Kazakhstan wants to support local defense producers through a new fund

According to Prime Minister Alikhan Smailov, the government of Kazakhstan is going to establish a new fund to support the domestic defense industry.

Why is a new fund needed? Alikhan Smailov said that as a country, Kazakhstan needs a robust industrial skeleton, citing the address to the nation President Kassym-Jomart Tokayev delivered in September. That is why the government will establish a new defense industry fund to support local producers by the end of this year.

What did President Tokayev say in his address? In early September, Tokayev said that creating defense production of a full cycle locally is «the most important task» for the country as this would let Kazakhstan reduce its dependence on supplies from abroad.

The Kazakhstani army should be equipped with high-tech weaponry and military equipment, including armored vehicles, unmanned aerial vehicles and modern small arms, the president highlighted.

So far, there is not a single company in Kazakhstan that can produce military equipment 100% on its own, although the Ministry of Defense believes that this is almost impossible and there is no full-cycle producer in the world.

«By now, the national defense industry is incapable of providing the army with weaponry and military equipment. This is why we need to boost the potential of our defense companies in terms of high-tech and precision weapons that would be able to deal with the current challenges and threats to national security,» the agency said in a statement.

How much does Kazakhstan spend on defense? In 2019, Kazakhstan’s military budget was $1.8 billion, $1.5 billion in 2020, $1.6 billion in 2021 and $1.1 billion in 2022.

According to the Stockholm International Peace Research Institute (SIPRI), the share of military spending in Kazakhstan’s GDP has declined since 2019. In 2019, this rate was at 1.02%, 0.91% in 2020, 0.82% in 2021 and 0.51% in 2022.

However, according to Kazakhstan’s national budget, defense spending has grown. For example, allocations for the army were at $1.7 billion last year, while in 2021, the defense ministry obtained just $797 million.