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It was announced on 6 November that President Vladimir Putin had fired Defence Minister Anatoly Serdyukov 'to prevent possible obstruction in the corruption investigation into the Ministry of Defence's "Oboronservice" property management agency'. The agency was headed by Eugenia Vasiljeva, Serdyukov's fiancée. Allegations of adultery by Serdyukov were leaked, which were especially damaging as Serdyukov was married to the daughter of Viktor Zubkov, a former Prime Minister and close associate of Vladimir Putin. Zubkov was also responsible for establishing the 'Ozero' co-operative, the closed club of Putin associates which effectively rules Russia today. Despite the existence of these scandals, there are tangible reasons to believe that Putin's decision was forced by external influences.
Anatoly Serdyukov is traditionally mentioned as one of just handful of people who really works for Putin, when many individuals use their political proximity to the Russian President to further their own cause. Thus Serdyukov was one of Putin's most trusted allies and useful servants. One of the key features of Vladimir Putin's personality is his deep intrinsic loyalty to his 'own people', and the Russian President publicly announced twice in late October and early November that Serdyukov was untouchable (the investigation of corruption at 'Oboronservice' had been under way since September 2012). However, he fired Serdyukov just several days after that comment. At the same time, corruption is so widespread in the Russian Ministry of Defence and Russia's governance system, both created by Putin, that sacking Russian high-ranked officials for corruption would leave Putin without a government.
Secondly, Serdyukov's adultery while possibly contributing to Putin's final decision (Zubkov is closer to Putin than Serdyukov), does not explain what happened three days after firing of the Defence Minister. On 9 November the Chief of the Russian General Staff Army General Makarov was also fired by the President. General Nikolay Makarov never betrayed Zubkov's daughter; he just actively supported the reforms to the Russian Armed Forces and military bureaucracy that Serdyukov implemented began in 2008.
The issue of military reform has been highly controversial within the Russian establishment, with the most controversial changes relating to procurement. Serdyukov broke the Russian military-industrial base's monopoly on supplying the Russian military. Before, the Russian Armed Forces simply bought what was produced regardless of its utility or quality. This industrial policy had badly affected the capabilities of the Russian Armed Forces. For instance the current T-90 main battle tank (MBT) is merely the 17th modification of the vintage T-72 designed in 1969. The T-90 was rebranded as the 'Vladimir' in 2004 in an unsubtle, military grade ego massage.
At the same time the monopolistic position of Russian arms producers and the political leadership's traditional obsession with defence created a culture and structure of procurement which produced hugely overpriced weapon. These regularly had serious design issues and were often delivered with huge delays. Serdyukov was determined to change these practises and challenge the power of the military-industrial complex, stating 'if you will not deliver what we need, in time, and for the negotiated price, we will find alternative suppliers'. Russia's purchase of French 'Mistral' amphibious ships, Italian armoured cars and German tank simulators were clear signals in Serdyukov's fight against the Russian military-industrial complex's inability to meet contemporary challenges. The refusal of the Russian Defence Ministry to purchase Russian weapons systems also influenced the position of these systems in the global arm's market.
Serdyukov's reforms and his antagonistic relationship with the military-industry base were not the result of entrepreneurial impulses. He was implementing what Putin had ordered him to do. Putin had repeatedly highlighted what he called the 'ticking time bomb of Russia's defensive capabilities', the fact that Russian industry was failing to produce modern and capable weapon. Serdyukov was keen to implement these orders, unconcerned that his actions frustrated the leadership of Russia's defence industry. These reforms also sought to change the Russian Armed Forces from their previous Cold War posture towards a leaner and more flexible formation, better suited for modern, unconventional wars. This did not win him the support of the traditionalist military elite.
It was not surprising that Sergey Chemezov, Sergey Ivanov, and Dmitry Rogozin allied in their criticism against Serdyukov. Chemevoz was the head of 'Rostekhnologii', a Russian arms manufacturer which enjoyed a monopolistic relationship with the Russian Armed Force (and the former head of 'Rosoboronexport' monopolistic arms exporter). Sergey Ivanov was Putin's Defence Minister between 2003 and 2007 and Deputy Premier-Minister Dmitry Rogozin who is now in charge of the military-industrial complex.
Putin publicly defended Serdyukov but regardless, the Investigation Committee publicly launched a case against Serdyukov on 25 October. While such public criticism is very much taboo within the Russian ruling elite it is worth remembering that Chemezov and Ivanov are FSB Generals while Putin was only a Major who rose to Lieutenant-Colonel in retirement.
Putin has fired Serdyukov and Makarov, appointed Sergey Shoigu Defence Minister and, in the sharp contradiction to his own previous position, instructed the latter 'to improve relations with the military-industrial complex'. Putin's press team have taken strenuous steps to prove that 'the President has undertaken the decision to fire the Defence Minister on his own, without any external influence'. This was in itself unprecedented as Putin's office has never before needed to state the independence of the President's decision making.
The new Russian Defence Minister Sergey Shoigu is known as Putin's 'crisis-manager'. At the same time he is known for his reflexive preference not to challenge powerful opponents, avoiding confrontation and retreating in cases of serious bureaucratic clashes. The most probable outcome of this appointment is that the reform process will slow down. The Russian Armed Forces re-armament and modernisation will probably suffer from this opportunistic victory by the Russian military and industrial traditionalists.
The successful ousting of Serdyukov by Chemezov, Ivanov and Rogozin, against Putin's public pronouncement of support, is an indication that Putin's dominance of Russia's ruling elite is slipping as is his hold on events in Russia. The actions of Rogozin are particularly significant as he is Putin's protégé, who owes all his current governmental position to Vladimir Putin - and that tells a lot about the state of Putin's control of the Russian elite.
The views expressed here are the author's own and do not necessarily reflect those of RUSI.