Rosoboronexport, one of Russia’s state owned arms companies, is considering accepting oil and gas rights in payment for arms deals.

It makes good business sense for Rosoboronexport as the transfer of mineral rights is harder to default on than cash payments.  But it’s got to be bad business for the countries buying the arms.  Their mineral resources are often a key driver of their economies, and revenues from mineral sales make up a huge part of their state budgets.  If they just hand them to a Russian company, although there will be some benefit to their economies in terms of jobs, every single cent of profit to be made from those mineral resources will leave the country destined for Russian bank accounts.