Europe

Archived version

TLDR:

• Aero-HIT, a Russian company, partnered with Chinese firms to build drones for the Russian military, according to documents reviewed by Bloomberg.
• The documents show Aero-HIT has been working with Autel engineers since early 2023 to localize production of the Autel EVO Max 4T drone, which was originally designed for civilian use but has proven effective in combat.
• Aero-HIT claims its production plant in Khabarovsk will have the capacity to produce as many as 10,000 drones per month this year, and the company has grown rapidly into one of Russia's main drone suppliers for military operations in Ukraine.

Soon after President Vladimir Putin launched his full-scale war on Ukraine, a little-known Russian company thousands of miles away hatched a plan to partner with Chinese firms and solve one of the most urgent challenges faced by the invading army — the need for combat drones that were radically reshaping the battlefield.

Documents reviewed by Bloomberg — including memos from the company, Aero-HIT, as well as correspondence with Russian government officials — offer unprecedented insight into how Moscow capitalized on its friendly ties with Beijing to skirt Western sanctions and acquire the know-how and capability to build drones to attack Ukraine. They lay out in detail a previously unreported case study of Russian-Chinese corporate collaboration on defense technology.

Taken together, the documents show how sensitive technologies can move from China to Russia even if President Xi Jinping's government says it's not supplying either side.

Aero-HIT, which has received Russian state funding, claims its production plant close to the airport in the far eastern city of Khabarovsk will have the capacity to turn out as many as 10,000 drones per month this year and it’s planning to expand production further into more advanced models. It has grown rapidly into one of Russia’s main drone suppliers for military operations in Kherson, the partly occupied region of Ukraine that Putin insists must be handed over fully to Moscow’s control as part of any deal to end the war. Its products include the Veles, a First-Person View (FPV) drone that allows pilots to monitor the battlefield in real time via a screen or virtual-reality goggles linked to the quadcopter’s camera. FPV drones have become a crucial weapon for both sides in the war, and multiple reports suggest Russia has deployed them to deliberately target and hunt down civilians in Kherson city that Ukraine successfully retook in late 2022.

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Last June, the US Treasury sanctioned Aero-HIT, stating that the Veles drones it makes “have been used by Russian forces based in Kherson against Ukrainian targets.” ...

The documents, which date from late 2022 through to June 2025, show the extent to which Moscow goes to mask its suppliers and deliver equipment to its military, often by using intermediaries that operate in other sectors like airline catering, agricultural supplies and seafood transportation services. In a letter dated June 16 this year, Aero-HIT wrote to the head of the department of interdisciplinary research and special projects at Moscow’s Ministry of Defense requesting financial support to expand its output by localizing the production of the Autel EVO Max 4T drone. Autel Robotics is one of China’s major manufacturers of drones and drone parts. It denies supplying or having any business relationships with Russian firms as of February 2022.

The letter, which contains financial plans for what would be a 7.1 billion ruble ($90 million) investment and a schedule of proposed deliverables over 28 months, states that the Russian company has been cooperating with Autel engineers since early 2023. The relationship between the two firms was briefly interrupted due to sanctions, but contacts with Autel personnel were re-established around the end of 2024 and the parties have been negotiating localizing production for the drone since May 2025, the letter states.

The proposal says the Autel EVO Max 4T was originally designed for civilian use but has proven highly effective in combat due to several key advantages such as a radio module resistant to electronic warfare. The sale price would be 650,000 rubles apiece, VAT included, and the plan foresees making as many as 30,000 units per year, according to details outlined in the proposal.

By localizing production of that model, Aero-HIT says it would be able to bolster high-tech drone manufacturing in Russia and gain the transfer of technologies and know-how, including firmware, debugging, production, and repair. Crucially, the project would integrate the drones with domestic IT systems and adapt them to frontline needs.

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The origins of Aero-HIT and its relationship with suppliers in China date back to the second half of 2022 — and have been crucial to Russia’s ability to manufacture Veles drones at scale, the documents show. In the fall of 2022, discussions began between a Russian company called Komax, representatives of the Harbin Comprehensive Bonded Zone in China, and Khabarovsk Airport — which lies around 20 miles from the Chinese border — to build a warehouse with special tax and customs arrangements to facilitate imports, as well as establish the production of drones using Chinese parts and technologies nearby. Russia’s business registry shows Komax is owned by an individual named Konstantin Basyuk. He is a former KGB operative, according to Russian media reports, and since 2022 a senator for Russian-occupied Kherson. Basyuk was sanctioned by the European Union in 2023. Komax also manages Khabarovsk airport.

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The relationship stepped up when, between April 28 and May 3, 2023, a Russian delegation traveled to China to meet with representatives of the Harbin Comprehensive Bonded Zone and companies linked to the Harbin Institute of Technology (HIT), one of China’s top engineering universities and particularly prestigious in the fields of astronautics and defense-related technologies.

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The parties agreed to set up a joint venture in Khabarovsk and that a sample of 100 drone kits would be delivered to Russia. During the same trip, the Russian delegation also visited the headquarters of Autel Robotics and a drone factory in Shenzhen, according to a Russian memo.

Later that month, on May 22, Russian and Chinese representatives of the joint venture met with Putin’s special envoy for the Far East, Yury Trutnev, on the sidelines of the China-Russia Business Forum in Shanghai. Trutnev recognized the project as a priority and promised to help it receive permits from Russia’s customs service to allow for tax-free imports, another memo indicates. A readout on the website of the Russian government confirms that Trutnev met with Chinese executives “to discuss the development of cooperation between Russia and China in the Russian Far East.”

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In January 2024, Aero-HIT presented its business at a Kremlin event for small and medium enterprises in Khabarovsk organized as part of Russia’s presidential election campaign that was taking place at the time. Ahead of the event, the company sent the Kremlin an overview of its plans to produce drones for military purposes under the name Veles and pitched for support. The pitch made no mention of Chinese involvement and it is not known whether that support was received. However, other documents indicate that the company has business ties with the Russian Defense Ministry and military — and its product, packed with Chinese components, was making its way onto the battlefield to be deployed against Ukraine.

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Document suggests that it is likely that ... Aero-HIT was procuring Autel parts and components from China via intermediaries. One such company named in one of the documents is Renovatsio-Invest, a firm sanctioned by the US in June 2024 for procuring Chinese-manufactured drones on behalf of Aero-HIT. ... Bloomberg is unable to confirm whether the drones were delivered to the 76th Guards Air Assault Division in Pskov, but Veles drones — easy to produce at scale as long as Chinese components remain available — continue to rain down on Ukraine’s cities each day.

Police in Budapest announced Monday that they will not initiate any legal proceedings against participants of the Pride parade that occurred in the Hungarian capital at the end of June, despite the ceremony being prohibited.

The decision from the police came amid fears that those who took part could face fines and with organizers facing up to a year in prison.

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Pride parades are held across the globe in support of LGBTQ+ rights. Budapest police said in a statement that this year's organizers created public uncertainty about the event's legal status.

Among them was Budapest's liberal mayor, Gergely Karacsony, who declared Pride an official municipal event and argued this renders the government's ban irrelevant.

According to the law in Hungary, municipal and state occasions are exempt from public assembly decisions.

In a statement on Monday, Budapest police said that they would not initiate any legal proceedings as participants came to believe that the march was legal due to comments by organizers and due to the participation of the municipal government.

Karacsony has been under police investigation for four days, with organizers of prohibited gatherings under threat of up to one year in prison.

Right-wing populist Prime Minister Viktor Orbandescribed the event as "repulsive and shameful" and accused the EU of orchestrating the march.

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Archived version

Russia’s growing ability to sustain weapons production despite Western sanctions is being driven by a flow of Chinese components and materials, Vladyslav Vlasiuk, the Ukrainian president’s commissioner for sanctions, told journalists on July 7.

Vlasiuk’s statement comes as Russia escalates its drone and missile strikes on Ukraine, while the U.S. continues to hold back on imposing tougher sanctions against Moscow and foreign-made components are still being found in Russian weapons used in the attacks.

Ukraine has previously documented that Chinese companies have contributed electronics and materials used in the production of these drones.

Just days earlier, after a large-scale Russian attack on July 4, Foreign Minister Andrii Sybiha shared on social media a photo of a component from a Shahed-136/Geran-2 combat drone discovered in Kyiv. According to Sybiha, the part was manufactured in China and delivered recently.

"The trend of China’s (role) is increasing," Vlasiuk told journalists.

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cross-posted from: https://scribe.disroot.org/post/3462386

Archived version

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Rotterdam’s measures are part of a wave of war preparations across the continent. The EU is drawing up a rearmament plan of up to €800bn as it tries to become more self-sufficient in defence in response to demands from US President Donald Trump, and to deter Russian aggression as Vladimir Putin’s full-scale invasion of Ukraine grinds into its fourth year.

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There would also be amphibious military exercises several times annually.

The port has handled armaments before, with a surge during the Gulf war from 2003, but even at the height of the cold war, it did not have a dedicated quay.

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[Boudewijn Siemons, chief executive of the Port of Rotterdam Authority] called for European countries to stockpile more essential supplies, as they do with oil. The EU mandated that members keep a 90-day strategic supply of oil after the 1973 oil shock, when Arab countries throttled production to put pressure on the west during their conflict with Israel.

“We should do the same with things like copper, lithium, graphite and a number of these critical raw materials,” Siemons said.

“We have it in oil, we don’t have it for gas yet, and, of course, we have some gasfields in Europe that can cater for that, but we should look at a wider spectrum of strategic resilience, also in pharmaceuticals and where do you build it up? And how resilient are you as a society? And that’s becoming increasingly important as the world is becoming more and more volatile.”

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cross-posted from: https://lemmy.sdf.org/post/38181164

Britain on Monday targeted two Russian individuals and one Russian entity as part of its chemical weapons sanctions regime, in its latest effort to punish Moscow for the war in Ukraine.

It imposed asset freezes and travel bans on Aleksey Viktorovich Rtishchev and Andrei Marchenko, the head and deputy head of Russia's radiological chemical and biological defence troops, for their role in the transfer and use of chemical weapons in Ukraine, the British government said.

It said the Joint Stock Company Federal Scientific and Production Centre Scientific Research Institute of Applied Chemistry was sanctioned for supplying RG-Vo riot control agent grenades to the Russian military.

The grenades have been used as a method of warfare against Ukraine in contravention of the Chemical Weapons Convention, the British government said.

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Paywall? https://archive.is/HmYBR

cross-posted from: https://lemmy.sdf.org/post/38180003

Archived

Russia has sharply reduced state support for small and medium-sized businesses as it grapples with a widening budget deficit and economic slowdown, raising concerns among economists and business leaders about the sector’s long-term health.

Government subsidies for small and medium-sized enterprises (SMEs) dropped by 43% in the first quarter of 2025 compared with the same period last year, according to a new report by the Higher School of Economics Development Center.

Total assistance fell from 127.8 billion rubles ($1.6 billion) to 72.3 billion rubles ($918 million).

That figure is also lower than the level of support provided in early 2022, shortly after Russia launched its full-scale invasion of Ukraine, when it stood at 75.8 billion rubles ($962 million).

At the same time, the number of SMEs and self-employed individuals receiving government aid declined by 17%, reaching 99,200 recipients.

The cuts reflect a broader shift in the Kremlin’s approach to business support, with planned allocations for the SME sector over the 2025-2030 period totaling 330 billion rubles ($4.2 billion), a 20% reduction from the previous six-year plan.

Lending programs, particularly the popular 1764 initiative that offered subsidized interest rates through commercial banks, have been hit hardest.

[...]

Archived (archive.org)

• Hungarian Prime Minister Viktor Orban is one of Russia’s allies in Europe. He claims that the EU is helping Ukraine at the expense of European interests and that Hungary will not quit Russian oil and gas. Experts and the press suspect that the Russian authorities have given Orban’s inner circle the opportunity to earn hundreds of millions of dollars from energy commodities trading.
• At the center of attention is the mysterious trader of Russian oil, Normeston Trading, which in 2009 got half of a gas trader created by Hungary’s largest oil and gas company, MOL, and then transferred its stake to Orban’s friends and their partners.
• Normeston Trading itself, on the Hungarian side, is co-owned by people affiliated with Orban’s friends. For years, the press and experts have tried to understand how Normeston could be connected to Russia’s top political circles.
• IStories found out that the former Russian owner of Normeston — race car driver Lev Tolkachev — was also a business partner of Gennady Timchenko’s top-managers. Vladimir Putin's close friend Timtchenko was the biggest Russian oil trader before 2014 sanctions. One of his former managers, Aleksandr Zhuravlev, still sits on the boards of some companies in the Normeston group together with the race car driver.
• In 2017 and 2018, Cyprus-based Normeston Trading was “under common control” with the Russian company of the race car driver, which was half-owned by another Timchenko top manager — Sergey Gzhelyak. In Cyprus, “common control” means that the companies are owned or their finances are controlled by the same parties.
• After the race car driver, the Russian businessman Valery Subbotin became a co-owner of Normeston. Subbotin is a former vice president of Lukoil, who fled from Russia in 2016 and settled in Europe, but established business ties with Putin’s friends and the entourage of former pro-Kremlin Ukrainian president Viktor Yanukovych.

Paywall? https://archive.is/5IISJ

BRUSSELS — Romania’s fledgling government is made up of the country’s most pro-European politicians, but that hasn’t stopped them citing Brussels as a key reason why they need to impose a drastic set of tax hikes and spending cuts to avert financial collapse.

For the past five years, Romania has been spending way beyond its means — in the words of new President Nicușor Dan, eating a large pizza while only paying for a medium-sized one — and has a projected budget deficit of around 9 percent of economic output this year, the highest in the European Union.

That record of poor fiscal management has provoked repeated reprimands from the European Commission, which Prime Minister Ilie Bolojan now says can no longer be ignored. This week, ministers from EU countries will vote to decide on a strict plan setting out exactly what Romania must now do to restore order to its public finances.

https://www.politico.eu/article/romania-reckoning-brussels-soaring-budget-deficit/