Russia’s factories are busy. Trucks roll out of Tatarstan, ammunition is produced in Tula, and tanks leave the assembly lines of Sverdlovsk. On the surface, this looks like resilience in the face of sanctions. But what Russia is really producing is not prosperity — it is dependence. Bread is being sacrificed for bullets, and the economy is hooked on war.
A Stimulus Fueled by Conflict
Russia spends between 25 and 47 billion rubles every day on its war in Ukraine. By 2025, military expenditure is set to reach 7.2% of GDP, the highest level since the Soviet Union. More than 6,000 companies are now tied to defense contracts, with even food suppliers, clothing manufacturers, and timber producers pulled into the war machine.
This militarisation has created jobs: nearly 3.8 million Russians work in defense-related industries, with the government saying another 160,000 are still needed. For regions like Tatarstan, where KAMAZ trucks are built, or Sverdlovsk, where tanks are assembled, the war has become an economic lifeline.
But this is not genuine growth. It is survival on state subsidies. The Kremlin is pumping money into weapons instead of schools, hospitals, or innovation. The economy looks alive, but only because it is being kept on an artificial stimulant.
The Cost of Silence
What happens if the guns fall silent?
A truce would expose the fragility of Russia’s wartime model. Factories that scaled up to produce drones, missiles, and armored vehicles would face massive overcapacity. Civilian firms that shifted to military orders would lose contracts overnight. Unemployment would rise, wages would stagnate, and consumer demand would fall. Entire regions would sink into recession.
This is not hypothetical. Russia faced the same problem after the Cold War, when the collapse of Soviet defense industries left hundreds of thousands jobless. Towns built around arms factories turned into ghost communities. Moscow was forced to keep redundant plants afloat, just to prevent social unrest.
History could repeat itself.
Hidden Scars of a War Economy
Economists agree: militarisation comes at a heavy price. A global study covering 133 countries showed that a 1% increase in military spending cuts economic growth by more than one percentage point. Wars shift resources away from education, health care, and infrastructure — the real drivers of prosperity.
Russia is already seeing the damage. Consumer industries are shrinking. Imports remain restricted despite sanctions loopholes. Inflation erodes wages. And while defense orders keep certain regions afloat, the rest of the economy continues to stagnate.
The longer this imbalance lasts, the more painful the correction will be when it comes.
Putin’s Trap
For Vladimir Putin, the war economy is politically convenient. It guarantees employment, secures loyalty from industrial bosses, and allows the Kremlin to claim that sanctions are failing. But this stability is fragile.
The more Russia relies on military contracts, the harder the crash will be when peace arrives. Continuing the war delays the reckoning, but it also deepens the addiction.
The Harsh Reality
Some analysts argue that even after a ceasefire, Russia will maintain high defense spending for years, replenishing its losses. That may cushion the blow, but it cannot replace genuine growth. Tanks and missiles cannot substitute for consumer demand, private investment, or technological innovation.
Peace would bring painful withdrawal symptoms: unemployment, falling wages, and local recessions. But it is the only path toward real recovery. Without demilitarisation, Russia will remain locked in a cycle of artificial growth, with no future beyond the battlefield.
Bread or Bullets
Russia’s economy is not resilient — it is addicted. Each new defense contract is another dose, keeping factories alive but weakening the country’s long-term health.
Bread is being sacrificed for bullets. And in the end, when the war stops, Russia will discover that it cannot live on weapons alone.