Latest update from russia's Federal State Statistics Service (Rosstat) shows that industrial production growth in the first half of 2025 slowed to just 1.4% year-on-year, which is a clear sign of "overcooling" of the economy. The same report notes a 4.2% year-on-year increase in the processing industries, but this applies almost entirely to the so-called "special sectors of the economy," primarily the military-industrial complex.
Against this backdrop, russia's business press is already openly pointing out signals of a growing economic crisis, noting that it is the military-industrial sector that is now essentially "keeping the industry afloat."
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On this note, Defense Express would like to emphasize that since Rosstat withholds many key figures, even domestic analysts are forced to "read between the lines" when working with the available public data — often interpreting trends that are not obvious at first glance.
For instance, one of the clearest indicators of actual industrial decline is the drop in electricity generation (–1.9% in the first half of 2025), as well as steep reductions in the production of automobiles (–47%), wood products (–18%), and "other non-metallic mineral products," including construction materials (–11%).
In contrast, growth attributed to the military-industrial complex is usually reflected in certain segments: "production of finished metal products" (up 1.5x), "electronics and optics" (up 2.1x), and "other transport equipment" (up 3.4x) — all showing strong increases during the same period.
An interesting statistical fluctuation may also point directly to the rhythm of activity in the defense sector: while industrial output rose by 1.6% month-on-month in April 2025, it fell by 1.9% the following month, in May.
However, it's important to add a caveat here: russian official statistics intentionally leave significant "room for maneuver" in interpretation. As a result, analysts are often inclined to simultaneously talk a worsening crisis in the economy and claim that russia is experiencing economic growth — supposedly fueled by its full-scale war against Ukraine.
From the crisis perspective, one of the most telling figures is the reported 1.5% decline in civilian industrial production over the first five months of 2025.
At the same time, Rosstat continues to promote the notion that, despite all setbacks, russia's overall industrial output in 2025 will be 10% higher than in 2022. For this reason, Defense Express stresses the importance of avoiding overly categorical assessments about the general state of the russian economy or its continued capacity to sustain the war.
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