Russia’s military budget cut for first time since full-scale invasion of Ukraine - NYT
Russia's military budget will shrink for the first time since the start of its full-scale invasion of Ukraine in 2026. This indicates that the Kremlin has reached the limits of its ability to finance the war amid growing economic pressure.
This was reported by The New York Times, according to Censor.NET.
It is noted that the draft budget provides for a reduction in defense spending from over $163 billion to about $156 billion at the current exchange rate. Taking into account the projected inflation rate of 7%, the reduction will be even more significant.
Despite the reduction, Russia's military spending remains almost four times higher than in 2021 and three times higher than Ukraine's defense budget. The Kremlin plans to continue the war, relying mainly on contract soldiers, which leads to an increase in the budget deficit. To cover it, the government will raise VAT from 20% to 22%.
Analysts note that in the event of a further increase in military spending, Russia will either have to raise taxes again or resort to more active domestic borrowing, which could undermine economic stability and make it more difficult to maintain public support for the war.
