EU Proposal to Redirect Cohesion Funds for Defence Boost

The European Commission suggests letting EU nations, particularly those near Russia, use EU funds to enhance defence capabilities. This proposal allows 392 billion euros from cohesion policy to be optionally redirected for defence, alongside plans for joint borrowing and spending exemptions, bolstering military readiness.

The European Commission on Tuesday proposed that European Union nations bordering Russia could use their EU budget allocations to strengthen defence capabilities. This significant move involves potentially redirecting 392 billion euros of the cohesion policy funds, traditionally aimed at equalizing living standards.

If agreed upon, governments can voluntarily allocate these funds for defence, supplementing the EU's 150 billion euros for joint borrowing on defence spending. Additionally, removing defence spending from annual EU government expenditure limits could increase spending by 650 billion euros over four years, according to Commission estimates.

This initiative, requiring European Parliament and EU governments' approval by 2026, would finance projects with dual civilian-military use, such as infrastructure reinforcement, while aligning with EU treaties' restrictions against direct military budget financing.

(With inputs from agencies.)