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By David Averre
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An end to the war in Ukraine is still nowhere in sight, but weapons developers on both sides of the front line already have their eye on the next fight—not for territory, but for money and global influence.
Nearly five years of relentless combat have turned Russia and Ukraine into rival laboratories for drones, electronic warfare and precision weapons, developed and refined under the most unforgiving real-world conditions imaginable.
When the bombs stop falling, the factories, engineers and technologies forged by the war won't simply disappear. Nor will the demand from foreign militaries eager to get their hands on cutting-edge, battle-tested weapons.
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Moscow and Kyiv will eventually stop shooting at one another, at least for a while. Yet any reprieve in front-line warfare will allow defense companies to shift their focus from arming their own soldiers to arming the rest of the world. When war grinds to a halt, the business of it will boom.
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Don’t Call It a Comeback
Russia was once the world’s second-largest arms exporter. Decades of Cold War innovation and Soviet-era relationships helped Moscow sell everything from jet fighters to tanks, missiles, and air-defense systems to dozens of countries.
Russia’s share of global major-arms exports collapsed from 21 percent in 2016-2020 to 6.8 percent in 2021-2025, according to the Stockholm International Peace Research Institute (SIPRI). The reason for this steep deterioration is, of course, the war in Ukraine—Russian defense equipment that may have been destined for export could no longer be spared. Now, that same conflict, and the rapid innovation required to maintain an edge in it, is seen as a vehicle to revitalize Moscow’s defense exports.
At a gathering of Russian financiers, politicians and defense industry chiefs late last month, Andrei Bezrukov, chairman of Russia's Center for Unmanned Systems and Technologies, laid out an ambitious vision. Winning the war is the immediate priority for Russia's drone manufacturers, but securing Russian technological leadership by 2050 is the ultimate goal.
To get there, he said, developers need more flexible government contracts, opportunities to compete with one another and, crucially, the ability to sell their products overseas.
Alexey Chadayev, head of the Ushkuynik drone development center, warned that Western investors would inevitably back startups employing Ukrainian weapons developers after the war. Russian firms, he said, should prepare now to compete for customers in Africa, Asia and Latin America, turning their battlefield experience into a commercial advantage.
But attracting private investment would require state defense contracts to offer profit margins of at least 15 percent, Chadayev added. Otherwise, financiers might as well leave their money in the bank.
The political and financial establishment seems to be on board. Ilya Medvedev, son of former Russian President Dmitri Medvedev and secretary of the ruling United Russia party's technology council, said promising domestic technologies needed to find practical applications "as quickly as possible."
Meanwhile, state-backed PSB, formerly Promsvyazbank, and Bezrukov's center have launched two specialist investment funds to support defense and dual-use technology companies. PSB chairman Pyotr Fradkov said the bank was already evaluating more than 1,200 projects spanning drones, robotics, microelectronics and other technologies.
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As Moscow’s capacity to export arms declined sharply, Kyiv’s appetite for them skyrocketed. Ukraine was the world’s largest importer of major arms in 2021-2025, but the war has also forced it to cultivate an extraordinary defense industry of its own.
The Ukrainian defense landscape now counts more than 1,000 companies, according to Ukrainian export-control chief Davyd Aloyan, of which roughly 90 percent are privately owned.
Ukrainian authorities estimate that the industry’s potential annual manufacturing capacity is now around $55 billion—55 times what it was when Russian forces stormed across the border four and a half years ago, while the CASE economic research institute reported that domestic factories made 4.5 million drones in 2025, with capacity to produce more than 8 million FPV drones this year.
But making the drones is one thing. Building an export business is a different challenge; one in which Russia is decades ahead.
Kyiv only reopened controlled arms exports in February, after effectively suspending them following Russia’s invasion. The approval system is now processing applications, but the vast majority concern repairs, maintenance and components rather than sales of finished weapons.
By mid-October, authorities had processed more than 450 applications, approving over 90 percent, but Ukraine’s National Security and Defense Council reported that only 18 companies had actually secured the permits to sell completed weapons systems beyond the nation’s borders.
The industry’s youth is partly to blame. Of Ukraine’s 1,000-plus manufacturers, most were launched after the full-scale invasion by engineers with scant business acumen and almost no knowledge of regulatory compliance and international contracting. But Kyiv’s own bureaucracy isn’t helping.
A supposedly streamlined 30-day approval process introduced in July had issued no permits three months later, partly because officials hadn’t finalized the lists of eligible destinations and weapons deemed too important to export.
Meanwhile, manufacturers seeking export permits under the fast-track scheme must pay the government a fee equal to 20 percent of the value of finished weapons, or 30 percent for components. The money is intended to support Ukraine's defense effort, but companies must pay upfront before knowing whether their exports will even be approved; a potentially ruinous requirement for small developers with meager cash flow or working capital.
Kyiv has good reason to be cautious; its soldiers must come first, and exports can’t be allowed to jeopardize domestic supplies or transfer sensitive technology irresponsibly. But manufacturers argue foreign sales would bring in investment, fund expansion and ultimately make more weapons available to Ukraine’s armed forces.
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Stacking Wins
Moscow’s sales pitch is no longer theoretical. State arms dealer Rosoboronexport says it signed more than $13 billion in arms-export contracts in the first half of 2026, roughly matching its entire 2025 total. It adds that it signed $1.7 billion in technology-cooperation contracts with African countries, including local weapons production and maintenance.
Kyiv is building a different kind of network. Ukraine has signed 11 long-term Drone Deal agreements, including with Saudi Arabia, Qatar and the United Arab Emirates, and seven members of the European Union. However, shipment volumes and prices remain largely undisclosed.
Ukraine is also looking to partner with Western allies to manufacture drones jointly, harnessing the industrial capacity and relative safety of European factories beyond the reach of Russia's regular attacks on Ukrainian industry.
NATO and EU countries are obvious natural partners for Kyiv; Moscow is unlikely to secure new weapons contracts with NATO allies or most European governments anytime soon. But elsewhere—in the Middle East, Africa, Asia and Latin America—the two countries could find themselves competing for the same customers.
The prize is bigger than individual weapons contracts. Foreign governments increasingly want technology transfers, local manufacturing and training, creating relationships that could tie their armed forces to Russian or Ukrainian suppliers for decades.
As far as we know, Kyiv and Moscow have not yet gone head-to-head over the same export contract. But both countries are laying the foundations for a rivalry that could outlast the war itself—competing to sell the world the weapons they spent years developing to destroy each other.
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