Russia Defense Budget Drops
Published By : 16 Oct 2014 | Published By : QYRESEARCH
Russia is being forced to slow down their current major spending drive due to a declining oil price, sanctions from the west and the looming threat of recession. Experts believe it to be a sign of President Vladimir Putin’s aggressive policies might find obstacles in the country’s economic reality.
For the first time since 1998, the Russian government is planning to cut their defense expenses by 5.3 percent in 2016. A draft government budget for the next three years is being deliberated upon in the Duma.
Almost half the Russian government’s revenue is accounted for in oil and gas expenses. The 25 percent slash in the price Brent crude is piling pressure on the country’s tight budget. Brent crude achieved the international benchmark in mid-June.
A small budget surplus that Russia ran last year was predicted to turn into a small deficit this year. The deficit could increase if oil prices continue to fall. Russia had already issued warnings that the current draft budget would be balanced only if the oil and gas prices remain above $100 for the next three years.
Ruslan Pukhov, the Russian defense analyst and a publisher for the Moscow Defense Brief, said the weakening Russian economy will make it inevitable to make cuts in the defense spending plan.
Putin and other Russian senior politicians have always maintained that it is a priority to strengthen the country’s military.
The rising budgetary expenses that Russia had undertaken contrast the defense cuts that the western countries are currently performing.