Moscow appears well-positioned to continue its invasion of Ukraine throughout 2026, despite mounting economic pressures and manpower challenges, according to a new analysis from the International Institute for Strategic Studies (IISS). The assessment, released this week, also highlights a growing concern: Russia’s increasing ability to project a missile and drone threat across Europe.
The IISS report indicates that the Kremlin spent at least $186 billion (£138 billion) on defense in 2025, a 3% increase in real terms, representing 7.3% of Russia’s GDP. This figure is more than double the proportion allocated by the United States and roughly three times that of the United Kingdom. This substantial investment, coupled with a reorientation towards a war economy following the full-scale invasion four years ago, suggests Russia’s capacity for sustained military operations remains robust.
Increased Defense Spending Fuels Continued Conflict
Despite a slowing Russian economy, defense spending has doubled in real terms since 2021, enabling increased investment in military equipment and recruitment, according to Fenella McGerty, a defense finance expert at the IISS. While a potential decline in real-terms spending is possible in 2026, the foundation of significant prior growth provides a considerable buffer. This financial commitment allows Russia to maintain “relentless ground and air attacks” against Ukraine, the IISS assessment states.
Bastian Giegerich, the director general of the IISS, noted there is “little indication” that Russia’s ability to wage war for a fifth year is diminishing. He added that, despite discussions of potential ceasefire agreements, Russia is intensifying attacks on Ukrainian infrastructure and population centers using a combination of cruise and ballistic missiles, as well as one-way attack drones.
Manpower Concerns and Potential Mobilization
While Russia continues to demonstrate military strength, concerns are emerging regarding recruitment levels. Nigel Gould Davies, a Russia expert at the IISS and former UK ambassador to Belarus, pointed to “growing signs that Russia’s rate of recruitment has begun to fall short of its monthly losses” on the battlefield. Russia currently recruits an estimated 30,000 to 35,000 people per month, but the quality of recruits is reportedly declining, with recruiters increasingly turning to individuals with health issues or substance abuse problems.
Davies suggests that if this trend continues, the Kremlin may face a “moment of truth,” potentially requiring a second wave of enforced mobilization – a move that could trigger social unrest similar to that seen during the September 2022 mobilization. Although, Moscow retains the ability to mitigate casualty rates by reducing the intensity of its offensives.
Modernization and the Threat to Europe
Beyond sustaining the conflict in Ukraine, Russia is actively modernizing its military capabilities. The IISS report highlights the development of new battle tactics, missiles, and attack drones, including a modernized version of the Shahed-136 drone with a range of up to 2,000km, capable of reaching targets across Europe. This development underscores the require for increased investment in missile defense and anti-drone systems by NATO, particularly following an incident last September where 21 Russian drones crossed into Poland, disrupting air traffic and prompting shelter-in-place orders.
European NATO allies and Canada pledged last summer to increase defense budgets to 3.5% by 2035, responding to the growing Russian threat and calls for greater European responsibility for its own security. However, the IISS cautioned that achieving this goal will require “sustained and significant investments,” which may prove challenging for some nations. The report also noted that Europe’s reliance on the United States for military intelligence, cloud computing, and space assets means it will likely take “well into the 2030s” to reduce this dependence.
The situation remains fluid, and continued monitoring of Russia’s military capabilities, economic performance, and recruitment trends will be crucial in assessing the long-term trajectory of the conflict in Ukraine and its implications for European security. The coming months will be critical in determining whether Russia can maintain its current level of military activity and whether the pressures on its resources will force a shift in strategy.
What are your thoughts on the evolving security landscape in Europe? Share your perspectives in the comments below.
