Tokyo is systematically restructuring its own defense industry along lines suggested by the battlefield in Ukraine. In doing so, a new and quite promising market is opening up for Ukrainian weapons manufacturers. This was reported on July 14 by The Japan Times.
The First Contract: Drones That Shoot Down Shaheds
Media outlets note that the first deal was struck between Tokyo-based Terra Drone and Kharkiv-based Amazing Drones in 2023.
The joint development of the two companies — the interceptor Terra A1 — reached a speed of approximately 300 km/h and a range of up to 32 km, significantly outpacing Shaheds (~200 km/h) in speed. The company positions the Terra A1 as a low-cost interceptor intended to serve as a cheaper alternative to traditional surface-to-air missiles and suitable for mass production.
Already in April 2026, Terra Drone announced that the system had made its way to combat use: the interceptor began to be employed by one of the Ukrainian Armed Forces units to combat Russian strike drones, and the company pledged to use battlefield data to refine the product.
Notably, the manufacturer initially had to work around Japanese legislation through a subsidiary in the Netherlands: direct supplies of military technology from Japan were effectively blocked by postwar arms export restrictions.
How Tokyo Lifted the Bans on the Defense Industry
The situation changed after Prime Minister Sanae Takaichi’s government revised the military export rules. On April 21, 2026, the largest reform of export regulations in decades was approved.
Defense products are now divided into two categories — “weapons” (ships, tanks, missiles, and other lethal systems) and “non-weapons” (radars, protective equipment, etc.). Decisions on the export of lethal weapons must be made by the National Security Council, and deliveries are restricted to 17 countries with which Japan has concluded defense technology transfer agreements, including the United States, the United Kingdom, Australia, and India.
The Prime Minister links the export liberalization to a broader revision of defense doctrine against the backdrop of what she calls “the most serious and complex security environment since World War II” — referring primarily to the growing military activity of China and its rapprochement with Russia.
At the same time, Tokyo is deepening its study of Ukraine’s experience: on May 29, 2026, Japan’s Ministry of Defense announced the deployment of four Self-Defense Forces personnel to the NATO Security Assistance and Training for Ukraine (NSATU) headquarters in Wiesbaden. The goal is to obtain firsthand the lessons Ukraine has developed regarding a “new way of warfare,” particularly concerning electronic warfare and counter-drone operations under GPS jamming conditions.
Moscow’s Reaction
The rapprochement between Tokyo and Kyiv in the defense sphere has already provoked a reaction from Russia: Russian Deputy Foreign Minister Andrei Rudenko summoned Japan’s ambassador and declared that the investment in Terra Drone was a “hostile act” that harms Russia’s national security. Rudenko later warned that Moscow had ways to “respond” to Japan’s continued course of action.
Kyiv’s Next Target — Air Defense
Ukraine’s Ambassador to Japan, Yurii Lutovinov, described the easing of export rules to Reuters as “theoretically a very big step forward,” while noting that Japan still restricts deliveries to active combat zones. Therefore, any direct supplies would require a separate bilateral defense technology agreement.
Kyiv’s most immediate practical interest lies in Japanese investment in the development of a Ukrainian air defense system that would reduce dependence on the scarce American Patriot.
In the ambassador’s words: “We have all the necessary production capacity. But we need investment. We need funding.”
Lutovinov also emphasized that combining Japanese technology and Ukraine’s combat experience could yield “a top-class product.”
Japan’s possible participation in the NATO PURL (Prioritized Ukraine Requirements List) mechanism is also being discussed — through which allies have already funded the delivery of weapons and ammunition to Ukraine worth more than $4 billion. Last year, the first non-NATO countries — Australia and New Zealand — joined this mechanism.
Separately, Kyiv views the Japanese market as a source for diversifying the supply of electronics and microcomponents for its own drone production.
This represents a shift in the model: instead of attempting to export outdated systems under a new regulatory framework, Japanese companies are seeking partners whose technologies have already been battle-tested in Ukraine.
At the same time, the liberalization of rules alone does not guarantee export competitiveness for Japan’s defense industry — the sector has been oriented toward domestic demand for decades and, according to media assessments, faces a “triple bottleneck“: limited production capacity, vulnerable supply chains, and a shortage of skilled personnel. This is precisely why the model of cooperation with Ukrainian developers, who offer ready-made, combat-proven solutions, looks particularly attractive to Tokyo.