MOSCOW—The International Monetary Fund slashed its growth forecast for Russia for 2013 and 2014 for the third time this year, urging the government to pursue structural reforms and improve the investment climate in order to boost growth.

The IMF said Tuesday that it saw the economy growing at 1.5% this year and 3% in 2014, held back by weak investment and low demand for its exports. In June, the Fund cut its outlook for 2013 to 2.5%, after an earlier cut in April to 3.4% from 3.7%. In April, the Fund saw Russia's economy growth...