Ukraine's Arms Industry Is Both Prize and Problem for Putin

As Russian President Vladimir Putin positions his army along the border with Ukraine, his eyes are trained on more than former Soviet territory.

The parts of Ukraine where separatists and loyalists face off in ever-more violent clashes are home to the most valuable assets of the nation’s defense industry. More than 50 factories form an arms cluster that caters to Russia based on a trade accord from two decades ago, churning out air cargo transporters, helicopter engines and other hardware.

“Taking Ukraine’s eastern and southern regions would be hugely beneficial for Russia from a military and economic point of view,” said Mikhail Barabanov, the editor-in-chief of the Moscow Defense Brief magazine. “Russia will have control of the very important and valuable defense companies and plants.”

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