Fragments of two Shahed drones at a secret Ukrainian workshop in the country’s southern Mykolaiv region on Oct. 31, 2022. (Heidi Levine/Washington Post)
The partnership between Iran and Russia to produce Iranian-designed drones on Russian soil has deepened military ties between the two heavily sanctioned states and substantially boosted Russia’s domestic drone industry, according to a report released Thursday.
In the two years since Moscow struck a deal with Tehran to exchange technology and set up production of unmanned aerial vehicles (UAVs) in Russia’s Tatarstan region, Russia has been able to vastly increase its capability for domestic drone production and used it to pummel Ukrainian cities with hundreds of UAVs a day.
The partnership also spawned a covert payment network involving gold transfers and intermediary countries to bypass Western sanctions - complicating efforts by the United States and its allies to enforce export controls.
The Washington Post previously reported on the large-scale effort at the Alabuga special economic zone in Tatarstan to build 6,000 drones by summer 2025, based on documents leaked from the Russian side. The deal sought to reverse Russia’s then shortage in long-range weaponry, after it had expended its cruise missiles, and to boost Moscow in the drone arms-race that is increasingly defining the war in Ukraine.
The new report - prepared by C4ADS, a Washington-based research group that studies global security issues, and shared with The Post - sheds light on the Iranian side of the deal and the deepening cooperation between the United States’ two geopolitical adversaries.
“The switch from UAV imports to localized UAV manufacturing has played a significant role in supporting Russia’s war in Ukraine,” the report said. The deal allowed Russia to build Iran’s Shahed-136 drone, a propeller-driven craft that flies hundreds of miles and crashes into a target carrying 118 pounds of explosives. Russia rechristened it the Geran-2.
According to Ukrainian figures, attacks involving an average of 100 Shahed-style drones a night have become common this year, with last weekend seeing some of the largest onslaughts at about 300 drones a night. The numbers suggest that the manufacturing deal, which has cost Russia an estimated $2 billion, has borne fruit.
An analysis of drone strikes on Kyiv - conducted by Dragonfly Intelligence, a geopolitical and security intelligence provider - found that the number of projectiles per attack has increased over time, rising from 60 a day between August and January to 110 a day over the past three months.
“Russian drones now fly faster and at higher altitudes, beyond the reach of Ukraine’s mobile air defence groups,” Thursday’s report said, adding that the drones were also carrying bigger payloads.
Ukrainian President Volodymyr Zelensky told journalists this week that Russia can build about 300 to 350 long-range drones a day.
Ukraine, meanwhile, builds about 100 long-range drones a day as it lacks the finances to ramp up production.
By localizing drone production, Russia has been able to quickly maintain and expand its long-range strike capability, building on existing research and development.
“To accommodate shifting mission requirements, Russia can allocate additional resources to produce or modify the Geran-2 without additional Iranian support,” the report said.
The Russian developers in the Alabuga drone-manufacturing facility were also able to acquire Iranian-supplied technology to start manufacturing the Geran-3 model, a jet-powered variant capable of a higher top speed than the Geran-2. This increase in flight speed allows for faster targeting and better evasion of antiaircraft systems.
“We’ve seen that they have been able to expand from importing the Geran-2, to a localized version of Geran-2, to now producing localized Geran-3,” said researcher Omar Al-Ghusbi, the report’s author. “We appear to be seeing a quite successful localization as we’re starting to see more and more variation from the initial set of Iranian drones, although for some things they still rely on imports.”
Russia’s Defense Ministry did not respond to questions about the report and cooperation with Iran on drone manufacturing. The Iranian mission to the United Nations also had no comment, but in the past, an Iranian spokesman acknowledged that Iran and Russia have “maintained bilateral defense, scientific, and research cooperation, that predates the start of the Ukrainian conflict.”
The C4ADS report draws on leaked data and public sources to trace the transfer of UAV technology from Iran to Russia. Key leaks include 10 gigabytes of files from Sahara Thunder - a Tehran-based company covering a range of activities, from oil shipping to defense procurement - released by the hacking group Prana Network in early 2024.
The leak revealed the company’s ties to Alabuga, home to a research center and production assembly line. The data from the leaks has been corroborated using additional publicly available data, aircraft and vessel location data and detailed component analysis.
The U.S. imposed sanctions on Sahara Thunder in April 2024 for supporting Iran’s Defense Ministry and facilitating UAV transfers to Russia. The company was identified as a front for Iran’s military, also involved in shipping commodities to countries such as Russia, China and Venezuela.
The report also outlined a complex system of payments used in this multimillion-dollar deal. Aside from a conventional wire transfer, which according to the documents was processed through a bank in the United Arab Emirates, Russia also delivered gold bars as part of the transaction.
Russia and Iran made use of the UAE’s Free Zone Establishments - special jurisdictions that allow full foreign ownership, tax exemption and an easier way to move assets and funds - receiving access to financial infrastructure otherwise inaccessible to these countries, the report said.
An excerpt from a contract between Alabuga and Sahara Thunder also detailed a delivery of gold ingots, totaling about $104 million.
“By using gold, the parties avoided using the U.S. dollar, which could be in short supply or subject to enforcement action by the U.S. Department of the Treasury,” the report said. “The transfer of gold also provides additional anonymity as it circumvents traditional financial systems while leaving a limited digital footprint.”
Iranian corporate data indicates that months after the U.S. imposed sanctions on Sahara Thunder, the company began a liquidation process, with another legal entity likely to spring up in its place.
According to the report, the Russia-Iran drone partnership underscores the limitation of global sanctions as entities adapt and others rise to take their place. “Only by understanding and adapting to these tactics can global stakeholders disrupt similar entities,” the report said. Siobhán O’Grady and Susannah George contributed to this report.
