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Excerpts From the Transcript of the Meeting with Cabinet Members

August 1, 2006, The Kremlin, Moscow

About the situation in the Chechen Republic

Dmitrii Medvedev: 25 July 2006 a meeting on Chechnya’s social and economic development was held in Moscow.

As a result of the meeting several orders were given, including orders about providing the Republic with additional financial help towards health care, education, and for carrying out seasonal agricultural work. In addition, the government of the Republic has been ordered to prepare additional estimates on various installations that have already been restored. I am referring to both the current situation and the inadmissibility of constructing installations without including them in the federal budgets and in the federal and regional programmes.

We also examined issues with respect to purchasing agricultural machinery, the possibility of opening Central Bank offices in the Republic and the work within the programme for restoring the Chechen Republic – the Republic’s economic and social spheres – and I am referring to the tasks at hand.

Vladimir Putin (addressing Finance Minister Aleksei Kudrin): Please go ahead, Aleksei Leonidovich.

Aleksei Kudrin: According to your order, before this meeting we also studied the installations that will be restored in the social sphere this year. And we have already prepared proposals that will ensure that all the staff employed by these establishments and all the current expenditures of these establishments will be well provided for already this year. The total sum for health care and education establishments will amount to more than 450 million roubles.

In addition to this, we studied proposals connected with repairing major roads in the Republic and this year an additional 400 million roubles will be allocated to this effect. In addition, we studied the requirements that must be satisfied so that agricultural establishments can bring in the harvest and about 130 million roubles will be allocated for these purposes.

The total volume of the operational expenditures will exceed 1 billion roubles. That is according to the decision that was made in accordance with the order you gave in December and after traveling on location, where we made the decision to allocate and additional four billion roubles. Now, as a matter of fact, we have already managed to fully provide for operational expenditures.

In addition the Republic has raised the issue of replacing furnaces in schools – the ones that have already been introduced and are already working – and now this topic is also being considered. I will look at this tomorrow at the meeting that will take place here, in Moscow, with representatives from the Chechen Republic.

In addition the Republic’s Prime Minister has asked for help in putting the airport back into operation by October 2006. Despite the fact that we are still continuing to coordinate all ministries and departments with respect to the technical possibilities for doing so, work is already taking place. At the meeting we made the decision that this year the budget will provide up to 240 million roubles (this sum is in the process of being determined) to this effect and to make the airport one of the region’s transport hubs.

German Oskarovich [Gref] looked at the other issues concerning the federal target programmes.

Vladimir Putin (addressing Economic Development and Trade Minister German Gref): Please go ahead, German Oskarovich.

German Gref: We coordinated the additional requirements that appeared in the Republic and, in connection with your order, by the end of this year we will have finished analyzing all the rubble that still exists, first and foremost in Grozny. And the preliminary estimates for these figures have also been calculated: by the end of 2006 the amount will be more than 700 million roubles and in 2007 we need to allocate an additional 940 million roubles. We agreed that we will allocate the full amount of these funds and that in the 2007 all the rubble will be liquidated. This is the most significant trace the war has left on the Republic’s territory and in practice by the end of next year this problem should have been eliminated.

We also discussed the mechanisms for implementing and the volumes of financing required for the federal target programme designed to restore the economy and social structures of the Chechen Republic. And next year we have allocated 6,8 billion roubles to that effect. We also agreed during this week (and I will also meet with the leaders of the government of the Chechen Republic this week) on the possibility of allocating additional financial resources so that next year we will be able to resolve basic problems in transportation, with respect to reconstructing social infrastructure, in housing construction, and also eliminate the consequences of the flooding in 2002. This is the task we have set for ourselves.

This week we should finally confirm all the figures, and by the end of this week we will provide for all these expenses in the budget.

We traveled through three cities in the Chechen Republic and I must say that as a whole, the restoration of the economy was visible. It is obvious that the Republic no longer looks as if it is involved in a war. Active restoration, active construction is really taking place and the changes are very significant compared to what we saw a year ago; 30 thousand people are working together and even on the weekends to restore the Republic. And the task that we discussed and that we formulated there is to erase all traces of war, enable Chechnya’s economy to develop independently, and ensure that Chechnya becomes once again an ordinary region of the Russian Federation.

Vladimir Putin: I wouldn’t have wanted to do that earlier, in all likelihood this was not possible; I mean during the active phase of the counterterrorist operation. We have already been down that path: huge injections and then, destruction. For that reason of course it was necessary to first restore a relative safety and then start restoration. But it is pleasant to note that now changes really are visible. And in these cases, as they say, “money is not for nothing”. Therefore I shall ask you to pay the very closest attention to the social and economic restoration – your ministry, and the Finance Ministry, and the government as a whole.

Apparently the decision to grant an amnesty towards people who have up until now been members of illegal armed groups was the right one.

How many people have laid down their weapon recently?

Rashid Nurgaliev: According to the information of the Antiterrorism Committee, already more than 70 people have laid down their weapons. In the last three days it was as follows: on 29 July – twelve people, on 30 July – 7 people, on 31 July – 10 people. In total, 29 people. And not only in the Chechen Republic but also in Daguestan and in the other republics of the Southern Federal District.

Vladimir Putin: We have to speed up the work on those who continue to engage in illegal activities. Just recently at the Antiterrorism Committee I said to [FSB Director Nikolai] Patrushev that work towards ensuring security in the Republic and in all the northern Caucasus should follow the proposals and the plans for the near future made by the ministries and departments.

August 1, 2006, The Kremlin, Moscow