Heavy Industry and the Military Complex

Perhaps the heaviest legacy (both literally and figuratively) of the Soviet economy was its military–industrial complex, called in Russian the voenno–promyshlenny kompleks or VPK. Its presence was pervasive: Entire cities were built around steel mills, aluminum smelters, tank manufacturers, chemical factories, or nuclear weapons facilities. Over 50% of the country's industrial output in the 1980s was generated by this sector. The Soviet Union produced more tractors, tanks, missiles, turbines, and heavy military equipment than any other nation, including the United States. Not all of the machinery or industrial production was for national defense; many civilian products were made in the same factories as well. A common Soviet joke was that what looked one day like a baby stroller could be converted into a machine gun the next day. Because of the secrecy surrounding the details of the VPK's components, both in the Soviet past and in Russia today, it is not always possible to obtain exact data on the production or consumption of these products. Also, in the recent past there have been many changes in production patterns because of the ongoing, and still unfinished, conversion to the market economy. Nevertheless, it is possible to provide a broad overview of the main spatial trends of production, as well as to discuss the challenges facing this sector today. I discuss the nuclear program first, as the most secretive and the most pivotal to the Soviet military machine. I then focus on other branches of heavy industry, both military and civilian: iron and steel, nonferrous metals, manufacturing of heavy machinery and equipment, and the chemical industry.

In Russia's industry today, the heavy machinery sector accounts for 17%, while metallurgy accounts for 16%. Combined, the two exceed the share of the energy complex discussed in Chapter 17. The geographic distribution of the VPK inside the country is as follows: 27% is concentrated in the Central federal district around Moscow, with 16% in the Urals, 14% in western Siberia, and 13% in the Volga region. St. Petersburg and the rest of the Northwest district account for 12%. Although the industry was hard hit by the reforms in the 1990s, the sector is now recovering strongly. The output decreased by more than half, to an all-time low of 47% of the 1990 level in 1998, but is now above 80% of the 1990 level. Bear in mind that because of much restructuring, many items produced today are different from what was made in the Soviet period. A large share of Russian heavy industry (over 80%) is now in private hands, typically in large-stock ventures. Some companies are nationally prominent, especially metal producers.

In 2007, 4 companies in the top 20 in Russia were engaged in metal production, heavy machinery production, or other heavy manufacturing: Nornickel in Norilsk, in 6th place (valued at $42 billion); the Novolipetsk metal combine, in 13th place ($19 billion); Severstal in Cherepovets, in 14th place ($17.5 billion); and the Magnitogorsk Metallurgical Combine, in 17th place ($14 billion). This last one, located in the city of Magnitogorsk, was built in 1929 as the first large industrial project of Stalinism. Today it employs 60,000 people and produces over 12 million tons of steel a year, about 16% of Russia's total. Other industrial giants farther down the list included TMK (a pipe manufacturer), Mechel (a metal and mining combine), GAZ and AutoVAZ (automakers), and many others. The sector as a whole employed almost 50% of industrial workers in Russia, over 7 million people.

Secret Nuclear Cities

Iron Ore and Steel

Nonferrous Metals

Heavy Manufacturing

The Chemical Industry

Review Questions

  1. Which main industries are included in the VPK?
  2. What are some common factors that influence the distribution of heavy industry?
  3. Explain why the Central federal district and the Urals have such a concentration of heavy industry in Russia.
  4. Use Table 18.1 to investigate which products showed the greatest decline after the fall of the Soviet Union. Try to explain why some were hit harder than others.
  5. In your own country, find regions similar to the heavily industrialized regions of Russia or other FSU nations. What are some of the same economic challenges experienced in these regions?


  1. Look up pertinent data on production of any car or truck manufacturer in Russia (good ones to try are AutoVAZ, GAZ, UAZ, or KAMAZ). Where are they located? Does geography play a role in where these are located? How many types of cars/trucks do they make? How many models or modifications? Who are their primary buyers? Do they sell vehicles outside Russia? How do their products compare to those of any major Western car manufacturer? You can have a class discussion and compare data for all of them, and additionally compare them to major Western manufacturers (e.g., Ford, GM).
  2. Imagine that you work for the government of a rich Middle Eastern country. The boss wants you to prepare a comparative report that highlights the costs and benefits associated with the purchase of about 50 Russian tanks (T-90) or an equal number of Western ones (e.g., American or German). Make a recommendation. Make sure you explain your rationale and back it up with some concrete numbers on performance and price.
  3. Visit your local pharmacy, and conduct an informal research of what you see on the shelves. What proportion of the over-the-counter drugs available are made in your country? What foreign manufacturers are represented? Are there any medicines that were made in developing countries (e.g., Brazil or India)? Why or why not?