Putin announces defence budget cuts, says Russia 'paid with inflation' for war; praises Trump for stabilising ties

Russian President Vladimir Putin on Friday announced a reduction in Russia’s military spending, even as Nato states ramp up their budgets, warning of a potential attack by Moscow in the next three years. “We’re planning to reduce defence spending,” Putin said at a press conference in Minsk, adding, “Russia has paid with inflation for military spendings,” reported Reuters.

Putin revealed Russia’s current defence outlay stands at 13.5 trillion rubles, or 6.3% of GDP, admitting the military campaign’s toll on the economy. “It’s a lot... we paid for it with inflation, but now we are fighting this inflation,” he said.

The timing of Putin’s remarks is notable. Nato states have just agreed to increase their defence budgets to 5% of GDP by 2035.

Nato Secretary General Mark Rutte warned the alliance that Russia could strike a member country within three years if defence investments lag. Putin dismissed the Nato buildup as “aggressive” and claimed it posed no real threat to Russia.

On the war in Ukraine, Putin said peace talks have made little progress, calling Russia and Ukraine’s latest proposals “absolutely contradictory.” Though the two sides exchanged over 1,000 prisoners and agreed on further contacts, Putin reiterated Kyiv’s terms remained unacceptable. Russia continues to demand more land and an end to Western military aid to Ukraine.

Despite intensifying aerial attacks and expanding territorial gains beyond five annexed regions, Putin insisted that dialogue would continue. He also said Russia is ready to return the bodies of 3,000 Ukrainian soldiers.

In a surprising pivot, Putin credited US President Donald Trump for improving Russia-US ties. “In general, thanks to President Trump, relations between Russia and the United States are beginning to level out in some ways,” he said, calling Trump a leader he respects and expressing willingness to meet, provided it is “carefully prepared.”