Since the onset of full-scale aggression against Ukraine in 2022, the economy of the Russian Federation has undergone significant changes. In the first year of the war, the country’s gross domestic product decreased by 1.4%. According to the International Monetary Fund’s forecasts, GDP growth in Russia is expected to be only 0.6% in 2025.
This is reported by Business • Media
Budget Deficit, Energy, and Foreign Trade
In 2025, Russia is forecasting a record budget deficit since the start of the full-scale war — it could reach 5.7 trillion rubles (approximately 68 billion dollars), nearly double the planned amount. Experts cite a significant decline in revenues from oil and gas exports as the main reason for this deficit.
The economy of the country is being supported primarily by trade with China and India, as well as partially with certain EU countries. The trade volume between Russia and China reached a historical high in 2023, exceeding 240 billion dollars (190 billion dollars in 2022). By the end of 2024, this figure had risen to nearly 245 billion dollars. The backbone of Russian exports consists of energy resources, particularly oil and gas, while China mainly supplies industrial products to Russia: cars, electronics, and equipment.
At the same time, there has been a significant reduction in trade relations with the European Union. In 2024, EU exports to Russia amounted to 34 billion dollars, which is 67.4% less compared to 2021. Imports from Russia to EU countries have decreased even more sharply over four years — to 36.3 billion dollars, or 79.2% less than in 2021.
Armaments, Investments, and Sanctions
In order to continue the war, Russia is actively increasing its arms production and seeking ways to circumvent international sanctions to procure high-tech equipment, raw materials, and electronics. As of 2025, 40% of such equipment is supplied from countries in the eastern part of the world, while 60% comes from western nations.
“From 2022 to 2025, the volume of foreign direct investment in the Russian economy decreased by 56.6%, to $216 billion. This is the lowest figure since 2009. The total economic losses of Russia due to the withdrawal of investments exceed $280 billion.”
Additionally, Western countries have frozen about 300 billion dollars of Russian assets since the start of the full-scale war. Some states have already agreed to transfer the income from these frozen funds to Ukraine for the reconstruction of the country or for the procurement of armaments.