Kyiv has relied on billions of dollars in military aid from its Western backers to fight back against Russian forces, but has also invested heavily in its domestic arms sector.
"In the first half of this year alone, Ukraine produced 25 times more ammunition for artillery and mortars than in the whole of 2022," Zelensky told a defence forum in Kyiv.
Almost 300 weapons companies, both Ukrainian and foreign, were in Kyiv for the conference, Zelensky said.
Throughout the conflict, Ukraine's army has used a mix of Soviet-era weaponry, supplies donated by the West and some cutting-edge domestic equipment such as long-range attack drones.
Its troops have faced months-long ammunition shortages amid political wrangling in Washington over aid payments, which has underscored to Kyiv the importance of investing in its own production.
"In the extremely difficult conditions of a full-scale war, under constant Russian attacks, Ukrainians were able to build a virtually new defence industry. Today, everyone can see this new Ukrainian capability," Zelensky said.
Ukraine now has the capacity to produce four million drones a year, Zelensky said.
Drones have become crucial battlefield equipment for both Moscow and Kyiv. Small craft are used everyday for frontline reconnaissance while larger ones are packed with explosives and flown hundreds of miles into enemy territory.
Ukraine's Prime Minister Denys Shmygal told a government meeting that half of the ammunition Ukraine uses at the front was produced domestically.
But further boosting production inside Ukraine is complicated by the fact that the entire country is within range of Russian missiles.
Despite the challenges, Zelensky said the sector had achieved a remarkable turnaround.
"Years ago, the Ukrainian defence industry looked, unfortunately, helpless," he said. "But now it is an industry that is on its way to becoming a leader, at least in Europe."
Alongside long-range drones, Ukraine also produces the Neptune anti-ship missiles that have been used to hit several Russian vessels in the Black Sea.
And at the end of August, Zelensky announced the successful test firing of the first Ukrainian-made ballistic missile.
Russians divided over army spending surge
Moscow (AFP) Oct 1, 2024 -
Russia's plan to hike defence spending next year has divided opinion in Moscow, with some objecting to devoting more money to the Ukraine conflict while many face a squeeze in living standards.
Russia is to spend more than 40 percent of its total budget on defence and security next year, more than the money allocated for social welfare and education combined.
"It is an outrage," 80-year-old pensioner Irina told AFP in Moscow on Tuesday. "We need to end this war, and spending the budget on war is a crime."
The government promised major investment in social support ahead of Monday's budget announcement, promising to make it a top priority.
But the $145-billion draft defence budget suggests military spending has crowded out other sectors.
Planned spending on "national defence" is more than twice that allocated to areas Moscow labels as "social policy".
"The population of the country does not live so well," pensioner Elena, 68, told AFP.
"I am generally against military action of any kind, in any country, in ours, and in general the whole world," she said.
- 'A disgrace' -
The Kremlin has heavily militarised Russia's economy since sending troops into Ukraine in February 2022, spending huge sums on arms and army salaries.
That spending boom has fuelled economic growth, helping the Kremlin buck initial predictions of a recession when it was hit with unprecedented Western sanctions in 2022.
But it has caused surging inflation, a sensitive issue for many in a country where memories of economic instability following the Soviet collapse run deep.
"There is not enough for anything at all. Not for treatment, not for anything," said 70-year-old Irina, who complained her pension was only 25,000 rubles ($260) a month.
"It's pennies. People are unprotected," she said.
"It's a shame and a disgrace that the country has no money to treat its own children," she added.
Moscow had already ramped up military spending to levels not seen since the Soviet Union era.
The latest planned increase in spending will take Russia's defence budget to 13.5 trillion rubles ($145 billion) in 2025, an annual increase of almost 30 percent.
Some were supportive of the plans.
"If it is not to the detriment of education, medicine, some other social programmes ... In the current situation, an increase in the amount of funding is understandable," said 49-year-old lawyer Vladimir.
Another resident named Vladimir, 50, told AFP the spending was needed for "protection".
"In the current times, it is necessary to spend money on defence, because NATO is playing against us," the IT worker said.
"We have to do something and we can't do it any other way."
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