Ukraine war costs becoming unaffordable for Russia, Putin told
What's the story
Russian officials have warned President Vladimir Putin that the financial burden of the Ukraine war is becoming unsustainable. The country's deficit had reached 5.9 trillion rubles by April, far exceeding the planned 3.8 trillion rubles for the entire year. Finance Minister Anton Siluanov cautioned against further public spending, saying that "a certain restraint" was required in public expenditure. "Reserves are not endless. We need to improve the efficiency of budget expenditures," said Siluanov.
Economic impact
Russia slips into stagflation
The Russian economy is slipping into stagflation despite a boost from rising oil prices. The government has cut its growth forecast for 2026 to 0.4% from 1.3%. For the first time in three years, the economy contracted in Q1 this year, as the Ukraine war, Western sanctions, and high interest rates took their toll.
Military strain
Ukraine strikes deep inside Russia
Ukraine has also put a strain on Russian resources. The country has been targeting critical infrastructure deep inside Russia, affecting energy production and transport. Despite these challenges, Putin has not shown any intention of de-escalating the conflict. Instead of cutting military expenditure, he has asked for reductions in other areas of the budget. Putin has ordered that military spending be reduced only as a last resort.
Economic plea
MP calls for end to war
Russian MP Renat Suleimanov has called for an end to the war due to economic hardships. He said, "What development, investment, and capital allocation can you talk about when 40% of the federal budget is defense and security?" "Tanks and shells don't have any consumer value," he said. The defense ministry has sought an additional 3 trillion rubles this year on top of the already allocated budget.