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Russia's huge military upgrade hit another snag - and Putin is not happy

Jul 17, 2015, 21:28 IST

Russian President Putin and Defence Minister Ivanov share a joke while visiting military exercises in the Russia's Arctic North on board nuclear missile cruiser Pyotr Veliky. Russian President Vladimir Putin (L) listens to Russia's Navy deputy commander Mikhail Zakharenko while visiting military exercises in the Russia's Arctic North on board nuclear missile cruiser Pyotr Veliky (Peter the Great), August 17, 2005. REUTERS/ITAR-TASS

Despite suffering economic sanctions and the falling price of oil, Vladimir Putin has pushed forwarded with an estimated 20 trillion ruble ($351 billion USD) program to modernize and overhaul the military by 2020.

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But the Russian defense sector is struggling to meet its goals.

"The objective reasons for the failure to meet state defense procurement orders include restrictions on the supply of imported parts and materials in connection with sanctions, discontinuation of production and the loss of an array of technologies, insufficient production facilities," Deputy Defense Minister Yuri Borisov said in video conference with Putin on Thursday, according to The Moscow Times.

Borisov said that Navy guard ships, 200 amphibious aircraft, anti-tank missiles, radio equipment for surface-to-air missiles, launchers for Tupolev-160 bombers are behind schedule.

Putin was not happy.

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"I will especially emphasize that those who are delaying production and supplies of military technologies, who are letting down related industries, must within a short term ... correct the situation," Putin reportedly said.

"And if that does not happen, the appropriate conclusions need to be made, including, if necessary, technological, organizational and personnel [changes]," Putin added.

The extravagant plans for military spending were drawn up before the ruble crashed and oil prices bottomed out, back when the government was expecting 6% GDP growth annually.

Nevertheless, Russia has continued with their hike in military spending, which is estimated to reach $29.5 billion in 2015, with around $4.4 to $4.7 billion going towards research and development alone.

Elena Holodny / Business Insider

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Putin has looked to defense spending to bolster employment, investment, and technological development.

As he said on his call-in show in March, "without a doubt, this program will be fulfilled," adding that, "Our goal is to make sure that by that time, by 2020, the amount of new weapons and military technologies in our armed forces reached no less than 70 percent."

Given that Russia's troubles will likely continue - sanctions will likely remain as fighting in eastern Ukraine continues and oil may drop as Iranian oil hits the market - Putin's big push may meet reality sooner than later.

On Thursday, Deputy Defense Minister Borisov said that 38% of Moscow's defense purchases planned for this year have been completed.

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NOW WATCH: Russia reveals new high-tech weapon vehicles in a rehearsal for the country's biggest military parade

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