Russia now appears to be on an irreversible and self-reinforcing pattern of militarisation under President Putin.
This assessment was issued to clients of Dragonfly’s Security Intelligence & Analysis Service (SIAS) on 29 September 2022.
He previously was keen to minimise the impact of the invasion on domestic society. But Ukraine’s military successes, apparent growing pressure from nationalists and the prospect of greater humiliation in the war appear to have forced the Kremlin into an unwanted and unplanned escalation, culminating – for now – in mobilisation.
We assess the next step in this wider strategic shift is martial law, which is likely in the next few weeks. But Russia’s transition to a wartime society is unlikely to stop at this. Putin is clearly set on winning at any cost and is probably facing growing internal political pressure to achieve this, even as Russia’s forces are on the back foot in Ukraine. This leaves Russia in a cycle of military failures and domestic escalation, in which the stalling of its war only incentivises Putin to double down and commit more resources.
Declaring martial law would have practical benefits for Russia. This would be particularly through smoothing out some of the early issues that Russia has encountered with mobilisation (such as preventing military-age males from leaving the country). Indeed, we suspect Moscow is already laying the groundwork to justify imposing it, through staging fake annexation votes in the occupied territories and then framing near-certain Ukrainian attempts to retake these to justify these as an attack on Russia.
This kind of total war trajectory brings with it several strategic-level risks to business still in or partnering with others in Russia. These range from the expropriation to conscription of dual-nationals, and detention of foreign citizens. Irrespective of these, organisations are now facing the prospect of a Russia that is shut off from the global financial system, subservient to China, retrenching from Central Asia and looking to disrupt and damage Western interests wherever possible, including in cyberspace.
Martial law likely in coming weeks
There are two reasons why we assess the imposition of martial law is likely in the coming weeks. The first is that martial law would probably include bans on military-age males leaving Russia, and even tighter restrictions on public gatherings. This would smooth out some of the issues Russia has encountered with mobilisation; protests in major cities and military-age males fleeing to neighbouring countries. Independent Russian media outlets citing Kremlin sources said the exodus of military-age males was ‘alarming’ the state.
The second reason is that supporters of escalation within the Kremlin seem to hold increasing political sway over Putin. Until now he had gone to lengths to distance society from the war, notably by sending ethnic-minority troops, describing it as a ‘special military operation’ and then criminalising those that refused. But according to the independent Baltic outlet Meduza citing Kremlin sources, the Russian government’s sudden shift in strategy owed to successful lobbying efforts by ‘a group of high-ranking Russian officials and security officials who advocate a further escalation of the conflict’.
The main indicator that would suggest that martial law is potentially imminent is any Ukrainian offensive on the occupied territories where Russia has just held sham referenda. Kyiv has maintained its stance that annexation will not change its strategy. This means we assess it is highly likely that it will continue attempts to retake territory, particularly given its current battlefield momentum. And we anticipate that Russia would frame any assault – particularly one which prompts a rapid collapse in parts of the Russian frontline – as an attack on Russia itself.
Implications of martial law
Martial law will almost certainly have major operational implications for organisations in Russia. Based on what we assess will probably be Moscow’s reasoning for declaring it, some (if not all) of the following measures are likely in such a scenario:
- Total bans on gatherings
- Expansion of eligibility criteria for conscription
- Harsher penalties for what Russia calls ‘crimes against military service’
- Bans on military-age males leaving the country
- Increased censorship
- Restrictions on internet usage
- Increased digital monitoring
- Local or nationwide curfews
Imposing such measures would likely help the Kremlin stamp out public shows of dissent against the war, increase the pool of potential conscripts to draft into the army and restate its increasingly shaky grip over the information space.
The path to wartime society
Putin has set Russia on an irreversible path to even greater militarisation. The US warned in May that Putin ‘doesn’t believe he can afford to lose’ and we have not seen any indication that this mindset has shifted. It is now near-impossible for him to reverse this trajectory without victory (insofar as he sees it) in Ukraine. We suspect doing so would threaten his own position internally. This means we anticipate future military failures, which are all but certain to only encourage Putin to escalate further and commit more resources to the war.
Against the backdrop of this ‘win at all costs’ mentality, further measures are likely. Moving the economy to a war footing and expanding the already-loose mobilisation criteria are two such probable outcomes. This is based on continued insufficient Russian troop numbers in Ukraine, and a military-industrial complex under growing strain, particularly against Ukraine which is benefiting from a steady flow of Western arms. Both would be likely to bring major strategic-level risks for businesses in Russia and those doing business with Russian entities, ranging from:
- Expropriation at home
- Intellectual property theft abroad
- Co-opting of businesses to support the military-industrial complex
- Conscription of Russian nationals staff or dual national staff
So far, we have not seen any indication that Russia is forcibly conscripting foreign nationals, with the exception of those in Ukraine’s occupied territories. But the US Embassy in Moscow warned on 27 September that Russia ‘may refuse to acknowledge dual nationals’ U.S. citizenship…prevent their departure from Russia, and conscript dual nationals for military service’.
Image: President Putin at the Grand Kremlin Palace, 20 September 2022, Moscow, Russia; Contributor/Getty Images.