Kazakhstan - Military Industry

Under the policy of regional, industrial specialization which was typical of the planned, centralized economy of the Soviet Union, enterprises belonging to manufacturing industries on the territory of Kazakhstan were not very numerous. Before the dissolution of the Soviet Union, Kazakstan was the most significant site of military-industrial activity in Central Asia. The republic was home to roughly 3 percent of Soviet defense facilities, including more than fifty enterprises and 75,000 workers, located mostly in the predominantly Russian northern parts of the country.

The principal centers of the Kazakh defense industry were Petropavlovsk in the north of the country, Oral and Aqtau in the west, Oskemen in the east, Akmola in the center of Republic, and the [former] capital, Almaty, in the south. A plant in Öskemen fabricated beryllium and nuclear reactor fuel, and another at Aqtau produced uranium ore. The town of Kurchatov near the former nuclear test site of Semipalatinsk had a major nuclear industry research center.

In Petropavl, one plant produced SS-21 short-range ballistic missiles, and other plants manufactured torpedoes and naval communications equipment, support equipment for intercontinental ballistic missiles (ICBMs), tactical missile launcher equipment, artillery, and armored vehicles. There was a torpedo-producing facility in Almaty as well. Chemical and biological weapons were produced in Aksu, and chemical weapons were manufactured in Pavlodar. Products of the enterprises in Oral included heavy machine-guns and small arms, equipment and munitions for the Navy (such as anti-ship missile systems).

In Kazakhstan the process of reorientation or transition to Republic jurisdiction, took place in a calm atmosphere for defense enterprises. In September 1991 there was a conference chaired by Kazakhstan Republic Deputy Prime Minister K. Baykenov, attended by leaders of the Republic Ministry of Industry on the one hand and by representatives of union defense ministries being abolished and defense industry directors on the other. It is said that it was then the idea arose of consolidating defense complex enterprises in state corporations. One of them was soon well known in Kazakhstan today. It is the Kazakh State Corporation of Electrical Equipment and Machine Building Enterprises of the Defense Complex, or KEMPO for short.

It was soon realized that very often managers were chasing across the entire Union after some kind of set-making parts, while what was needed was already being produced or could be produced without problems nearby in native Kazakhstan. But excessive secrecy and notorious departmental dissociation interfered: one plant, for example, was the private domain of the Ministry of the Radio Industry, and another of the Ministry of the Electrical Equipment Industry. On the whole, the striving to create one's own complete production cycle within the framework of each sectorial department brought no small costs. Previous ties with component manufacturers were not always successfully preserved. Some inflated prices to an unacceptable level and others demanded, for example, refrigerators and refrigerators alone as barter exchange.

The KEMPO Corporation established an exchange, a bank and a trading house. It chose priority directions for Corporation enterprises: manufacture of equipment for the agro-industrial processing industry and public dining and trade enterprises. We manufacture medical equipment as well as consumer goods, including sophisticated household equipment. One problem is that not only does the enterprise have to place new conversion commodities into production, but also find the consumer. By 1992 KEMPO Corporation was striving to develop foreign economic activities, supported both by the Kazakhstan Cabinet of Ministers and by the Republic Ministry of Industry.

By 1994 most of Kazakstan's defense plants had ceased military production. All of them required component parts from inaccessible sources outside Kazakstan, principally in Russia. Even more important, the Russian military-industrial complex was itself in collapse, so that Kazakstan's military enterprises no longer could rely on Russian customers. In addition, the great majority of key workers at all these facilities were ethnic Slavs, the most employable of whom moved to Russia or other former Soviet republics. Substantial elements of Kazakstan's military-production infrastructure nevertheless remain in the republic. By 1996 approximately 90 percent of defense industry of Kazakhstan were grouped under two state companies - KORGAU and KATEP. Nine tenths of nuclear-oriented plants and facilities of the nuclear industry came under KATEP state company.

The most important key point is that by 2013 Kazakhstan had not only JSC NC Kazakhstan Engineering, but also private firms that specialize in military products. In these enterprises was about 41%-42% of production for military purposes. And all of these indicators showed that growth was evident in defense industry.

The Ministry of Defense (MOD) set an ambitious task-to bring to 80% local content in products for military use, in the territory of the Republic of Kazakhstan. By 2013, industry achieved the target of 50%. The goal was set up to the year 2020 to bring this figure up to 80%. It is not an end in itself, it's not a PR-campaign for the achievement of these targets. This is a real need, the strategic need for basic key performance indicators for any military products produced on the territory of the Republic of Kazakhstan. However, the world experience of leading countries of the world, such as United States, United Kingdom, Germany shows that 100% is not achieved on their own territory. Now this activity is international cooperation, it is impossible within the territory of one State, and even no need – all produce on the territory of one country.

The armed forces are mainly equipped with Soviet and Russian-made equipment. From 2009 onwards, the MOD adopted a program connected with the opening of businesses on the territory of Kazakhstan. The MOD began to equip the army with only automotive equipment, manufactured in the territory of the Republic of Kazakhstan. The main base of trucks KAMAZ vehicles are produced at the company JSC "KAMAZ Engineering" in Kokshetau. The MOD identified this car base, produced various versions of combined arms and trucks to special. In respect of passenger road transport, the MOD has a step-by-step process of updating vehicle fleets. Basically, the MOD buy cars produced at the plant in Ust-Kamenogorsk – «Asia auto», also since 2012, the MOD began to acquire all-terrain cars Ssang Yong (JSC "Agromashholding"). Prospects for a light protected vehicle were being studied with a number of foreign companies, as was the question of the organization of the production of heavy-duty vehicles, specifically designed for use in military environments.

The military exhibition "KADEX" has undoubtedly been one of the key events in the country. Great interest was seen from partners at many leading companies dealing with not only manufacture of military weapons and equipment, but also dual-use products. Today the exhibition "KADEX" has become a top international arms exhibitions of military equipment. The first exhibition was held in the year 2010, and the results allowed Kazakhstan in 2011 and 2012 to open new businesses to equip the army with modern samples of armament and military equipment. The second exhibition gave impetus to Kazakh enterprises to deliver products to the international market.