russia Has Flubbed Up the Import Substitution Program

As of 2025, there is no industry in which russia has managed to completely overcome its dependence on imports. At this, in some spheres, the need for foreign technologies and equipment has increased.

The reasons for the failure of the import substitution program include the inability to replace foreign intermediate goods (used for further production of the final product), lack of experience in providing engineering and consulting services, and poor domestic production capability.

The largest increase in production dependence on imported intermediate goods in 2021-2023 was observed in coal mining (+5 % compared to 2021); production of tobacco products (+4.3 %); information and communication (+2.1 %); production of medicines and materials used for medical and veterinary purposes (+0.7 %); and production of textiles (+0.2 %).

In addition, more than half of russian companies have publicly stated that there are no alternative suppliers in the country capable of fully replacing the unavailable foreign equipment, materials, and components.

In the medium term, import substitution in russia will slow down even more. The forecasted decline in GDP growth and the continuation of the russian-Ukrainian war will increasingly impede the modernization of russian production and substitution of high-tech foreign-made goods.