Budget context
Russia’s 2025 federal budget appropriated 13.5 trillion rubles to "national defence" — a real-terms 5.9% rise per SIPRI. The 2026 draft budget reduces national defence to 12.93 trillion rubles, the first nominal cut since 2022, while raising overall defence-and-security spending to 16.8 trillion rubles, ~38% of the federal budget. Roughly 84% of defence spending is classified. Wartime production has displaced civilian investment: VAT was raised to 22% in 2026 and corporate income tax to 25% in 2025 to fund the war. Sanctions push the budget toward a deficit financed by the National Wealth Fund (now under 50% of pre-war size) and domestic OFZ borrowing.
Force structure
Russia maintains ~1.32 million active military personnel across the Ground Forces, Aerospace Forces (VKS), Navy, Strategic Rocket Forces, and Airborne Forces (VDV). Putin’s December 2023 decree set a 1.5 million target by 2026, sustained through volunteer contract recruitment (~30,000-40,000 per month in 2025). Five military districts were reorganized in 2024 to recreate the Moscow and Leningrad districts facing NATO. The Strategic Rocket Forces field ~310 ICBMs (Yars, Sarmat, Avangard). The VKS has lost ~120 fixed-wing aircraft in Ukraine per open-source tallies. Wagner Group was absorbed into the Ministry of Defence following Prigozhin’s August 2023 death; Rosgvardiya (~340,000) handles internal security.
Industrial posture
Rostec dominates the Russian defence industrial base alongside Almaz-Antey (air defence), UAC (aviation), USC (shipbuilding), and KTRV (missiles). The OPK has shifted to wartime three-shift operation — tank production tripled to ~1,500 per year (mostly upgrades of stored T-72/T-80) and Shahed-136/Geran-2 drones reached ~6,000 per month at the Alabuga plant in 2025. Critical bottlenecks remain in microelectronics (largely sourced via grey-market routes through China, Türkiye, and the UAE), large-caliber barrels, and precision-guided munitions. Russian arms exports collapsed from $14B in 2021 to roughly $3B annually post-invasion. North Korea has supplied an estimated 8+ million artillery shells and KN-23 SRBMs since late 2023.
Conflict exposure
Russia’s war in Ukraine continues into a fifth year. Occupied territory in 2026 covers ~18% of Ukraine, with grinding offensives in Donetsk Oblast (Pokrovsk, Toretsk axes) and continued Black Sea Fleet attrition by Ukrainian USVs. Open-source casualty estimates exceed 800,000 Russian killed and wounded as of early 2026. Russia maintains forward presence in Belarus, Moldova’s Transnistria, Armenia, and Kyrgyzstan; Syria bases (Hmeimim, Tartus) were largely lost after Assad’s December 2024 fall, with partial reconstitution in Libya and the Sahel via the Africa Corps (former Wagner). Western sanctions and oil price-cap enforcement remain active.
Recent developments
SIPRI’s April 27, 2026 fact sheet placed Russia at $190B for 2025. The 2026 federal budget signed by Putin in December 2025 reduces national-defence spending nominally for the first time since the 2022 invasion, signaling fiscal stress. Sarmat ICBM serial deployment continues despite the September 2024 silo accident. Yars-S regiments fielded in 2025. The Oreshnik IRBM, first used against Dnipro in November 2024, has entered limited serial production. North Korean troops (~12,000 of the KPA Storm Corps) remain deployed alongside Russian forces in Kursk Oblast as of early 2026.