Russia warns war costs are ravaging its finances while Ukrainian ‘drone overmatch’ sends Putin’s forces reeling in new phase of combat
Russia's finances are under severe strain due to escalating war costs and a deepening budget deficit. The finance ministry has warned that war-related spending could exceed the budget by trillions of rubles, while economic growth remains stagnant. Meanwhile, Ukraine's advancements in drone warfare are significantly impacting Russian military operations and resources.
- ▪Russia's finance ministry estimated war spending could exceed the budget by at least 2 trillion rubles this year.
- ▪The Kremlin's budget deficit has worsened, reaching 5.9 trillion rubles in the first four months of the year.
- ▪Ukraine has achieved tactical drone supremacy, allowing it to regain ground against Russian forces.
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The Kremlin sounded the alarm on its deteriorating finances earlier this year, just as its war on Ukraine pivoted dramatically against Russian forces.Recommended Video According to a letter seen by the Financial Times, Russia’s finance ministry estimated in Feb. that spending on Vladimir Putin’s war was on pace to exceed its budget by at least 2 trillion rubles this year, or about $28 billion, with a more negative scenario putting that figure at 4 trillion rubles. The ministry also put war-related overspending at 4 trillion rubles in 2027 and 2028, while asking the cabinet to freeze trillions in non-defense outlays in the coming years. The projected explosion in war costs comes as Russia’s budget deficit was quickly diving deeper into negative territory.
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