Arya News - Russia spent about half of its state budget on its military last year, according to an analysis by Germany’s foreign intelligence agency.
Russia spent about half of its state budget on its military last year, according to an analysis by Germany’s foreign intelligence agency.
The Bundesnachrichtendienst (BND) also found that Russia’s real defence spending was 66 per cent higher than officially declared, with expenditure rising sharply every year since the country’s full-scale invasion of Ukraine in 2022.
According to the analysis, the Kremlin’s true military outlay was approximately €250bn in 2025, equivalent to roughly half of total state spending and about 10 per cent of the country’s GDP.
At the start of the war, military expenditure accounted for about 6 per cent of GDP.
The BND said the funds were being used not only to sustain the war in Ukraine but also to expand military capabilities beyond the battlefield, particularly along Russia ’s borders with eastern Nato countries.
Western officials, including Mark Rutte, Nato’s secretary-general, have warned that Russia could attack one of the alliance’s members within two to five years.
According to local media, the BND report said: “These figures clearly demonstrate the growing threat to Europe posed by Russia.”
The agency found that much of the additional spending, including on construction projects, military IT programs and social benefits for armed forces personnel, was hidden elsewhere in the state budget.
Russia has a much narrower definition of defence spending than that used by Nato, while the Kremlin also systematically distorts official figures, the BND said.
Moscow’s budget plans for 2026, released last autumn, suggested defence spending would fall for the first time since the war began. However, the official figure of 13 trillion roubles (£123bn) is far below what German analysts believe the Kremlin is actually spending.
The rising cost of the war and a slump in revenues from energy exports has forced the Russian government to slash social welfare spending and raise VAT, while running a large budget deficit – estimated at more than $70bn (£51bn).
Last year, in contrast, the Stockholm International Peace Research Institute estimated that Russia’s total defence outlay was around 7 per cent of GDP, a level it described as “manageable”.
Even by the Kremlin’s figures, Russia now has the third-largest defence budget in the world, behind the United States and China. Its military spending has more than doubled in the past five years.
The scale of Russia’s rearmament has, in turn, pushed Western Europe into its largest military build-up since the Cold War.
Germany, for example, is set to double its pre-2022 defence budget, with Berlin aiming to have its armed forces ready to fight a conventional ground war by 2029.
Fresh talks in Abu Dhabi
The BND’s report came as Moscow demanded Kyiv accept its conditions to end the four-year-war or face a continuation of the conflict. It came ahead of fresh negotiations between the two sides in Abu Dhabi.
The US-mediated meeting is the latest in a series of talks that have so far failed to result in any agreement to end the fighting.
The war has spiralled into Europe’s deadliest conflict since the Second World War, with hundreds of thousands killed, millions forced to flee their homes, and much of eastern and southern Ukraine decimated.
The Kremlin’s hardline rhetoric in the run-up to the talks, coupled with significant air strikes on energy facilities amid below-freezing temperatures in Ukraine, has threatened to overshadow the latest talks.
Speaking on Wednesday as the latest negotiations got under way, Dmitry Peskov, the Kremlin spokesman, told reporters: “Our position is well known.
“Until the Kyiv regime makes the appropriate decisions, the special military operation continues.”
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