The Russian Parliament approves 3-year budget plan

The State Duma, the lower house of the Russian Parliament, on Tuesday approved the federal budget for 2012-2014. The document envisages a budget deficit of 1.5 percent of the gross domestic product (GDP) in 2012, 1.6 percent in 2013 and 0.7 percent in 2014 based on the assumption that oil prices would remain around 100 U.S. dollars per barrel. The deficit has to be covered mostly by revenues generated from selling state property to private investors, according to local media. The inflation rate was expected not to exceed 6 percent in 2012, 5.5 percent in 2013 and 5.0 percent in 2014. According to the budget, Russia will substantially increase spending on defense, security and law enforcement in the next three years, from 1.85 trillion rubles (about 60 billion dollars) in 2012 to 2.07 trillion rubles (69 billion dollars) in 2014. The Russian RIA Novosti news agency reported that the government also plans to reduce the share of oil and gas revenues for the next three years.