STORY: :: File

Vladimir Putin tapped a civilian economist as his surprise new defense minister on Sunday.

It's an attempt by the Russian President to prepare Russia for economic war by trying to better utilize the defense budget and harness greater innovation to win in Ukraine.

More than two years into the conflict, which has cost both sides heavy casualties, Putin proposed Andrei Belousov to replace his long-term ally, Sergei Shoigu as defense minister.

Belousov is a 65-year-old former deputy prime minister who specializes in economics and has played an important role in overseeing Russia's drone program.

He is known to be very close to Putin and shares the Russian leader's vision of rebuilding a strong state.

Meanwhile Putin wants Shoigu to become the secretary of Russia's powerful Security Council.

His new job is technically regarded as a step up to his defense ministry role, which ensures continuity and allows him to save face.

Shoigu was heavily criticised by Russian military bloggers for a series of retreats the Russian military was forced to make in 2022.

Kremlin spokesman Dmitry Peskov said the change made sense because Russia was approaching a situation like the Soviet Union in the mid-1980s, when the military and law enforcement authorities accounted for 7.4% of gross domestic product (GDP).

Peskov said that meant it was vital to ensure such spending was better integrated into the country's overall economy.

It was why Putin now wanted a civilian economist in the defense ministry job, Peskov added.

Russia's economists have so far largely ensured economic stability and growth despite the toughest sanctions ever imposed on a major economy.

The changes are the most significant Putin has made since launching what he called a special military operation in Ukraine in 2022.

They indicate Putin is is eager to harness more of Russia's economy for the Ukraine war.