What the SIPRI Numbers about Russia’s Defense Budget Mean and What They Don't

Paul Goble

            Staunton, May 2 – Almost all Russian news outlets function during this holiday week have carried stories about the conclusions of the Stockholm International Peace Research Institute that Russia cut its defense spending by 20 percent between 2016 and 2017, the first such reduction in defense spending in Putin’s time (rosbalt.ru/world/2018/05/02/1700455.html).

           

            SIPRI says that “the modernization of the military remains a priority for Russia, but the military budget was cut in connection with the economic problems with which that country has encountered since 2014.” Both the reported reduction and its cause are certain to be the subject of much commentary in the coming days.

            And so it is important to understand the limitations of these figures as well as the reasons that the Kremlin may in fact have reduced its spending on the military and what such cuts will mean both in terms of Russia’s ability to project power and build the next generation of weapons that Vladimir Putin has talked about.

            First and foremost, estimating Russian defense spending is notoriously difficult. Not only are large and changing segments of Moscow’s spending in this area classified or hidden within other line items in the budget, but the normal divisions between government and business do not apply in the Russian case.

                Consequently, all estimates, including ones by as distinguished and careful an institution as SIPRI, must be treated with care, and both specific dollar amounts and specific percentages should be assumed to be approximations rather than exact figures.  It is thus likely that actual Russian spending is higher than this report and that the decline may very well be less.

            Second, at least part of the reduction in spending may have to do with the reduction in Russian fighting in Ukraine, even though that was likely partially compensated for by increasing spending in Syria and other theaters.  But however that may be, the amount SIPRI gives is still enough to ensure that Moscow can project power in the ways that it has up to now.

            That in turn means that no one in the West should be assuming that the sanctions it has imposed on Moscow up to now have effectively blocked the Kremlin’s ability to engage in aggressive actions in the post-Soviet space or get involved militarily further afield as in Syria or the Central African Republic. Moscow likely has enough funds to do what it wants in this regard.

            But third, the SIPRI report even with the caveats suggested above means that there is almost no way for Moscow to make the defense breakthroughs Vladimir Putin was talking about on March 1 or even to bring the Russian navy up to genuine competitive status with other powers like China in its theater or the US more broadly.

            Most commentators had been skeptical about Moscow’s ability to do either already before the SIPRI figures were announced. The new numbers will only add to that skepticism. Once again, ever more Russians and others will see that Putin has talked boldly but doesn’t have the funds or the infrastructure to back up his words.

            That more than almost anything else will cast a shadow over his approaching new term in office.