Russia’s government is considering several measures to shore up Russian Railways as the state-owned company grapples with a massive 4 trillion rouble ($50.8 billion) debt load, according to two sources familiar with the discussions.
Russian Railways — the country’s largest commercial employer with around 700,000 staff — has seen revenues fall amid a slowdown in the war-driven economy, while soaring interest rates have pushed up borrowing costs to their highest levels in two decades. Most of the company’s debt is owed to state banks.
Officials are weighing multiple solutions, including raising cargo tariffs, increasing subsidies, cutting taxes, or tapping the National Wealth Fund. A government meeting on the issue took place in late November, with another expected in December. Neither Russian Railways nor government ministries responded to requests for comment.
Additional ideas, not yet formally discussed within the government, include capping the company’s interest payments at 9% or converting a portion of its debt into equity stakes for state banks. One proposal under consideration would transform 400 billion roubles of debt into shares.
The measures are seen as part of broader efforts to “save” Russian Railways, which operates the world’s third-largest rail network. The company reported 2024 revenues of 3.3 trillion roubles and expenditures of 2.8 trillion, but its debt rose by about 700 billion roubles in the first half of 2025 alone, for reasons that remain unclear.
Long viewed as a key barometer of Russia’s economic health, the company’s difficulties underscore the strains facing an economy dominated by state-owned enterprises and heavily burdened by war-related spending. As Russia prioritizes record military expenditures, the state is increasingly responsible for the liabilities of major firms.
Russia’s economic expansion has slowed sharply from the rapid growth seen in the early 2000s. With GDP forecast to rise just 1% in 2025 — and the IMF projecting an even lower 0.6% — officials acknowledge cooling economic activity, weak business conditions, and the pressures of high interest rates. Despite thousands of Western sanctions, President Vladimir Putin maintains that Russia’s economy is performing better than expected and remains largely free of public debt, though he has admitted to investment challenges.
A senior Sberbank executive recently noted that the economy faces “continued cooling,” with sluggish business activity expected for four to five quarters.
