Kremlin’s defense spending hike could destabilize Putin's regime, warns ISW

Analysts think that maintaining a high levels of defense spending in the coming years will make it challenging for the Russian government to allocate funds for social programs and would also hamper efforts to address the country's demographic crisis.

The report highlights that the Russian public's growing demand for more social investment and less defense spending could undermine domestic support for the regime and jeopardize the Kremlin's ability to sustain its war against Ukraine.

Moreover, the increase in military spending does not necessarily translate into improved military capabilities, as a significant portion of the funds are allocated to benefits for soldiers, veterans, and their families.

This continued focus on defense spending could affect the effectiveness and sustainability of Russia's social programs.

This follows a Reuters report the same day, citing a draft of Russia's 2025 federal budget, that Moscow plans to increase its defense spending by 25% next year.

This will bring Russia's military spending to 6.3% of its GDP, the highest level since the Cold War, and account for 32% of total federal budget spending in 2025.

Earlier, Bloomberg reported plans to gradually reduce military spending to 5.6% of GDP in 2026 and 5.1% of GDP in 2027 after the 2025 increase.