Technological Development of Serbian Defence Industry and Contribution of Yugoimport SDPR to Enhancement of Serbian Armed Forces’ Combat Capabilities
The defence industry represents one of the key pillars of a country's scientific and technological development. Scientific breakthroughs, innovation, and sophisticated military systems and platforms have a positive effect on many other industrial sectors as well.
After the breakup of Socialist Federal Republic of Yugoslavia, years of sanctions, the loss of major domestic buyers (Yugoslav People's Army, civil defence, and the Ministry of the Interior) which absorbed nearly 50% of total production output, the devastating effects of the 1999 NATO aggression, and a turbulent transition period in the first decade of the 2000s, the Serbian defence industry companies managed to survive, despite numerous operational challenges and problems, the principal ones being a failure to modernise technologies and a lack of capital investment.
The year 2013 marked the beginning of a major technological consolidation of defence production facilities. The goal was to enable these plants to again manufacture cutting-edge weapons and modernise existing ones, primarily to meet the needs of the Serbian Armed Forces.
The key measure directly contributing to the rapid development of the defence industry has been its technological revitalisation through direct state investments in the factories’ manufacturing capacity, as well as new products developed by the Military Technical Institute and defence plants, tailored for the Serbian Armed Forces. These products quickly gained recognition in the international market. Over the past 13 years, the number of newly adopted, domestically developed weapons systems and military equipment has grown three and a half times, compared to the period between 2000 and 2012.
From 2013 to the present, investments into critical technologies have increased 12 times through combined factory self-investment and direct state investments, compared to the period between 2000 and 2012.
New complex combat system manufacturing plants started to operate in Velika Plana, which enabled Serbia to start producing new combat platforms for the Serbian Armed Forces and modernise the existing ones.
Yugoimport-SDPR, together with its subsidiaries (Complex Combat Systems (BSS), “BELOM” Small Arms Ammunition Factory, Kovački Centar (Forging Center), Utva Aircraft Industry, and others), has made a significant contribution to the development of Serbia’s defence industry from 2013 to the present day.
At BSS facility in Velika Plana, new production facilities for complex combat systems were opened in three phases. At this site, operations are carried out in several interconnected stages, including the design and preparation of engineering and technological documentation, production planning and preparation, manufacturing, and quality control. Manufacturing takes place in several organizational units, including:
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Metalworking and Welding Facility – performs metalworking operations such as cutting, welding, rough honing, sandblasting, straightening of parts, preheating, and annealing of welded structures.
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Machining Facility 1 and 2 – performs machining operations (turning, milling, and electrical discharge machining), cuts bar stock using metal-cutting saws, drills components, using vertical boring machines, carries out grinding on double-sided grinding machines, and calibrates machine tools using a tool calibration machine.
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Metal Cutting and Plastic Deformation Facility – performs material preparation and laser cutting, as well as the bending of components using a tandem press.
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Electrical Facility – manufactures electrical installations and assemblies, produces electrical equipment and devices, and installs them on combat systems.
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Painting Facility with Curing Oven – performs degreasing, putty application, priming, and topcoat painting, while curing operations are carried out in ovens.
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Vehicle Adjustment Facility – performs final vehicle adjustments.
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Assembly Facilities 1 and 2 – carry out metalworking assembly, interior installation, powertrain mechanical work, and final assembly of artillery systems and vehicles, including Nora M15, Nora M21, Nora NG, Tamnava, Milosh, Milosh 2, Lazar 2 and subsequently Lazar 3, Lazar 3M, Lazanski, Aleksander the Unifier, and others.
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Gun Barrel Facility – performs gun barrel machining operations, including deep honing, turning, rifling, honing, autofrettage, fitting of barrel sleeves, and barrel bending.
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A new production facility was opened in June 2020 at the BSS facility in Kuršumlija, marking the first phase of the construction of a metal machining factory in Pljakovo near Kuršumlija. Today, the factory in Kuršumlija covers most of the production processes carried out at the Velika Plana facility.
Since its establishment, the factory has continuously invested in increasing production capacity and introducing new technologies, thereby significantly expanding its production range.
Small Arms Ammunition Factory, BELOM, was established in 2015 with the aim of organizing its own manufacture of weapons and ammunition in calibres up to 12.7 × 108 mm.
In July 2017, the opening of the small arms ammunition factory took place in Uzici near Požega, as a part of a defence industry development project. The investor in the ammunition factory is BSS, a subsidiary of Yugoimport-SDPR.
Owing to its business activities and its affiliation with the public enterprise Yugoimport-SDPR, “BELOM” has become a recognized name on the global market in a very short period of time.
This is further evidenced by the fact that, in 2018, “BELOM” Ltd. became a member of the Association of European Manufacturers of Sporting Ammunition (AFEMS).
In 2017, the public enterprise Yugoimport-SDPR became the majority owner of Utva Aircraft Industry. Currently, Utva Aircraft Industry’s product portfolio includes Sova and Lasta aircrafts.
In addition to its core product range, consisting of Sova and Lasta aircrafts, Utva has for years been manufacturing aircraft armament, as well as subsystems for complex combat systems used by the Army. Particular emphasis is placed on investment in expanding UAV production capacity. In addition to Pegaz and Vrabac (Sparrow) UAVs manufactured for the Serbian Armed Forces, plans are underway to expand production capacity and manufacture other types of UAVs.
Using modern design and manufacturing concepts, Utva Aircraft Industry strives to meet all current market requirements. Thanks to the satisfaction of domestic and international customers, Utva has earned worldwide recognition for its safe, comfortable, and reliable aircrafts.
Kovački Centar (Forging Center) Valjevo is the first facility of its kind to have been built in the Serbian industry in many years. Its construction was financed by Jugoimport-SDPR as the majority owner, while the infrastructure was provided through the ownership stake held by HC “Krusik” JSC Valjevo.
The manufacturing processes at Forging Center Valjevo include forging, pressing, stamping, metal rolling, and similar operations. Its product portfolio comprises forgings for mortar, artillery, and rocket ammunition, manufactured by forging and made of carbon and alloy steels. The new product range also includes various other forgings, as well as plastic components.
Since the establishment of Forging Center, Yugoimport-SDPR has continuously invested in the modernization of technology and the expansion of production capacity for large-calibre ammunition, primarily 155 mm ammunition with standard and extended range. Investments have also focused on completing all stages of the production cycle for artillery, mortar, and rocket ammunition shell bodies.
In addition to the modernisation and retrofitting of existing technologies and the introduction of new ones, the defence factories’ manufacturing capacity has significantly increased through production optimisation and automation, enhanced energy efficiency, and upgraded occupational health and safety standards. In specific segments, manufacturing capacity has experienced dramatic growth. The production of missiles and ammunition components increased four times, high explosives production and complex systems manufacturing and overhaul capacity doubled.
In addition to strengthening the defence industry through domestic investments, the procurement of imported complex combat systems has further enhanced the industry through the transfer of cutting-edge technologies, industrial cooperation, and the localisation of sophisticated system and component production in Serbia.
The planned development of the domestic industry has significantly increased its capacity to produce new complex land combat systems, unmanned platforms, telecommunication, optical, and optoelectronic systems, modern extended range and high precision guided and unguided ammunition, and new energetic materials. It has also boosted its capacity to develop modern software and utilise it in the design, testing, and production of weapons and artificial intelligence algorithms, as well as in other segments vital to the defence system.
Today, Serbia’s defence technological and industrial base comprises over 60 enterprises of different sizes and ownership structures, employing more than 20,000 people, directly engaged in the production of weapons and military equipment. It also includes military-technical institutions involved in the development, overhaul, modernisation, and testing of military equipment, as well as a range of subcontractors supporting the development and production of weapons and military equipment. The core of this base is the Serbian Defence Industry Group, which comprises 17 state-owned defence enterprises managed and supervised directly by the Ministry of Defence.
The technological modernisation of domestic factories and military-technical institutions over the past 13 years, combined with favourable defence budget trends, has intensified the award of contracts to the domestic industry for the delivery of new weapon platforms to the Serbian Armed Forces.
In an effort to equip the Serbian Armed Forces with domestically developed and manufactured weapons and military equipment, the past seven years have witnessed an intensified award of contracts to the domestic industry for the supply of newly developed and modernised systems whose serial production was successfully established following rigorous testing and verification processes.
Between 2013 and 2026, the total value of defence procurement contracts awarded to the domestic industry for modern military equipment was 20 times higher than the total contracted volume between 2000 and 2012.
From 2020 to the present, the domestic industry has delivered several hundred newly developed and modernised complex combat systems to the Serbian Armed Forces. The performance of these systems is similar or equivalent to platforms used by the world’s most advanced armed forces. Several hundred additional units are currently being produced, to be delivered to the Serbian Armed Forces by the end of this year and in the first half of next year. Over the same period, domestic manufacturers have supplied the Serbian Armed Forces with substantial quantities of next-generation small arms, state-of-the-art optoelectronic surveillance and sighting systems, various types of extended range, high efficiency artillery rockets and shells, and tens of thousands of uniforms, shoes and personal protective equipment for soldiers.
Strategically speaking, the domestic defence industry plays an important role in Serbia's international relations alongside its principal role. Serbian defence products are internationally recognised for their quality and reliability, and there is a strong international demand for our latest products. Defence export has risen steadily since 2013, with annual export values over the past two years reaching five times the levels recorded in 2012. Realistic forecasts indicate that the annual volume and value of Serbian-manufactured weapon exports will grow by an additional 20% to 30% over the next two years.
As the integrator of Serbia’s domestic defence industry in international trade fairs and foreign markets, Yugoimport SDPR actively showcases and promotes the capabilities of the Serbian defence industry, as well as its own development and production programmes.
