Ukraine is considering lifting a military ban on the export of drones, as senior officials and manufacturers believe it is now critical to ramp up production to match Russiaʼs capabilities on the battlefield. Ukrainian manufacturers could get up to $20 billion from sales abroad and increase domestic production for the army.
This is reported by the Financial Times.
The Defense Forces of Ukraine desperately need more drones for reconnaissance, cover, as well as long-range strike drones, the publication notes. However, with limited state resources available to pay for military supplies, drone companies are looking for ways to sell excess production abroad to generate the revenue needed to produce more drones for the Ukrainian military.
The export of drones can bring Ukraine up to $20 billion in revenue — "exactly the money we lack," said the head of the subcommittee on regional economic cooperation and trade Oleksandr Marikovsky.
After the full-scale invasion of Russia in 2022, Kyiv banned the export of military goods so that the Armed Forces of Ukraine would always have enough weapons. However, the Ukrainian government lacks the funds to purchase all available drones, let alone invest in further research and development. So allowing companies to export their surplus products is now seen as a way to attract investors.
Meanwhile, Russia has significantly increased its weapons production — Ukrainian industrialists estimate its advantage in the number of strike drones as 5–10:1. According to Dmytro Khasapov, head of one of Ukraineʼs largest UAV manufacturers, “Ukrspetssystemy”, Ukrainian forces "have a colossal shortage of drones."
Last week, he spoke at the Defense Industry Forum in Kyiv organized by the Ukrainian government to attract more foreign investors and importers. Khasapov said that his company does not receive enough government contracts.
The state budget of Ukraine for armaments this year is only $6 billion. About a third of this amount is for the purchase of drones for the army — this will not even cover its initial needs. Currently, the only customers for Ukrainian arms manufacturers are the state and funds that attract private financing for the army.
This means that companies are often faced with short-term or delayed contracts and no long-term guarantees to purchase and test expensive components, says Marikovsky. "Ukrspetssystemy" is one of the few Ukrainian manufacturers of drones that recently opened production in Poland, trying to circumvent the export ban.
Marikovsky said the trend is a concern in Ukraine because it could lead to a "brain drain" and reduced tax revenues, another reason to reconsider the ban. He warned that without the resumption of arms exports, prices for Ukrainian drones will most likely rise.
Another Ukrainian drone manufacturer, Roboneers, told the Financial Times that it had won government tenders at a price that only covered production costs.
"The biggest problem for every [Ukrainian] company is research and development," said an unnamed company representative.
Several of Ukraineʼs partners have pledged to purchase locally produced drones for the Ukrainian military, but arrangements are still in the early stages.
Danish company MyDefence, which specializes in anti-drone weapons, told the Financial Times that it recently opened a facility in Ukraine to help outpace Russian technological advances.
According to the companyʼs executive director Dan Hermansen, the Russian military has begun to change the frequencies of its drones, so arms suppliers to Ukraine must adapt and offer new solutions. He stated that after the war, Ukraine will have "great export potential."
Manufacturers say they, too, desperately need more standardization and planning from the government. Dozens of different types of drones received by the Ukrainian military run on different software, says a leading expert on drones, Ukrainian serviceman Yuriy Kasiyanov. He described the situation with UAVs on the battlefield as a "drone zoo.”
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