Although the chip blockade measures of Europe and the United States against Russia are severe, Russia still has channels to obtain a large number of Western chips, thus alleviating the problem of insufficient chips. In the first three quarters of 2023, Russia imported $1.7 billion worth of chips, most of which came from well-known manufacturers such as AMD, Intel and Texas Instruments in the United States. In addition, transit through third-party countries such as Turkey and the United Arab Emirates has also become one of the most important methods in Russia. However, the complex transit process of these chips and the large number of dealers make it difficult to track the specific transaction process. This article will discuss the channels and ways in which Russia obtains Western chips, and analyze the importance of how to strengthen the R&D and manufacturing of independent chips for Russia.
It is worth noting that although the Western chip giants claim to cut off the supply of Russian chips, this has not stopped companies and distributors from third-party countries from exporting chips to Russia. For example, the Royal United Services Institute (RUSI) has released a research report that some Russian-made missiles obtained by Ukraine contain a large number of foreign parts, many of which are digital signal processors and flash memory modules produced by American companies such as Texas Instruments and Supermicro Semiconductor. In addition, the hand-held navigation system used by the Russian special forces is actually made of memory microchips developed by Cypress Semiconductor in the United States. Most of these parts had their identification markings scratched off before they arrived in Russia, making it more difficult to track the chips**.
In order to circumvent the Western blockade, Russia has used forwarding companies from third-party countries to import American chips. In Turkey, for example, a PC wholesaler called AzuInternational was established in Turkey in March 2022 and soon began forwarding computer parts from the United States to Russia. The company resold nearly $20 million in parts to Russia over the next seven months. There are a number of other global forwarding companies in a similar situation, many of which are shell companies. The existence of these small dealers makes it difficult for Western countries to adopt effective sanctions.
Before the Russia-Ukraine conflict, Russia had stockpiled a large number of chip parts. According to an investigation by the London-based Conflict Armaments Research Car, more than 70 European-American components were found from dismantled Russian-made equipment, most of which were manufactured between 2014 and 2020. After disassembling the Iskandar missile, it was found that its chip was equipped with a DSP chip manufactured by Texas Instruments in the 80s of the last century. These chips were hoarded back in Soviet times and used in military equipment. It can be seen that Russia has prepared chip reserves before the blockade. This discovery forced us to realize that it is essential for Russia to strengthen the R&D and manufacturing of its own chips.
At present, except for some chips with backward processes that are produced in Russia, nearly 95% of chips rely on imports. Although the demand for advanced process chips for military equipment is not high, in the civilian field, especially in the terminal industry and Russia's over-reliance on imported chips, the market is sluggish. Therefore, it is imperative to strengthen the R&D and manufacturing of independent chips. Before the advent of lithography and integrated circuit technology, the Soviet Union considered the development of electron tube technology only from a military point of view, while the United States chose to develop transistors, which led to the creation of chips. However, after the collapse of the Soviet Union, the semiconductor industry was hit hard, and the development of civilian chips could not keep up with the pace of the West. Therefore, Russia needs to get rid of its excessive dependence on foreign chips, strengthen independent innovation, and promote the development of the local chip industry.
Despite the West's chip blockade of Russia, Russia still bypassed sanctions through channels such as third-party country transit and imported a large number of Western chips. However, the ** and transaction processes of these chips are complex and difficult to trace. Russia has a large stockpile of chip components, which is confirmed in military equipment before the Russia-Ukraine conflict. Therefore, in order to get rid of dependence on foreign chips, Russia should strengthen the research and development and manufacturing of independent chips, and promote the development of the local chip industry in the field of military and civilian use.