A year and a half of war in Ukraine and the increasing involvement of Western countries in the conflict have not led to the serious escalation that Western analysts feared at the beginning of the war. Ukraine's determination and Western unity have acted as deterrents against Kremlin aggression. However, from the very beginning, the current conflict has been developing along unpredictable trajectories, and analysts have been constantly wrong in their forecasts.

Next year’s unprecedented military budget reflects a fundamental change in Russia's economic policy. For more than two decades, the authorities have adhered to a conservative fiscal and monetary policy, acknowledging the risks of softening it in the face of volatile export-oriented state revenues. The government initially assessed realistic income parameters and then planned its expenses based on them. However, the war has forced a shift in favour of a hybrid approach.

A year and a half of war in Ukraine and the increasing involvement of Western countries in the conflict have not led to the serious escalation that Western analysts feared at the beginning of the war. Ukraine's determination and Western unity have become deterrents for the Kremlin. However, from the very beginning, the current conflict has been developing along unpredictable trajectories, and analysts are constantly making mistakes in their forecasts.

Next year's unprecedented military budget reflects dramatic changes in Russia's economic policy. For more than two decades, the authorities have adhered to conservative fiscal and monetary policies, recognizing the risks of easing them in the face of a volatile export and raw material profile of government revenues. The government first assessed realistic revenue parameters and then planned expenditures based on them.