Government to Slash Military Spending by 15% Next Year

While Azerbaijan continues to announce massive increases in its military spending, the government of Armenia on Thursday approved a draft budget that sees a 15 percent decrease in military spending in 2026.

Discussion to downsize the military spending began circulating after Prime Minister Nikol Pashinyan and President Ilham Aliyev of Azerbaijan met at the White House last month and initialed an agreement to advance peace in the region. Although no such cuts were outlined in the official documents signed in Washington, Pashinyan began to advance the issue, with defense department officials echoing the need for the steep cuts.

The draft budget approved by the government on Thursday allocates 563 billion drams ($1.47 billion) in funding for Armenia’s Armed Forces, down from 665 billion drams allocated for this year. Instead, ahead of the 2026 parliamentary elections, there is a five percent increase in overall public spending in 2026, projected at 3.6 trillion drams ($9.5 billion).

“In line with the priorities of the Government of the Republic of Armenia, a number of measures of a social, educational, healthcare, economic support, and infrastructure nature will be implemented in 2026,” announced Finance Minister Vahe Hovhannisyan.

However, among the priorities listed by the Finance Minister, there was no reference to the defense sector. The Defense Minister, who was present at the session, did not provide any justification.

While slashing the defense budget, the government is increasing the funding of the ministries of territorial administration, health, and economy in the pre-election year. More specifically, steps will be taken to reduce poverty, and government-funded subsidy programs will increase. For this purpose, it is planned to spend 2 billion drams in 2026 instead of 1 billion in 2025.

“This budget is clearly oriented toward investing in people, with which, for example, at the education ministry, thus GDP from 3.3 percent to 3.5 percent. There will be an increase increase from 1.5 percent to 1.8 percent in the health ministry,” Hovhannisyan explained.

The government’s decision to reduce defense spending was strongly criticized by Tigran Abrahamyan, an opposition member of the parliament’s Defense Committee. He said this decision is unacceptable, especially when Azerbaijan has already announced that it will increase military spending next year.

“Azerbaijani troops continue to remain in the sovereign territory of the Republic of Armenia, a large number of issues in the negotiations with Armenia and Azerbaijan have not yet been resolved in any way or are left in limbo without deadlines, and Azerbaijan is clearly declaring that it relies primarily on use of force and acts from a position of force,” Abrahamyan pointed out.

“Given this reality, such a significant reduction in Armenia’s military budget in itself indicates that the Armenian authorities are clearly threatening the negotiations of the Republic of Armenia and are also putting the Armenia-Azerbaijan negotiation process under a considerable blow, giving Azerbaijan a trump card to act not only from the position of a winner, but also from the position of a strong and potentially powerful state,” Abrahamyan emphasized.

“Who can expect peace, who can guarantee that relations between Armenia and Azerbaijan will end peacefully, where Armenia’s positions will also be taken into consideration. In this case, getting ahead of events and sending a message to Azerbaijan that Armenia not only lacks the political will to resist and fight, but is immediately giving up its positions in that regard, this is the best gift that can be given to Azerbaijan,” Abrahamyan said.