- On 30 September 2024, the Russian government submitted draft budget proposals for 2025 to the State Duma. The 2025 budget expects expenditure to grow by 5% (not adjusted by inflation) to 41.5 trillion rubles ($447bn).
- The proposed budget envisages an approximate 25% increase in defence spending in 2025, compared to the announced 2024 budget. Defense spending accounts for 32% of the 2025 budget, up from the pre-war share of 14.5% in 2021. The new budget demonstrates Russia's continued prioritization of financing the war over other domestic priorities. For example, social spending is expected to decrease by 16% in 2025.
- Demand continues to outpace supply in the Russian economy and the expanding budget for 2025 is highly likely to worsen this. This will almost certainly add to inflationary pressures which remain a key issue, due to the inflation rate being approximately 9% in August 2024.
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