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12 Jul 24. AFP charges ADF member and her husband over alleged Russian espionage attempt. A 40-year-old army private and her 60-year-old husband have been arrested at their Brisbane home after an alleged plot to share defence force material with Russian authorities.
The Australian Federal Police arrested and charged a Brisbane couple following an alleged attempt to share ADF secrets with authorities in Russia.
The pair – a 40-year-old army private in the Australian Defence Force and her 60-year-old husband – were each charged with one count of preparing for an espionage offence and will appear before a Brisbane court today.
This marks the first time charges have been laid under espionage-related laws that came into effect in 2018.
“The counter-foreign interference taskforce, which includes AFP, ASIO and other Commonwealth partners, has dedicated significant resources and capability to Operation Bergazada,” AFP Commissioner Reece Kershaw said at a press conference this morning on June 12.
“The AFP will allege the individuals worked together to access Australian defence force material that related to Australia’s national security interests.
“We allege the woman was undertaking non-declared travel to Russia, whilst she was on long-term leave from the Australian Defence Force. We allege that whilst she was in Russia, she instructed her husband, who remained in Australia, on how to log into her official work account from their Brisbane home.
“We allege her husband would access requested material and would send it to his wife in Russia. We allege they sought that information with the intention of providing it to Russian authorities. Whether that information was handed over remains a key focus of our investigation.”
Commissioner Kershaw did say, however, that he believed the “alleged criminality has been disrupted”.
The Director General of ASIO, Mike Burgess, also at the press conference said the woman had been an “information systems technician” with the ADF for “several years”. When asked about the ADF’s vetting process, Director General Burgess said the process only goes so far.
“I respectfully suggest that vetting is not a solution that stops problems because it depends on what you say – if you meet the requirements to get a security clearance, you will get one, but that doesn’t mean to say the security journey stops at this point,” Director General Burgess said. “In this case, because of defence and security awareness, ASIO and the taskforce and the AFP were able to intervene and control this operation.”
Director General Burgess said that investigations into the matter are ongoing, but did confirm the pair possessed Russian passports.
In a separate statement, Director-General Burgess said: “Espionage is real. Multiple countries are seeking to steal Australia’s secrets.”
“Espionage is not some quaint Cold War notion. Espionage damages our economy and degrades our strategic advantage. It can have catastrophic real-world consequences.
“ASIO takes its responsibility as Australia’s spy catcher extremely seriously. If you are spying in this country, we are looking for you; if you are being spied on in this country, we are looking out for you.”
If found guilty, the pair could face up to 15 years in prison. Director General Burgess added that the sentence could be “upgraded to 25 years to life, depending on what we further discover”. (Source: Defence Connect)
11 Jul 24. Iran: IRGC operations in West Azerbaijan province will likely drive incidental risks for bystanders. On 9 July, Iran’s Islamic Revolutionary Guard Corps (IRGC) claimed to have dismantled an unspecified armed group in north-western West Azerbaijan province earlier that day, killing several ‘terrorists’ and confiscating their equipment. The exact location of the operation remains unclear, though it comes amid a spike in illegal oil smuggling from Iraqi Kurdistan into Iran. A heightened security posture will likely persist near border crossings along the Iran-Iraq frontier, disrupting the flow of goods and services and elevating supply chain risks. There is an increased likelihood of further sporadic clashes between IRGC forces and armed groups in the region, elevating incidental risks for business personnel and NGO workers operating in West Azerbaijan. There is also an increased risk of arbitrary stop-and-search practices and detentions at the border. We assess that the incident is unlikely to strain Iran-Iraq diplomatic relations; cross-border co-operation will also likely remain intact. (Source: Sibylline)
11 Jul 24. Armenia-Azerbaijan: Diplomatic engagement will likely reduce tensions; peace deal remains unlikely. On 10 July, the foreign ministers of Armenia and Azerbaijan met in Washington DC (US) on the sidelines of the NATO Summit. US Secretary of State Antony Blinken asserted that he believes both countries are ‘very close’ to reaching a final peace agreement. Blinken stated that Yerevan and Baku have worked towards negotiating and concluding a deal that is ‘durable’ and ‘dignified’. Both South Caucasus countries released almost identical statements following the meeting. The two sides noted progress achieved towards concluding a peace settlement and establishing interstate relations, as well as an agreement to continue work in this regard. No specifics were provided on what was discussed in Washington DC, or if any progress was made at this meeting. Although the meeting underscores mutual willingness to engage at the diplomatic level, we assess that a comprehensive peace deal that ends the conflict in its entirety remains unlikely in the short term. Nevertheless, diplomatic engagements will likely aid in reducing regional tensions and the prospects of a resumption of hostilities in the coming weeks. (Source: Sibylline)
12 Jul 24. New Caledonia: Unrest risks will likely continue despite increased security measures. Earlier on 12 July, the French High Commissioner of the Republic of New Caledonia Louis Le Franc extended New Caledonia’s curfew to 22 July amid efforts to stabilise the region after riots began on 13 May due to electoral reform issues. Also earlier on 12 July, police began clearing roadblocks on Provincial Road No.1 near Mont-Dore (South province) to restore traffic flow. Additionally, the French gendarmerie’s tactical intervention unit (GIGN) killed an ethnic-Kanak man on 10 July after a shooting incident. This has intensified tensions, with local independence movements and tribal leaders labelling the altercation an ‘act of war’ by France. In the face of sustained unrest, law enforcement received additional material reinforcements, including ten Centaure armoured vehicles. We assess that the risk of unrest in New Caledonia is likely to continue in the medium term due to local grievances over the handling of the protests and riots by the French authorities, including the arrest and relocation of indigenous activists to mainland France. (Source: Sibylline)
09 Jul 24. Japan, Philippines sign historic Reciprocal Access Agreement.
Japan and the Republic of the Philippines have signed a new agreement expanding armed forces coordination and cooperation in a historic bilateral defence milestone for both countries.
Japanese Minister for Foreign Affairs Kamikawa Yoko signed the Japan-Philippines Reciprocal Access Agreement with Gilberto C. Teodoro Jr, Secretary of National Defense of the Republic of the Philippines, on 8 July.
The signing ceremony was also attended by the President of the Republic of the Philippines, Ferdinand R. Marcos Jr, Minister of Defense of Japan Kihara Minoru, and Secretary for Foreign Affairs of the Republic of the Philippines Enrique A. Manalo.
The new agreement allows and improves facilitation of reciprocal access and cooperation between the Self-Defense Forces of Japan and the Armed Forces of the Philippines. In addition, the agreement establishes procedures for the cooperative activities that are conducted by the forces of Japan and the Philippines while the force of one country is visiting the other country and defines a legal status of the visiting force.
It’s expected that the Japan-Philippines Reciprocal Access Agreement (RAA) will facilitate the implementation of cooperative activities, such as joint exercises and disaster relief between Japan and the Philippines and improve interoperability between the forces of the two countries.
The Philippines is the third country with which Japan signed the RAA, following Australia and the United Kingdom.
“Ministers discussed the current bilateral security environment and exchanged views on regional issues including the situation in the East China Sea, South China Sea, Taiwan, and the Korean Peninsula,” according to a joint press release published regarding the 2nd Philippines-Japan Foreign and Defense Ministerial Meeting.
“Ministers emphasised the need for the international community to speak out on the importance of maintaining and strengthening the free and open international order based on the rule of law. The ministers strongly opposed any unilateral attempts to change the peacefully established status quo by force or coercion.
“Ministers underscored their unwavering commitment to freedom of navigation and overflight consistent with UNCLOS and expressed serious concern over the dangerous and escalatory actions by China at Second Thomas Shoal, which obstructed freedom of navigation and disrupted supply lines, thus increasing tensions.
“The Philippines appreciated Japan’s consistent support on the various incidents which constitute destabilising conduct. The Philippines and Japan decided to continue coordination in promoting the adherence to international law, in particular UNCLOS, and through various related initiatives, and called on China to abide by the final and legally-binding 2016 Arbitral Award on the South China Sea.
“Ministers reaffirmed the importance of peace and stability across the Taiwan Strait and called for a peaceful resolution of cross-Strait issues. Ministers reiterated their commitment to achieving the complete, verifiable and irreversible dismantlement of all weapons of mass destruction and ballistic missiles of North Korea and emphasised the importance of the full implementation of the relevant United Nations Security Council Resolutions. The ministers also urged North Korea to immediately resolve the abductions issue.”
The joint statement also outlined Japan’s decision to grant aid for coastal surveillance radar systems to enhance the capabilities of the Armed Forces of the Philippines, continued cooperation on strengthening maritime and air domain awareness, promotion of military interoperability, cooperation on defence equipment and technology, promotion of cooperation on cyber security and trusted telecommunications networks (open radio access network), and the continuing commitment of Japan and the Philippines to a world without nuclear weapons and promoting the commencement of negotiations for a Fissile Material Cut-Off Treaty. (Source: Defence Connect)
10 Jul 24. Thailand announces new senate, replacing army-appointed lawmakers. Thailand’s Election Commission on Wednesday endorsed 200 new senators who will replace a military-appointed upper house, revealing a new legislative body that analysts say could make it harder for the embattled ruling Pheu Thai party to govern.
The new upper house will not have a role in voting to approve who becomes prime minister, but will retain the power to vet laws and appoint crucial members of powerful organisations like the Election Commission and the Constitutional Court.
Election Commission Secretary-General Sawaeng Boonmee said that there had been a delay in announcing the results of a complex senate selection process that ended last month because of a number of complaints, which have now been examined.
“The Election Commission has passed a resolution to endorse 200 senators,” Sawaeng told reporters.
Provisional results of the senate selection showed an upper house lacking key Pheu Thai affiliates, while marking a gain for its largest coalition partner, Bhumjaithai, which could act as a proxy for the conservative-royalist establishment, analysts said.
A rift between the conservatives, backed by the military, and populist parties like Pheu Thai has long defined Thailand’s politics, sometimes triggering violent street protests and military coups in 2006 and 2014.
“The election of a new Senate was a chance to turn a new page and allow a more Pheu Thai-friendly senate to take office,” said Mathis Lohatepanont, an independent political analyst.
NEW ESTABLISHMENT BULWARK
The new senate, which starts a five-year term this month, also reflects the waning influence of Pheu Thai patriarch and former prime minister Thaksin Shinawatra whose parties have dominated Thailand’s politics till last year’s election.
Pheu Thai has recently been ensnared in two ongoing legal cases that could see Thaksin jailed and Prime Minister Srettha Thavisin dismissed from office.
Pheu Thai was trounced by the progressive Move Forward in the 2023 elections but the winner wasn’t able to take power after it was blocked by the outgoing military-appointed senate.
Instead, Pheu Thai formed the government with the help of rival military-backed parties and others including Bhumjaithai, which was also part of the previous ruling coalition.
Bhumjaithai leader Anutin Charnvirakul, who successfully pushed for legalising cannabis in Thailand last year, is currently deputy prime minister and interior minister.
“Bhumjaithai gained substantial ground and is presenting itself as a new bulwark of the royalist establishment,” said Thitinan Pongsudhirak, a political analyst at Chulalongkorn University.
An endorsement from one-third of the new upper house is also required to amend the military-drafted constitution that came in the wake of the 2014 coup. This is a potential obstacle for Pheu Thai, which made an election pledge to revise the constitution. (Source: Defense News Early Bird/Reuters)
09 Jul 24. North Korea-Russia: Growing military ties will sustain regional tensions, security risks. On 8 July, North Korea dispatched a military training delegation from North Korea’s Kim Il Sung Military University to Russia, the first military exchange following the Comprehensive Strategic Partnership agreement signed between the two countries in June. This agreement, affirmed by leaders Kim Jong Un and Vladimir Putin during a summit in the capital Pyongyang, includes a mutual defence pledge mandating immediate mutual assistance if either country is subjected to an armed attack. The specific agenda and locations of the delegation’s visit remain undisclosed. The visit follows intensified diplomatic and military engagements between the two countries, with North Korea reportedly provisioning Russia with significant military support, including nearly five m artillery shells, along with ballistic missiles. Additionally, North Korea recently switched its state TV broadcasts from a Chinese to a Russian satellite, reflecting its strengthening ties with Russia. These developments point to an uncertain security environment on the Korean peninsula. It is highly unlikely that North Korea will commit to de-escalating tensions and abandoning its weapons and nuclear programme. (Source: Sibylline)
09 Jul 24. Myanmar: Anti-junta groups increase pressure on junta, elevating risks of prolonged conflict. On 7 July, the Arakan Army, an Ethnic Armed Organisation (EAO), claimed to have killed more than 400 military junta soldiers in an ongoing ground operation to take Thandwe (Rakhine state), a tourist hub. Separately, local reports indicate that fighting around the Lashio (Shan state) is escalating, with the junta aiming to retain control of its north-eastern regional command after the breakdown of the Chinese-mediated ceasefire; thousands of Lashio residents are fleeing. These developments highlight the continued pressure on the junta as it struggles to secure control nationwide. In May, the Special Advisory Council for Myanmar (an independent panel of experts) observed that townships covering 86% of the country’s territory ‘are not under stable junta control’. Despite this, the junta retains air superiority and will likely maintain control of major urban and economic hubs such as Yangon (Yangon region) and the capital Naypyitaw in the short term (see Situation Update Brief – 12 June 2024). Armed conflict will almost certainly persist across ethnic-minority border states in the coming months, driving safety risks and further undermining the already extremely challenging business environment. (Source: Sibylline)
09 Jul 24. India: Attack on military convoy underscores persistent militant threat, disruption risks. On 8 July, militants ambushed a military convoy during a routine patrol in Kathua district in the Jammu division (Jammu and Kashmir union territory), killing five soldiers and injuring five others. The security forces have launched a search operation in the area. The incident comes amid an uptick in militant activity in the union territory, particularly Jammu division (see Situation Update Brief – 25 June 2024). Last month, an attack on a bus carrying Hindu pilgrims killed nine and injured 33 others in Reasi district (Jammu division). The 8 July ambush is the second major incident in Kathua district since last month and reflects an elevated military posture in the region. Given the realistic possibility of further attacks and the ongoing Amarnath Yatra pilgrimage in Jammu, the authorities will highly likely strengthen security measures across the union territory, particularly around military installations and tourist hotspots. Restrictions on public movement and temporary internet suspension are also likely during search operations scheduled for the coming days; this will elevate disruption risks. (Source: Sibylline)
09 Jul 24. Turkey-Iraq: Uptick in operations against PKK possibly signals wider operation in coming months. On 8 July, Turkey conducted a drone strike on a vehicle belonging to the Kurdistan Workers Party (PKK) in Iraq’s Sinjar district (Nineveh Governorate). The attack comes amid a new round of Turkish operations against the group in Iraq’s northern Kurdistan Region (KR) including in Mount Gara, Hakurk, Zap and Metina (all Dohuk governorate). The authorities commenced these operations on 3 July. Given the uptick in aerial operations, the gradual buildup of Turkish forces along the border and Turkey’s coordination with the Iraqi and KR governments, there is a realistic possibility of a wider ground operation against the PKK in the coming months. One of the operation’s objectives would likely be to secure the Iraq Development Road Project slated to pass through KR. Any such operation will significantly elevate attack and collateral risks to assets and staff along the border. The operation will likely prompt a complete cessation of movement along the Turkey-Iraq border, disrupting supply chain continuity. (Source: Sibylline)
09 Jul 24. Hungary: New ‘anti-war’ plan will raise taxes, elevate policy risks to firms. On 8 July, the Hungarian government announced a new ‘anti-war’ action plan which would hike windfall taxes on the private sector and further curb the influence of foreign media perceived to support the war in Ukraine. The government has confirmed that energy companies, banks and other multinational firms earning additional profits during the current ‘wartime’ conditions (in reference to the war in Ukraine) will have to contribute to a ‘defence fund’ via a new windfall tax. The government has not yet confirmed how much it will raise or what the fund will be spent on. The Hungarian authorities also confirmed that existing windfall taxes, including those on retailers and various multinationals, would now be extended rather than phased out, as had originally been proposed. The new action plan will also examine whether media outlets use foreign funding to promote so-called ‘pro-war propaganda’. The proposed defence fund represents a hardening of Hungary’s anti-Ukraine war stance, driving business policy risks and clampdown risks on NGOs and media funding in the country. (Source: Sibylline)
09 Jul 24. Russia: Arrests underscore continued clamp down on militant Islamist activity in North Caucasus. On 9 July, Russia’s Ministry of Internal Affairs reported that authorities detained ten residents of the Muslim-majority Kabardino-Balkarian Republic (North Caucasus, Russia) on extremism charges. The authorities explained that the suspects were pressuring locals to follow strict Sharia laws. The arrests occurred after Russian media reported on an ongoing anti-terrorist operation in the Republic of Dagestan (North Caucasus, Russia) aimed at restricting extremist propaganda via the messaging platform WhatsApp. The North Caucasus has historically been the locus of Islamist activity in Russia. On 23 June, Islamist militants co-ordinated terror attacks in Dagestan against two Orthodox churches, a synagogue and a traffic police post in the city of Derbent (see Sibylline Alert – 24 June 2024). The attacks underscored an escalation in Islamist militants’ capability in the region. These latest arrests underscore Moscow’s heightened security posture and efforts to clamp down on Islamist activity in the North Caucasus. This will likely lead to further raids and arrests, sustaining the risk of sporadic clashes between militants and security forces in the region. (Source: Sibylline)
09 Jul 24. China and Belarus hold joint military exercises on border with Poland. China and Belarus began joint military exercises in a region next to Poland on Monday ahead of the annual Nato summit in Washington, according to the countries’ defence ministries.
The operations are “near Brest”, China’s ministry of defence said. Brest borders Nato member Poland and is just 200km from Warsaw.
China and Belarus said the exercises, named “Attacking Falcon”, are “anti-terrorist operations”. According to Belarus, they are practicing “night landing, overcoming water obstacles, and conducting operations in a populated area”.
Belarus is closely aligned with Russia, which has military stationed in the country. Last year Russian President Vladimir Putin announced Russia would move tactical nuclear weapons to Belarus, which joined the China-led Shanghai Cooperation Organisation last week. (Source: FT.com)
08 Jul 24. Iran: Large policy shifts are unlikely, despite Pezeshkian electoral win; operational risks are sustained. On 5 July, Iranians elected the reformist Masoud Pezeshkian as their new president in a run-off against Saeed Jalili, a hardliner. Pezeshkian’s victory is likely to increase policy risks in Iran, as he has indicated that he intends to reform the economy, policing, online censorship and the enforcement of the Hijab and Chastity bill. Many of Pezeshkian’s domestic policies will likely be difficult to implement, with Supreme Leader Ali Khamenei retaining final authority over social and economic changes. This increases the likelihood of persistently high inflation and currency depreciation, elevating operational and socio-economic risks for businesses and NGOs in the country. While Pezeshkian has implied a willingness to re-engage with the West on the Iranian nuclear situation, we assess that Khamenei will likely also limit Pezeshkian’s influence over foreign and nuclear policy, elevating the risk of policy stasis. However, Pezeshkian is likely to reform language policies in regions with large Kurdish populations, reducing ethno-religious tensions. (Source: Sibylline)
08 Jul 24. Sahel: Formalisaiton of AES members’ relations raises risk of regional sanctions. On 6 July, the heads of the military governments in Burkina Faso, Mali and Niger signed a confederation treaty during the first summit of the Alliance of Sahelian Sates (AES). The treaty formalises previous AES commitments to increase diplomatic and military collaboration and re-iterates member states’ intentions to withdraw immediately from the Economic Community of West African States (ECOWAS). On 7 July, ECOWAS Commission President Omar Touray highlighted that this would restrict AES member states’ access to ECOWAS’ common market, regional economic projects and counter-insurgency intelligence-sharing programmes. Nevertheless, AES members are highly likely to continue their efforts to withdraw unilaterally, undermining socio-economic health and regional labour flexibility (though the timeline is unclear; the AES previously committed to an ‘immediate’ withdrawal in January). There is also a realistic possibility of ECOWAS re-applying sanctions on AES members and junta figures, increasing compliance concerns. Despite the AES’ plans to establish a regional investment fund, we assess these measures are highly unlikely to mitigate against the economic impacts of withdrawing from ECOWAS, further undermining regional socio-economic health in the medium-to-long term. (Source: Sibylline)
08 Jul 24. Kyrgyzstan: Coup claims are unlikely to undermine government stability significantly. Kyrgyzstan’s State Committee for National Security (GKNB) reported on 5 July that the special services had prevented a violent attempt to seize power. According to the department, a ‘destructive group’ plotted to organise mass riots. The alleged coup attempt was reportedly supposed to be orchestrated on 31 August (Kyrgyz Independence Day). The GKNB claimed that the would-be perpetrators included religious fanatics and supporters of ‘criminal ideology’, without providing further specifics. Some 70 weapons, 255,000 rounds of ammunition, homemade explosives and undisclosed extremist literature were confiscated. The GKNB periodically releases statements about quashing coup preparations. Notably, the Kyrgyz authorities made two similar allegations in the summer of 2023, though government stability was not significantly strained after either occasion. Nevertheless, we assess that a heightened security posture in Kyrgyz urban centres is likely over the coming weeks; the authorities will possibly use the latest allegations as a pretext in order to crack down against members of the political opposition and perceived religious radicals. (Source: Sibylline)
09 Jul 24. State-sponsored and hacktivist groups will likely exploit the increased convergence of information technology (IT) and operational technology (OT) to target critical national infrastructure (CNI) amid ongoing conflicts and geopolitical tensions.
- State-sponsored actors will likely increase espionage actions targeting global CNI to bolster the economic position of their sponsors. Bilateral tensions and ongoing conflicts will also foment pre-positioning and disruptive operations.
- Escalations in regional tensions will likely result in a wave of disruptive attacks from state-aligned hacktivist groups.
Context
On 30 May, the technology company Microsoft reported an increase in attacks targeting internet-exposed and vulnerable operational technology (OT) environments since late 2023. The onset of the Israel-Hamas war in October 2023 engendered a wave of hacktivist attacks against US OT environments, many of which successfully infiltrated critical national infrastructure (CNI). In early Q1, pro-Russia hacktivists altered the normal parameters of water pumps and blower equipment, compromising the systems of several US water and wastewater providers and causing water tanks to overflow. This recent increase in OT cyber attacks is a symptom of the inadequate and outdated nature of OT security systems, which will likely continue to incentivise attacks against this sector.
Forecast
State-sponsored and hacktivist groups will likely seek to compromise OT equipment within critical national infrastructure amid ongoing conflicts and geopolitical tensions
Cyber attacks against critical national infrastructure rose by 140% in 2022, according to a 2023 report by Waterfall Security. OT is often responsible for critical functions within CNI, making it an attractive target for cyber threat actors. More specifically, OT professionals are increasingly adopting smart industrial devices or Industrial Internet-of-Things (IIoT) devices to automate the maintenance of national infrastructure. Despite reducing costs and increasing efficiency, IIoT devices expose OT environments to potential cyber attacks by transmitting data from industrial equipment to assets connected to the internet. The White House and Environmental Protection Agency (EPA) released an advisory in March, warning that water and wastewater utilities in the US are being routinely targeted by adversarial state-sponsored groups. The advisory specifically mentioned threats to OT environments with the potential to affect the safety and supply of drinking water, highlighting significant infrastructure risks. The continued convergence of IT and OT systems provides threat actors with unprecedented opportunities to achieve their strategic objectives by amplifying their ability to gather intelligence, disrupt adversarial infrastructure and hinder defences. As such, cyber attacks against CNI by state-sponsored and hacktivist groups will likely increase in the long term as ongoing regional conflicts and bilateral tensions persist and OT environments become increasingly exposed to threats from the internet.
Cyber actors undertaking espionage operations will highly likely intensify their targeting of OT environments within CNI systems
In February 2024, the Federal Bureau of Investigations (FBI) stated that the Chinese state-sponsored group ‘Volt Typhoon’ infiltrated hundreds of small office/home office (SOHO) routers since at least 2019. The group executed espionage operations against US critical infrastructure including telecommunications organisations, transportation hubs and US military bases in Guam. Additionally, unnamed North Korean state-sponsored actors targeted at least two South Korea-based semiconductor companies in March, stealing highly sensitive data (such as product design drawings and facility site photos) possibly to spur North Korea’s own efforts to produce semiconductors. Relations between China and the US remain strained as the two countries continue to compete for military, economic and technological dominance. On 21 June, the Biden administration announced measures to curb US investment in Chinese tech firms developing semiconductors, quantum computers and artificial intelligence (AI). The announcements signal rising trade tensions between the two countries and likely precede additional measures aimed at slowing China’s economic and technological development. Similarly, North Korea continues to face economic sanctions which reduce the country’s ability to advance its weapons and missile programmes. As such, both Chinese and North Korean state-sponsored groups routinely target OT environments within CNI systems to bolster their economic and technological posture. We assess that the competitive nature of these relations, combined with talks of further economic decoupling and ongoing sanctions, will likely elevate espionage risks to global OT providers in the long term.
State-sponsored actors will likely seek to disrupt OT environments within CNI systems amid regional tensions and ongoing military conflict
The tactics, techniques and procedures (TTPs) used by Volt Typhoon signal an intent to pre-position itself for future disruptive operations. The group infiltrated IT environments within CNI, likely to migrate to OT systems for potentially disruptive operations at a later stage. Another Chinese state-sponsored group, ‘ChamelGang’, has disrupted national infrastructure in a series of ransomware operations conducted since at least 2019. As geopolitical tensions persist, we assess state-sponsored groups will likely continue to infiltrate and pre-position themselves within IT and OT environments. This will elevate disruption risks in the long term.
In October 2023, the Russian state-sponsored group ‘Sandworm’ caused a power outage after deploying OT malware in one of Ukraine’s power plants. The group reportedly executed malicious code against the plant’s supervisory control and data acquisition (SCADA) instance which included commands to turn off substations. The attack notably coincided with a series of missile strikes on Ukraine’s electrical grid, indicating that Sandworm likely worked with the Russian army to aid kinetic operations and disrupt Ukraine’s ability to defend against the hybrid attack. In April, Sandworm disrupted information and communication systems for 20 Ukrainian energy, heating and water organisations. The group deployed two new backdoors in this campaign, indicating its focus on developing new and more sophisticated cyber capabilities to target. This attack is likely indicative of Russia’s long-term objectives for the war in Ukraine, which include weakening Ukraine’s defence capabilities by undermining its energy resilience. The war in Ukraine represents the first conflict to involve significant levels of cyber operations to support military action. This trend elevates security and disruption risks to OT providers in the long term.
The escalation of regional tensions and military conflicts will likely engender a wave of disruptive cyber attacks from state-aligned hacktivist groups
Security agencies in Canada, the UK and the US have warned of a rise in pro-Russian hacktivist attacks against OT environments in North America and Europe in May following an increase in hacktivist attacks against CNI in these regions. Affirming these warnings, the Iranian-aligned hacktivist group ‘Cyber Av3ngers’ compromised an Israeli-made programmable logic controller (PLC) at the Municipal Water Authority in Aliquippa (Pennsylvania, US) in November 2023. Although the attack did not cause any operational disruption, the group displayed an anti-Israel message and vowed to continue targeting Israeli-made equipment. Similarly, the hacktivist group ‘SiegedSec’ claimed responsibility for a series of attacks against Israeli infrastructure and industrial control systems (ICS) in October 2023. The group primarily compromised human machine interfaces (HMIs) within the water and wastewater sectors, altering normal equipment parameters and causing minor tank overflows. Although none of these attacks resulted in major disruption, they display hacktivists’ capabilities and intent to target OT following the escalation of regional tensions and military conflicts. The continuation of the Israel-Hamas war and the war in Ukraine will sustain elevated disruption risks to OT providers within adversarial nations in the medium-to-long term. There is also a possibility that any escalation in combat or rhetoric will further prompt a rise in hacktivist cyber attacks targeting this sector. (Source: Sibylline)
10 Jul 24. Pakistan: Authorisation for spy agency to intercept calls will elevate surveillance, harassment risks. On 8 July, the government authorised the military-run Inter-Services Intelligence (ISI) agency ‘to intercept calls and messages or to trace calls through any telecoms system’ in the interest of national security. This development comes amid increasing concerns from opposition parties over the role of the military and the intelligence agencies in politics, as well as over the heightened surveillance of citizens. In June, the Islamabad High Court (IHC) noted that the authorities ordered domestic telecommunications companies to ‘finance, import and install’ a system enabling mass surveillance of citizens’ data. The authorities have also banned the social media platform X (formerly Twitter) since February on the grounds that it is a ‘threat to peace and national security’. We assess that the latest government order will enable intelligence agencies to surveil citizens with impunity under the guise of national security. This will likely raise the risk of harassment and arbitrary detention for dissidents and critics of the military. (Source: Sibylline)
08 Jul 24. Two Russian warships sent on training mission to Asia-Pacific waters, Interfax reports. Two corvettes of the Russian navy’s Pacific Fleet left the port of Vladivostok in Russia’s Far East to carry out training missions in the Asia-Pacific region, the Interfax news agency cited the fleet’s press service as saying on Monday.
“When leaving the main base of the fleet, the crews of the ships practiced emergency preparations for battle and sailing, and when passing through a narrow area, they conducted training in repelling a UAV (unmanned aerial vehicle) raid of a mock enemy,” the agency reported, citing the press service.
The corvettes, the Rezky and the Gromky, will conduct a number of exercises in the Asia-Pacific region, including searching for and destroying mock enemy submarines, and will also work out joint algorithms for air defence and anti-sabotage defence at sea, Interfax reported.
The Rezky corvette – which according to Russian state media can fight enemy submarines and surface vessels, strike coastal targets and counter enemy aircraft – entered into the Pacific Fleet service in September, 2023. The Gromky, of the same class as the Rezky, entered the Fleet’s service in 2018, according to TASS state news agency. (Source: Reuters)
05 Jul 24. India surpasses defence production milestone, marking self-reliance shift. India’s defence production over the last five years reveals a growth trajectory, with a cumulative increase of more than 60% since 2019-20. India’s defence production has soared to new heights, achieving a figure of Rs1.27bn ($152m) in the fiscal year 2023-24, a notable 16.7% increase from the preceding year. This surge, reported by the Ministry of Defence, shows the country’s progress towards self-sufficiency in defence manufacturing, buoyed by Prime Minister Shri Narendra Modi’s ‘Make in India’ initiative.
Surge in indigenous manufacturing
The milestone was celebrated by Raksha Mantri Shri Rajnath Singh, who hailed the achievement as a testament to India’s growing capability in the global defence sector. “Our consistent efforts under the ‘Make in India’ program have propelled us towards record-breaking production levels year after year,” stated Shri Rajnath Singh, emphasising the government’s commitment to elevate India into a leading defence manufacturing hub.
GlobalData’s intelligence on the Indian defence market highlights that the latest draft version of the Defence Production Policy was introduced in 2016 to achieve self-reliance in the design, development, and production of equipment, weapon systems, and platforms required for defence, to create conditions conducive for the private industry to take an active role in this endeavour, to enhance the potential of SMEs in indigenisation, and to broaden the country’s defence R&D base.
A breakdown of the production figures reveals that Defence Public Sector Undertakings (DPSUs) and other Public Sector Units (PSUs) contributed significantly, accounting for 79.2% of the total production value, with the private sector contributing the remaining 20.8%. This balanced growth signifies a collaboration between public and private entities to advance India’s defence manufacturing capabilities.
The achievement is attributed to a decade-long reform agenda to enhance the ease of doing business and promote indigenous production. These reforms, coupled with indigenisation efforts, have fostered an environment conducive to growth in defence output. The result is a boost in domestic production and a rise in defence exports, which surged to Rs2.1bn in FY 2023-24, marking a 32.5% increase from the previous fiscal year.
Focus on achieving self-reliance
India’s strides towards self-reliance in defence manufacturing have been marked by milestones, including the delivery of the indigenous Project 15B guided missile destroyer, Imphal, and the issuance of a Request for Proposal (RFP) for 156 Prachand Light Combat Helicopters (LCH). The LCH, equipped with weaponry, is poised to replace older models and reduce reliance on foreign helicopters like the AH-64 Apache.
India’s defence production over the last five years reveals a growth trajectory, with a cumulative increase of more than 60% since 2019-20. This steady ascent reflects India’s emerging prominence in global defence manufacturing and highlights its shift towards reducing dependence on imports.
As India continues to strengthen its domestic capabilities, the focus remains on achieving self-reliance across the entire spectrum of defence manufacturing. The growth in production and exports is a statistical milestone and imperative to bolster national security and foster economic resilience.
With projections pointing towards sustained growth in the coming years, India’s ascent in the global defence arena appears to redefine the country’s role as a player in defence manufacturing, embodying the spirit of ‘Aatmanirbharta’ envisioned by its leadership.
The surge in India’s defence production to a record high in FY 2023-24 marks a step towards self-reliance and global leadership in the sector. Bolstered by reforms and growth in exports, India is poised to emerge as a force in defence manufacturing, setting the stage for a journey towards economic and national security resilience. (Source: army-technology.com)
05 Jul 24. Japan-Philippines: New defence pact will likely drive tensions with China. On 4 July, Japan’s ambassador to the Philippines announced that negotiations for a Reciprocal Access Agreement (RAA) between the two countries are nearing completion. Japanese and Philippine foreign and defence ministers plan to finalise the defence pact on 8 July. The agreement is expected to allow military forces from each nation reciprocal territorial access and will include clauses for defence equipment transfers and joint military exercises. This pact is part of broader efforts by the Philippines to strengthen ties with neighbouring countries in response to China’s growing assertiveness in the South China Sea. We assess that this development will increase regional tensions, with China likely perceiving it as a step towards consolidating US-aligned cooperation in its vicinity. Additionally, there is a realistic possibility this pact will drive broader co-operation involving other Western-aligned regional stakeholders such as Australia, which signed an RAA with Japan and upgraded its ties with the Philippines to a strategic partnership in 2023. (Source: Sibylline)
05 Jul 24. South Africa’s arms exports nearly doubled in 2023. The National Conventional Arms Control Committee’s (NCACC’s) 2023 annual report shows a massive rise in South African defence exports, which totalled R7.1bn for the previous calendar year, up from R4.6bn in 2022.
R1.6bn worth of armoured combat vehicles were exported in 2023 to over a dozen countries. These included Burkina Faso (four vehicles worth R40m); Cameroon (six vehicles worth R47.3m – most likely upgraded Ratels from OTT); China (38 vehicles worth R261m), the Democratic Republic of Congo (30 vehicles worth R231m – apparently Maatla and Mbombe 4s from Paramount); Cote d’Ivoire (77 vehicles worth R503m); Ecuador (six vehicles worth R83m – believed to be Mbombe 6s from Paramount); Guinea (two vehicles worth R26m); Kenya (35 vehicles worth R272m); Mali (two vehicles worth R15m – possibly Puma M36s); Malawi (15 vehicles worth R14.6m); Saudi Arabia (six vehicles worth R46m); Thailand (six vehicles worth R36m); Togo (three vehicles worth R46m – apparently Mbombe 4s); the United Arab Emirates (two vehicles worth R21m); and Zambia (two vehicles).
Light weapons worth R153m were exported to a dozen countries, with the largest orders coming from Bangladesh (620 items worth R41m); Brazil (70 items worth R3.5m); Indonesia (34 items worth R76m); and the UAE (33 items worth R6.5m).
Regarding bombs and rockets, four countries ordered R175m worth of these munitions, namely Bangladesh (60 000 bombs worth R58.5m); Germany (4 584 bombs worth R36.6m); Malaysia (2 002 bombs worth R12.6m); and the Philippines (82 625 bombs worth R67m).
Ammunition, including artillery rounds, once again accounted for the majority of arms exports in 2023, according to NCACC figures, amounting to over R3.8bn, with the majority exported by Rheinmetall Denel Munition (RDM).
The largest order came from Germany, which acquired 43 624 rounds/shells for R1.66bn. This was followed by Hungary with 35 818 rounds/shells purchased for R1.59bn. Other large orders came from Bangladesh (100 080 rounds/shells for R88m); Estonia (10 900 rounds/shells for R218m); Gabon (6 022 rounds/shells for R115m); Philippines (71 222 rounds/shells for R101m); Spain (29 500 rounds/shells for R46m); and Switzerland (5 850 rounds/shells for R11m).
Electronic systems also continue to make up a significant component of South African defence exports, with nearly R890m worth of countermeasures, observation equipment, electronic warfare systems, and measuring/communication equipment exported in 2023, according to the NCACC.
Notable exports in 2023 included R111m worth of communication/measuring equipment to Bangladesh; R80m worth of measuring/communication equipment to India; R33m worth of countermeasures equipment to Australia; R120m worth of observation equipment to Italy; R29m worth of countermeasures equipment to Germany; R377m worth of countermeasures equipment to Turkey; and R10 m worth of alert and warning equipment to China.
Other notable exports in 2023 comprised 42 ‘bombs and rockets’ to the UAE worth R26 m along with eight UAVs listed as worth R45 000. It is believed the UAE received Al Tariq and Sejeel guided bombs, according to SIPRI data.
With regards to dual use items, the NCACC annual report lists R421m worth of items being exported to nearly 40 countries in 2023. This includes 33 718 items of ‘armour’ to the DRC worth R172m; communications equipment worth R43m to Australia; R21m worth of communications equipment to Germany; R35m worth of communications equipment to Saudi Arabia; R27 m of the same to the United States; R22m worth of UAV and aerospace systems to Malaysia; and R19m of the same to Zimbabwe. Other items on the dual use export list include sensors, information security products, electronics and communications systems.
All told, the NCACC annual report gives South Africa’s total 2023 exports as amounting to R7.1bn, which is up substantially from the R4.679bn exported in the 2022 calendar year, and R3.353 bn in 2021.
2022 calendar year exports were also dominated by ammunition (R1.6bn), bombs and rockets (R946m), and electronic equipment (R1.3bn).
The strong export sales in 2023 are most likely a result of the general world increase in military expenditure that accelerated following Russia’s February 2022 invasion of Ukraine. The Stockholm International Peace Research Institute (SIPRI) reported that global military expenditure continued to increase last year, remaining well over the $2trn mark, to reach a new high of $2 240bn.
Note: NCACC figures are unreliable, with multiple mistakes evident in reporting. For example, R33.2bn worth of ‘countermeasure equipment’ exported to Australia in 2023 was in fact R33m, as clarified by Ezra Jele, Head of Secretariat, NCACC. It is not clear how many other errors are contained the 2023 annual report. (Source: https://www.defenceweb.co.za/)
05 Jul 24. Philippines Demands Compensation from China for South China Sea Confrontation. Philippine forces will defend themselves with “the same level of force” if they come under attack again from China’s coast guard in the disputed South China Sea, said Armed Forces of the Philippines Chief Gen. Romeo Brawner Jr. on Thursday. This statement follows a recent incident where Chinese personnel, armed with machetes and spears, injured Filipino navy personnel and damaged two of their boats.
In response to the June 17 confrontation at Second Thomas Shoal, the Philippines is demanding 60 m pesos ($1m) in damages from China, which includes compensation for two navy boats and the return of seven rifles seized by Chinese coast guard personnel. The clash also led to a Filipino sailor losing a finger.
The demands and a strong protest were relayed during talks with a Chinese government delegation in Manila. The Chinese delegation did not immediately respond to these demands. During the incident, China’s coast guard reportedly punctured Philippine boats and seized firearms.
China’s foreign ministry spokesperson defended the actions, stating that Beijing took enforcement measures to protect its sovereignty following provocations by the Philippines. Meanwhile, diplomatic discussions between Chinese Vice-Foreign Minister Chen Xiaodong and Philippine Foreign Affairs Undersecretary Ma. Theresa Lazaro aimed at easing tensions.
General Brawner emphasized that the Philippine military would respond proportionately to any future confrontations. He clarified that if Chinese forces used knives, Filipino personnel would defend themselves with the same weapons, adhering to the concept of proportionality.
The Second Thomas Shoal, a critical and contested area in the South China Sea, has become increasingly dangerous. Chinese coast guard, navy, and suspected militia ships have surrounded Philippine marines stationed on a grounded ship, aiming to prevent the delivery of supplies to the Filipino outpost. Both China and the Philippines blame each other for the recent confrontations, with Beijing accusing the Filipinos of entering Chinese territorial waters and Manila asserting that its navy was delivering essential supplies to its forces.
Despite a January agreement between China and the Philippines to ease conflicts, recent clashes have cast doubt on the effectiveness of this bilateral mechanism. Chinese vessels have used water cannons on Philippine ships, causing damage and injuries, while maintaining that their actions were lawful and professional.
After meeting with President Ferdinand Marcos Jr., General Brawner reiterated the Philippines’ intention to avoid war but emphasized that the military would not allow any foreign country to infringe on its territorial rights. President Marcos ordered the military to take steps to de-escalate tensions in the disputed waters while continuing to defend the Philippines’ sovereignty. (Source: https://www.sofx.com/)
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