Russian authorities are relieving regional governments of debt obligations. The government is continuing its efforts to ease the debt burden on Russia’s regions, Prime Minister Mikhail Mishustin said at a cabinet meeting on Wednesday. Another six regions will have RUB 37.5 bln written off, representing two-thirds of their outstanding budget loan debt. More than RUB 100 bln has already been written off for regions previously. Experts, however, expect regional debt burdens to continue rising
Under a decree signed by Mishustin, debt will be written off for Yakutia, Tatarstan, Khabarovsk Territory, and the Vladimir, Kurgan and Omsk regions. This will free up substantial resources in regional budgets and support further economic development and improvements in living standards, the prime minister said
According to the government, the amount written off corresponds to these regions’ spending on housing and utilities modernisation projects, including lift replacement in apartment buildings, relocation from unsafe housing, renewal of public transport fleets, recapitalisation of industrial development funds, implementation of national projects and development initiatives for key population centres
Earlier this year, authorities wrote off more than RUB 100 bln in debt for over 20 Russian regions. (see Nezavisimaya Gazeta, April 16, 2026, May 4, 2026, May 14, 2026.)
The government notes that debt relief measures are being implemented on the instructions of President Vladimir Putin. In 2025, 58 regions took advantage of the budget-loan write-off programme, reducing their debt burden by around RUB 230 bln. In 2026, 54 regions are expected to receive debt relief totalling RUB 175 bln. The funds released are to be directed towards ‘further economic development.
In late April, Putin backed a proposal to restructure regional budget-loan debt by postponing repayment deadlines. Specifically, the proposal called for debt due in 2026 to be pushed back to a later date, with the resulting budget savings redirected towards social support measures.
At the time, Putin reminded officials that a decision had already been taken to write off two-thirds of regional budget-loan debt, provided the freed-up resources were used for investment and other priority projects.
‘This is more than RUB 1 tn through to 2030. Two-thirds of budget-loan debt is being written off. The remaining debt will be repaid by regions in an orderly and timely manner. This year alone that amounts to around RUB 100 bln. For many regions, however, even this burden remains quite high,’ Putin said.
Following the president’s proposal, the Ministry of Finance submitted draft legislation that would postpone repayment of part of regional budget-loan debt from 2026 to 2030. The measure concerns the one-third of budget-loan debt that is not eligible for write-off and was originally due this year. According to the Finance Ministry, the extension will allow regions to redirect budget resources towards priority objectives.
The total debt of Russia’s regions currently stands at about RUB 3.5tn, nearly one-third of which will eventually be written off, Finance Minister Anton Siluanov said
At the end of 2025, total regional government debt exceeded RUB 3.48 tn, up 10.6% year on year. In absolute terms, debt increased by RUB 333.5 bln, according to the Finance Ministry. Debt declined in 51 regions and increased in 38. Regional debt burdens rose by 1.1 percentage points to 18.9%. Budget loans account for more than 67% of total regional debt. Regional budget deficits increased from the usual RUB 200 bln–300 bln range to RUB 1.5tn, Siluanov said. He expects the combined deficit of regional budgets to reach RUB 1.9tn in 2026
According to rating agency Expert RA, more than 70 regions recorded budget deficits last year. The agency expects regional finances to remain vulnerable in 2026 to monetary-policy and foreign-trade developments. ‘Regions with poorly diversified economies will remain in the most vulnerable position. Maintaining budget balance will require strict spending optimisation and the search for new internal growth drivers. Regional debt obligations are likely to increase to RUB 3.6tn, and possibly higher,’ analysts said
The Accounts Chamber has reported that budget loans account for more than 79% of total regional debt. As of October 1, debt in 40 of Russia’s 89 regions consisted entirely of budget-loan obligations. The Accounts Chamber has repeatedly criticised the mechanism under which regional debt is written off in exchange for new investment commitments. Auditors concluded that New Investment Projects financed through debt write-offs have delivered weak results and have not had a significant impact on economic or investment activity. (see Nezavisimaya Gazeta, December 25, 2025.)
Among other support measures, the government allocated RUB 3 bln to Chechnya and Dagestan, two regions affected by severe flooding earlier this year. (see Nezavisimaya Gazeta, April 9, 2026.)
‘This spring, Dagestan and the Chechen Republic experienced extremely heavy rainfall that caused major flooding and damage to residents and their property. Essential infrastructure was also badly affected, including educational facilities. Around 80 schools, kindergartens and colleges were damaged, while another 10 buildings were destroyed,’ Mishustin said. The government will allocate almost RUB 3 bln for construction and major repairs of these facilities. Mishustin instructed the Ministry of Education to transfer the funds quickly and stressed that all work should be completed before the start of the new academic year.
In addition, RUB 4.5 bln will be allocated to the Kursk and Belgorod regions to compensate residents for housing rental costs. ‘To help people facing difficult circumstances, the government previously provided funding so affected families could rent housing, purchase apartments or build homes. Today we will allocate an additional RUB 4.5 bln for these purposes in Kursk and Belgorod,’ Mishustin said.
Another major topic at the cabinet meeting was the development of public transport in the regions. Nearly RUB 11 bln will be allocated over the next three years to renew transport fleets in the Kursk, Volgograd, Nizhny Novgorod and Saratov regions, including RUB 5.5 bln this year.
‘The arrival of modern buses, trolleybuses, trams and electric buses is transforming cities and making them more comfortable places to live. Route networks are expanding, travel times are falling and passenger comfort is improving. Environmental conditions are also getting better,’ Mishustin said.
ORIGINAL: NG/Regions Receive Debt Relief
