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Russia is going to spend $112 billion on the army in 2024. This amount is double what the Kremlin spent in 2023. According to Bloomberg, which has reviewed the draft Russian budget for next year, $112 billion is kept in a classified part to avoid citizens’ close attention to the consequences of the war, FREEDOM reports.
“Actually doubling the Russian defense budget will allow the Russian occupation army to tighten its trousers a little, which suffered critical losses and fairly large-scale expenses during the first year and a half of the Russian-Ukrainian confrontation. After all, the losses of the Russian army are estimated at at least 150 billion dollars, this is a very large amount. Obviously, it includes not only payments to killed and maimed Russian servicemen, but also losses in Russian military equipment,” says military expert Vladislav Seleznev.
Russia continues to rebuild on wartime footing in order to produce the required amount of equipment and weapons. Military experts suggest that next year, in addition to technology, Russia will focus on air attack weapons.
“The focus will be on creating additional missiles. After all, it is obvious that the enemy sees that his tactics of missile terror aimed at destroying the Ukrainian energy infrastructure on the territory of Ukraine are yielding results. Of course, the Russians will try to localize the production of kamikaze drones such as “Shahed 131” and “Shahed 136,” Seleznev believes.
By increasing spending on the army, the Kremlin plans to reduce spending on other items. For example, $15 billion will be allocated for education and healthcare, which is 7 times less than what Moscow plans to spend on the army, Bloomberg reports. Experts believe that, as in the Soviet Union, in Russia about 5 percent of the population will directly benefit from the war. The rest of society will experience a deterioration in their financial situation.
“A certain number of millions of Russians will be below the poverty line. Neither the Kremlin, nor the military-industrial complex, nor the army leadership are interested in how they will live there. Moreover, they will say that if you want to eat well, then join the army. Here you have a compulsion to mobilize, which will come at the expense of impoverishing the population and cutting costs or deteriorating health care or education services,” says Yaroslav Romanchuk, chief economist of the Office of Simple Solutions and Results.
At the beginning of 2023, Russia broke another record – a budget deficit of almost 2 trillion rubles. According to the BBC, expenses increased by 60 percent, more than 3 trillion rubles. In turn, household incomes decreased by more than 35 percent compared to pre-war January 2022. However, Russia still has somewhere to draw savings from, and it’s not just about the reserves of the central bank and the Welfare Fund, experts say.
“If we consider Russia as a single totalitarian complex, then in addition to the federal budget there are local budgets, in addition to the local budget there are state enterprises and state banks. There is also money from the population in deposits, which, if necessary, can be slowed down, frozen and some part used to finance the necessary costs for the military-industrial complex and other areas,” says Romanchuk.
According to Rosstat data for the 1st quarter of 2023, almost 20 million Russians live below the poverty line.
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