Indirect China-Russia trade is bolstering Moscow’s invasion of Ukraine

China’s trade with Russia has risen substantially since the Kremlin’s full-scale invasion of Ukraine, significantly bolstering Moscow’s war aims. While there is no publicly available evidence that Beijing is providing lethal arms to Russian forces, its goods exports are nonetheless likely facilitating Moscow’s invasion. Importantly, trade between China and Russia does not only occur bilaterally. The two countries are also trading via Central Asian countries, which bridge the two authoritarian powers rather than divide them. With the US widening sanctions on Russia, policymakers should pay close attention to potential China-to-Russia trade diversion via Central Asia and other locations.

China’s direct exports to Russia since Moscow’s invasion of Ukraine have fallen only twice, both during times Chinese firms feared sanctions risks. Chinese exports first dipped in the initial days of Russia’s invasion in early 2022 amid sanctions concerns, but Chinese corporates reestablished these links, often at the urging of Chinese officials. Second, China-to-Russia shipments have declined in recent months, likely owing to stricter Western sanctions imposed in December 2023 and to Lunar New Year production pauses. This downtick is likely only temporary, and the bilateral relationship at the highest level remains strong, as the meeting between Chinese leader Xi Jinping and Russian President Vladimir Putin in Beijing in May indicates.

Chinese imports from Russia have risen consistently throughout the conflict, largely owing to surging global commodity prices and the redirection, whenever possible, of Russian hydrocarbon exports from Europe to China.

Russia’s crude oil exports to China rose significantly after Moscow launched its full-scale invasion in February 2022. Still, Russia’s exports of other mineral fuels to China—such as natural gas, coal, and other hydrocarbons, including diesel—have grown more rapidly in percentage terms. Pipeline natural gas trade increased on the Power of Siberia pipeline as upstream production ramped up, while Russia’s coal exports to China also rose sharply.

While Russia’s exports help finance its war effort, its imports of industrial goods are vastly more important for sustaining the economic, political, and military dimensions of its war effort, at least in the short term. Russia’s imports prevent shortages, maintain political support for the war by stabilizing living standards, and, in some cases, facilitate military capabilities. China’s exports to Russia, including of machinery, vehicle-related items, and dual-use technologies, have underpinned the Kremlin’s ongoing war effort.

Chinese automobile manufacturers, due to a mixture of massive subsidies and genuine innovations, have become global exporters. China has essentially replaced the West in vehicle trade across Russia, Central Asia, and Belarus, as a comparison of each country’s total 2021 imports versus China’s 2023 exports to those same countries suggests.

Vehicle imports by country

Russia receives Chinese vehicle-related shipments both directly and indirectly, via transshipments from third countries. While Kyrgyzstan routinely undercounted imports even prior to the war, it is not spending a quarter of its gross domestic product on auto imports from a single country. Additionally, Kazakhstan reported importing nearly $7.8 billion in autos from all sources in 2023, more than double what it imported in 2021. Many Chinese vehicle-related exports notionally bound for Central Asia are in fact headed to Russia.

Chinese vehicle-related direct and indirect exports to Russia seem to be significantly bolstering the Kremlin’s war effort. Some Chinese-made vehicles, such as excavators, have been employed directly on the front lines. In most cases, however, Chinese vehicle-related items serve as logistic enablers, allowing Russia to avoid bottlenecks and repurpose its existing truck fleet to the front lines.

Trucks, which ease goods shortages and bottlenecks for the civilian sector and enable battlefield logistical support, are illustrative. In 2021, Russian total imports of heavy-duty trucks reached 12,785 units, for a total cost of $1.04 billion, with more than half of these shipments derived from Western sources. By 2023, conversely, China alone exported 42,562 units of these heavy-duty trucks to Russia, to the tune of $2.1 billion. Russia’s surging trucking imports are driven by wartime needs, as well as the collapse in domestic auto production, which has only recently stabilized. Here, it has found a willing supplier in China.

Chinese firms are also enabling Russia to maintain its existing civilian and military vehicle fleet. Chinese exports of vehicle spare parts to Russia and its neighbors nearly tripled since 2021, rising from $383 million to $1.12 billion. Again, while some fraction of this trade was commercial, it’s noteworthy that much of it—more than $415 million in 2023—was routed through Kyrgyzstan, which is importing 642 percent more than it did in 2021. Russia’s access to Chinese-made vehicle spare parts may have removed severe operational constraints that otherwise would have limited its recent military offensives.

While China’s direct and indirect vehicle-related exports to Russia have been instrumental for the war effort, other exports have been even more critical for Russia’s defense industrial base. The United States, European Union, United Kingdom, and Japan imposed strict export controls on the “Common High Priority List,” a list of fifty products that Russia may seek to obtain for use in its military sector. Since then, Russia has sourced these materials directly from China and, almost certainly, from procurement agents across Central Asia. The extent of Western companies’ participation in this trade, especially via Central Asia, is an important question for policymakers to consider.

Chinese exports to Russia of high-priority goods exhibited the same pattern seen throughout the conflict. First, there was a surge in exports in the last months of 2021, due to year-end production surges (and potential stockpiling by Moscow); followed by a sharp drop in the first months of the war; a rise throughout mid-2022, as Beijing began to back Moscow’s war effort more vigorously and openly; and a decline beginning at the end of 2023, due to stricter Western sanctions (as well as the Lunar New Year).

Conversely, a look at China’s exports of dual-use goods to Central Asia and Belarus shows a nearly continuous increase since the war started.

Some of these export shipments could be legitimate. On the other hand, it is very prudent to examine if China’s shipments of dual-use goods to Central Asia and Belarus, which more than doubled in 2023 from the prior year, are simply being re-exported on to Russia. Western sanctions officials should continue to monitor Chinese dual-use exports to third-party countries, especially in Central Asia, that may serve as transshipment points and evaluate these transactions on a case-by-case basis.

In sum, trade between China and Russia has risen sharply since the beginning of Moscow’s full-scale invasion of Ukraine, facilitating the Kremlin’s war effort. Direct trade, including in vehicles, machinery, and dual-use components, aids Russian forces in Ukraine and eases shortages in the Russian economy. Indirect trade, especially via Central Asia and Belarus, serves as a supplement for the already-considerable commercial ties between the world’s two most powerful autocracies. When examining China-Russia trade, analysts must consider the totality of their interactions, including indirect linkages via Central Asia.

Joseph Webster is a senior fellow at the Atlantic Council’s Global Energy Center and its Indo-Pacific Security Initiative. He is also an editor of the independent China-Russia Report. This analysis reflects his own opinion.

Further reading

Image: A fully loaded container train is preparing to depart from the China-Kazakhstan Logistics Cooperation base in Lianyungang, Jiangsu Province, China, on May 10, 2024. (Photo by Costfoto/NurPhoto)