Russian President Vladimir Putin announced on Friday that Moscow intends to scale back its defense spending starting next year, drawing a stark contrast with NATO’s recent pledge to significantly ramp up its own military budgets.
Speaking at a press conference in Minsk, Putin responded to NATO’s commitment this week to increase collective defense spending to 5% of GDP over the next decade. The alliance has cited the “long-term threat” posed by Russia as justification for the move.
Putin dismissed NATO’s decision as an internal matter focused largely on propping up U.S. defense contractors.
“This money will mostly go toward buying weapons from the U.S. and supporting their military-industrial complex,” he said. “That’s their business, not ours.”
“What’s more important,” Putin added, “is that we are planning to reduce defense spending — next year, the year after, and over the next three-year cycle.”
While he noted that final decisions were still being debated among the defense, finance, and economic ministries, he said there was consensus forming in that direction.
“Meanwhile, Europe is increasing its defense budgets. So who’s really preparing for aggression — us or them?” he asked.
Western Skepticism
Putin’s remarks are likely to be met with disbelief among Western analysts and governments, as Russia has substantially increased military expenditures since launching its full-scale invasion of Ukraine in 2022.
The war has escalated in recent weeks, with no meaningful diplomatic progress toward a ceasefire or settlement. Putin, however, reiterated that Russia remains open to talks and appreciated U.S. President Donald Trump’s efforts to end the conflict.
“He recently said it’s turned out to be more difficult than it looks from the outside. That’s true,” Putin said.
Trump claimed earlier this week that Putin is interested in a resolution. However, Ukrainian leaders and many of their European allies remain skeptical, saying the Kremlin continues to seek territorial gains, not peace.
Putin also said negotiations between Russian and Ukrainian representatives remain ongoing and that Russia is prepared to return the remains of 3,000 Ukrainian soldiers.
Economic Pressures Mount
Despite Putin’s talk of future cuts, Russia’s defense budget has reached historic highs. For 2025, the Kremlin increased defense spending to 6.3% of GDP — the highest level since the Cold War. Military expenses now account for nearly one-third of total federal spending.
Defense factories have been operating around the clock, and the government has poured money into recruitment bonuses and compensation for the families of fallen soldiers.
Putin acknowledged that this surge in spending has fueled inflation.
Earlier this year, the finance ministry raised the 2025 budget deficit forecast to 1.7% of GDP, up from 0.5%, after slashing its projection for energy revenues by 24%. Officials plan to dip into fiscal reserves to help cover the shortfall. The next draft of the federal budget is expected this fall.
