![[Full brief] Escalating hybrid warfare erodes western defence capacity](https://storage.ghost.io/c/89/91/8991d669-2232-433f-acc6-3df3100a9509/content/images/size/w1100/format/webp/2026/08/photo-1589128560340-b66ae74e4fc4.jpeg)
Hybrid warfare is no longer a special-category threat to the West – often treated as a hypothetical – but a clear and present danger and a new normal. Initial isolated incidents, few of which inflicted major damage, have multiplied to become a heterogeneous swarm of aggressions which, in their totality, create a climate of insecurity that almost simulates a state of low-grade war. That is precisely the purpose of hybrid warfare: to generate an environment in which the target nations feel beleaguered, often without being able to expose the perpetrator with irrefutable, clear evidence, at least in a juridical sense. An enemy that is constantly prodding to find vulnerabilities in a potential opponent’s defences – or is actively engaged in sabotaging them, or pre-positioning to do so – while maintaining technical deniability, can create a sense of destabilisation and loss of the initiative in a target nation. Aside from the direct security risks it creates, these activities introduce political dilemmas and inject uncertainty regarding defence priorities.
The recent intensification of hybrid attacks this month alone has demonstrated the range and versatility of this kind of harassment. As on the conventional battlefield, drones have played an increasing role. On 4 August, a quadcopter drone with plastic explosives attached to it flew undetected past air defence installations at Leipzig/Halle Airport, a major NATO airlift hub. German interior minister Alexander Dobrindt described the incident as marking a “new level of danger”, saying: “These threats are not the work of amateurs. Rather, they require very professional preparation and execution. We’re dealing with possibly foreign powers.” On 7 August, two drones were sighted over Mechernich military base in Germany, where Patriot air-defence components are stored.
Also in Germany, on 5 August, a plot was foiled allegedly aimed at assassinating Stefan Thumann, CEO of Donaustahl, drone manufacturers and suppliers to Ukraine. The Russian intelligence services are believed to have been the instigators. Add to that, a drone explosion near a gas pipeline in Bulgaria on 8 August and the German government’s complaint of “daily” hybrid attacks, and the severity of the situation becomes evident. The hybrid war has even reached the Antipodes: between 8 and 9 August, two key internet cables were damaged in a protection zone off Perth, during a period of suspicious activity by foreign vessels. That exact area hosts HMAS Stirling (also known as Fleet Base West, near Perth), which is the designated submarine base for the future SSN-AUKUS. It is already being used by Royal Navy Astute class attack submarines, and is set to receive US Virginia-class SSNs on a rotational basis from 2027. The suspected bad actor in this cable-cutting instance is China.
In some cases the West has only itself to blame. On 10 August it was discovered that cameras on Royal Navy K3 Scout drones supplied by British contractor Kraken Technology were sending “heartbeat” signals to China. That Chinese components should have been used in any British-made military technology is imprudent, to say the least; that the Ministry of Defence should have accepted it in service is deeply concerning. In the recent past, British governments have often put commercial before security considerations in dealings with China, including by permitting the construction of a Chinese mega-embassy in London, which is inevitably destined to become a hub for espionage and hybrid warfare operations.
Britain, Europe, NATO and the United States urgently need to devise a comprehensive response to the challenges of hybrid warfare. In principle, the threat is not new: in its currently-understood form it goes back to Russia’s invasion of Crimea in 2014 and the famous “little green men”. Now it is a major item on NATO’s agenda, with major conferences held on the issues of hybrid warfare in Prague in 2024 and in Oslo in 2025. But it is the comprehensive nature of hybrid warfare that makes it so difficult to address: it requires the allocation of funding and resources to an eclectic range of measures, capabilities and regions.
Hybrid warfare embraces a great variety of areas, many of them not directly military. Russia employs strategies as varied as malicious cyber activities, political interference, economic pressure and coercion, subversion, outright sabotage and assassination – often without directing a single “Russian” drone at a military target. China’s strategy employs the same covert tactics, as well as seeking to control key technological and industrial sectors, critical infrastructure, strategic materials and supply chains. Both China and Russia are natural hybrid warriors, since both have revolutionary backgrounds, creating a psychological affinity with subversive activities. Although the Soviet Union is history, Vladimir Putin is a former KGB officer, while China is still a Communist state predicated on revolutionary orthodoxy. Both countries’ citizens and military personnel have long lived with the rhetoric and mythology of an anti-Western narrative.
It is NATO doctrine that the primary obligation for responding to hybrid aggression lies with the target state. Thereafter, the Alliance will render all necessary support. Since as early as 2016, NATO has declared that hybrid actions against a member state could trigger Article 5 of the North Atlantic Treaty. Since 2018 the Alliance has maintained counter-hybrid support teams, providing bespoke targeted assistance to Allies, and since 2022 NATO has designated comprehensive preventive and response options to counter hybrid threats, tailored to specific situations. In 2025 NATO appointed a Special Coordinator for Hybrid Threats, to oversee its initiatives in this field.
It is obvious, therefore, that NATO has been aware of and responsive to the threat of hybrid warfare for the past decade. One problem is that countering this type of warfare requires the Alliance to cultivate and cooperate with many parties and nations beyond its membership. That brings its own complexities and diplomatic challenges, but also, if well executed, its own reward.
One of the worst aspects of hybrid warfare is that, termite-like, it nibbles away at the boundaries of peace and security. Already we have reached a point where, due to the covert advance of hybrid aggression, the West is routinely subjected to low-level provocations that, in decades past, would have provoked a major geopolitical incident or even been regarded as a casus belli. We need to bear in mind that some of these aggressions are not merely provocative, disruptive, or intended to test Western resolve. In some instances, such as attacks on subsea cables, they are at the very least a rehearsal for the destruction of key infrastructure, in preparation for an attack.
2. NOTABLE DEVELOPMENTS TO WATCH
2.1. Australia releases its 2026 Defence Industry Development Strategy
Australia has released its 2026 Defence Industry Development Strategy, which aims to deliver a more resilient sovereign defence industrial base and provide the Australian Defence Force (ADF) with the capability to operate as an integrated, focused force through more diverse international industrial partnerships, while reducing exposure to supply-chain shocks. The strategy also proposes an extension of the Defence Industry Development Grants Program, which provides an additional A$80 million in funding, bringing total funding to almost A$250 million through to 2030.
Key point: To support small and medium-sized businesses, the 2026 Defence Industry Development Strategy also proposes relaunching the US$3 billion Defence Export Facility administered by Export Finance Australia. Source.
2.2. Britain and Australia to boost cooperation on radar technology
During UK Minister for Defence Readiness and Industry Luke Pollard MP’s visit to Australia, CEA Technologies and QinetiQ signed a new Statement of Intent in Canberra on 12 August. The agreement will see the British and Australian governments and defence industries collaborate on advanced Active Electronically Scanned Array (AESA) radar systems.
Key point: The initiative builds on the agreement reached at the June 2026 Australia-UK Ministerial Consultations, which aims to strengthen supply chains while creating new export opportunities for the defence industries of both countries. Source.
2.3. Lithuania to produce Ukrainian drones on its territory
Lithuanian Defence Minister Robertas Kaunas said that the country is working to establish production of Ukrainian drones domestically using technology acquired from Ukraine under a bilateral defence industry cooperation agreement signed in May 2026. Several Ukrainian defence-industry investors have received approval from the Lithuanian investment security commission, allowing them to begin operations in the country.
Key point: For Ukraine, the project would expand production capacity, while for Lithuania, it would strengthen the defence industry through new manufacturing capabilities and technological advances. Source.
2.4. Canada launches its first Quantum Defence Innovation Secure Hub to strengthen defence capabilities
Canadian Minister of National Defence David J McGuinty announced on 6 August the launch of the Quantum Defence Innovation Secure Hub (DISH) in Alberta, highlighting quantum technology as one of the country’s sovereign capability priorities under its Defence Industrial Strategy. The DISH is operated by a University of Calgary-led consortium, which receives C$20.3 million to support its operations. Quantum technologies have the potential to transform national security and defence capabilities by advancing secure communications, navigation, sensing and computing.
Key point: The Quantum DISH is a secure, mission-oriented hub selected through a competitive Call for Proposals. It expands Canada’s growing network of Defence Innovation Secure Hubs under BOREALIS (the country’s defence innovation accelerator for faster tech delivery), joining the Maritime DISH pilot and the Uncrewed Systems DISH. Source.
2.5. India explores joining French-led FCAS programme following Germany’s exit
Following the collapse of the Franco-German fighter partnership amid longstanding industrial disagreements over issues including leadership, workshare and intellectual property, India has officially initiated efforts to join France’s multinational Future Combat Air System (FCAS), a sixth-generation fighter programme. India’s consideration of FCAS over the UK-led Global Combat Air Programme could potentially give its indigenous defence industry access to high-end technologies, AI solutions, manned-unmanned teaming capabilities and cloud networking.
Key point: India and France are deepening their defence partnership, following India’s progress earlier this year on a decision to purchase 114 Rafale fighters from France in a deal of up to $39 billion. The two countries also share operational requirements for airborne nuclear deterrence capabilities. Source.
3. GRAPH:
Where the money went in defence tech
The seven privately held Western defence technology companies that closed a venture round in 2026 at a post-round valuation above $3bn, ranked by valuation. Between them they raised $12.12bn against $116bn of combined value. Four of the seven are European, three German, one British, and account for 28% of that total.
Most of the capital behind those European rounds came from American funds.
Sources: Company announcements and Bloomberg reporting: Shield AI, 26 March 2026; Saronic, 31 March 2026; Anduril, 13 May 2026; STARK, 23 June 2026; Quantum Systems, 2 July 2026; Helsing, 13 July 2026; Cambridge Aerospace, 10 August 2026.
4. INDUSTRY TRACKER:
4.1. Thales UK has been awarded a £9.8 million contract by the UK Ministry of Defence to support the system that manages and monitors all Link 16 activity (the secure NATO tactical data link) across Britain. Source.
4.2. Cambridge Aerospace, the UK-based defence start-up, has raised $300 million in a Series C funding round at a valuation of $3.4 billion, led by California-headquartered venture capital firm DFJ Growth. Source.
4.3. Pyra, a London-based defence technology start-up recently founded by Nick Blair, son of former British Prime Minister Sir Tony Blair, is in talks with investors about raising around $200 million. Source.
4.4. Rheinmetall announced on 6 August strong sales growth and record profitability, with consolidated sales increasing by 39% to €5.2 billion in the first half of 2026. Source.
4.5. Boeing secured a US Air Force Undefinitised Contract Action worth $75 million for the production of its BSU-111/B Payload Delivery Unit (PDU) for the Joint Direct Attack Munition Long Range (JDAM LR). Source
4.6. Lockheed Martin launched Strigo, a new line of modular missile and sensor hardware, on 10 August, along with a dedicated product centre aimed at getting Strigo capabilities into the field faster. Source.
4.7. Raytheon and US-based Composite Energy Technologies have successfully demonstrated the undersea launch capabilities of their new low-cost, long-endurance unmanned undersea vehicle (UUV), HADALUS. Source.
4.8. Northrop Grumman announced Raid Hunter, an Air Defence Defence system based on the 50mm Bushmaster Chain Gun, designed to strengthen short-range, layered air defence and protect against drone swarms, cruise missiles and other aerial threats. Source.
4.9. Heaviside Industries, a California-based precision munitions start-up, has raised $60 million in a Series B funding round at a valuation of $600 million, led by American VC firm Felicis. Source.
4.10. Hadrian, an American advanced manufacturing start-up, has raised $1.37 billion in Series D equity financing at a valuation of $7.87 billion, in a round co-led by WCM Investment Management, Washington Harbour Partners, Valor Equity Partners, 137 Ventures and Baillie Gifford, with JPMorganChase’s Strategic Investment Group as the anchor co-lead. Source.
Neil Brown
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5. GOVERNMENT TRACKER:
5.1. The Australian government is acquiring AIM-260 Joint Advanced Tactical Missiles (JATM), worth almost A$736 million, for the Royal Australian Air Force. Australia will be the first country outside the United States to operate these long-range air-to-air missiles. Source.
5.2. Australia and Vietnam stated on 11 August that they would deepen their comprehensive strategic partnership, signing several cooperation agreements covering areas including defence and border security, and agreeing to enhance bilateral cooperation on supply chains involving critical minerals and semiconductors. Source.
5.3. US Deputy Defense Secretary Steve Feinberg has given defence industry leaders 21 days to submit plans for accelerating weapons production to help replenish US munitions stockpiles. Source.
5.4. The US Department of War has launched a new programme called Farseer, in a bid to transition mature quantum sensing and timing technologies into operational use by the Joint Force to enhance the assured precision, navigation and timing elements of its ISR systems. Source.
5.5. The US has officially launched the Golden Dome for America Hub, a digital platform designed to improve coordination between the US Department of War and the commercial technology sector, investors, defence contractors, researchers and other potential suppliers. Source.
5.6. NASA has extended an invitation to the Indian Space Research Organisation to join its Moon Base programme, which aims to establish humanity’s first long-term outpost near the Moon’s South Pole. Source.
5.7. Ukraine is seeking air defence systems from South Korea, with the Ukrainian President calling for closer cooperation between the two countries; Seoul’s position is that it does not currently plan to supply lethal weapons to Ukraine. Source.
5.8. President Zelensky said on 13 August that the country could get through the winter if the US supplied it with 5% of its stockpile of Patriot interceptor missiles. Source.
5.9. The BraveTech EU defence innovation programme has opened applications for DefTech Forges (manufacturing bootcamps) to Ukrainian and EU-based developers of defence and dual-use technologies, with selected defence start-ups competing for €120,000 prizes. Source.
5.10. Estonia received its first payment of €351.6 million under the EU’s Security Action for Europe (SAFE) defence instrument on 12 August, accounting for 15% of its total allocation of €2.3 billion. Source.
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6. APPOINTMENTS
6.1. The Royal Air Force has announced senior appointments, with Air Vice-Marshal M G Jackson OBE to become Assistant Chief of Defence Staff (Military Strategy), and Air Vice-Marshal S R Strasdin CBE to become Air Officer Commanding Number 1 Group. Source.
6.2. The US Department of War has announced nominations for Army senior appointments, with Lt Gen Edmond M Brown to become Deputy Commanding General, US Army Transformation and Training Command. Source.
6.3. The US Space Force has also announced the nominations of Maj Gen Robert J Hutt for appointment to lieutenant general and assignment as Senior Military Assistant to the Deputy Secretary of War, and Maj Gen Christopher S Povak for appointment to lieutenant general and assignment as Deputy Chief of Space Operations for Operations. . Source.
6.4. AeroVironment, a Virginia-based defence technology company, has appointed Michael D Ruppert to its Board of Directors, effective 5 August 2026. Source.
6.5. Applied Aerospace & Defense, an Alabama-based provider of advanced manufacturing solutions for mission-critical space and defence applications, has appointed Chris Rogers as President and Chief Strategy Officer, a newly created position. Source.
6.6. Everforth ECS has appointed Sam Yousef, formerly Sector Vice President and Chief Technology Officer at Peraton, as the new head of its Global Defence business unit. Source.
6.7. US cybersecurity firm Aethon Security has promoted Noël Vestal to President, nearly two years after the company’s founding. Vestal will retain her role as Chief Information Officer. Source.
6.8. The US Senate has confirmed Jules “Jay” Hurst III as the Pentagon’s comptroller in a party-line vote, filling the department’s top financial management post after a vacancy of around 18 months. Source.
6.9. Alaska-based Chugach Government Solutions has appointed Jon Walman and Eric Bowen as Business Development Executives, with Walman overseeing Navy and Marine Corps opportunities and Bowen leading the company’s Army portfolio. Source.
6. QUOTE:
We shall never surrender.
- Winston Churchill
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