russian Regions Drowning in Deficits, Yet Financing the War

According to the results of the first half of 2025, the consolidated budget deficit of the rf grew to 4.95 trillion rubles (≈52 billion US dollars). russian regions are failing to meet their planned state budget revenue targets en masse – half of the federation’s constituent entities have budget deficits.

Kemerovo region planned a $170 million gap between revenues and expenditures by the end of the year, but a deficit of $380 million was already recorded in January–July. The reasons are Western sanctions on russian coal and low demand for metallurgical products.

In Bashkortostan, the budget deficit exceeded the planned figures 2 fold – $84 million already in April. Huge overspending was recorded in Yakutia: the gap between actual expenditures and the plan for the first half of the year is 300 %.

The budget of Rostov region was initially planned to be in surplus, but by the end of the year, it is expected to be revised to a deficit of $242 million.

The financial difficulties of the regions make it impossible to adequately fund education, healthcare, infrastructure, and other social programs. At the same time, local authorities are actively reporting an increase in one-time payments to “volunteers” under contract with the ministry of defense to participate in the war against Ukraine.