Outside Nato’s headquarters in Brussels, the national flags of 28 member states fly in a proud circle. Even after decades of defence cuts, these countries still account for 58 per cent of global military spending, giving Nato more firepower than any other alliance on Earth.

Yet, if Nato is a giant, it has often seemed a sleeping one — at least since the Cold War ended in a bloodless victory more than two decades ago. With Russian troops on the march in Ukraine, however, the task of reawakening the Nato giant to face a new crisis has fallen to Jens Stoltenberg, a former prime minister of Norway who became the alliance’s Secretary-General six weeks ago. In a sparse office decorated only by a map of the world — with Nato’s members shaded in blue — Stoltenberg seems grimly aware that he is taking over at a perilous moment.

The latest intelligence on Russian troop movements in Ukraine is particularly worrying. During the past 10 days, Russian President Vladimir Putin has sent columns of Russian soldiers and tanks across the border to reinforce the area of eastern Ukraine held by pro-Moscow rebels.

A ceasefire agreed in Minsk on September 5 has unravelled and both sides are preparing for renewed fighting. “We have seen movements of equipment, artillery, tanks, trucks and soldiers into Ukraine and towards the front line,” says Stoltenberg.

“The border between Ukraine and Russia is completely open, so there are movements back and forth, but there is a significant military build-up taking place.” Stoltenberg declines to put a figure on the scale of the Russian deployment, but he is struck by the presence of sophisticated air defences inside the rebel-held enclave in Ukraine.

“We see a lot of advanced air defence systems, for instance. This has to come from somewhere and it has to be operated by people who are able to operate this kind of advanced military equipment,” he says. As for who broke the Minsk Agreement, Stoltenberg places the blame firmly on Russia. “The developments are going in the wrong direction,” he says.

“The idea with the Minsk Agreement was that Russia should withdraw its forces. But instead of withdrawing them, they are sending in new forces and that’s undermining the whole ceasefire and the Minsk Agreement.”

So has Russia invaded Ukraine? Stoltenberg, for all his candour, still declines to endorse such a blunt term. “There are Russian forces inside Ukraine and there has been a military build-up and that’s in violation of the Minsk Agreement,” he replies. “It’s a threat to the ceasefire — and that’s the reason why we’re calling on Russia to withdraw its forces.”

What might be the rationale for this Russian build-up?

One plausible explanation is that Putin and the rebels are planning a joint offensive to enlarge the pro-Russian statelet by capturing more Ukrainian territory, possibly beginning with the port city of Mariupol. “I’ll be very careful on speculating on intentions,” says Stoltenberg. “But I see what they do: Nato acts based on what we see Russia actually doing. And what they are doing is violating international law, they are violating the whole rules-based system of working together in Europe — which was developed over decades — and they are also using force to change borders in Europe.”

In addition, Russia is sending more and more jet bombers and fighters to probe the air defences of Europe.

In itself, this is nothing new: Exercises of this kind have always happened. But Stoltenberg points out that Nato fighters have intercepted Russian intruders more than 100 times so far this year — a three-fold increase in the number of incidents recorded in 2013. Moreover, the Russian planes often ignore safety procedures, raising the risk of a catastrophic collision with civil airliners in European airspace.

“The problem is that many of the Russian pilots don’t turn on their transponders, they don’t file their flight plans and they don’t communicate with civilian air traffic control,” says Stoltenberg. “This poses a risk to civilian air traffic and therefore this is a problem, especially when the Russian activity increases.”

In response to Russia’s new challenge, Nato has taken a series of decisions. Three times as many fighter aircraft have been deployed to protect its Baltic members — Estonia, Latvia and Lithuania — and more warships have been dispatched to the Black Sea. Nato’s armies are creating a “spearhead” force designed to guard the alliance’s most exposed members. All this, says Stoltenberg, amounts to the “strongest increase in our collective defence since the end of the Cold War”. In factual terms, he is right. But the absolute size of the forces involved is modest.

The tripling of the “Baltic Air Policing Mission”, for example, means deploying 12 fighters instead of four. Russia’s air force, meanwhile, possesses 1,389 combat-capable aircraft. Given the escalating crisis in Ukraine, might there be a case for sending more Nato warships and fighters to eastern Europe? Stoltenberg sidesteps this question, saying only: “We’re working on the assurance missions for 2015 now — and we’ll come back to the size and composition of the assurance missions.” In fact, Nato is still observing a self-denying agreement dating back to the 1990s, when the alliance expanded to include former members of the Warsaw Pact. In order to soothe Kremlin’s concerns about Nato entering Russia’s old domain, the allies agreed that no foreign troops or nuclear weapons would be based permanently east of Germany.

Despite recent events, Nato has not walked away from that deal. Moreover, Nato’s total defence spending has fallen by 20 per cent over the past five years (Russia’s military budget, by contrast, rose by 50 per cent over the same period). Nato’s European members cut their defences most of all, leaving America to pick up an ever greater share of the bill. In 1995, the US accounted for 58 per cent of Nato defence spending. Last year, the figure was 72 per cent. Stoltenberg agrees that Europe cannot leave America to shoulder more and more of the burden. At the summit in Wales in September, all Nato members agreed to spend at least 2 per cent of national income on defence — but, for now, this target is met only by the US, Britain, Estonia and Greece.

“In total, Europe is investing too little and that is why we have agreed to stop the cuts in defence spending and gradually increase the investment in defence,” says Stoltenberg. “First we had the end of the Cold War and then people rightly expected a peace dividend — and defence spending went down. Then we had the financial crisis and defence budgets were cut more than other budgets. But now things are changing. Threats are coming closer, both in the east and in the south — with Isil [Daesh or Islamic State of Iraq and the Levant] and Iraq, Syria. So we have to reverse the trend.”

Once again, the resolve of Europe’s leaders is being tested. The post-war generation rose to the challenge of confronting the Soviet threat. It remains to be seen whether Stoltenberg and Europe’s current leaders possess the collective determination to reawaken the Nato giant and face down Putin.

— The Telegraph Group Limited, London, 2014