The Russian government has tallied up the costs of modernizing their aging military forces’ equipment and concluded that it will total about $700 billion:
To pay for this, the military wants another 1.5 percent of GDP, meaning 5 percent of GDP will be devoted to defense. [...] Back during the Cold War, the armed forces had five times as many troops (over five million) and dibs on over ten percent of the national GNP (no one is sure of the exact amount, as the communists were not big fans of accountants and accurate financial reporting.) Currently, Russia is playing by West European rules when it comes to military spending, meaning no more than 3-4 percent of GDP going to the military. With a $1.7 trillion dollar economy, growing at 7 percent a year, the generals can expect a lot more cash to work with. But most of this money is going to replace Cold War era weapons, which are now considered out-of-date and of limited usefulness.