Russia reported a paltry rise of less than $500 million in its arms exports for 2016 compared to 2015, indicating the battering its weak economy is taking from the crippling economic sanctions imposed on it in 2014 by the United States and the European Union as punishment for Russia's occupation of Crimea.

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Russian arms exports amounted to some $15 billion in 2016, exceeding 2015's figures, which stood at $14.5 billion, said Prime Minister Dmitry Medvedev in a report addressed to the State Duma (lower house of parliament).

"We're the second-biggest player on the global arms market. Last year exports of products for military purposes exceeded $15 billion," said Medvedev.

He noted that "the new contracts signed (in the reporting period) amounted to $9.5 billion, while the stock of orders in end-2016 was worth around $50 billion."

Russian arms exports have remained flat since 2014. Before this year, however, arms exports rose rapidly from $6.12 billion in 2005 to $15.7 billion in 2013, according to data from the the Center for Strategic and International Studies in Washington D.C.

Those figures dropped to $14.5 billion in 2015 and then inched slightly upwards to $15 billion in 2016.

China and India account for about half of Russia's arms exports. CSIS said China kept Russia's defense industry afloat in the 1990s, buying fighters jets, warships, and other weapons developed by the Soviet Union.

It's a different story today, however, since China now has a growing, indigenous defense industry. Russia completely lost its share of the Chinese market for warships to Chinese shipbuilders. Russia last delivered a destroyer to China in 2006.

India is also ramping-up domestic production of its weapons, a development that bodes ill for future Russian arms exports to India.

South Korea has taken Russia's place as the builder of warships for the Indian Navy. South Korea has become India's leading Asian weapons supplier and defense industry partner and a recent agreement on warship construction for the Indian Navy cements this position for South Korea.

Both countries on April 21 signed an inter-governmental memorandum of understanding (MoU) on "Defense Industry Co-operation in Shipbuilding" that will facilitate their partnership in warship building programs. Under this deal, warships for the Indian Navy will be built at domestic shipyards with South Korean assistance.

The MoU was signed by Ashok Kumar Gupta, India's Secretary of Defense Production and Chang Myoung-jin, South Korean Minister of Defense Acquisition and Program Administration.

India has selected state-owned Hindustan Shipyard Limited (HSL) to cooperate with a shipyard nominated by South Korea.

Located at Visakhapatnam on the east coast of India, HSL has built some 2,000 ships, including warships for the Indian Navy. It's upgrading its facilities to build nuclear powered submarines. It currently refits and overhauls navy submarines.

TagsRussia, arms exports, economic sanctions, United States, European Union, Crimea, Prime Minister Dmitry Medvedev, Center for Strategic and International Studies, Center for Strategic and International Studies (CSIS)