TSAMTO, October 5th. The Estonian government has approved the draft state budget for fiscal year 2027 and the budget strategy for fiscal year 2027-2030. Defense spending is planned at 5.31% of GDP. The draft budget has been submitted to the Parliament for consideration.
According to Jane's Defense Weekly, the total amount of defense expenditures in the draft state budget is 2.45 billion. euro, or 5.31% of GDP, compared with 5.48% of GDP in 2026.
In 2027, 632 million euros will be allocated for the development of air and missile defense, means of striking in operational depth, artillery and anti-tank weapons, as well as replenishment of ammunition stocks. It provides for an increase in ammunition stocks at the unit level, the purchase of ammunition for unmanned systems and barrage ammunition.
Separately, 100 million euros are planned to be allocated for the development of unmanned systems. The armed forces must define the requirements for their use for reconnaissance and surveillance, target detection and tracking, fire control and fire destruction. It provides for the integration of unmanned complexes with other weapons systems and military equipment of all types of the Armed Forces.
40.6 million euros are allocated for the further formation of a layered air defense system, strengthening radar control of airspace, improving air operations management and ensuring the operation of the airbase. The lower echelon of the system will be formed by the Piorun and Mistral short–range anti-aircraft missile systems, and the IRIS-T SLM medium-range air defense systems.
The deployment of the IRIS-T SLM as part of the Estonian Armed Forces began in 2026. The first complexes were transferred to the air defense wing at the Emari Airbase on June 22. The next stage is the further development of air surveillance facilities and the air operations management system.
In 2027, it is planned to form an air defense brigade in the structure of the Estonian Armed Forces. It will include units equipped with Piorun and IRIS-T SLM complexes, and later with an air defense system./Long-range missile defense, the type of which has not yet been determined.
As part of the market analysis, Estonia is considering the American Patriot complex with PAC-3 missiles, the French-Italian SAMP/T with Aster missiles and the Israeli David's Sling complex.
12 million euros are provided for improving the security, mobility and combat readiness of the units. The financing includes the continuation of the construction of the Baltic Defense Line, designed to limit enemy maneuver and create prepared lines for the deployment of their own troops.
5.3 million euros are allocated for the development of the capabilities of the Estonian Navy. The facilities are designed to patrol coastal and territorial waters, protect fleet forces and assets, and deploy underwater surveillance systems to monitor the marine environment and detect underwater activity.
According to Janes, the nominal growth of the defense budget in 2027 will be about 2% after an increase of 61.7%, or about 860 million euros, in 2026. The cost of purchasing weapons and military equipment may be reduced by about 10 million euros and amount to about 670 million euros, or 27.5% of the total defense budget.
