Russian Economy Risks Going 'Berserk' on War Footing: Kremlin Official

A Kremlin official warned Tuesday that Russia risks pushing its economy into “berserk mode” if policymakers subordinate civilian activity entirely to the demands of the military-industrial complex.

Boris Titov, President Vladimir Putin’s special representative for international development, said the country needed to preserve a balance between military production and the wider economy as wartime pressures intensify.

“Military and civilian economies have ⁠always existed in symbiosis everywhere. Many technical inventions that are useful for all originated within the military-industrial complex. The key lies in maintaining balance,” Titov told Russian business outlet RBC.

Warning From Inside Kremlin Circles

Titov’s intervention marked an unusual public expression of concern from within Kremlin circles over the strain being placed on an economy increasingly organized around the 4-1/2-year war in Ukraine.

Russia has raised taxes, redistributed property and encouraged businesses to contribute to financing the war.

Authorities have also threatened business owners accused of failing to take sufficient measures to protect their facilities from Ukrainian drone attacks.

Some officials and supporters of the war have pointed to the Soviet Union’s World War II economic mobilization under Josef Stalin as a precedent, invoking the slogan: “Everything for the front, everything for victory.”

Titov questioned the sustainability of such an approach.

“This is not an economy at all, it's a kind of 'berserk mode' that can only exist for a very limited time, and the necessity of ‌which ⁠should be considered very carefully,” he said.

Civilian Economy Under Pressure

Russia’s economy is expected to expand by only 0.4% this year, while several non-military sectors are stagnating or contracting.

Ukrainian attacks on refineries, online retailers and oil and grain export infrastructure could place additional pressure on that growth rate.

Titov’s remarks also reflect signs of resistance among parts of Russia’s political and economic establishment to an increasingly militarized economic model.

Moscow Mayor Sergei Sobyanin said last month that “killing a normal economy is equivalent to killing the whole country.”

Andrei Klepach, chief economist at the state development bank, lost his job last month after publicly discussing economic challenges created by the war.

Pressure Ahead of Election

The warning comes as Russia prepares for a parliamentary election this month.

The only political party openly advocating an end to the war has been barred from taking part, while opinion polls cited in the draft show increasing fatigue with the conflict and stronger support for a negotiated settlement.

Rumors have also circulated about a possible large-scale military mobilization after the election aimed at capturing the whole of Ukraine’s Donbas region.

The Kremlin has described those claims as a hoax.

Titov, appointed to his current role in 2024, previously headed an influential business lobby and ran for president in 2018.