Russia Gets Smart on Ukraine

This is a very effective way for Russia to drop a smart bomb on the Ukraine. The economic carrot is always better than the military stick.

Moscow may offer Ukraine contracts to build aircraft carriers for the Russian Navy, a senior Russian lawmaker told RIA Novosti on Wednesday.

He commented on Russian Defense Minister Anatoly Serdyukov's statement on Tuesday that Russia could make several lucrative proposals to Ukraine that could convince Kiev to allow Russia's Black Sea Fleet to remain in Sevastopol after 2017, when the lease on the naval base in the Crimea expires.

"We can offer Ukraine extensive and lucrative opportunities in the sphere of shipbuilding. They have the Nikolaev shipyards that used to build aircraft carriers during Soviet times," said Vyacheslav Popov, a former commander of the Northern Fleet who now sits in the upper house of parliament.

Nikolaev Shipyards is abandoned and bankrupt, but doesn't need to be. Russia can spend a lot of money to get the northern shipyards up to speed to build aircraft carriers, or invest less money with a strategic aim and build in the Ukraine. While it may be hard to tell, if it was to happen this would be good news for western interests as well.

While the Russian model is still clearly flawed, and I'm speaking directly to the point the Navy appears to be looking at ships as ends, not means, it is hard to argue that Russia investing in shipbuilding outside of Russia is worse than Russia building up its own shipbuilding capability.

Russia appears set on a coarse for aircraft carriers, although for what purpose is still unclear. If it is going to happen anyway, it doesn't hurt the west that it would be in the Ukraine, because whenever the model is partnership that is to the advantage of the west who is encouraging a global model for cooperation. It wouldn't hurt at all if Russia is building aircraft carriers in Ukraine, and Ukraine became a member of NATO. Indeed, that is the solution to the kind of problems that led to the Georgian incident, although that is probably an unpopular sentiment to those who won't let go of the cold war.

From the Russian view, this is also smart. It is hard to get Russians excited about working in a shipyard where the temperature is more often below freezing than above. The other, and larger problem facing Russia is that the Russian shipbuilding industry is suffering from inflation from rising costs on all fronts for large projects, which is why we have seen the cancellation of several civilian shipbuilding projects and major cost overruns for the upgrades Russia is doing for the Indian Navy.

This will be very interesting to watch, because it is hard to say this would be a bad deal for the Ukraine. However, at the end of the day opening up a shipyard for the sole purpose of building aircraft carriers will be a major undertaking, and in the end the ships will likely be just as expensive built in the Ukraine as they would be in Russia, if not more so due to lack of skilled labor in the Ukraine. With that said, it is easier to entice skilled labor to come work in the Black Sea than it is to lure such skilled help to the Arctic Ocean.