Defence Finance Monitor

Defence Finance Monitor

The Ukrainian Drone Industry: Supply Chain Analysis and Chinese Dependencies

Jul 17, 2025
∙ Paid
Ukraine's Drone Industry Takes Flight

Ukraine’s drone industry has experienced an explosive expansion since the Russian full-scale invasion in 2022. From ad-hoc garage projects, it has evolved into a robust sector that has dramatically scaled up production. By some estimates, Ukraine’s defense manufacturing output in 2024 is 35 times higher than in 2022. This growth was fueled by wartime necessity and government support – including reduced taxes, grants, and even hackathons to spur innovation – which together fostered a “startup” culture in defense that cut through bureaucracy to deliver results quickly. As a result, Ukraine is now regarded as perhaps the largest producer of drones in the Western-aligned world, giving the country a fighting chance against a larger adversary and becoming a model observed closely by Europe.


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