Ukraine may allow drone exports in bid to support domestic producers
Ukraine is reportedly considering lifting restrictions on the export of drones as the country seeks to strengthen domestic drone production. The Ukrainian drone manufacturing industry has expanded rapidly since the start of Russia’s full-scale invasion and is now operating at well below its potential capacity due to a lack of government funding. Supporters of the export initiative believe foreign sales could generate much needed revenues and fuel the further development of Ukraine’s drone industry, while also preventing an exodus of cash-strapped Ukrainian drone makers.
There is little doubt that in the long run, Ukraine will become a major drone exporter. After all, Ukrainian drones are tested in battle and are highly sought after internationally. Nevertheless, some have been surprised by the timing of recent suggestions that Ukrainian companies should be allowed to export drones as the country fights for survival against Russia’s ongoing invasion.
There are a number of economic arguments in favor of drone exports. At a time of acute economic distress, exports could prove extremely profitable for drone manufacturers. Ukrainian MP Oleksandr Marikovskyi, who heads the Ukrainian parliament’s economic subcommittee investigating drone export regulations, believes exports could generate up to $20 billion. If export markets remain off limits, there is a danger that a significant portion of Ukraine’s domestic drone producers will be forced to relocate abroad or close down entirely.
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There is unlikely to be any shortage of potential international buyers for Ukrainian drones, which have demonstrated their effectiveness throughout the war with Russia. Meanwhile, many NATO countries are cautious about the acquisition of drones manufactured in China, while other major drone producers have a range of restrictions in place that limit foreign sales. This could create additional opportunities for Ukrainian companies.
Crucially, exporting drones to international markets might actually make it easier for Ukraine’s drone producers to deliver more drones to the Ukrainian military. Ukrainian drone production has increased so much over the past two-and-a-half years that it has now far outstripped the Ukrainian government’s procurement potential. In other words, Ukrainian drone manufacturers are capable of producing significantly more drones than the state can currently purchase.
Opening up export markets could help solve this problem. Enabling exports would allow Ukrainian drone companies to operate closer to capacity, making it possible to scale up production and reduce the cost of individual drones for all customers, including the Ukrainian state. This is a key reason why many Ukrainian producers see exports as the most sensible solution to the current challenges facing the industry.
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While the arguments in favor of lifting export restrictions appear strong, any steps to allow the sale of drones to foreign clients during wartime would be seen by many as controversial. If the Ukrainian authorities do opt to allow exports, they will need to determine which categories can be sold abroad and in what quantities. The needs of the Ukrainian military will naturally remain the number one priority. With this in mind, it may make sense to create some kind of centralized mechanism to regulate international sales in order to streamline the process and enhance transparency.
Ukraine would also have to take steps to monitor where the country’s drones end up. Any potential misuse of Ukrainian drones would likely be very high profile and could raise serious concerns among the country’s partners. Exporting drones internationally would also increase the risk of Russia acquiring and examining Ukrainian technologies.
Permitting the export of Ukrainian drones would be a complex process with a number of potential pitfalls. At the same time, Ukrainian officials and the country’s drone manufacturers currently appear to have few other options as they look to boost domestic production while faced with limited state funding.
Exports could help Ukraine’s drone industry continue to grow at a time when the country’s future hinges on staying one step ahead of Russia in the defense tech arms race. If Ukraine decides to allow drone exports, the process must be thoroughly thought out and carefully implemented in order to safeguard all-important drone deliveries to the Ukrainian military.
Marcel Plichta is a PhD candidate at the University of St Andrews and former analyst at the US Department of Defense. He has written on the use of drones in the Russian invasion of Ukraine for the Atlantic Council, the Telegraph, and the Spectator.
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The Eurasia Center’s mission is to enhance transatlantic cooperation in promoting stability, democratic values and prosperity in Eurasia, from Eastern Europe and Turkey in the West to the Caucasus, Russia and Central Asia in the East.
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Image: An FPV drone with an attached portable grenade launcher is seen during a test fly conducted by Ukrainian servicemen of the ‘Bulava’ Unmanned Aerial Vehicles Unit of the Separate Presidential Brigade at their position near a frontline, amid Russia’s attack on Ukraine, in Zaporizhzhia region, Ukraine. October 11, 2024. (REUTERS/Stringer)
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