Russia has committed over 240 billion rubles (approximately $2.5 billion) to develop domestic chipmaking equipment and materials by 2030. This ambitious program includes 110 R&D projects, with the goal of reducing reliance on foreign technology for its semiconductor industry, according to reports by CNews and Tom’s Hardware.

The initiative, spearheaded by Russia’s Ministry of Industry and Trade and the International Scientific and Technical Center of Electronic Technology (MIET), aims to replace around 70% of foreign-made equipment used in Russia’s microelectronics manufacturing. So far, 41 projects have been launched, with 26 more set to begin by the end of 2024, and the remaining 43 planned between 2025 and 2026.

Russia’s chipmaking industry has faced significant challenges due to sanctions imposed following the country's invasion of Ukraine in 2022. Companies such as Baikal Electronics, Mikron, and the Moscow Center of SPARC Technologies (MCST) were added to the sanctions lists of both the US and UK, severely limiting their access to critical chipmaking tools and materials.

Currently, Russian chipmakers can produce semiconductors using older nodes like 65nm and 90nm, but the country remains heavily dependent on foreign equipment, with only 12% of the tools used in semiconductor production made domestically. Sanctions have increased the cost of importing critical equipment by 40% to 50%, with much of it being smuggled into the country.

Despite this, the American Enterprise Institute (AEI) reported in April 2024 that Russia’s chip industry is still operational, primarily serving government customers, including the military. However, the AEI described the industry as “small” and “technologically backward,” stressing the need for tighter export controls from European and Asian allies to further restrict Russia’s access to advanced chipmaking tools.

In response to these pressures, Russia has accelerated efforts to develop its own lithography equipment and silicon ingots. By 2026, the country aims to produce lithography tools for 350nm and 130nm process technologies, with plans to scale to 65nm and 90nm by 2030.

Meanwhile, US lawmakers introduced legislation in June 2024 to bar US companies receiving CHIPS Act funding from purchasing chipmaking equipment from countries like Russia, China, North Korea, and Iran. Two months later, the Biden Administration banned the export of Nvidia and AMD's advanced GPUs to some Middle Eastern countries, amidst concerns that Russia was using the United Arab Emirates as a transshipment point to evade sanctions.

As sanctions tighten, Russia increasingly relies on China for semiconductor imports. In the first half of 2023, 88% of Russia’s chip imports came from China, according to the AEI report. Despite the hurdles, Russia's efforts to localize semiconductor production are seen as a crucial step in safeguarding its chip industry from future geopolitical risks.