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Budgets | Issues - Political | Russia

Putin Proposes 22% Increase for Official FY 2006 Russian Defense Budget

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Russia plans another substantial increase in defense spending next year to pay for across-the-board military upgrades, development of new weapons systems and improved social benefits for defense-sector employees. DID has noted on occasion the procurement difficulties created by Russia’s budgetary shortfalls. Russia’s land forces have been particularly hard-hit, even as the country attempts to move toward a more professional military. AFP reports that a draft FY 2006 budget for Russia allocates 668.3 billion rubles (USD $24 billion, EUR 19.5 billion) for spending on national defense, an increase of nearly 22% on this year’s defense budget and a figure equivalent to about 2.75% of Russia’s projected gross national product. The draft budget heralds a third consecutive year of significant official increases in Russian defense spending in real terms, but the defense increase is still smaller than the proposed FY 2006 40% rise in expenditures overall. Moscow News goes into greater detail, noting that overall expenditure is earmarked at RUB 4.27 trillion (USD $150 billion), up from RUB 3.05 trillion in 2005. Revenues are forecast at RUB 5.46 trillion (USD $192 billion), up from RUB 3.326 billion a year earlier. The budget surplus is expected to be RUB 776 billion (USD $27.3 […]

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