Russia's ongoing war with Ukraine is projected to persist through 2026, despite economic and manpower challenges, according to a leading military think tank. Bastian Giegerich, director-general of the International Institute for Strategic Studies (IISS), asserts that Russia's capacity to sustain its conflict with Ukraine for a fifth year remains robust. The Kremlin's defense expenditure in 2025 amounted to a staggering $186 billion, a 3% increase in real terms, constituting 7.3% of the country's GDP. This figure is more than double the US's defense spending and approximately three times that of the UK. Fenella McGerty, a defense finance expert at the IISS, acknowledges that Russia's economy is slowing, potentially leading to a decline in real-term military spending in 2026. However, she emphasizes that this trend must be considered against the backdrop of several years of significant growth in military spending, enabling Russia to invest heavily in military equipment and recruitment to sustain its relentless ground and air attacks against Ukraine. The war has also spurred Moscow to develop new battle tactics, missiles, and attack drones, including the modernized Shahed-136, capable of striking targets across Europe. Nigel Gould Davies, a Russia expert at the IISS, notes a discrepancy between Russia's recruitment rate and its monthly battlefield losses, suggesting that Moscow can reduce its casualty rate by slowing its offensives. This could potentially lead to a critical juncture where the Kremlin must decide between a second forced mobilization and the risk of widespread social unrest, similar to the enlistment protests in September 2022. The IISS also highlights the need for NATO to enhance investments in missile defense and anti-drone systems, as demonstrated by the incident where 21 Russian drones crossed into Poland, causing disruptions. European NATO allies and Canada have committed to increasing defense budgets to 3.5% by 2035, but the IISS warns that this will require substantial and sustained investments, which many allies may struggle to achieve due to potential spending cuts and trade-offs.
