Is China building attack drones for Russia? European officials recently claimed that Chinese and Russian companies have been collaborating on building long-range lethal drones similar to the Iranian Shahed for use in Russian President Vladimir Putin’s war against Ukraine, as reported by Bloomberg. While the People’s Republic of China maintains its neutrality in the conflict, and the US has claimed there is no evidence it is providing lethal aid to Russia (the UK claimed in May that the countries were “working towards” it), there is no question that de facto Chinese support is critical to Russia’s war effort – leading some observers to assert that China could leverage that dependence to unilaterally force Russia to end the war if it so desired. 

BIS adds China-connected companies to entity list: On 2 July, the Commerce Department Bureau of Industry and Security (BIS) added six entities from China, South Africa, the UAE, and the UK to its Entity List, which restricts export licensing with entities whose dealings may comprise a national security threat to the US. Several of the entities added in the announcement are allegedly tied to the training of Chinese armed forces. 

Treasury sanctions highlight Chinese networks’ role in fentanyl money laundering: On 1 July, the US Treasury Department Office of Foreign Assets Control announced sanctions on one Mexican and two Chinese nationals in connection with money laundering for the Mexican Sinaloa cartel. The sanctions follow the 18 June announcement of federal charges against two dozen individuals linked to such activities. Treasury had previously highlighted the growing role of Chinese Money Laundering Organizations (CMLOs) in international financial crime in the February 2024 National Money Laundering Risk Assessment. The Financial Times illustrated the dynamics of this complex trade – which involves Chinese pharmaceutical companies producing fentanyl precursors, Mexican drug gangs manufacturing, shipping, and retailing fentanyl itself, and sophisticated Chinese underground banking networks – in a 27 June expose, and 3 July piece. The US has worked with Chinese and Mexican officials to target the criminal networks involved. This illustrates the delicate balancing act the US must play when it comes to securing Chinese cooperation in managing the harmful outflows of that country’s massive industrial production – components going to Russian arms manufacturers in one direction, and precursors going to Mexican fentanyl producers in the other. In the meantime, Ukrainian and American (not to mention Russian and Mexican) lives hang in the balance. 

Iran hit with new sanctions in response to nuclear activities: On 27 June, the State Department announced a new set of sanctions designations against three entities involved in the Iranian petroleum and petrochemical industry, identifying 11 associated vessels as blocked property. The announcement, which followed a 25 June designation by the US Treasury’s Office of Foreign Assets Control (OFAC) of dozens of entities allegedly involved in an Iranian security forces-linked “shadow banking network,” claimed the action was in response to Iranian nuclear enrichment activities. This week, Newsweek reported on alleged Iranian attempts to secure Uranium sources from West Africa, where Russia has also sought to expand its influence. 

EU expands Belarus sanctions: On 29 June, the Council of the European Union adopted expanded restrictive measures targeting Belarus, according to a press release. The measures, which include increased controls on the export of dual-use goods, raw materials, energy technology, services, and logistics, and increased due diligence requirements for EU-based entities, are in response to Belarus’s support for Russia’s full-scale invasion of Ukraine. The package – which comes in the wake of the EU 14th sanctions package on Russia – also aims to close the biggest loophole in the EU’s Russia sanctions regime, as Russia has previously been able to exploit relatively lax EU sanctions against Belarus, a “vassal state” with which it has nearly open borders through the Union State.   

US raises alert level at military facilities in Europe as Russia wages hybrid war on NATO and Ukraine reportedly foils coup attempt: The US Department of Defense European Command (EUCOM) said 30 June that it had raised alert levels at facilities across the continent to “Charlie,” the second-highest level of readiness. The security posture shift comes amid  several major events – including the French elections and the upcoming Olympics – that may increase the risk of security incidents. Perhaps most concerning is a series of recent acts of sabotage across Europe, which Western security officials have identified as a hybrid warfare campaign being waged by Russia on European soil, as CNN reported. Meanwhile, Ukrainian officials claimed on 1 July that they’d foiled a coup attempt; it was unclear if the supposed would-be putschists had any connection to Russia. 

US promises more Ukraine aid, as glide bombs pound front lines and RUSI urges targeted approach to degrading Russian MIC: The US is reportedly preparing a new US$2.3 billion military aid package for Ukraine under Presidential Drawdown Authority, according to Defense Secretary Lloyd Austin. The announcement comes as Ukraine’s front lines and cities continue to be pummeled by a rain of glide bombs, allowing recent Russian advances – at massive human and material cost. The threat from glide bombs – which have become one of Russia’s main weapons in recent months, and often include Western-manufactured components, as TDP has previously covered – prompted Ukrainian President Volodymyr Zelensky to urge the US to permit strikes on the Russian airfields from which the bomb-dropping aircraft are launched. Among the targets of the modified long-range bombs has been a Ukrainian airfield expected to house long-awaited F-16s. Ukraine hopes the arrival of the US-made fighters will help blunt the glide bomb threat. The population of the Russian border region of Belgorod should share this hope, given that almost 40 of the massive bombs have landed there, as reported by the Washington Post 2 July. 

All this highlights the urgency of a 26 June report by the UK-based Royal United Services Institute (RUSI). Titled “A Methodology for Degrading the Arms of the Russian Federation,” the report outlines the shortcomings of current allied sanctions and export control regimes against Russia. It then presents possible solutions, calling for a coalition of allied states to establish a combined intelligence fusion center and systematically coordinate actions to identify and target bottlenecks in the procurement and production processes of the Russian military industrial complex. 

NATO prepares to gather in DC, Modi readies for Moscow trip, Orban pops in to Kyiv for a chat: Indian Prime Minister Narendra Modi is planning a state visit to Moscow on 8-9 July, Bloomberg reported. This visit will not only be his first trip abroad since his (surprisingly contentious) re-election in June, but also his first visit to Russia since the start of the full-scale invasion of Ukraine in 2022. The visit, which coincides with the NATO summit in Washington, DC, highlights India’s complex global position: while the US regards India as a key partner in its burgeoning geostrategic competition with China, the nation’s close ties – and ongoing arms and energy trade – with Russia are a complicating factor. For their part, Indians have in recent years come to regard China (rather than historical archrival Pakistan) as India’s main threat, and New Delhi is troubled by the increasingly intimate de facto alliance between Moscow – historically a key partner – and Beijing. 

While Modi – whose leadership of the Hindu-nationalist Bharatiya Janata Party (BJP) has driven Indian politics to the right in the last decade, and who has garnered criticism for alleged authoritarian tendencies – was  planning his trip to Russia, another right-wing populist world leader has made a surprise visit to Ukraine. Prime Minister Viktor Orban of Hungary – which last week took over the rotating presidency of the EU, coinciding with European parliamentary elections that  featured a strong showing by far-right parties – traveled to Kyiv to “promote ‘peace’” on 2 July. Like Modi, Orban – whose opposition to Ukraine aid makes his Kyiv trip an unexpected move – is famously close to Putin’s Russia. Less well known is that unlike Modi’s India, however, Orban’s Hungary is chummy with China, which has used extensive investment there to build a strategic economic foothold in the EU.