July 1939 - Overview
Armed Forces
Red Army has evolved from a large contingent of ill-trained troops equipped with obsolete weapons into a modern military force, prepared to participate both in offensive and defensive operations. During the last 3 years our small arms, artillery and tank design bureaus have developed chip and reliable weapons that are not lacking in performance and capabilities compared to the Western European armies (e.g. France, Germany). And, while we still have the largest army in the world, the Red Army is in a serious disadvantage in one aspect - quantity. We will need far more troops to defend our borders from the possible imperialist invasions, not to mention the glorious task of liberating proletarians of the world
Infantry, which remains the core of our army, should be supplemented with at least 80 more divisions in 2 years, most of them strengthened by either conventional, anti-tank or anti-air artillery brigades.
We should also significantly increase the size of our mechanized forces. General Staff decided that our armor and motorized infantry brigades should be concentrated in a separate corps formations. We should have either tank corpses (2 armor divisions, 1 motorized division) or mechanized corpses (1 armor division, 2 motorized divisions). The former would be intended for breaking the enemy lines, and the latter for exploitation, although both types of mechanized formations should be delegated to parry the enemy strikes if necessary.
Although the younger generation of officers sees the future of mobile warfare in the rapid development of armored and mechanized forces, most of the senior ranking Red Army commanders led Budyonny and Kulik insist that cavalry should decide the fate of the offensive operations like it happened during the revolution. These old guard top-brass generals even suggested to completely disband our mechanized forces, claiming that they would be too expensive and ineffective. But, much to their dismay, the large military maneuvers in Minsk and Kiev Military districts showed that cavalry is extremely vulnerable to aircraft strikes, and is virtually incapable of breaking the entrenched infantry formations. Therefore, it was decided that all the existing cavalry divisions should be transferred to the secondary theaters like Central Asia and Far East.
The Red Navy almost did not change compared with 1936. All the Great War era submarines and destroyers were scrapped, but no new surface ships were commenced or even designed during this period. However, we have designed quite modern Series XIV submarines and should build them in minor numbers. In general, the Navy will have two roles in the near future - protecting our shores with the help of VVS and harassing enemy trade and supply lines.
The Red Air Force has seen the most rapid expansion since the 1936. Now there are 15 divisions of fighters dispensed into 8 air corpses, ready to drive the enemy aircraft out of the Soviet airspace. The attack capability of the Red Air Force is comprised of 7 bomber divisions, distributed in 3 air corpses. All the aircraft is fairly modern - the early models of LaGG-3 fighter were introduced into the service in early summer 1939, and now 4 fighter divisions are completely re-equipped with them. Regarding the bomber aircraft, the Yakovlev OKB is expected to finish designing a new model of tactical bomber - test flights are scheduled by the end of July 1939. If the plane would meet the VVS requirements, it should gradually replace well-proven but aging SB-2 and DB-3 bombers.
Compared with the situation in 1936, VVS became much stronger both in terms of quantity and aircraft quality. The main pitfall lays in the generally poor training level of pilots and ground personnel. We also don't have any understanding upon how the modern air war should be waged. Taking into the account vastly increased industrial capacities of the Rodina, the Peoples Commissar of the Air Force Pavel Rychagov came up with the following proposal - we should increase our fighter air arm at least by 60% in 2 years. We should also consider development of a multi-role fighter, capable of close escorting our bombers and more suited to perform ground attack duties than ordinary fighter planes. There are still some debates regarding the bomber air arm of the VVS. Some people insist that we should continue to produce solely twin engine tactical bombers, while others suggest that we should develop single engine armored aircraft specifically designed for close air support role. The second approach would be cheaper and more practical, as it would allow us to focus on the mass production of single engine aircraft, thus having more planes able to attack the enemy troops and mechanized formations.
Industry
The improvement of industry - both in terms of new technologies and constructing more factories was truly the focus of our country's development from 1936 to 1939. If we are to withstand the struggle for liberating the working people of the world, we had to greatly expand our production capabilities, most importantly the heavy industry. This process, dubbed as "Industrialization", consisted of several industrial constriction programs on the territories between our western borders and Urals. Although from the strategic point of view it could be better to concentrate all the industry in Siberia, the harsh living conditions and poor infrastructure led the Peoples Commissar of Heavy Industry Lazar Kaganovich to a more pragmatic solution - factories should be built where it would be convenient, and the Red Army should defend them from any enemy incursions.
Organizing geological expeditions into the lesser explored territories and developing improved mining and metal production techniques that would yield more materials for the growing number of our plants was also a priority. It could be said that chemical engineering was Kaganovich's favorite sphere - he always insisted that we should better use the available natural resources.
As a result, we have entered the summer of 1939 with 221 factories all over the Soviet Union, and we have produced coal, metal and rare materials in amounts far exceeding our industry needs. This situation allowed us to trade them in large quantities with many countries. Despite major ideological differences, Germany was our main trade partner - we sold them metal and rare materials, and bought supplies in return.
Diplomacy & Intelligence
The international situation became even more dangerous than it was in 1936. Fortunately for us, the world imperialism forces are divided into two opposing camps. First one, led by the United Kingdom and France, is interested in maintaining the status quo, while the second one, led by Germany, Japan and Italy, would like to get more territories under their control. Thus, it is very unlikely that these countries will unite against us, although we can not completely dismiss such possibility. The best course of actions for us will be to evade any major confrontation if possible. If any of the mentioned factions will initiate diplomatic negotiations with us, aimed with long-term cooperation, we should see what benefits it gives us. For now, our foreign policy should be led by pragmatic geopolitical goals instead of ideology.