Putin sharply increases Russia's military spending to record levels - Bloomberg
Photo: Russian President Vladimir Putin (Getty Images)
Russia's military spending in 2026 could reach $199 billion after the Kremlin sharply revised its budget plans, Bloomberg reports.
According to two people familiar with the Russian government, Russia's defense spending could approach 17 trillion rubles, or $199 billion, by the end of 2026.
The new figure is about 40% higher than the initial plan approved by the Russian authorities at the end of 2025. At the same time, it is almost equal to the amount of military spending included in Russia's new budget for 2027.
Why the Kremlin changed its plans
A year ago, Russia planned to curb the growth of military spending. The Kremlin expected to reduce the budget deficit and begin replenishing reserves that had been largely depleted during the war.
Before the 2026 budget was approved, Putin met with US President Donald Trump in Anchorage, Alaska.
According to Bloomberg sources, after the meeting in August 2025, the Russian president hoped that a peace deal with Ukraine could be reached as early as the following year. In that case, the need for a significant increase in military spending would have been reduced.
However, by January, the Kremlin concluded that it would not be possible to reach a deal with Ukraine and that US-led efforts had failed to produce the expected results.
After that, the Russian government began accelerating advance payments to defense industry companies and increasing other war-related spending.
As a result, Russia's projected budget deficit for 2026 rose to more than 7 trillion rubles. Initially, the Russian authorities had expected a deficit of 3.8 trillion rubles.
The Kremlin financed the additional spending, among other things, by increasing domestic borrowing and selling gold.
Russia's military spending to remain high
Russia does not plan to significantly cut defense spending in the coming years either.
According to budget plans, 17.1 trillion rubles is allocated for military needs in 2027. In 2028, this amount is expected to decrease to 16.6 trillion rubles, and in 2029 to 16.3 trillion rubles.
At the same time, Bloomberg sources suggest that actual spending in 2027 could exceed the planned amount.
One of the reasons is Moscow's doubts about the possibility of reaching a deal with Ukraine on terms acceptable to the Russian leadership.
The war against Ukraine is becoming increasingly costly for Russia. High defense spending and sanctions are putting serious pressure on the Russian economy.
According to an assessment by the Danish Defense Intelligence Service (DDIS), Russia is approaching a "major crisis" as the war requires increasingly more resources while losses among the Russian military are mounting.
