Putin's expensive warlust: Russia's economy on the edge of the crisis!

Putin's expensive warlust: Russia's economy on the edge of the crisis!

In the current Situation, Russia is faced with enormous economic challenges under the leadership of President Vladimir Putin. The Ukraine War has not only shaken the geopolitical balance, but also changed the country's economic priorities significantly. Putin pursues the goal of stabilizing the economy despite strong international sanctions through massive investments in the military and war efforts. However, this strategy could have fatal consequences for other areas of the Russian economy.

Russia is increasing more and more public funds for war, which leads to a radical rethink in the economic strategy. The budgets for 2025 are controversial; The military spending is intended to record a record of 13.2 trillion rubles, which makes up for about 6.2 percent of gross domestic product. These expenses are a clear sign that the Kremlin has declared military armament and warfare to the top priority. In comparison, a total value of 17 trillion rubles will be predicted for national defense spending in the coming year, which is 40 percent of the total government spending.

war expenditure versus civil sectors

The significant redistribution of budgets in favor of the military raises questions about the future development of other essential sectors, including education, healthcare and infrastructure. Experts emphasize that such high expenses for the military will inevitably have negative effects on economic growth and quality of public services. "This redistribution will undermine the competitiveness of Russia," warns Andrius Tursa, an expert in Central and Eastern Europe at Teneo. He adds that the military investments will go to productive sectors at the expense of investing, which could lead to a further economic decline in the long term.

Another central point are the significant inflation rates that burden the Russian economy. According to the Russian statistics authority Rosstat, the inflation rate is currently 8.3 percent, the highest value since February 2023. This high inflation continues to make the economic situation further complicates, since it has also led to an increase in the key interest rate through the central bank. The lack of specialists, especially due to the high losses on the front, also exacerbates the situation.

Putin's political decisions and their consequences

Putin's decisions seem to indicate an unsustainable economic strategy that could have fatal effects in the coming years. Despite the serious problems with which Russia is confronted, the president sees the war as a kind of "doping" for the economy, which means that it is not willing to reduce investments in the military sector. "If Putin stops investing in the military, the growth of the economy could be severely impaired," said the economist Vasily Astrov, which indicates a potential recession if this course is maintained.

The long -term prospects for the Russian economy are dark when the current trends last. These are reinforced not only by spending on the war, but also by the persistent inflation and the lack of workers. Russia could thus get into a phase of economic instability, while the Kremlin continues to focus on its aggressive course.