• Russian President Vladimir Putin is replacing his defense minister with a civilian economist.

• Andrei Belousov will lead Russia’s military-industrial complex as Putin prepares for a protracted war.

• The move shows Russia’s wartime economy has become a key pillar of growth.

Russian President Vladimir Putin replaced his defense minister with a civilian economist on Sunday. The move has surprised analysts and signaled to some observers that Putin has no intention of ending the war in Ukraine any time soon.

On Sunday, Putin — who was sworn in Tuesday for a fresh six-year term — proposed his new Cabinet.

The Russian leader proposed Andrei Belousov, a 65-year-old former deputy prime minister, as defense minister to replace his longtime ally Sergei Shoigu.

The personnel changes still need to be approved by Russia’s parliament, but given Putin’s grip on power, there are few doubts they will be checked off.

Kremlin spokesman Dmitry Peskov said the Russian defense military’s budget is nearing that of the former Soviet Union in the mid-1980s.

“Today on the battlefield, the winner is the one who is more open to innovation,” Peskov said of Belousov’s appointment, per TASS state news agency.

“Therefore, it is natural that at the current stage, the president decided that the Russian Ministry of Defense should be headed by a civilian,” Peskov added.

Putin is putting the war at the center of Russia’s economy

Putin’s cabinet reshuffle comes as the war in Ukraine drags well into its third year.

Russia continues to face sweeping Western sanctions that were designed to cripple its economy. However, Russia’s economy has appeared to remain resilient.

Reports from Russia suggest the country’s economy is primarily driven by wartime activities that generate a demand for military goods and services, subsidies that steady the economy, and sharp policy-making from its top central banker, Elvira Nabiullina.

Just last month, Putin denied Russia’s economy was moving to a wartime regime.

However, the Russian leader’s appointment of a civilian economist with no military experience as defense minister signals Putin expects the military-industrial complex to be a key pillar of Russia’s wartime economy amid the conflict in Ukraine.

It suggests Putin may be preparing for a confrontation with NATO in the future, analysts at the Institute for the Study of War, a think tank, wrote on Sunday.

It also points to a long war in Ukraine.

“Belousov’s appointment to the position of Russian Defense Minister is a significant development in Putin’s efforts to set full economic conditions for a protracted war,” the analysts added.

Defense minister Belousov will be a ‘financial administrator’

Belousov’s appointment to defense minister is unlikely to impact military operations on the ground.

Valery Gerasimov, Russia’s top general and chief of general staff, will remain in his position and is expected to continue playing a key role in directing the Ukraine war, Mark Galeotti, the director of the London-based Mayak Intelligence consultancy, told Reuters. Gerasimov reports directly to Putin.

“In that context, having an economist, someone who has been speaking about the need to basically subordinate much of the economy to the needs of the defense sector, makes a certain amount of sense,” Galeotti told the news agency. “It is now essentially a financial administrator’s job and Belousov can do that.”

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