Foreign Governments' Debt to Russia Rises to $33.1 Billion - A 26-Year High. An Analysis of the Largest Debtor Nations, the Role of the CIS, and Investment Risks for Global Investors.
In 2024, the debt of foreign governments to Russia increased by $2.6 billion, reaching $33.1 billion - the highest level since 1998. This assessment is provided by the World Bank, noting that Russian lending to foreign partners is actively expanding despite sanctions pressure. Moscow has become a significant creditor for a number of developing countries, increasing the provision of state loans and export credits.
According to the World Bank, by the end of 2024, 38 countries had debts to Russia. For the first time in decades, the largest debtor was not a CIS country: Bangladesh surpassed Belarus to take the top position, owing $7.8 billion. Belarus's debt decreased to $7.6 billion, placing it in second. The top five debtholders also include India ($4.9 billion), Egypt ($4.1 billion), and Vietnam ($1.4 billion).
New Debt Record and Historical Context
The volume of external debt to Russia has reached a record value for the post-Soviet period. The previous peak occurred in 1998 when the debt of foreign nations was around $38 billion. However, at the end of the 1990s, a significant portion of this sum was a remnant of the Soviet era and was subsequently restructured or written off. In the 2000s, Moscow undertook a large-scale debt write-off for developing countries – by various estimates, over $100 billion was forgiven to countries in Africa, Asia, and Latin America under debt relief initiatives and to strengthen diplomatic ties.
Due to the write-offs of old debts, the overall debt to Russia significantly decreased by the 2010s. The current rise to $33 billion is primarily due to new loans issued by Russia over the past decade. Unlike the Soviet era, modern loans are targeted and aimed at financing specific projects and supporting allies. Thus, the current record level of debt reflects Russia's enhanced role as a creditor in a new geopolitical context.
Top 5 Largest Debtors to Russia
The majority of the debt is concentrated in a few countries. By the end of 2024, the five largest borrowers accounted for nearly 80% of the total debt to Russia. The leaders are as follows:
- Bangladesh — $7.8 billion (an increase of $1.2 billion over the year)
- Belarus — $7.6 billion (a decrease of $125 million over the year)
- India — $4.9 billion (an increase of $799 million over the year)
- Egypt — $4.1 billion (an increase of $815 million over the year)
- Vietnam — $1.4 billion (no change over the year)
In comparison, the smallest debt to Russia is owed by the small island nation of Grenada – only about $2,000, which indicates a complete repayment or a symbolic nature of the obligations. The contrast between the largest and smallest debtors underscores the concentration of the Russian credit portfolio: the two leading countries (Bangladesh and Belarus) together account for nearly half of all debt owed to Russia.
CIS Countries: The Importance of Neighbors and Allies
Until recently, CIS countries topped the list of Russia's debtors. Belarus had long been the largest borrower, regularly attracting Russian loans to support its budget and implement joint projects. Its current second position ($7.6 billion in debt) reflects the continued close financial ties between Minsk and Moscow, although the slight decrease in debt in 2024 indicates that Minsk has begun repaying some obligations.
Other post-Soviet countries have significantly lower debts to Russia. For example, Uzbekistan increased its debt in 2024 by only $39 million – likely due to the utilization of new credit lines for infrastructure projects. Caucasian countries have largely eliminated debts: Georgia, for instance, fully repaid its remaining historical debt to the Russian Federation in 2025. Overall, the share of CIS countries in the total external debt to Russia has decreased, giving way to countries in Asia and Africa, but for key allies like Belarus, Russian loans remain critically important.
Export Projects and Strategic Interests
The rise in foreign countries' debt to Russia is driven by a targeted lending policy that serves both economic and geopolitical goals. A significant portion of Russian loans is tied to specific projects, such as the construction of nuclear power plants. Bangladesh received funding from Russia for the construction of the Ruppur NPP – this accounts for the rapid increase in its debt by almost 19% over the year. Similarly, Egypt is increasing borrowings for its El-Dabaa NPP project and other infrastructure, which has driven its debt up by 24% in 2024. Such projects provide Russian companies (especially Rosatom) with substantial export contracts and a long-term presence in partner markets.
Another driver is loans for the purchase of Russian goods, primarily military equipment. India, a traditional buyer of Russian arms, increased its debt by nearly $800 million over the past year, likely as part of payments for the delivery of air defense systems and other equipment on an installment plan. Likewise, Vietnam and Egypt received state export loans for military equipment in previous years. By extending credit to foreign clients, Moscow supports the export of its high-tech goods and strengthens defense cooperation.
Financial Risks and Investment Aspects
For Russia, providing loans to other governments is a form of investment, albeit one associated with risks. Loans are typically issued on concessional terms: for example, loans for nuclear power plants have long grace periods and relatively low interest rates. This assists partners in servicing their debt but implies moderate returns for the lender. Nevertheless, such loans are tied to future fuel deliveries, servicing of equipment, and other ancillary services, creating long-term profit sources for Russian companies.
However, the risk of non-repayment persists. Some of Russia's borrowers are experiencing debt burdens and economic difficulties. Egypt, for instance, is facing a currency shortage, and Belarus’s economy heavily relies on support from Moscow. In the event of defaults or the necessity for restructuring, the Russian budget would have to absorb the costs, as has been the case previously with the debts of several countries. At this time, the total volume of such assets ($33 billion) is not critical for the Russian economy (less than 2% of GDP), but it is noticeably increasing. It is important for investors to consider that the accumulation of external debt is part of Russia's strategy to enhance its influence, which comes at the cost of frozen capital and potential losses in the event of adverse developments.
Outlook: Further Growth of the Credit Portfolio
According to budget plans, Russia does not intend to decrease the volumes of external lending. For the years 2026–2028, around 1.8 trillion rubles (approximately $18.5 billion) has been earmarked in the federal budget for providing state and export loans to foreign countries – this is 14% more than previously planned. These resources will primarily be directed to 'friendly' countries for financing infrastructure projects, technology supplies, and other needs.
If all planned loans are realized, the total debt owed to Russia could reach historical highs in the coming years, surpassing levels from the late 1990s. This would strengthen Moscow's presence in the economies of partner countries but simultaneously increase the potential risks of non-payment. It is essential for global investors to monitor this dynamic: the expansion of the Russian credit portfolio reflects a redistribution of financial influence in the world – shifting from traditional Western donors to new creditors, such as Russia and China. For debtor countries, Russian financing represents an alternative source of development, while for Moscow, it serves as a tool of 'soft power' and expansion of economic influence.
