Why does Putin want an economist to become Russia’s defense minister

Russian President Vladimir Putin walks past an honour guard as he attends a meeting with Cuban President Miguel Diaz-Canel in Moscow, Russia, May 9, 2024.

Maxim Shemetov | Reuters

A government reshuffle was always in the cards after Russian President Vladimir Putin was sworn in last week as Russia’s leader for a fifth term.

But Putin’s replacement of Defense Minister Sergei Shoigu was unexpected — and his choice of successor, civilian economist Andrei Belousov, was even more of a surprise.

The appointment of Belousov — a technocrat who has served in various roles in Russia’s government, including as minister of economic development and deputy prime minister — is bound to raise eyebrows in military circles, but it comes as defense spending surges and Putin prepares the country and economy for a long war in Ukraine.

As such, the appointment of an economist to the defense ministry is being widely seen as a way to marry Russia’s immense defense needs with the booming war-oriented economy and military-industrial complex.

“These high-level reshuffles following the Russian presidential election strongly suggest that Putin is taking significant steps towards mobilizing the Russian economy and defense industrial base to support a protracted war in Ukraine and possibly prepare for a future confrontation with NATO,” analysts at the Institute for the Study of War (ISW) said Sunday.

Russia’s incoming Defense Minister Andrey Belousov.

Anadolu | Anadolu | Getty Images

Analysts at the Washington-based think tank noted that Belousov’s lack of military experience is not anomalous given the fact that his predecessor Shoigu also had no prior experience. Instead, the ISW noted, it was likely that the Kremlin intended Belousov to “integrate and streamline” Russia’s defense industrial base with the country’s wider domestic economic policy.

“Belousov’s nearly decade-long tenure as an economic minister in the Russian federal government and his more recent involvement managing various domestic defense industrial base innovation and drone projects, prepare him well to lead the struggling Russian MoD apparatus,” the ISW said.

“Belousov has a stronger reputation for being an effective technocrat, and insider sources have claimed that he has a positive relationship with Putin,” the analysts added.

Need for ‘innovation’

In this pool photograph distributed by Russian state agency Sputnik, Russia’s President Vladimir Putin visits Uralvagonzavod, the country’s main tank factory in the Urals, in Nizhny Tagil, on Feb. 15, 2024.

Ramil Sitdikov | Afp | Getty Images

Russia analysts stress that Belousov will have little to do with Russian military tactics and strategy in Ukraine in any case, with that task largely resting on the shoulders of Russia’s top general, the Chief of the General Staff Valery Gerasimov, who will remain in his job, the Kremlin press secretary noted Sunday.

“First of all, Belousov will not manage military combats, he will not get engaged in military planning tactics,” Tatiana Stanovaya, senior fellow at the Carnegie Russia Eurasia Center and the founder of analysis firm R.Politik, told CNBC Monday, saying military planning would be left to military officials like Gerasimov, although his replacement could also not be ruled out.

“Belousov’s main goal is to secure [Russia’s] military needs in terms of arms. This is the major incentive for Putin to make this personnel decision. Belousov is keen on military technologies and innovation in the military industry,” she said.

A Russian S-400 air defense system unit drives along Red Square during a rehearsal for a military parade, which marks the anniversary of the victory over Nazi Germany in World War II, in central Moscow, Russia, on May 5, 2024.

Maxim Shemetov | Reuters

“So Putin thinks if he puts Belousov as the head of the defense ministry, he will have a better situation in terms of arms supplies to the army. In this sense, the appointment is not surprising,” Stanovaya said.

Why has Shoigu gone?

The Kremlin announced on Sunday that Shoigu, Russia’s defense minister since 2012, had been relieved of his post and would become secretary of Russia’s influential Security Council. There he will replace Kremlin ideologue and close Putin ally Nikolai Patrushev, who would be given a different role, the Kremlin said.

Shoigu had no military experience prior to his appointment to the defense ministry and his credentials have been put to the test with Russia’s invasion of Ukraine in February 2022, and was often found wanting.

A number of Russian military commentators and officials, among them Yevgeny Prigozhin, the head of the Wagner Group of Russian mercenary fighters, have criticized Russia’s military strategy and leadership in Ukraine — often at great personal cost.

Prigozhin died last August in a plane crash after a short-lived and ill-fated rebellion against Russia’s military leadership. Though the Kremlin denied any involvement in his death, Putin was seen to have backed Shoigu over his old associate Prigozhin as the feud played out.

Russian President Vladimir Putin, accompanied by Chief of the General Staff of the Russian Armed Forces – First Deputy Defence Minister Valery Gerasimov and Russian Defence Minister Sergei Shoigu, tours an exhibition of cutting-edge pieces of armament following an expanded meeting of the Defence Ministry Board at the National Defence Control Centre in Moscow, Russia December 19, 2023. Sputnik/Mikhail Klimentyev/Kremlin via REUTERS ATTENTION EDITORS – THIS IMAGE WAS PROVIDED BY A THIRD PARTY.

Mikhail Klimentyev | Sputnik | Reuters

Another factor that could have influenced Putin’s decision-making is the fact that Shoigu has become increasingly unpopular with Russia’s military-industrial complex, publicly chiding arms manufacturers for what he saw as sluggish production, and is seen as an unpopular figure with Russia’s armed forces.

“Shoigu has had so many vulnerabilities,” R.Politik’s Stanovaya noted. “One of them was the conflict with [Russian state-owned defense conglomerate] Rostec.”

“Shoigu complained a lot about how the the military facilities produced arms. For Shoigu, it was too slow and of not enough good quality … I think that the fact that it did not work out between defense ministry and Rostec bothered Putin and he wanted to secure [an alliance] that works.”

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