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President of Russia Vladimir Putin: Mr Vasilyev, you have already been working in the republic for two months. What are your impressions?

Acting Head of the Republic of Daghestan Vladimir Vasilyev: The time passed quickly. We were busy.

Vladimir Putin: How has the initial period been? How is the republic doing?

Vladimir Vasilyev: We have a process in place. There are some difficulties but there are also promising potential and interesting opportunities.

Vladimir Putin: Well, Daghestan offers many opportunities.

Vladimir Vasilyev: I am currently meeting with heads of districts and they recall the difficult time, the time when you flew there. They convey their best wishes to you.

Vladimir Putin: Thank you. Please give them my best wishes, too.

Vladimir Vasilyev: In these nine months the picture has been good in our economy in a number of areas. Our industrial production, agriculture and construction are doing well. Average salaries and real incomes have grown.

Vladimir Putin: By how much?

Vladimir Vasilyev: Real incomes increased by 3.3 percent, and average salaries went up by 5.1 percent in nine months.

Vladimir Putin: This is more than the national average.

Vladimir Vasilyev: For a number of indicators – yes.

Vladimir Putin: The average for Russia is 3 percent.

Vladimir Vasilyev: I would like to thank the federal government for the help. When we speak about 29 percent growth in industrial production, many people in Daghestan are doubtful and not without cause, because this figure was mostly produced by two major companies that received a defence order which caused capacity to increase by 1.7–1.8 times. Regrettably, there has been a decline in some industries. We must resolve these problems.

Unemployment has fallen by 6.9 percent – almost 7 percent. We are carrying out executive orders.

Vladimir Putin: What is the unemployment rate?

Vladimir Vasilyev: I am unable to quote the exact figure for fear of misguiding you. I will have to clarify. But it fell by about 7 percent.

Now a few words about the executive order and salaries. In our region the average salaries of the teaching staff in general education schools, masters of vocational training, physicians and paramedical personnel meet the requirements of your executive order. We are lagging behind in five positions: social workers, preschool teachers, workers of culture, and higher vocational education and training instructors.

As for healthcare, the death rate from tuberculosis has decreased by 11.5 percent, while infant and road traffic accident mortality rates have gone down by 4.4 percent. But we must still do more in this respect. The death rate from cardiovascular diseases has been reduced only by one percent. Just on Friday Ms Golodets [Deputy Prime Minister] held a meeting to which all relevant ministries and departments were invited and we discussed only Daghestan, for which I am most grateful. We have reached some agreements on a number of issues.

And now I will turn to the subject that we are seriously worried about: the tumour death rate has increased. We lost 151 people, which is an increase of 8.3 percent. We did not find money in our regional fund to purchase the necessary equipment, including fluorographic units. Ours were made in 2006 and have become obsolete. We also have problems with medicines for cancer patients – for the time being we do not have enough money. But we have agreed with the Healthcare Ministry that it will send its team to us and we will think about how to resolve this problem on the spot.

Incidentally, this way of working in line with your instruction – visits by our sectoral ministries – is highly efficient. Recently, Education Minister Olga Vasilyeva came to see us and we worked with her. Transport Minister Maxim Sokolov also visited us before Ms Vasilyeva, and we had a practical discussion. Such visits are pulling us up to the federal level. So I would like to ask you to continue supporting us in this respect.

You are keeping tabs on preschool education. We are currently meeting 85 percent of the demand as compared to 53 percent in 2013. During this time, we have built 108 new kindergartens for 14,000 children. The problem remains, however. It must be resolved, including with our own means as a republic. We are well aware of it, because we still have over 20,000 children on the waiting list.

Vladimir Putin: To kindergartens?

Vladimir Vasilyev: Yes.

With regard to investment, which is the key to resolving many problems, we rank first in the North Caucasus Federal District in terms of fixed assets. However, we are close to the bottom of the list in terms of investment appeal. We need to keep working on it.

In March, the Government decided to create a priority development area Kaspiysk. Our parliament has passed in the first reading a draft law on creating favourable conditions, and I hope this will help draw investment to our region.

Vladimir Putin: What do you plan to produce in this area?

Vladimir Vasilyev: Kaspiysk includes several areas of focus which we hope to get underway in the near future, including the latest technologies.

The agricultural complex in our region is doing well. Of course, we need to think about the manufacturing industry, not just the defence industry, since, frankly, there’s not much we can do about the defence order.

The vastness of the shadow economy represents both a problem and an opportunity for major growth. Today’s tax rate is set at 5.2 percent, which is one of the lowest in 2016, as compared to 10 percent in the North Caucasus Federal District, and 20 percent nationwide. There are things to address, so we are moving calmly and consistently towards this end.

I would like to say that, as I said earlier, our growth structure was affected by the defence order. It could undergo major changes if we managed to improve tax collection.

By the way, I want to thank you. At some point, I asked for help at the request of our citizens who wanted to bring things up to code in our republic in all aspects. I want to thank the Prosecutor General for approving a new candidate to the prosecutor’s office who is currently being approved at the Supreme Court. Both businesses and citizens are waiting for these decisions. Everybody wants a law like in Russia.

Vladimir Putin: Like everywhere in Russia.

Vladimir Vasilyev: Yes.

Vladimir Putin: Well, much remains to be done in Russia to make sure everything functions properly.

Vladimir Vasilyev: We, in Daghestan, have things to strive for.

Vladimir Putin: I understand.

Vladimir Vasilyev: I see what people want and I understand them. They support us. I hope we will be able to move in this direction. Thank you for your help.

In accordance with the rankings of the Russian regions in terms of excessive oversight activities, we came in 85^th in Russia in 2016. We must put an end to this. The agricultural businesses are overloaded with inspections and complain about it. We are working on it and will continue to do so in a more efficient manner.

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