Financially independent: how did the Russian regions develop in 2025
The results of the first half of 2025 indicate a continued recovery in the economies of Russia's regions after a period of turbulence, according to a review by the Expert RA rating agency, received by Izvestia. Rising household incomes and record low unemployment are supporting consumer demand. However, there remains a significant differentiation between regions: raw materials and industrialized regions show the best results, while depressed territories remain dependent on money from the center. Although the financial autonomy of most regions is increasing, rising costs against the background of declining transfers pose risks to budget balance and may lead to a further increase in the debt burden. Details can be found in the Izvestia article.
Expenses have overtaken revenues
According to the results of the first six months of 2025, the revenues of the consolidated budgets of the Russian regions showed moderate growth, increasing by 2.1% compared to the same period last year and amounting to 10.1 trillion rubles. The situation is primarily affected by the increase in own income — tax and non-tax revenues (IND), which increased by 4.2%. At the same time, the volume of inter-budget transfers from the federal center decreased by 2.4%, which indicates the growing budgetary autonomy of the subjects.
Tax revenues showed multidirectional dynamics. Income tax receipts for individuals (personal income tax, +10.3%) increased significantly, largely due to an increase in the payroll and income from equity participation. Personal income tax receipts increased in almost all regions, especially in the Chukotka Autonomous Okrug (+40.1%), Amur (+29.5%) and Novgorod regions (+28.5%), the Republic of Khakassia (+27.6%) and Sevastopol (+27.0%). Fees from the simplified taxation system (USN, +12.1%), corporate property tax (+6.1%) and mineral extraction tax (MET, +32.5%) also increased significantly.
At the same time, corporate income tax receipts decreased by 7.8%, mainly due to lower profits of extractive industries and the timber industry, as well as financial sector organizations. The reason is the cooling of lending activity, rising business costs and the cost of loans, as well as the filing of clarifying tax returns, the abolition of the institute of consolidated taxpayers (CGT) and the continued sanctions pressure on purchase prices in a number of key sectors of the economy.
The expenses of the regions increased significantly over the past six months — by 14.9%, to 10.5 trillion rubles. This led to a cumulative budget deficit of 393.9 billion rubles. The national debt of the constituent entities of the Russian Federation increased by 3.9% and reached 3.27 trillion rubles as of July 1, 2025, of which 80% are budget loans. In conditions of high interest rates and an uncertain economic situation (the period of rapid growth is coming to an end), rising costs can pose significant risks in terms of increasing the debt burden, when both the body of debt and the share of the budget that will be spent on its repayment will simultaneously grow.
Uneven recovery continues
Most regions showed positive dynamics in key economic indicators. Industrial production increased by 1.4%, with growth recorded in 46 regions. The leaders were the Chukotka Autonomous Region (+23.5%), the Kurgan Region (+20.5%) and the Khabarovsk Territory (+18.0%). At the same time, the largest drop was noted in North Ossetia (-21.8%) and Dagestan (-16.1%).
Construction increased by 4.3%. The largest growth was shown by the Republic of Adygea (twice), Yaroslavl (1.6 times) and Leningrad regions (+47.9%). Nevertheless, the volume of construction work decreased in 44 regions. Investments in fixed assets increased by 8.7% in the first quarter. The maximum growth was demonstrated by the Jewish Autonomous Region (twice), the Kamchatka Territory (1.9 times) and the Vologda Region (1.8 times). At the same time, investments in the Republic of Kalmykia fell by 47.1%.
Consumer demand remains stable: retail trade turnover increased by 2.1%, and the volume of paid services to the public increased by 2.3%, which is largely due to the steady growth in real monetary incomes of the population, which increased by 8.3% YoY in the first quarter of 2025. Growth was recorded in all regions, with the leaders being the Chukotka Autonomous Region (+17.6%), Kalmykia (+14.5%) and Kabardino-Balkaria (+14.2%).
The average unemployment rate in Russia in April – June 2025 decreased to 2.2% against 2.5% on average in 2024. The lowest rates were recorded in Moscow (0.8%), Yamalo-Nenets Autonomous District and Khanty-Mansiysk Autonomous District — Yugra (1% each). The situation remains most acute in the regions of the North Caucasus, where the unemployment rate ranges from 6.7% in Karachay-Cherkessia to 26.1% in Ingushetia.
According to Vladislav Bukharsky, Associate Director for Sovereign and Regional Ratings at Expert RA, the current dynamics in the first half of the year is likely to last until the end of the year.
"Among the most dynamic regions will remain the Chukotka Autonomous District, where gold mining is increasing, the Khabarovsk Territory, where projects related to coal and metal ore mining are being implemented, as well as the Kurgan Region, where growth is still largely driven by the military—industrial complex," the expert explains.
The economies of the regions that are attacked more often than others (Kursk, Belgorod, Rostov regions, the Republic of Crimea) are at risk. At the same time, the regions that already had the largest decline in industry in the first half of the year (the republics of North Ossetia — Alania, Dagestan, Kostroma Region and some others) probably will not show a serious recovery until the end of the year against the background of negative trends in the manufacturing sector, the expert believes.
Переведено сервисом «Яндекс Переводчик»
