Nato's plans to upgrade the US's estimated 180 tactical nuclear weapons in western Europe are unnecessary, expensive and likely to exacerbate already difficult relations with Russia, according to a report.

The alliance is preparing to replace "dumb" free-fall nuclear bombs and ageing delivery aircraft with precision-guided weapons that would be carried by US F35 strike aircraft, according to a report from the European Leadership Network (ELN), a thinktank supported by former UK defence ministers including Lord Des Browne and Sir Malcolm Rifkind.

The report, Escalation by Default?: the Future of Nato Nuclear Weapons In Europe, is by Ted Seay, who until last year was arms control adviser to the US mission at Nato headquarters in Brussels.

The plans to upgrade significantly the US's stockpile of tactical nuclear weapons would increase its ability to reach targets in Russia at a time when Nato and Russia are already locked in a tense standoff over missile defence, warns the report.

Nato possesses 180 B61 free-fall tactical nuclear bombs in Europe stored at bases in Belgium, the Netherlands, Italy, Germany and Turkey. The bombs, relics of the cold war, have no guidance systems and are regarded as having no real military purpose or value, says the report. The aircraft tasked with delivering them are also in need of replacement.

Despite defence spending cuts, the US is planning to upgrade the bombs with precision-guided B61-12 nuclear gravity bombs at a cost of $4bn (£2.5bn), according to the report. European countries, whose pilots are trained to deliver the B-61s to their targets, are also facing expensive decisions to replace their existing aircraft with the US F35 Joint Strike Fighter, whose cost has risen to more than $100m (£62m) each.

Nato's plans would produce a "formidable increase in nuclear capabilities for Nato in Europe", according to Seay, who adds that modernisation would be a form of expensive nuclear escalation by default that could be expected to draw a hostile reaction from Moscow.

Ian Kearns, the ELN chief executive, said: "The planned upgrade of Nato's tactical nuclear forces in Europe will be expensive and is unnecessary. Nato states are fully secure without this additional capability and should be focused on removing all tactical nuclear weapons from Europe, not on modernising them".