KYIV — In a vast historic building in Ukraine’s capital — a structure normally used for book fairs and concerts — the atmosphere is radically different. Against a backdrop of techno music, drones, missiles and robots — the pride of Ukraine’s military innovation — are on full display.
For the latest news & views from every corner of the world, Worldcrunch Today is the only truly international newsletter. Sign up here.
For security reasons, the name of the venue must remain confidential, but the event captures the energy driving Ukraine’s defense sector. Soldiers in uniform, government officials, state engineers and techies-turned-drone-manufacturers: everyone here exudes a surprising optimism, despite stalled U.S.-Russia negotiations and continued Russian strikes.
A major source of this confidence lies in Ukraine’s growing ability to wean itself off foreign arms deliveries. Long neglected after the collapse of the Soviet Union, the country’s defense industry is now operating at full speed.
In 2024, production reached $9 billion worth of weaponry — up from just $1 billion in 2022, at the outset of Russia’s full-scale invasion. Nearly 630 tech startups have joined about a 100 long-established state-owned firms to manufacture artillery, ammunition, armored vehicles, drones and missiles.
Value of battle-forged weapons
“Today, between 30% and 40% of the equipment used by our troops at the front is made in Ukraine,” explains Oleksandr Kamyshin, the former Minister of Strategic Industries and now a defense industry advisor to Ukraine’s president.
In 2024, more than 96% of drones deployed by Ukrainian forces on the frontlines were produced domestically. Ukraine manufactures about 10 million first-person view (FPV) drones annually.
Around 300,000 workers in the defense sector are now “capable of producing all the products our army needs,” says Ukrainian Railways former president, Kamyshin, — recognizable by his distinctive Cossack haircut — celebrating the sector’s positive economic impact.
“I am convinced that after the war ends and we achieve victory, we’ll be able to export our battle-forged weapons to our strategic partners abroad,” he adds.
Routa, Leleyka, Bars — the source of Ukraine’s growing optimism is on full display in the exhibition halls, where weaponry bears names as whimsical as they are folkloric.
“Palianytsia,” the name of a traditional Ukrainian bread, has been repurposed here for a mass-produced long-range missile drone. The “Peklo” missile — meaning “hell” in Ukrainian — is already striking refineries up to 700 kilometers inside Russia.
Missiles 100% Made-in-Ukraine
“In 2023 we had only one guided missile — the Neptune — today our production capacity has exploded,” says Herman Smetanin, Minister of Strategic Industries. Yet the real dynamism lies less with legacy state companies and more with the new wave of startups that emerged after the invasion.
“Last year, we launched many new missile models, multiplying production eightfold compared to 2023,” says Smetanin, who notes that only 13% of Ukraine’s weapons manufacturers today are state-run.
One of our goals was to break the monopoly of state manufacturers and allow in private capital.
“One of our goals was to open our defense complex to private production — to break the monopoly of state manufacturers and allow in private capital,” he continues. “Today, nearly 52% of all military equipment is made by private manufacturers.”
One standout is the Trembita, the star of the exhibition, developed by the independent Pars design bureau. Its engine — a modernized $200 version of the German V1 bomb from 1944 — propels it at 400 km/h for up to 200 km.
A more powerful version capable of reaching Moscow is now in development. Serial production will begin once the final field tests are completed. The enthusiasts behind the Trembita took just a year and a half to go from concept to battlefield — an extraordinary pace in an industry where development usually takes years.
By November 2024, Ukraine had already produced its first 100 domestically-made missiles. The following month, President Volodymyr Zelensky announced the goal of manufacturing 30,000 long-range drones and 3,000 missiles by 2025.
“Both sides are racing to gain an edge through technological advances, whether by creating new solutions or copying those of their adversary,” explains Mykola Bielieskov, an analyst at Come Back Alive, Ukraine’s largest army support foundation.
For Kyiv, this race is especially crucial as it strives to replace the Western arms it once depended on. Drones, initially used for reconnaissance, have evolved into an effective artillery substitute.
“Ukraine and Russia are learning fast and gaining access to similar technologies,” warns Bielieskov. “In today’s arms race, any advantage from a new technology lasts only a few weeks, whereas it used to last months.”
Production under cover
Ukrainian weapons manufacturers work under highly restrictive conditions, with every stage of production cloaked in secrecy. Many companies, targeted by Russian strikes, have moved their operations underground.
“We hire new employees through word of mouth, knowing that the Russians are constantly trying to infiltrate,” says Konstantin Mynakov, director of Omnitech Defense, speaking from his office in central Kyiv. “Our teams work in civilian clothes, and from the outside, there’s no sign our facilities produce drones.”
“One day, a well-meaning neighbor figured out what we were doing — we immediately shut the site down,” he recalls. To maintain discretion, Omnitech ships drones in plain, unmarked boxes.
Our production capacities far exceed the available budget
A major challenge for Ukraine’s now-massive production capacity is reducing dependence on Chinese components. Several companies are already assembling drones exclusively with Ukrainian-made parts, without significant cost increases compared to Asian alternatives. This self-reliance is spreading across the arms industry.
Ukraine now claims it can domestically manufacture 85% of the components for the Bohdan self-propelled howitzer.
Still, one key hurdle remains: a lack of financing is slowing the sector’s full potential. “Today, our production capacities far exceed the available budget,” Kamyshin notes. “Unfortunately, a significant portion of our manufacturers don’t even have guaranteed contracts through the end of the year,”
Even though Ukraine’s defense production capacity reached $20 billion last year, less than half was utilized due to insufficient funding. To overcome this, Ukraine is making a major push for international investment. Denmark has already stepped forward, becoming the first NATO member to directly invest in weapons production on Ukrainian soil.
