(UFA, BASHKORTOSTAN, RUSSIA) – Authorities in Bashkortostan are preparing to sell a significant portion of their ownership in Bashneft, a major regional oil company, in an attempt to address a deepening budget deficit. The decision follows months of warnings about a worsening financial outlook in the republic, which has traditionally relied heavily on revenue from the oil and petrochemical sector.
The regional government currently owns 25 percent plus one share of Bashneft. Under a new privatisation initiative, it intends to sell around 11.3 million shares, estimated at 6.3 percent of the company’s total stock. Based on a market rate of approximately 1,433 rubles per share (about 18.60 US dollars), the sale could raise the equivalent of more than 16.2 billion rubles (about 210 million US dollars). This would help cover the region’s deficit, reported to be close to 7 percent of the budget.
Estimated Sale Value
| Item | Rubles | US Dollars |
|---|---|---|
| Price per share | ₽1,433 | $18.60 |
| Shares planned for sale | 11.3 million | 11.3 million |
| Estimated total value | ₽16.2 billion | $210 million |
Officials say the move is necessary because of sharp declines in revenue from corporate profits. Bashkortostan’s economy has been affected by oil sanctions imposed on Russia following its full scale invasion of Ukraine, as well as weakening market demand. Ten major companies contribute over 30 percent of the region’s tax income. Their reduced performance has pushed the republic into financial strain earlier than expected.
Alongside the share sale, Bashkortostan plans to cut spending across all sectors. These cuts include reducing payments to Russian contract fighters serving in Ukraine. Reports indicate that incentive payments for those joining the war will be halved from 1 million rubles (around 13,000 US dollars) to about 500,000 rubles (around 6,500 US dollars). The republic had previously allocated significant funds to encourage recruitment, but now struggles to meet basic budgetary needs.
Public frustration over economic pressures is becoming more visible across Russia, particularly in regions far from Moscow and Saint Petersburg, which suffer most from the Kremlin’s centralised resource control. Demonstrations were recently held in Irkutsk, Novosibirsk, Chelyabinsk, Tomsk and Udmurtia, with entrepreneurs protesting against planned tax increases. Many fear the additional burden will push small and medium businesses into closure. Despite their grievances, protestors were reported to carry slogans supporting the Russian dictator — a sign analysts believe reflects fear of political consequences rather than real support.
The Kremlin’s failure to reverse economic decline has been linked directly to its ongoing war. Continuing military expenditure, combined with sanctions and the falling value of the ruble, has created significant nationwide financial instability.
