Russia`s economy contracted sharply in April - shrinking by 10.5% from the same month a year ago - Deputy Economy Minister Andrei Klepach has said. The data came as officials were quoted as saying Russia would have a budget deficit equivalent to 9% of GDP in 2009, from an earlier 7.4% prediction. Russia`s economy had been growing thanks to high oil prices, which peaked at about $147 a barrel last summer. But since then, the price of oil, a key export, has fallen by more than half. The sharp drop in the economy in April came after Federal State Statistics figures showed that, on a year-on-year basis, output dropped 9.5% in the first three months of the year. `Tough regime` Industrial output has slowed in the wake of the global economic slowdown, and investors have withdrawn from Russia. There are fears that poverty levels are rising - with Russian churches reporting a rise in the number of people seeking free meals as a result of the global financial crisis On Monday, Russian President Dmitry Medvedev gave downbeat comments on the country`s economy - though he avoided giving precise statistics on how bad it had become. However, he called for sharp cutbacks in government spending in a "shift to a regime of tough economising of budget funds". Mr Medvedev also hit out at corrupt officials for "sucking" away state funds. Russia`s regions should be less reliant on Moscow and be prepared to fend more for themselves, he added.