Prime Minister Nikol Pashinian signaled such plans on August 21 two weeks after reaching what he portrayed as landmark peace agreements with Azerbaijani President Ilham Aliyev in Washington.
“I think that in our 2026 state budget we will probably have no substantial increase on defense expenditures or no increase at all,” he told reporters.
Finance Minister Vahe Hovannisian similarly said that the government is planning to lower next year the share of those expenditures in overall public spending. But he did not give any numbers. The government is expected to unveil its 2026 budget proposal by the end of this month.
Sargsian said in this regard that he is unaware “at the moment” of the amount of defense spending that will be projected by the draft budget. He seemed confident that it will not undermine Armenia’s defense capabilities.
“I can assure you that the Defense Ministry will work in 2026 with the same logic that it worked in 2024 and 2025,” he told journalists.
Armenia’s defense budget for this year is projected at 665 billion drams ($1.7 billion), up by 20 percent from 2024. The figure is equivalent to almost one-fifth of the country’s 2025 state budget.
The Armenian military officially received 341 billion drams in 2020. It appears to have used the bulk of the increased funding for replenishing its arms stocks diminished during the disastrous war. By comparison, Azerbaijan is due to spend a total of about $5 billion on defense and national security this year.
Pashinian’s August 8 talks with Aliyev hosted by U.S. President Donald Trump resulted in the initialing of an Armenian-Azerbaijani peace treaty. Pashinian has since repeatedly claimed that “peace has been established between Armenia and Azerbaijan.”
His domestic critics counter that Aliyev did not drop his preconditions for signing the treaty. They also say that it would not preclude further Azerbaijani military attacks on Armenia.
When asked whether he thinks the peace deal with Baku claimed by the government is sufficient grounds for cutting defense spending, Sargsian said: “I wonder if there is any country that is at peace with its neighbors but doesn't spend money on its army.”