Russia's wartime defense manufacturing surge is nearing its limit, Industry and Trade Minister Anton Alikhanov said Tuesday, signaling that one of the country's main economic growth engines is beginning to lose momentum.
"The defense industry as the locomotive of industrial growth will soon reach its maximum output and a high base and will no longer provide the substantial boost to manufacturing growth that it did previously," Alikhanov said, according to Interfax.
Manufacturing, led by the defense-industrial complex, has been one of the main drivers of Russia's wartime economy. After it became clear that the conflict would be prolonged, the government sharply increased military spending and expanded defense procurement.
Russia spent between 3 trillion and 3.6 trillion rubles ($39.3 billion-$47.2 billion) annually on "national defense" between 2019 and 2021.
This year's budget allocates 12.1 trillion rubles ($158.5 billion), though that figure is likely to increase after Finance Minister Anton Siluanov warned that both government spending and the budget deficit would exceed planned levels.
