Russia has imposed severe budget restrictions following an April liquidity crisis that exposed the mounting financial cost of its invasion of Ukraine. The federal budget deficit for the first four months of 2026 reached approximately 5.9 trillion rubles, about 2.5% of GDP, already surpassing the full-year target of 3.8 trillion rubles. Military and security spending now accounts for roughly 40% of the federal budget, totaling around 16.84 trillion rubles, while financial reserves are dwindling, with the liquid portion of the National Wealth Fund falling to approximately 3.4 to 3.9 trillion rubles in early April. In response, the government is considering 10% cuts to non-sensitive spending areas, with a potential deferral of 2.9 trillion rubles in non-military, non-social expenditures.
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