Funding for Ukraine’s defense industry has increased more than ninefold in recent years. In 2022, ₴2.5 billion was allocated for defense needs, but after adjustments, this amount reached ₴7.7 billion. In 2023, expenditures for the sector amounted to approximately ₴12 billion, and in 2024, it was ₴39.6 billion. The most significant growth occurred in 2025: initially, the budget anticipated ₴54.6 billion, but after revisions, it stands at ₴84.5 billion – an absolute record during the years of full-scale war. For 2026, ₴44.4 billion is planned for the development of the defense sector.
This is reported by Finway
Growth of Production Capacities and Innovations
Since 2022, the production capabilities of the defense sector have increased 35 times and are currently estimated at $35 billion. The Ukrainian defense ecosystem comprises about 900 enterprises, including approximately 100 state-owned and 800 private companies. Around 1,000 teams of engineers and developers work daily on innovative projects.
A breakthrough in the production of modern missiles and unmanned aerial vehicles deserves special attention. Ukraine is already serially producing the “Flamingo” cruise missiles with a range of up to 3,000 km, the “Long Neptune” with a range of 1,000 km, as well as the drone missile “Hell,” which can reach speeds of up to 700 km/h. Prior to this, the drone missile “Palyanytsia” was developed, featuring a warhead weighing approximately 100 kg, which is also in serial production.
Production of Drones and Artillery
The Ukrainian defense industry continues to enhance its capabilities in the field of long-range drones. Approximately 4 million drones of various types are produced annually in the country, and production capacities allow for this figure to be doubled. The production volumes of the self-propelled artillery systems “Bohdana” (155 mm) have also significantly increased: while 6 units were produced per month in December 2023, by October 2025, this number had risen to 40.
“Over 40% of the weapons on the front lines are of Ukrainian origin, but Ukraine is also establishing joint productions with other countries and attracting investments for systematic scaling of capacities. Already, 25 foreign companies are at various stages of localizing production in Ukraine.”
In addition, Ukraine is actively developing cooperation with foreign partners. Already, 25 international companies are at different stages of localizing production within the country, contributing to attracting investments and expanding the technological capabilities of the defense sector.