Russia cuts defence spending 15 per cent amid revenues crunch

Feb 12, 2009, 12:52 GMT

Moscow - Feeling the pinch from declining revenues, Moscow is in the process of cutting its military spending by 15 per cent, with even more possibly to come, officials said Thursday.

According to a report by Interfax, Moscow fears a loss of state revenues of as much as 40 per cent due to the drastic drop in raw materials prices.

'It is well possible that this is not the last decision of this kind for the 2009 defence budget,' the deputy head of the State Duma defence committee, Mikhail Babitch, said, according to Interfax.

Previously, Premier Vladimir Putin had assured the domestic arms industry that weapons purchases would not be cut back.

Russian military spending figures, shrouded in part in secrecy, had been put at 1.3 trillion roubles (37 billion dollars) for 2009. By comparison, the US defence budget, with the wars in Iraq and Afghanistan, is some ten times that size.

But a reduction in arms spending by Moscow would be a setback to the ambitious plans promised by Putin before the economic crisis, in which he had spoken of a 'grand modernisation of the armed forces, including atomic weapons,' with spending of upwards of 150 billion dollars.

Defence policy experts in the Duma believed that the government now would not be able to avoid, in addition to arms spending, cutting back on social expenditures and the housing construction for officers.

Western military experts say that Russia's armed forces, compared with those of NATO, are in desolate shape. Some one-third of the air force's fleet of jet fighters are, by Moscow newspaper accounts, ready for the scrap heap.

Military officers earn only an average of 500 euros (650 dollars) a month while tens of thousands of officers' families have long been awaiting new apartments promised them.