WASHINGTON ― A senior U.S. State Department official said Thursday that a massive Ukraine aid package ― which contains $4 billion in grants for allies to buy American-made military hardware ― is partly aimed at eroding Russia’s share of the global defense market.

“There is an opportunity here for us to work on helping other countries divest from Russian equipment moving forward,” Assistant Secretary of State for Political-Military Affairs Jessica Lewis told the Senate Foreign Relations Committee.

The U.S. should take advantage of the Russian invasion force’s poor performance against western-backed Ukrainian forces and Russia’s faltering defense supply chain, she said, to diminish Moscow’s influence abroad and increase America’s.

“It gives us an opportunity to also send that message around the world to our partners and allies and friends about Russia’s reliability as a defense partner,” Lewis said, adding: “There are long-term impacts, and frankly opportunities, that we need to seize right now.”

Washington is fostering three-way swaps, where Eastern European nations send Ukraine their Soviet-era kit in exchange for U.S.-made weapons, that should be used to “encourage partners to diversify their equipment inventories away from Russian systems,” Lewis said. But she also worried China could also have its eyes on Russia’s vulnerable market share.

“Priority systems for diversification could include, but are not limited to, legacy Russian fixed and rotary-wing aviation, air defense, armor and infantry fighting vehicles, and artillery systems,” she said in written testimony. “It is imperative that we provide affordable or subsidized U.S. solutions, not only to offramp partners from Russia, but also to ensure that any global military capability gaps that emerge are not filled by People’s Republic of China.”

Russia is the world’s second-largest arms exporter after the U.S., averaging more than $13 billion in reported annual sales, according to the Congressional Research Service. Russia exports a majority of its arms to five states: India ― the largest importer of Russian arms since 2016 ― followed by Algeria, China, Egypt and Vietnam.

But U.S.-led sanctions are straining Russia’s defense supply chain, even forcing it to use microchips from household appliances in some military equipment, U.S. Commerce Secretary Gina Raimondo told lawmakers this week.

“We have reports from Ukrainians that when they find Russian military equipment on the ground, it’s filled with semiconductors that they took out of dishwashers and refrigerators,” Raimondo told Senate appropriators.

U.S. exports of technology to Russia have fallen by nearly 70 percent since sanctions were imposed in late February, after Russia invaded Ukraine, she said, adding that two Russian tank factories have shut, along with a number of auto makers.

After $650 million in State Department-controlled Foreign Military Financing was approved for Ukraine and other Eastern and Central European countries in the previous Ukraine-related aid package, the pending $40 billion package would add another $4 billion.

The proposed aid was approved overwhelmingly by the House and has strong bipartisan support in the Senate, but it has been delayed until next week by Kentucky Republican Sen. Rand Paul, who often opposes U.S. intervention abroad.

In Lewis’ written testimony, she pointed to Russia and China to make a pitch for “broader structural mechanisms [to] make U.S. arms transfers more competitive.” She argued for building defense exportability into platforms and technology early in the acquisition process, as well as flexible financing options for the purchasing country.

The panel’s chairman, Sen. Robert Menendez, R-N.J., has said he plans to spearhead legislation with the ranking Republican Sen. Jim Risch, of Idaho, to reform America’s globe-spanning security aid program.

“As with the future of NATO security cooperation, there may need to be changes to our authorities, and I think it will be vital to ensure that the Foreign Relations Committee and the State Department are on the leading edge of finding those solutions to ensure foreign policy remains in the driving seat of our security cooperation with, and assistance to, Taiwan,” Lewis said.

Following a New York Times report that Washington is urging Taiwan to order mobile, lethal weapons that would help its small military repel a seaborne invasion from China better than large weapons platforms, Lewis said it was important to deepen defense ties “in a manner that is commensurate with the threat we assess from the PRC.”

“[T]he United States supports and encourages Taiwan with its innovative and asymmetric security posture,” Lewis said. “Since the Biden-Harris Administration took office in January 2021, the State Department has approved several key capabilities to Taiwan, including enhanced air defense systems.”

Bryant Harris contributed to this report.

Joe Gould is the senior Pentagon reporter for Defense News, covering the intersection of national security policy, politics and the defense industry. He served previously as Congress reporter.

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