The Kremlin plans to increase defense spending by 30 billion, but hides it: ISW analysis

The Kremlin plans to increase defense spending by 30 billion, but hides it: ISW analysis Anastasia Lukashevskaya

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The Kremlin plans to further increase defense spending in 2025. However, Russian officials point to planned social spending, avoiding discussing the increase in defense spending.

The Kremlin's rhetoric was analyzed by analysts at the Institute for the Study of War (ISW). They note that the attempts of politicians in the aggressor country to compensate for defense spending with “social projects” are forced by the fact that Russians are tired of the war.

What budget has Russia allocated for defense

The Russian Cabinet of Ministers has approved the draft federal budget for 2025-2027; it will be submitted to the State Duma by October 1. It provides that Russia's federal revenues will grow by almost 12% in 2025 compared to 2024, and the share of oil and gas revenues in the federal budget will increase to 73%.

Bloomberg previously reported that, according to the draft three-year budget, the Russian government plans to spend 13.2 trillion rubles (about $140 billion) on defense in 2025, which is more than the 10.4 trillion rubles (about $110 billion) planned for 2024.

Thus, Russia's spending on national defense and internal security in 2025 is more than on education, healthcare, social policy, and the federal economy combined. The Kremlin will also increase spending on classified items to 12.9 trillion rubles (about $136 billion).

Kremlin Rhetoric

Russian Prime Minister Mikhail Mishustin assured that the government plans to fulfill “all social obligations to citizens” and noted the planned funding for medicine, pensions, and national projects. However, a sober mind is enough to analyze the Russian budget for 2025 and understand that this is far from true.

Russian Finance Minister Anton Siluanov admitted that “significant resources” are being directed to Russia's “special military operation,” but emphasized that 40 trillion rubles (about $424 billion) will go to 19 national projects over 6 years – twice as much as the funding allocated for the period from 2019 to 2024. Siluanov also stressed that Russia plans to spend 180 billion rubles (about $1.9 billion) on upgrading public utilities and preferential mortgage programs.

ISW notes that Kremlin officials are likely concerned about war fatigue among the Russian population and are trying to stimulate public support for the war by increasing the Kremlin's focus on social projects.