Military budget of the Russian Federation

TsAMTO, October 26. State Duma deputies adopted in the first reading the draft federal budget for 2024 and the planning period 2025-2026, RIA Novosti reports.

320 parliamentarians voted “for”, 80 “against”, and there were no abstentions. The second reading is expected on November 15.

Federal budget revenues are planned at the level (hereinafter quoted from the RIA Novosti agency):

- 2024 – 35.065 trillion. rub.;

- 2025 – 33.552 trillion. rub.;

- 2026 – 34.051 trillion. rub.

Expenses:

- 2024 – 36.66 trillion. rub.;

- 2025 – 34.382 trillion. rub.;

- 2026 – 35.587 trillion. rub.

Thus, during the entire three-year period, the budget deficit is expected to not exceed 1% of GDP. In 2024 it will amount to 0.9% of GDP, in 2025 – 0.4%, in 2026 – 0.8%.

It is planned to cover the deficit through government internal borrowing, and in 2024 also from the National Welfare Fund.

The total volume of domestic borrowing to cover the deficit over a three-year period will be about 4 trillion. rub. in year.

Total spending on national defense in 2024 will be 10.8 trillion. rub. and “will increase significantly compared to previous years,” said Finance Minister Anton Siluanov, presenting the document to deputies.

According to him, “29% of all budget expenditures are aimed at our main task today - to ensure our victory. Before the start of the special military operation, expenditures on national defense were half as much - 14%,” the minister added.

GDP forecast:

- 2024 – 179.956 trillion. rub.;

- 2025 – 190.637 trillion. rub.;

- 2026 – 202.304 trillion. rub.

Inflation is expected not to exceed 4.5% in 2024 and 4% in the next two.

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Best method, in my opinion, would be to "borrow" from the National Welfare Fund.

I think they need to raise the oil export tax or use a different calculation mechanism based on cost of Brent crude oil. There are probably a lot of shenanigans where the oil is being claimed to be sold at a low price in the port facility, with the gain going to middlemen along the route. While this was understandable initially due to lack of available ships not insured by the West, right now it is still a bit much.

As for the loss in gas export revenue, growing sales of gas to China should mitigate this over next two years. Power of Siberia has about as much capacity as Nord Stream did.