An update on the activities of Sergei Ivanov and Anatoly Serdyukov

The end of this week will mark 100 days since the presidential decree that made Sergei Ivanov a senior deputy prime minister and Anatoly Serdyukov the defense minister. What have they been doing in their new roles?

The end of this week will mark 100 days since the presidential decree that made Sergei Ivanov a senior deputy prime minister and Anatoly Serdyukov the defense minister. The attitudes among their teams are remarkably similar. “There’s no reason to mark anything, report on results, or mention this boundary at all,” say the advisors of Ivanov and Serdyukov. Perhaps because there aren’t any results to report; only a few isolated events and measures, not yet coalescing into a bigger picture.

At first sight, Sergei Ivanov seems to have far too much on his plate. The defense sector alone is more than a handful – but he’s also responsible for industry, transport, and communications. And the distinctly different fields of air traffic control and nuclear energy. Plus 26 federal targeted programs.

One might assume that Ivanov’s schedule is swamped by endless travel, meetings, and inspections. In April alone, there were 11 business trips and visits to dozens of enterprises. The issues varied greatly: completing construction of the first Project 955 nuclear submarine, the Yuri Dolgoruky, at the Severodvinsk shipyard; seeing space tourist Charles Simoni take off from Baikonur; the 50 Years of Victory nuclear-powered ice-breaker; the SuperJet, a new passenger airliner; developing Russia’s river vessels (we have hardly any); the perennial problem of timber exports; and starting construction of the world’s first floating nuclear power station.

Each of these fragments has some connection to the next, and taken together they form a picture of an entirely different Russian economy.

Ivanov often talks of diversifying the economy. In his view, this is “not just an economic strategy, but a strategy aimed at eliminating our still-considerable dependence on raw materials exports.” Creating, not selling: that’s the argument that might be used to describe Ivanov’s activities.

According to Ivanov, the military-industrial complex is “the driving force for diversification.” The defense sector is the only sector of industry which is steadily increasing its output volumes of civilian and consumer products. Around 30-35% of the defense sector’s output consists of civilian products. The objective is to increase that proportion.

It is also becoming clear how the defense sector’s products will be delivered to consumers: by establishing large integrated holding companies. One result of the past hundred days is the formation of the Unified Ship-building Corporation. President Putin recently signed a decree establishing AtomEnergoProm for the nuclear power sector. Now Ivanov faces another task: establishing similar structures in radio-electronics and the rocketry and space sectors.

“These holding companies, possessing strong scientific, industrial, and personnel resources, will receive stable funding from state arms procurement as well as investment, so within a few years they should become leading players in global markets for military and civilian products,” said Ivanov, setting out an ambitious mission for the holding companies. He will focus on this task, with no regard for hundred-day terms or any other boundaries.

Anatoly Serdyukov’s first weeks as defense minister made him seem like a recluse. Then he emerged from the Defense Ministry, making visits to the chief commands and other Armed Forces command centers, followed by the federal services and agencies that are linked to the Defense Ministry. Now he is visiting the military districts.

Thus, quietly and imperceptibly, Serdyukov has been familiarizing himself with the situation in the Armed Forces. There has only been one disruption in his subtle approach: when he made a surprise visit to the Nakhimov Academy in St. Petersburg. The minister discovered some disgracefully unsanitary conditions there, and fired Academy Director Alexander Bukin on the spot.

This was followed by another sudden decision: Serdyukov decided to enrol in a training course at the General Staff Academy. “He acted as if he’d been reviewing parades all his life,” said a defense analyst after observing Serdyukov’s first Victory Day parade. Now the parade is over, and the Academy exams have been passed, and Serdyukov has acquired a general knowledge of the situation in the Armed Forces. He will now settle down to routine, painstaking work. Its main focus, according to Serdyukov, is “the financial component.” Serduyukov plans to convert the Defense Ministry’s six-level financial system to a three-level system. This has drawn mockery from the top brass: they say it can’t be done. But Serduykov is confident that it will happen.

The five priorities of Senior Deputy Prime Minister Sergei Ivanov:

1. The SuperJet project – one hundred new Russian-built passenger jets

2. Projects aimed at overcoming “transport inequality”; developing east-west transport routes

3. Making the GLONASS navigation system accessible to ordinary consumers

4. Establishing the Unified Ship-building Corporation, with subsequent reforms for ship-building, ports, and other infrastructure

5. Establishing AtomEnergoProm; developing the nuclear power sector.

The five unexpected moves of Defense Minister Anatoly Serdyukov:

1. Deciding to undergo training at the General Staff Academy

2. Deciding to launch a financial inspection for the Defense Ministry staff

3. A surprise visit to the Suvorov and Nakhimov Academies in St. Petersburg

4. An inspection of a mountain troops brigade garrison in Botlikh, Dagestan

5. Visiting an officers’ dormitory in Chita, Trans-Baikal military district.