The Russian government’s attempt to isolate its economy from global supply chains has reached a dead end. According to the Foreign Intelligence Service of Ukraine (SZRU), 83% of Russian companies involved in government procurement have formally acknowledged the failure of the “national regime” policy, which aimed to force the substitution of imported goods with domestic alternatives starting January 1, 2025.
Statistical data provided by the intelligence agency highlights that 61% of businesses consider the mechanism ineffective, while 22% reported zero results since its inception. The core issue lies in “fake localization.” Many manufacturers simply relabel foreign-made components or perform minor assembly, presenting them as Russian-made to satisfy government mandates. This practice has led to inflated prices for state contracts while failing to stimulate actual technological growth.
Furthermore, the Russian state has struggled to implement a transparent pricing methodology for government contracts, and the registry of industrial products remains so complex that many reliable vendors are withdrawing from the market entirely. Officials are now reportedly developing a system of “official exceptions” that would allow for imports when domestic producers cannot meet requirements—a tacit admission that the nation remains heavily dependent on foreign technology.
Analysts from the SZRU warn that this policy is merely increasing administrative burdens and stifling competition without addressing the root cause of the country’s technological dependency. Instead of industrial breakthroughs, Russia is drowning in bureaucratic paperwork, forced to hide the truth behind high-level labels while economic indicators continue to trend downward. As Russia continues to prioritize military spending, the inability to replace foreign industrial components creates a long-term strategic weakness that even the most aggressive protectionist measures cannot resolve.