Kyiv hospital strike sheds light on Russia’s sanctions Evasion

• The Kh-101 cruise missile attack on a Kyiv children’s hospital in July demonstrates Russia’s ability to overcome Western supply constraints.
• Despite the attack, Russia has used over 700 guided aerial bombs, 170 attack drones, and nearly 80 missiles against Ukraine.
• Experts estimate that Russia will produce 700 to 750 missiles this year and 1,000 units in 2025.

The Kh-101 cruise missile that struck a children’s hospital in Kyiv in early July perfectly illustrates the Russian defense industry’s ability to overcome Western efforts to cut its supply of key components. The July 8 attack killed two people and damaged large portions of the surrounding buildings of the clinic, which was treating about 600 patients, provoking international outrage.

Yet, Ukrainian President Volodymyr Zelensky said, “Just since the beginning of this week, Russia has used more than 700 guided aerial bombs, more than 170 attack drones of various types, and almost 80 missiles against Ukraine.”

The days when Western military officials reported that Russian military production capacity was insufficient to sustain the war in Ukraine, or when a Ukrainian official predicted Russian strikes would soon stop due to a lack of ammunition, are long gone. According to The Financial Times, Russia is now producing eight times as many Kh-101 missiles as it did before its invasion of Ukraine in 2022, although the sources were not named.

Experts consulted by AFP did not confirm the figures but emphasized Russia’s increased capacity to build more of these crucial cruise missiles.

“I would say the real number might be even higher,” said Vladislav Inozemtsev, a Russian economist who lives in exile. He estimates that Russia will make 700 to 750 this year and that production could reach 1,000 units in 2025.

“In April 2024, Ukrainian sources reported monthly production of 40 Kh-101 missiles,” much higher than the 56 produced over the whole of 2021, said a Western source in the arms sector.

However, these missiles’ operating systems require many components made in countries that support Kyiv and have imposed sanctions on Russia. The official site war reported that debris from Kh-101 strikes contained US-made AMD memory cards, Texas Instruments microcircuits, and Dutch-made Nexperia buffer chips.

“Not all the electronic components inside of Russian missiles are military grade. Many of them if not most are consumer-grade or industrial-grade and still available for Russia on the global market,” said Pavel Luzin, a specialist in Russian defense policies.

“Moreover, there was a storage of electronic components in Russia made before 2022.”

An industrial source said Russia, with the help of friendly countries, has set up trading companies and “shows no signs of vulnerability in its supply chains.”

“First, there are the Chinese who supply the Russians with many kinds of dual-use products which are successfully used by the military industry,” Inozemtsev said.

The industrial source added: “The main foreign components found on the Kh-101 wrecks today are American or Taiwanese commercially available processors, purchased by Russian trade missions in embassies abroad or through shell companies.”

Some countries have become important hubs.

In a report published in late 2023, British research institute Rusi said that “faced with losing access to essential supply lines, Russia adapted, rerouting trade flows through friendly jurisdictions and bordering countries, often using complex front-company networks to evade scrutiny.”

“For example, in 2022, Armenia’s microelectronics imports from the US and EU increased by over 500 and 200 percent, respectively, with most of these later re-exported to Russia.”

Rusi noted that Kazakhstan’s microelectronics exports to Russia increased from around $250,000 in 2021 to over $18 million in 2022. However, sometimes these sales pass directly through Western countries. For instance, the Russian company Compel JSC made purchases from Germany. On Wednesday, a Stuttgart court sentenced a 59-year-old Russian-German man to almost seven years in prison for supplying 120,000 components and other pieces of equipment to Russia between January 2020 and May 2023.

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