Military budget of the Russian Federation

The military budget of the Russian Federation is the portion of the overall budget of Russia that is allocated for the funding of the Armed Forces of the Russian Federation. This military budget finances employee salaries and training costs, the maintenance of equipment and facilities, support of new or ongoing operations, and development and procurement of new weapons, equipment, and vehicles.

The Russian government's published 2014 military budget is about 2.49 trillion rubles (approximately US$69.3 billion), the third largest in the world behind the US and China. The official budget is set to rise to 3.03 trillion rubles (approximately US$83.7 billion) in 2015, and 3.36 trillion rubles (approximately US$93.9 billion) in 2016. As of 2014, Russia's military budget is higher than any other European nation, and approximately 1/7th (14%) of the US military budget.

Unofficial estimates
Unofficial estimates place the total amount of military spending for the Russian Federation higher than the Russian government figures, but these calculations tend to differ between organizations. According to the IISS "By simple observation..[the military budget] would appear to be lower than is suggested by the size of the armed forces or the structure of the military-industrial complex, and thus neither of the figures is particularly useful for comparative analysis".

IHS Inc. estimated the 2013 Russian military budget as being US$68.9 billion, US$78 billion in 2014, and predict a rise to US$98 billion in 2016. IHS described this as a rapid increase in spending which will result in the defence budget increasing from 15.7 percent of federal expenditure in 2013 to 20.6 percent by 2016.

The International Institute of Strategic Studies (IISS) estimated the 2013 Russian military budget at US$68.2 billion, a 31% rise since 2008. IISS noted in their 2013 report that this meant that Russia had passed the UK and Saudi Arabia to become the world's third largest military spender, though exchange rates had also been a factor in this.

The Stockholm International Peace Research Institute (SIPRI) 2013 Military Expenditure Database estimated Russia's military expenditure in 2012 at US$90.749 billion. This estimate is an increase of more than US$18 billion on SIPRI's estimate of the Russian military budget for 2011 (US$71.9 billion).

History
In 1988 military spending was a single line item in the Soviet state budget, totaling 21 billion rubles (68.8 billion 1988 U.S. dollars). Given the size of the military establishment, however, the actual figure was considered to be far higher. However, in the wake of the breakup of the Soviet Union and the emergence of Russia as an independent state, between 1991 and 1997 Russia's defence spending fell by a factor of eight in real prices. Between 1988 and 1993 weapons production in Russia fell by at least 50% for virtually every major weapons system.

In 1998, when Russia experienced a severe financial crisis, its military expenditure in real terms reached its lowest point— barely one-quarter of the USSR's in 1991, and two-fifths of the level of 1992, the first year of Russia's independent existence. However, since the rise to power of Vladimir Putin and the exposure of the poor state of preparedness amongst Russia's armed forces in the Chechen Wars and the 2008 conflict with Georgia over South Ossetia, Russian military spending has rapidly increased, particularly after the 2008 Russian military reform. According to SIPRI, Russian military spending in real terms in 2012 was the highest it has been since Russia's re-emergence as an independent nation, but is still far lower than the estimated military expenditure of the USSR in 1990 - its final full year of existence (US$291 billion at 2012 prices).