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Russia budget boosts military spending, army wages
MOSCOW, Oct 19 (Reuters) - The second reading of Russia's 2002 draft budget, which the lower house of parliament began debating on Friday, will boost military spending and army wages, Finance Minister Alexei Kudrin said.
The new budget reading increases national defence provisions by 2.2 billion roubles to 284.18 billion roubles ($9.6 billion), Kudrin said, and allows additional cash to boost army wages.
"We think that we have fulfilled the president's message on increasing spending on servicemen's salaries and technical material," Kudrin told reporters during a break in lower house, or State Duma, debates.
Earlier in the week, President Vladimir Putin told a special meeting of top defence officials that Russia had to pour more money into modernising its armed forces, whose shortcomings have been laid bare by two military campaigns in rebel Chechnya over the past decade.
Putin also announced that the Russian military would be pulling out of the Lourdes base in Cuba, and out of the Cam Ranh naval base in Vietnam, as the army redistributes its cash- strapped resources.
Kudrin added spending on government defence orders was stepped up by 27 billion roubles to a total sum of 79 billion roubles.
The budget's second reading includes Russia's first-ever surplus and a contingency reserve to cover any cash shortfalls during peak foreign debt repayments.
"The discussion has begun on whether to keep intact the balanced variant of the budget. I think the budget will preserve its firmness and realism," Kudrin told reporters.
The added military spending will not mean an increase in the total budget.
Russia's 2002 draft budget is 2.13 trillion roubles ($72.45 billion). Spending is set at 1.95 trillion roubles, leaving a surplus of 178.3 billion roubles, or 1.63 percent of the gross domestic product.
The draft must pass four readings in parliament before being sent to the upper house, then signed into law by Putin.
($1-29.55 roubles)
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