Lawmaker: Russia To Cut Defense Budget 15 Pct.
By AGENCE FRANCE-PRESSE
Published: 12 Feb 08:28 EST (13:28 GMT)
MOSCOW - Russia is to reduce its defense budget for the current year by 15 percent in response to the financial crisis, the head of parliament's defense committee said on Feb. 12, Interfax reported.
"A decision was made for a reduction of 15 percent and it is highly likely that this is not the last decision on the budget," said the deputy, Mikhail Babich.
He added that spending on new weapons would remain unchanged.
"The important question now is to know which lines of military spending will be reduced in order to not affect the fundamentals we want to preserve: state order and social spending," he added.
This year the defense ministry's budget was set at around $39.5 billion (30.71 billion euros).
On February 5, Russia's authorities indicated that the 2009 budget deficit would be at least eight percent of GDP because of the economic crisis that has hit Russia.
Russia's economy, driven in recent years by the soaring price of raw materials, has been hit particularly hard by the collapse of oil prices.
The ruble has lost a third of its value against the euro and the dollar since last November and the government says it expects somewhere between zero growth and a 0.2 percent decline in GDP this year.
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