be very costly and time consuming, the strengthening of the Russia-China nexus as a result of the war will likely force Hanoi to seriously consider alternative sources of arms imports.


Russia’s invasion of Ukraine is likely to create severe problems for its DIS, resulting in falling overseas arms sales, including to Southeast Asian countries. Sanctions will make it difficult for Russian defence companies to receive payments from foreign customers, and export controls will severely restrict their access to high-tech components. The Russian armed forces’ dire performance in Ukraine has damaged the reputation of Russian-manufactured equipment, and export orders may be diverted to replenish battlefield losses. The DIS will look for workarounds, including closer collaboration with defence companies in countries that have not imposed sanctions and export controls on Russia, including in China and India. Moscow may be more willing to accept larger part payments in commodities from countries such as Vietnam and Myanmar. Russia’s problems will create market opportunities for defence companies in other countries, such as Europe, Israel, Turkey, China and South Korea.

This is an adapted version of ISEAS Perspective 2022/47 published on 5 May 2022. The paper and its references can be accessed at this link.

Ian Storey is Senior Fellow at ISEAS – Yusof Ishak Institute.