How Western technology is fueling Russia's war

Almost two years after the start of the war, Western components continue to end up in the tanks and missiles Putin is using to terrorize Ukraine via hundreds of front companies. The EU arms embargo is failing: the Russian secret services are playing cat and mouse with Europe.

The cruise missile that hit a block of flats in the small Ukrainian town of Uman on April 28 was hardly any different from the thousands of other missiles that Vladimir Putin has been firing at the country's civilian infrastructure since the beginning of his invasion of Ukraine. The wave of attacks with almost two dozen projectiles, fired from strategic bombers over the Caspian Sea, killed 23 people, according to Ukrainian figures. In their beds at dawn, including four children.

However, the Kh-101 flying bomb, NATO code name "Kodiak", which used 450 kilograms of explosives to level part of the nine-storey house hundreds of kilometers behind the front line that morning, could not have hit its target without a crucial component. According to research by the "FAS", the chips in the on-board computer that guided the deadly cargo to its target did not come from a Russian weapons manufacturer. But from the German manufacturer Infineon. When asked by the "FAS", Infineon CEO Jochen Hanebeck regretted that some of his chips could have reached Russia despite sanctions. However, his company could not help it: immediately after Putin's attack, the company withdrew from the Russian market - and the current supply chains could not be fully traced.

The Russian military repeatedly hits power plants, shopping centers and residential buildings in Ukraine with such weapons. And even almost two years after Putin's invasion, the country's civilian population continues to be terrorized with the help of American, European and German high-tech. Despite countless rounds of sanctions, microchips and other dual-use goods produced in the West continue to enter Putin's empire unhindered. Without this constant supply of critical components, the Russian war machine would not be able to deliver the tanks, cruise missiles and drones that the Kremlin needs. If the West could cut off the supply routes, the war would be over quickly. But Europe and the USA are unable to find any real means of countering the secret smuggling.

Missile terror with Western high technology

"It's all imported. Apart from the assembly, the markings and the serial numbers, there is nothing Russian here," Deutsche Welle quotes the head of a Ukrainian military unit that analyzes the components of launched Russian missiles in an article on the "Kodiak" on-board computer. The Russians knew that they were being watched, says the man, and had "started to file out the serial numbers from the chips" in order to conceal the delivery routes.

According to the FAZ and the British think tank RUSI, the "Kodiak", one of the most modern Russian cruise missiles, not only contains electronics from Infineon and its US subsidiary Cypress. It also contains an Intel processor and chipsets from Analog Devices, Texas Instruments and Xilinx. RUSI has identified a total of 450 Western components in the Kremlin's most modern weapons - from cruise missiles to radar systems and navigation systems.

Western microchips have been indispensable for most Russian weapons since the Cold War. Instead of building up its own semiconductor industry, Russia made the strategic decision back in Soviet times to steal Western microchip technology and bypass export controls via middlemen - in other words, to smuggle the components in. The KGB even had its own department for this - "Line X". The importance that the procurement of Western components still has in Russian military doctrine today is illustrated by one person: Sergei Chemezov, head of the largest Russian arms company Rostec, is an old companion of Vladimir Putin. In the 1980s, they served together in the KGB office in Dresden.

According to the independent Russian online medium "Verstka", Russia imported Western microchips worth more than 500 million dollars in the first half of the year alone. The Russian investigative journalists analyzed secret Russian customs data for this purpose. The majority of the components came from the US manufacturers Intel (169 million dollars), Analog Devices (98 million dollars) and Xilinx (75 million dollars), followed by Microchip Technology (42 million dollars), Texas Instruments (38 million dollars) and Infineon (28 million dollars).

Russian agents buy in the middle of Europe

US companies and the German chip giant are thus the most important suppliers to the Russian defense industry in the midst of the war. According to the Kiev School of Economics, imports have almost reached pre-war levels again. Even though the direct sale of electronics to Russia is of course prohibited, Moscow is easily circumventing the arms embargo via ex-Soviet republics such as Kazakhstan, Tajikistan and other third countries such as the United Arab Emirates. Hundreds of front companies are in business.

The vast majority of deliveries are made via China. According to "Verstka", the three largest importers of Intel chips are all based in Hong Kong. Of the 25 largest importers of microchips to Russia, 11 have direct supply relationships with defense companies. As long as the manufacturers in Europe and the USA deliver to non-sanctioned Chinese dealers, they are not in breach of the Western embargo. Many may not even know that their products end up in Russian drones and missiles. But the same cannot be said of all Western companies.

"What gets less attention is how Russian procurement networks often target smaller, specialized companies in Europe to acquire high-end equipment that cannot be easily sourced elsewhere," writes RUSI. Chip and specialist companies have been primary targets for Russian intelligence services since Soviet times. This has not changed since the fall of the Berlin Wall. And certainly not with the invasion of Ukraine.

The secret services rarely succeed in thwarting the operations of Putin's agents. French businessman Marc R., for example, was head of the French semiconductor manufacturer Ommic until his indictment in March. A photo on a yacht in the Mediterranean was apparently his undoing. According to the Financial Times, it shows a man who R. later claimed he only knew by his first name "Maxim". According to the newspaper, Maxim Ermakov is said to have bought the special circuit boards from Ommic, which are used in French tanks and fighter planes, for Istok, a subsidiary of the Russian arms company Rostec, which manufactures radar jammers, for example.

Ommic has since been closed, Maxim Ermakov is on the EU sanctions list and, according to Le Parisien, French prosecutors are investigating R. for "passing on procedures, documents or files to a foreign power that are likely to harm the fundamental interests of the nation". Officially, the investigation concerns suspected illegal exports, embezzlement and falsification of documents. According to the newspaper, R. is said to have developed various circumvention strategies to supply prohibited material to Moscow via China. According to the FT, R. also flew to Greece in 2021 to personally hand over 230 microchips worth 45,000 euros to "Maxim". The French investigators are said to have found invoices for a total of 34,000 chips. R. denies all allegations.

German machines for Putin's war machine

Not many managers go to such great personal lengths as R. to keep in touch with their Russian business partners. They are no longer just interested in Western microchips. Machine tool manufacturers have also been subject to the strictest controls since Putin's invasion of Crimea. The precision machines used to mill metal parts for weapons have since been effectively banned from export to Russia.

Ulli S., until recently head of a machine tool company in Baden-Württemberg, has apparently not been deterred by this. He has been in custody since August and was charged in October for allegedly supplying a Russian weapons company with six systems for the production of sniper rifles worth 2 million euros. According to the federal prosecutor's office, he allegedly concluded contracts for this in spring 2015 - one year after Moscow's annexation of Crimea. The deliveries were concealed via a Russian company, a Swiss company and Lithuania. According to the investigators, Ulli S.'s company even trained employees of the Russian arms company to handle the German machines.

The fight against Russian smuggling routes has always been a cat-and-mouse game for the secret services: as soon as one network is dismantled, a new one immediately emerges. Not only because Moscow needs the microchips at all costs. But also because a global embargo would be too expensive: "You effectively forbid your own companies from earning money," the FT quotes an ex-US Security Council official as saying. As long as the West is not prepared to pay a higher price and ban exports to China, Thailand or the Gulf Emirates, Russia's agents will not stop buying up Western technology through middlemen. They will only disappear even deeper underground.