Russia's Economic Strain: Inflation, Bankruptcies, and Kremlin Concerns

The Institute for the Study of War (ISW) reports that Russia faces significant economic, demographic, and defense industry challenges amid its ongoing war in Ukraine. With inflation at 9% and Western sanctions straining the economy, Russia increasingly relies on China, Türkiye, and North Korea for support. The Kremlin has implemented policies to reduce costs and combat inflation, but these measures highlight its struggle to sustain the war effort long-term. Recent changes to military compensation have sparked criticism, and high interest rates are impacting defense production. Demographic issues, including a declining population and labor shortages, further threaten Russia's economic stability.