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Russia's Defense Sector Struggles Amid Budget Crisis

11/11/2025

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Summary

Story summary

Russia faces a severe budget crisis, with a projected 2025 deficit of 2.6% of GDP and seven straight deficits.
Sanctions and lower oil prices limit financing, forcing reliance on domestic borrowing and constraining defense spending.
The defense industry faces outdated practices and a shortage of skilled labor, as many workers are deployed in Ukraine, hindering operations.

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Story summary

Russia faces a severe budget crisis, with a projected 2025 deficit of 2.6% of GDP and seven straight deficits.
Sanctions and lower oil prices limit financing, forcing reliance on domestic borrowing and constraining defense spending.
The defense industry faces outdated practices and a shortage of skilled labor, as many workers are deployed in Ukraine, hindering operations.