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S.Brilyov: Vladimir Vladimirovich, this year’s Direct Line is somewhat unusual in the sense that it has been taking place for almost as many years as you have been president. We are now on the eve of 2008, an important year. All the same, I would like to begin in the traditional way with the classic question of what events have made the biggest impression on you over the year since the last Direct Line broadcast, and what changes have taken place in our country’s life?

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Vladimir Putin: I will answer your question now, all the more so as it is a traditional question. I have even made some notes so as not to get anything wrong, though by now I already know all these figures by heart.

But I would like to begin our discussion today by congratulating Russia’s soccer team on its victory yesterday. I congratulate all soccer fans and all sports lovers in general on this wonderful victory. I think that the team was greatly helped to victory by the powerful support from its fans in the stadium, by its team spirit and, of course, by the good fortune that follows Mr Hiddink, the chief trainer. This is a wonderful event in our country’s sports life and I congratulate everyone from the bottom of my heart.

Now, what has changed in our country’s life over this last year?

In my answers to this question over these last years, practically every year I have spoken about the positive results achieved. I am pleased to be able to say that I always gave the facts as they were and did not have to invent anything. We have indeed achieved positive results over all these last years, and the current year is no exception. Indeed, the results are even better than we had hoped. The main measure of success is economic growth, the country’s gross domestic product. We are always making reference to this particular indicator. This is because the GDP represents the size of our economy. The amount of economic growth we achieve determines the number of jobs created, the amount of revenue coming into the budget, and the state’s ability to not just fulfil its social obligations such as paying wages and pensions on time, but also to raise these same wages and pensions. The development of the social sector, healthcare, education, and our ability to ensure the country’s defence and security all depend on economic growth.

Last year, we achieved 6.7 percent growth. This is a good result. This year we planned for 6.2 percent growth, but over the first eight months of this year we have already reached a figure of 7.7 percent – considerably higher than the planned figure. This in itself is a good result, but what is even better is that we have finally reached the goal we were aiming at over all these years. This growth, far from being entirely fuelled by raw materials, oil, gas, metals and so on, it is other economic sectors that account for two thirds of it. Which sectors in particular? They include construction, transport, communications, retail, and investment activity. In this respect I would like to point out that investment in main capital has now reached a figure of 25 percent, that is to say growth of 25 percent. Direct foreign investment has increased by even more – 2.5-fold – and comes to $16 billion. As I said, the construction sector is the leader in terms of growth, with an annual increase of 15 percent over the last five years. This is a very high growth rate. This year, the figure will increase to almost 25 percent – 24.4 percent – and growth in the area of housing construction is even higher – 34.5 percent. We could say that this looks now like a genuine construction boom.

The processing sector has grown by 10.3 percent, and growth in terms of machinery and equipment comes to a figure of 25.4 percent.

Russia’s gold and currency reserves have reached record levels, higher than ever seen in either the Soviet or tsarist periods, and now total $424 billion, while the Government Stabilisation Fund now comes to 3.5 trillion roubles.

What impact does this have on our people’s lives and on the real social situation? The main indicator here is wages growth. Last year, wages rose on average by 13.4 percent, and this year by 14.4 percent. But what I particularly want to note is that, although wages rose by 13.4 percent on average last year, pensions rose by only 5.1 percent on average. This year, taking into account the increase that will take place as from December 1, pensions will rise by 21 percent on average. I think that this is a decent result. I want to stress that this is real growth, adjusted for inflation. I do realise that we still have problems to address and I will say more about this later, but this growth is real growth and it does take inflation into account.

What is especially pleasing to see are the changes in the demographic situation. When we discussed our programmes a couple of years ago, there were sceptics who said that no matter how much money invested in demographic projects, they would not produce results because low birthrates are simply the general trend in all post-industrial countries, including throughout Europe. But I nonetheless agreed with those who said that in our country, if the state gave this problem its attention, we could produce results, and this has proven to be the case.

What have we seen over this last period? The birthrate is higher than it has been for the last 15 years and the mortality rate is at its lowest since 1999. Infant mortality has also come down.

Finally, one of the positive effects or positive results of this last year that I would like to name is the reduction in unemployment. Last year, unemployment stood at 6.5 percent, while this year it has dropped to 5.7 percent. To give an idea what this actually means, this figure represents 600,000 people who have found jobs and begun working over this last year.

Of course there are still problems, and some of them are very clear, obvious to everyone in this country. They include rising prices and inflation, which we are unlikely to be able to keep within the target limit this year. We had planned for inflation of no more than 8 percent, but cumulative inflation already comes to 8.5 percent this year, and we still have two-and-a-half months to go before the end of the year. This is a problem that the Government must and will address, of course, and I am sure that we will succeed in resolving this problem too, but we need to take swift action to address it now, increasing people’s incomes, especially pensioners’ incomes.

I have decided to increase the basic pension by 300 roubles as from December 1, and this means that some categories of pensioners will see their pensions increase by 500 or more roubles, but the inflation problem still remains.

Rising prices go hand in hand with inflation. The Government has adopted a whole package of measures that I hope will bring positive results in this area. I think that we will feel the effects of these measures by the end of the year.

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O.Satinko (Vladivostok, Primorsky Region): Satinko, Olga Vladimirovna, a resident of Russky Island.

Vladimir Vladimirovich,

I send you my greetings on behalf of the 7,000 residents of Russky Island.

People in the Far East say that there are two Russias: one is the flourishing Russia that reaches to the Urals, and the other, after the Urals, feels all the isolation of an island. It costs a huge amount of money to fly from Vladivostok to Moscow. A return ticket to Moscow costs 45,000 roubles. But if Vladivostok is cut off from the rest of Russia, we on Russky Island are cut off even from Vladivostok. You cannot imagine just how many problems we have: unemployment, poor roads on the island, healthcare, education – there are many problems. But the biggest problem of all is the link between the island and the mainland. Our life depends entirely on the ferry, and the ferry depends on the weather. Either there’s ice or there’s a storm warning, and we end up running along the coast on the island or on the mainland, trying to get back home or trying to get into work or school. For this reason we are often turned down when we apply for jobs.

We place great hopes on the summit [the APEC summit – ed.] We hope that the summit will take place on Russky Island, in Vladivostok and will at least partially solve our problems. We place great hopes on you, Vladimir Vladimirovich, because you are one of the few leaders in our country who come to see us regularly. Few officials give us their attention. The question that interests us is: what will happen with us after your term in office ends, and will the summit take place in Vladivostok?

Vladimir Putin: I want to say first of all that the situation in the Far East and the Trans-Baikal area is a sensitive issue for the entire country. A total of 1.5 million people have left these regions over the last years and these regions now face a depopulation problem. This is an unacceptable situation and it is dangerous for us. Russia has developed these territories over hundreds of years and we will not allow the situation to degrade there further.

What are we doing to address this problem? First, we have adopted a number of federal programmes to develop the Trans-Baikal and Far East regions. A special commission was established on my initiative and it is headed by the Prime Minister. Officials at every level will therefore be paying the Far East their attention, and this attention will only increase.

Second, the federal targeted programmes for the Far East’s development allocate considerable money from the federal budget – 500 billion roubles over the next 4–5 years. This is a lot of money and we have never previously allocated such sums to any one programme. The issue is not just one of developing links with the European part of the country. The issue is also about, as you and everyone who lives in the region knows, disparities in electricity prices, and in this respect we plan to develop the energy sector in the region itself, develop the region’s gas and electricity resources. Our plans also include creating new jobs above all in the high-technology sectors. We will support the Far East’s traditional industrial sectors. These include aircraft construction, and, as you know, we have the Superjet project, which is moving along well. We will also support shipbuilding. As part of our work to establish a united shipbuilding corporation, the different shipbuilding segments in the Far East will be supported within the framework of the new corporation. We will develop infrastructure, build roads and ports and so on.

Of course, we need to put more thought into how to reduce the dependence of people in these regions on the high cost of plane or train travel. Cross-subsidising in this situation is justified and we will maintain and increase this system. The more fundamental solution is to increase people’s incomes in these regions so that they can afford to travel freely around the country.

I assure you that the Government is aware of this situation and will work hard on resolving these problems. Attention to the problems of the Far East will not weaken but on the contrary will only increase.

Regarding the second part of your question, Russky Island and the APEC summit, it has been decided that the Russian Federation will host the APEC summit in 2012. At the last summit in Australia, I immediately informed my colleagues that if this honour is accorded to us, and the decision has been made now, as I said, we will organise the summit in Vladivostok. A Government commission, together with the regional authorities, has decided that the summit’s central events should take place on Russky Island. This will require building at least one bridge and maybe even two bridges to link the island with the city of Vladivostok.

I have no doubt that this will improve the employment situation and create new jobs in Vladivostok and in the Far East in general. It will contribute to the region’s development. These kinds of events are important, of course, but their greatest importance is that they serve as a magnet for attracting investment, both domestic and foreign investment. This is a good signal and it will be given.

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Question (Vladivostok, Primorsky Region): Hello Vladimir Vladimirovich, my name is Vladislav and I am a student.

You have approved a programme for resettling Russians from abroad in regions where they are most needed. I know the Far East is just such a region, but for the most part it is not Russians from abroad returning to settle here but our nearby neighbours, people coming in from the neighbouring countries.

Then there is also the problem of how to encourage the people already here to stay here. I, for example, am in my second year of studies and am specialising in finance. I know that most of my fellow students plan to move west once they graduate, to Moscow or St Petersburg, or they plan to go abroad. I don’t want to leave my region, but at the same time, I know that it will be quite hard for me to find work here once I graduate.

Thank you very much.

Vladimir Putin: Vladislav, I also do not want you to leave, not you nor your fellow students or anyone living in the Far East in general.

As I said before, the federal budget is allocating funds for infrastructure development and the creation of new jobs in the region, and I am sure that these programmes will be carried out.

There is indeed an outflow of people from the region, unfortunately, but I hope that the programmes I have mentioned will help not only to stabilise the situation but also to encourage people to move into the region.

Regarding the resettlement programme, we have indeed adopted a programme for resettling Russians from abroad. I cannot say that it has been so very effective so far. The pilot regions that will receive federal allocations for carrying out this programme include practically all the regions of the Far East and Trans-Baikal area: Khabarovsk, Primorsky, Magadan, Amur Regions and so on. There are 12 regions in total, most of them in Eastern Siberia and the Far East.

Under this programme, the regions concerned will receive the funds needed for the resettlement of Russians from abroad. What kind of funds are we talking about? I do not remember the exact figure but I think it is an initial sum of 60,000 followed by a monthly benefit if the people who have resettled do not have a permanent source of income. There is also administrative support for all procedures, customs procedures, moving costs, all the paperwork and so on. This is a social benefit package that also covers school and kindergarten education and so on. It is not a large sum of money but it does provide real support, and for people coming from the former Soviet republics it can be a considerable help. But this is not all the programme involves.

People who come to settle permanently in the Russian Federation and wish to become citizens of our country need jobs and housing, and this is the second component of the programme. This second component is the regional authorities’ responsibility. Through joint efforts by the federal and regional authorities we can obtain the necessary synergy and produce the necessary results.

In this respect, I want to call on the regional officials in the Far East and Eastern Siberia. We have not yet seen particular enthusiasm on their part. It is a lot easier to bring in people from, China, say, have them carry out whatever work needs to be done and then send them back home again. This is a fair enough solution to immediate problems. Incidentally, the experts say that the number of foreign citizens in the Far East does not exceed the critical level. But we nevertheless have to think about how to stabilise our own population in these regions, and this is work that we will most definitely carry out.

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A.Tkachenko (Vladivostok, Primorsky Region): Good afternoon, Vladimir Vladimirovich. My name is Alexander Tkachenko and I am also studying finance. I am in my third year. What worries me is that, after the APEC summit takes place here, our city could end up seeing resources concentrated in criminal activities? I say this because I know that there are plans to open some kind of gambling zones, something related to this kind of activity, but overall, how will the facilities built here be used?

Vladimir Putin: Regarding the gambling zones, you have no doubt heard of the decision made with regard to this sector of activity, namely, that gambling activities in Russia should be permitted in four regions only. The regions are now competing vigorously in the Government to obtain the right to open such a zone on their territory. Why such stiff competition? Because experts forecast that opening a gambling zone on this or that territory will bring significant revenue into the regional budget, and this in turn creates added opportunities for resolving social and related problems. If the budget has money, solutions can be found, but if there is no money, the region is forced to turn to the federal authorities and ask for subsidies. Opening a gambling zone is a very attractive prospect therefore from an economic point of view. Of course, it depends on the local and regional authorities to ensure that this is done in a civilised fashion.

The Government is to decide very soon on the framework for defining the boundaries of these zones. The choice of actual location for the zone is your governor’s decision. If the regional authorities are opposed to the idea, the zone can be moved to a different location all together. But I assure you that given the economic attractiveness of establishing such a zone, no one is likely to turn down the opportunity.

You are right in that gambling often goes hand in hand with criminal activities, but as I said, it is the responsibility of the local authorities above all to ensure that these zones are organised in a proper and civilised fashion.

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A.Sibert (Novosibirsk): Mr President, I want to ask a question that is no doubt of interest to many Russians. In an interview not so long ago, former U.S. Secretary of State Albright said that it is not fair that Russia alone should have control over Siberia’s colossal natural wealth. My question is: what consequences can such statements have, and what is your view of such statements?

Thank you.

Vladimir Putin: This is an unexpected question, but I understand that it is an issue of concern, especially for everyone actually living in Siberia.

I am not acquainted with this particular statement by Mrs Albright, but I know that some politicians do share these ideas. I think such ideas are a sort of political erotic fantasy: they procure a certain pleasure, perhaps, but are unlikely to ever produce positive results. The events in Iraq provide the best illustration. There we have a small country with little ability to defend itself but with enormous oil reserves. And what is happening there now? We can all see with our own eyes that they have learned how to shoot there but have not had such success in bringing order to the country. And it is unlikely that they will be very successful because fighting the local population is always a losing prospect. It is possible to overthrow tyrannical regimes, such as that of Saddam Hussein, for example, but there is no future in waging war against the people.

Russia, fortunately, is not Iraq. Russia has enough means and strength of its own to be able to defend itself and protect its interests both at home and in other parts of the world. These kinds of statements by Western politicians only serve to confirm that the work we are undertaking to improve our defence capability and strengthen our armed forces is the right choice, and we will continue this work.

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R.Melikhova (Novosibirsk): I am Raisa Melikhova, a design engineer at a research and design bureau.

Prices are rising. The rise in prices has been especially noticeable over the last month. In the shops I see that the prices of the goods on the shelves have almost doubled. This is a big burden for people like me who work in the public sector, not to mention for pensioners. My question is therefore, what will happen with prices over the coming months, and what is the Government doing to stabilise prices and prevent them from rising further?

Vladimir Putin: Yes, I also spoke about this, and you no doubt heard that I asked the government to pay attention to these rising prices.

Why are prices rising? Above all, this is because our country has become part of the world economy and everything that happens on world markets has an impact on us. We import a great many foodstuffs from Europe, but Europe has recently ended a lot of its agricultural subsidies and this has pushed up prices there by 15–17 percent. The increases in Europe have in turn pushed up prices here by 25 percent and in some cases, such as sunflower seed oil and a few other goods, by as much as 40 or even 60 percent.

We also have to look at what is happening in the global economy. Demand for alternative energy sources, bio-ethanol, for example, has increased, and this means that grain crops are also being used now for producing fuel that serves as an alternative to gas and oil. The volumes are not great as yet, but this increasing demand has already led to rising prices on this market.

What is the government doing to address this issue? What measures is it taking?

First, it is intervening on the market by drawing on grain reserves.

Second, it has increased export duties on grain in order to keep supplies here on the domestic market. It has also lowered import duties for some foodstuffs coming into Russia, in particular milk and dairy products, but we are proceeding very cautiously in this area so as not to undermine our own agriculture sector.

I know that people in the rural areas are probably also listening. Rising food prices are not good for people in the cities, but for agricultural producers they have a positive effect, and people in rural areas are no doubt afraid that we might lift all the barriers and they will end up having to sell everything they have produced at bargain-basement prices. These are all very delicate operations and I hope that the Government will make the optimum decisions.

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Igrikov (Aktau, Kazakhstan): Russia and Kazakhstan share a common history. We have good relations, our presidents and peoples are friends with each other and we have no unresolved problems.

I see that you meet regularly with our President. You met with him recently in Novosibirsk and just a few days ago in Iran. I hope that you will also hold a meeting here, on the banks of the Caspian Sea, where we are building Aktau City, the city of the future.

I would like to see our two countries become even closer friends. What does the President of our neighbour think of this idea?

Vladimir Putin: Good afternoon once again. Since we are now talking with people outside our own borders, in our friendly neighbour, Kazakhstan, I would first like to send my very best wishes to everyone in Kazakhstan and send my warmest greetings to my friend, President of Kazakhstan Nursultan Nazarbayev.

Regarding our cooperation, the Kazakhstan leadership and the President of Kazakhstan have really been the driving force behind integration in the post-Soviet area. Much that has been achieved so far in terms of integration projects has been at President Nazarbayev’s initiative. At the recent Eurasian Economic Community summit in Tajikistan we made an important decision that we hope will have significant benefits for our economies and our peoples. We agreed that Belarus, Russia and Kazakhstan will establish a Customs Union on the understanding that the other members of the Eurasian Economic Community – Tajikistan, Kyrgyzstan and Uzbekistan – will join the union as and when their economies are ready. What does this mean in practice? Under the terms of this agreement, we will, for the first time in the post-Soviet area, establish a supranational body to regulate tariffs. This is a direct step towards creating a genuine union in the interests, above all, of making our economies more competitive. Ultimately, this will lead to the merger of entire sectors and to greater cooperation between individual companies, and this will all have benefits for people’s lives.

Regarding the border areas, they account for approximately 70 percent of our countries’ bilateral trade growth over these last years. A lot depends on the people who live in these border regions. I want to wish everyone success. Thank you very much.

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Y.Gerasimenko (Aktau, Kazakhstan): Vladimir Vladimirovich, unlike in the Baltic states, we have no problem with the Russian language here in Kazakhstan. We can study and speak the language here without problem. But what is Russia doing to promote the Russian language in the former Soviet republics, and to support Russians abroad in general?

Vladimir Putin: Support for the Russian language as a means of international communication is one of the most important areas of our work. For Kazakhstan this has particular relevance. My data might not be exact, but I think that the figures I have are close to the truth: 85 percent of the population in Kazakhstan speaks Russian. This is a huge number.

Kazakhstan’s leadership is indeed doing all it can to support this state of affairs and promote the development of the Russian language and its influence on cooperation between our countries. True, we have seen a certain reduction in the number of schools teaching Russian of late, due to technical reasons, I think. I think this is perhaps linked to insufficient literature in Russian, a shortage of textbooks. We are aware of this problem. Again, I am not certain that my figures are exact, but I think we sent around 23,000–25,000 textbooks to Kazakhstan last year, and this year we are sending more than 33,000 textbooks. I know for certain that the Government plans to expand cooperation in this area.

We have even established a special organisation, Russian World, to support the study of Russian abroad, above all in the former Soviet republics, of course. We will continue to give this matter our every attention, including in Kazakhstan, given the huge number of people there who consider Russian their native language.

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G.Barakin (question by telephone): Hello, I am retired Lieutenant-Colonel Gennady Barakin, and I live in the village of Balasheika in Syzran District.

I am sure that my question reflects the interests of many military pensioners: will military pensioners be paid the debts owing to them for pension arrears between January 1995 and February 1998? Thank you.

Vladimir Putin: Your question has been raised on many occasions by military pensioners. Indeed, military servicemen’s wages were indexed in 1994–1995, and in accordance with the legislation in force, military pensions were also to be indexed immediately. This did not happen. I will not go into the reasons for this now, but I think that decision was unfair and justice should triumph.

At the same time, the bureaucratic problems encountered have not made it possible to settle this issue. In order to put an end to these bureaucratic obstacles, I will take the simple but radical decision of issuing a decree obliging the Government to resolve this problem by the end of the year.

I know that this will require an additional 40 billion roubles. We have this money. We need to settle this matter and we will do so in the nearest future. This will concern not just the arrears for 1995 but also the debts still owing from 1994. I promise you that this decree will be issued soon.

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Not only will we pay this money owed by the state, but we will adjust these payments accordingly to take into account current military pensions. In other words, military pensioners will receive payments adjusted to take into account the pension increases carried out over these last years. They will receive the money for 1995–1998, and the according coefficients will be applied to ensure that they receive in full the lost income for these years. That is what I wanted to add regarding the matter of military pensions.

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S.Brilyov: There are two questions that should probably be discussed. One comes from Moscow, and we now have Moscow on line. The question is: what do you think of the idea of holding Children’s Olympics in Moscow?

Vladimir Putin: I support it. I think that any competitions, especially for children, for boys and girls, are a very positive thing. Moscow has shown a lot of initiative, including by holding children’s and youth games for the CIS countries. This is a very good initiative by Moscow’s mayor, Yury Luzhkov. Moscow and the Moscow Region are doing a lot to build modern new sports facilities and I have no doubt that Moscow is already practically ready to hold these events. Moscow has been essentially the initiator of the Junior Olympics. We presented this idea to the International Olympic Committee, which then took the idea under its own flag and is now carrying out the work to select the city to host these games. We will naturally support Moscow’s efforts.

S.Brilyov: I am sure that we will return to Olympic matters today. Now we have another question that has come in by SMS and concerns a completely different but no less important subject: “Vladimir Vladimirovich, why did you go to Iran, after all, you were under threat there?”

Vladimir Putin: This visit was already planned a long time ago. The summit of Caspian nations was taking place there, bringing together the five countries of the Caspian region: Russia, Kazakhstan, Azerbaijan, Turkmenistan and Iran. Russia has an interest in settling all of the problems the Caspian countries encounter in order to ensure that the Caspian’s resources are used in stable, predictable and civilised fashion and on a long-term basis. To be fair, we have already settled our relations with our nearest neighbours, Azerbaijan and Kazakhstan, but we want to reach a comprehensive settlement regarding the Caspian. This was the main motive behind continuing these discussions and building up friendly working relations with all of the Caspian countries. We have taken the necessary steps in this direction through our work together, needed and useful steps, and I am very pleased by this.

Concerning our relations with Iran, we all understand that Iran and Russia have always been close neighbours, and we will continue to develop good-neighbourly relations with this country.

In some areas, cooperation in the energy sector, for example, in oil and gas, electricity and nuclear energy, we are without any doubt very important partners to put it mildly. This creates a need to discuss all the relevant matters at the very highest level.

Of course, we are all aware of the Iranian nuclear issue. Russia is working together with the other members of the international community to help find peaceful solutions to this problem in the interests of the entire international community and of the Iranian people. This was also an important part of our talks.

Regarding the threats that were made, I think this was no more than an attempt to prevent this visit from going ahead. I think this is detrimental for international communication because direct dialogue, direct contact between the leaders of countries that are encountering problems is always more productive and a quicker road to success than a policy of threats, sanctions and even more so using the pressure of force.

S.Brilyov: So this is why you dismissed the threats of an assassination attempt so lightly in Wiesbaden? When was that, on Monday?

Vladimir Putin: Yes, that is why I dismissed these threats.

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L.Kulkova (Yekaterinburg): Hello Vladimir Vladimirovich, I am Larisa Ivanovna Kulkova, a history teacher.

Our region, the Urals region, has always been Russia’s reliable support base. Our country’s history shows just what an important part our country has played in forming and developing our state. But few remember this now. As a teacher, I am worried about this negligent attitude towards history, especially among young people. There are a mass of shocking examples of historical ignorance.

Vladimir Vladimirovich, do you not think that the state should pay greater attention to the problem of attitudes towards history here in our country, whether the history of our individual regions or that of the country as a whole? If we do nothing to address this problem, we risk turning into people who don’t remember their own roots, and life has given us enough examples to show us just how potentially dangerous this can be for the country.

Thank you.

Vladimir Putin: Larisa Ivanovna, you teach history?

L.Kulkova: Yes.

Vladimir Putin: That explains why you have a professional as well as a civic interest in this problem.

I fully agree with you. I also love history. We all know that just recently you could open a textbook and read things, especially about the outcome of World War II, that made your hair stand on end, but there have been positive changes in this respect of late.

I met with history and social sciences teachers just recently, with scholars working in these fields, and they formulated some very good proposals on what we can do to improve the situation, not by imposing a state point of view, but by giving young people above all, and all people in our country, the chance to learn about all the different points of view on this or that issue, while providing an objective view of history and of our people’s acts and accomplishments.

I think this is an extremely important area of our common work. In order to ensure the necessary quality in this work (you no doubt know that the relevant decision has been adopted in law) the Education Ministry will play a greater role and will be able to provide expert evaluation during the preparation of textbooks. I hope that this will have a positive impact.

<…>

K.Vlokhov (Yekaterinburg): Konstantin Petrovich Vlokhov, lathe operator.

Vladimir Vladimirovich, there has been a lot of talk of “Putin’s Plan, Russia’s Victory” of late. Could you tell us what your plan is all about?

Thank you.

Vladimir Putin: Konstantin Petrovich, when I spoke at the United Russia congress, I said that I did not think it right to personify this plan, because it is really the product of work carried out by experts at all levels. This plan is the result of work done by experts in both houses of the parliament, and in the Government. This plan is set out in my Annual Addresses to the Federal Assembly. It is one of my duties to make these annual addresses.

Over these last years I have taken as the main theme social development, strengthening the armed forces and improving defence capability and security, international relations, and economic development. Medium- or long-term programmes have been drawn up for all of these different areas, and I consider that all of this together provides a strategic plan for the country’s development.

One of the issues we have been discussing now is the demographic situation. As you know, as part of our efforts to resolve this problem, we have decided to institute what has been called the maternity capital. This is a programme that will be carried out over a ten-year period, an example of an absolutely concrete programme with funding calculated for ten years ahead.

Or take rural development, for example, another area in which we have adopted a rural development programme that will be implemented over the next several years. And then there are the armed forces, where we have a programme for modernising arms and equipment over the period through to 2015. All of these different programmes are components of the strategic national development plan. The fact that people have decided to personify this plan and link it to the current President can be put down to campaign tactics in the run up to the parliamentary election, but the plan itself is real and the country needs it, and I am sure that if we implement it consistently, we will succeed in making serious progress in our development.

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G.Stafeyev (Yekaterinburg): Gleb Nikolayevich Stafeyev, senior craftsman.

Vladimir Vladimirovich, I am very concerned about our relations with our neighbours, especially with Ukraine. What is the outlook for our relations with Ukraine, all the more now that elections have taken place there?

Thank you.

Vladimir Putin: Developing our relations with the former Soviet republics is one of our main foreign policy priorities. The extent of our trade and the depth of our cooperation is such in some economic sectors that if our work together were to suffer in these areas entire production sectors would find themselves at a standstill. Furthermore, there is a high level of interdependence in agriculture and in defence. That is not to mention the millions of our citizens who have direct ties with friends and family in these countries. According to the statistics, up to 17 million ethnic Russians live in Ukraine, while some four million Ukrainians live in Russia, whether permanently or temporarily. In other words, the relations between our countries have a direct impact on the welfare of millions of Russians and Ukrainians. We will give this matter our closest attention. Of course, relations between our two countries should be built on a modern and pragmatic basis that takes into account each other’s interests.

Our cooperation in the energy sector, for example, should be based on market principles. As I have said on many past occasions, we have provided subsidies to the Ukrainian economy in the form of cheap energy prices totalling $3 billion-$5 billion a year over the last 15 years. No other country in the world has probably provided Ukraine with such support.

But we will ensure that the transition to market relations is gradual and takes place in a friendly atmosphere, so as not to be to the detriment of our Ukrainian partners, all the more so as we too are making the transition to market price formation here on our domestic market.

As for political cooperation, I hope that whatever the future government in Ukraine, whatever its political platform, the objective reality will encourage our partners to develop cooperation with the Russian Federation. We seek such cooperation and will do everything we can to encourage it.

<…>

S.Peshkov (Podkolodnovka Village, Voronezh Region): Peshkov, Sergei Petrovich, chairman of Krinitsa Agricultural Cooperative.

The state is doing what it can today to provide us with material assistance, but this is clearly insufficient. You already mentioned that our country will soon join the World Trade Organisation, and, under this organisation’s rules, the subsidies the state provides us will either drop dramatically or will be abolished altogether.

But how are we supposed to survive in such conditions? We are being asked to open up our market, but then we will be flooded with a lot of food products, some of which are of dubious quality, and what are we, the farmers, supposed to do?

Vladimir Putin: Sergei Petrovich, you noted yourself that the state is making an effort to support agriculture. There is probably never enough support.

<…>

Although there are entire programmes that have been drafted and are being carried out in various regions of the country.

Regarding support for agriculture in general, you probably know that this covers taxation, above all, tax preferences, the consolidated agricultural tax, and it also covers rural development, the area in which we have adopted an entire programme. It also covers support for young families, above all in rural areas, helping them to obtain housing by subsidising up to 40 percent of the cost through various financing sources. And then there is also the implementation of a balanced customs policy. You have probably heard about the decision to introduce import quotas for foodstuffs. Unfortunately, our producers are not yet able to cover all our needs, as can be seen by the rising prices for foodstuffs in the big cities. We have to address this issue too, and this is why we have been forced to lower the import duties on a number of foodstuffs.

Look at what the state has done over these last years to resolve the issue of subsidised interest rates for loans. The number of agricultural enterprises obtaining loans has hit record levels over these last years, and this has boosted growth in livestock and some other segments of the agriculture sector.

As for the potential dangers in Russia’s accession to the WTO, I have already said in the past that Russia will join the WTO only on conditions that are acceptable for our country and for producers in various sectors of our economy, including in agriculture. Our negotiators have negotiated just such conditions. This covers agricultural subsidies too. In Europe, the decision has been taken to reduce agricultural subsidies, and they are ultimately to be phased out altogether. We have already negotiated a transition period for Russia, quite a long transition period, during which the Government will retain the right to subsidise agriculture.

All of these different measures should ultimately develop our country’s agriculture and create an environment of healthy competition, and, of particular importance, give our producers the chance to take their products to the world market. This year, we had a grain harvest of 78 million tons, I think. This is slightly less than last year but it is still enough for us to be able to export around 10 million tons.

One other circumstance that I already mentioned today is that there is growing demand in the world for bio-fuel. What is this? This is the use of various crops to produce alternative fuels to oil and gas. There are not so many countries in the world that can supply these crops, but one of the potential suppliers is, of course, Russia with its vast territory. In this respect, our rural population will eventually find themselves taking over the niche occupied by our oil and gas companies. Surely this is a good prospect? I think that if we work carefully and keep close watch over our interests, we will be able to achieve positive results, including in our accession to the WTO. But as things stand at the moment, we have still not joined the WTO and are still engaged in accession talks.

<…>

A.Tishchenko (Podkolodnovka Village, Voronezh Region): Vladimir Vladimirovich, I sell my milk for 8 roubles a litre, and in the shops it sells for up to 30 roubles a litre. Why such a big difference? After all, the producer’s job is much tougher than that of the processing company.

Thank you.

Vladimir Putin: Yes, I agree with you and we are aware of this problem. It is not easy to address this problem, but there are some things we can do. What this problem suggests is that the companies buying up the milk in many localities and regions are acting in monopoly fashion, whereas what is needed is for the companies that do the buying up and the wholesalers to offer their services on a market basis. It is with regret that I say this, but to a large extent, the reason why the system is working as it is, is because officials at various levels, especially at local level, support these monopolies or see them as their own. Addressing this problem requires them to put in place market conditions rather than offering protection to those with whom they have established special ties. This is the most important step towards resolving this situation. This is an issue the governors, above all, should be paying attention to. They know what I am talking about and it is their duty to take the necessary measures.

The second issue, of course, is that of price mark-ups. In one and the same small town, price mark-ups on products differ considerably, sometimes by up to 40 percent or more, and this is also something the regional authorities need to monitor.

<…>

S.Semyonov (Plesetsk, Archangelsk Region): Hello Vladimir vladimirovich, hello Katya, hello Sergei.

The Plesetsk Space Launch Centre, where we are right now, is the northernmost space launch centre in the world. It is celebrating its fiftieth anniversary this year. Over these years, it has launched around 2,000 spacecraft. The launch facilities here also launch ballistic missiles.

This morning, a military-training launch of a Topol ballistic missile took place, and, as an exception, our TV crew was allowed to go as close as possible to the launch facility. Now our viewers can see for the first time just what the launch of a Topol missile looks like from a distance of only 400 metres. Around 20 minutes later, the missile hit its target at a test ground in Kamchatka.

Here now are officers who took part in the launch. The ones in the blue uniforms are on military duty, and there are also soldiers and officers here in their everyday uniforms, people who are off duty today and have come along.

Of course, everyone has a lot of questions. Please, put your questions to the Commander-in-Chief, but don’t forget to introduce yourselves.

Polunin: Comrade Commander-in-Chief, I am Colonel Polunin, head of the test department.

For us who carry out the tests of our equipment, it is always pleasing when we see it not only on display at exhibitions but also being delivered to the troops. How quickly will the programme to modernise the armed forces’ equipment take place?

Vladimir Putin: First of all, I would like to congratulate you all on the successful launch. I think that servicemen know…

Voices: We serve the Fatherland!

Vladimir Putin: Thank you. I suppose the journalist present perhaps does not know all the details, but as far as I understand, the missile launched today was a Topol-M missile rather than a Topol, is that so?

Polunin: No, it was a Topol missile that has had its service life extended, comrade Commander-in-Chief.

Vladimir Putin: I see. But we know that the Topol-M missiles are now being commissioned by the armed forces. And we will give our attention not just to the nuclear triad – the strategic missile forces, strategic aviation and the nuclear submarine fleet – but also to other types of arms.

We have adopted an arms programme through to 2015 that provides for the development of all the different branches of the armed forces. This concerns aviation too. As you know, we have started delivering Su-34 attack aircraft to the armed forces. The numbers are not large as yet, but these aircraft are of the highest quality and are world leaders in their sector. I hope that by 2012 or 2015, we will have developed a new generation attack aircraft ready to be commissioned by the armed forces.

We will develop missile technology, including entirely new strategic systems, not just the Topol system with multiple warheads, but also completely new systems. I have already spoken about this on many occasions. Work is progressing well.

We will also pay attention to high-precision weapons. Tests have been conducted and I was present for one of them. Tests have been conducted from on board strategic aircraft, from the Tu-160. We will modernise these aircraft, just as we will modernise the Tu-95. The Iskander-M attack system is already being delivered now to our ground forces.

We will also pay attention to intelligence, communications and electronic warfare equipment. And we will also pay attention to the soldiers in the potential field, to ensuring that their operations are as effective as possible and that they themselves have maximum protection.

We are also developing the navy, both surface vessels and submarines (you are with the missile forces and are not sailors, but you know what nuclear submarines are all about). Work on the Yury Dolgoruky submarine will be completed this year. It is already in the dry dock and tests in the water will begin soon. Work is continuing on the nuclear submarines Vladimir Monomakh and Alexander Nevsky. In 2008, we will begin work on another strategic nuclear submarine.

As you can see, our plans are very ambitious indeed, but they are also absolutely realistic and I have no doubt at all that we will carry them out. Our armed forces will be compact but effective and will provide our country with a reliable guarantee of its security for many years to come.

<…>

Stranatko (Plesetsk, Archangelsk Region): Head of the launch group Major Stranatko.

Compulsory military service is currently 18 months. This is to be reduced to one year starting in January 2008. How can a year be enough to master technology and equipment as complex as ours, in the space forces? Will this not lower the level of combat preparedness in the armed forces?

Vladimir Putin: Comrade Major, I can give you my assurance, but I am sure that you yourself know well enough the soldiers doing compulsory military service and do not let them handle the kind of complex equipment that is under your command.

The reasons for reducing military service to one year are: first, ensure that there is a sufficient supply of young people for the national economy and, second, combine this shorter military service with pre-military service training. We are currently drawing up a whole programme for working with young people before they reach military service age. As for service in units where special training is necessary, units involved in high-technology areas of military activity, these units should be manned primarily by contract soldiers. Indeed, some kinds of equipment should be serviced only by officers. We are aware of these circumstances and will ensure that this is indeed the case.

The reduced military service period will also mean that young men doing their military service will not be sent to ‘hot spots’. Only professionals will work in such zones. This is also a very important part of military reform.

<…>

Kuzyaev (Plesetsk, Archangelsk Region): I want to ask you a question on behalf of all Russian soccer fans. We all watched the soccer match yesterday, and it was a fantastic game that gave us all a real boost.

I would like to know what were your personal impressions of yesterday’s match?

Vladimir Putin: I congratulated all the fans and the team members at the start of this broadcast.

My friends and I managed to watch only parts of the match yesterday and not the whole event, unfortunately, because I was preparing for today’s work and had to look through a large amount of documents and statistics, though I was keeping one eye on the TV screen. I liked the match.

I think that our team won thanks to its team spirit and the high level of professionalism of the trainer, the chief trainer, and also thanks to the support that was felt all around the country and in the stadium itself. This support was clearly visible. I think that we should try to keep this winning mood in the future.

<…>

Question by telephone: My name is Andrei Sosnin and I am an ambulance driver in Moscow. Whenever we get called out or are driving patients to the hospital, we always run into the most awful traffic jams and also plenty of rude drivers. But people’s lives depend on how quickly the ambulance can get through.

What interests me then is what will be done to resolve the traffic jam problem in the big cities?

Thank you.

Vladimir Putin: Andrei, as far as the big cities are concerned, the only solution is infrastructure development. You know that in Moscow this involves the construction of ring roads, various overpasses and tunnels. To be frank, a lot of work has already been done. The roads bear a high burden, there is a lot of traffic to deal with and it is not always possible to resolve everything effectively and quickly, but the Moscow city authorities are working hard on these issues.

As for the problem of rude drivers, breaking the road rules and so on, this depends more on general culture. The way drivers behave on the road is directly linked to the way they behave in general. Of course, the laws also need to react to what is happening in real life. The decision was taken recently to toughen the penalties for breaking the road rules. Let’s see how this will be enforced in practice and how well it will actually work. Depending on this, we will take additional steps if needed.

<…>

A.Nurutdinov (Question by telephone): This is Andrei Nurutdinov. My question is: the Americans do not even hide the fact that they began the war in Iraq and in Afghanistan in order to get control of these countries’ oil reserves, and now they are gradually withdrawing their troops from these countries. What consequences could this have for Russia?

Thank you.

Vladimir Putin: Afghanistan does not have oil reserves, so that is a separate case.

As for Iraq, I agree that one of the aims pursued, in my view, of course, was to gain control of that country’s oil reserves.

Somewhere in the middle of this broadcast I said that there are some whose minds have become inflamed with this idea of getting their hands on Russia’s resources, including in Siberia. We see what is happening in Iraq and see that this policy does not bring results.

As for the possible withdrawal of international contingents, including the American contingent, from these two places, the burden for countries, especially for European countries, with military contingents in Afghanistan is great. This is a material burden and also a considerable moral and political burden. Russia is doing all it can to support these countries that are trying to stabilise the situation in Afghanistan. For the first time in our history we have allowed NATO countries to use our country as a transit route for military cargoes and personnel. We help by providing information and we are examining the possibilities for economic participation in helping to rebuild Afghanistan. We are in constant contact with Afghanistan’s leadership and there are good prospects in this respect.

As for Iraq, I agree with the President of the United States and think that he is absolutely right when he says that the international contingent can withdraw from Iraq only once the Iraqi leadership is able to ensure a stable regime in the country. The difference in our approaches is that the Americans think that a deadline for withdrawing the foreign troops on Iraqi territory should not be named, while I think that a deadline should be named, because so long as the Iraqi leadership feels that it is protected by America’s umbrella, it will not be in such a hurry to develop its own armed forces and law enforcement agencies. But once they know that there is a countdown to the deadline, after which the American guns will be gone, I think they will make an effort to work more effectively and consistently and show more resolve in strengthening their own armed forces. But it is absolutely unacceptable to keep an occupation regime in place there forever.

<…>

Question by telephone: My name is Svetlana. I am a first-year student from Yekaterinburg. I am studying in an institute that does not have facilities for wheelchair-users. Also, there are not enough traffic lights for blind people in our city. What can be done to address these problems?

Thank you.

<…>

Vladimir Putin: Unfortunately, not much has been done so far by way of adapting infrastructure, above all city infrastructure, for people with disabilities in order to ensure that they can lead a normal life. Now, the appropriate changes are being made to various standards, above all technical standards, and urban development plans are increasingly taking into account the needs of people with disabilities.

Recently I had the chance to inspect new vehicles — buses and trolleybuses – and I was pleased to see that manufacturers are not just producing modern vehicles but are ensuring that they can be used by people with disabilities. These vehicles are fitted with all the necessary equipment. As for the issue of traffic lights and other infrastructure, you are right, unfortunately – little has been done. But we will work hard to develop this infrastructure.

<…>

Y.Andreyeva: We are now on line with a district centre that became famous throughout the whole country and around the world after local people formed a people’s militia to fight the terrorists led by Basayev and Khattab. We go live now to Dagestan, to Botlikh, where our correspondent Ilya Kanavin is at work.

Ilya, hello, the floor is yours.

I.Kanavin: Hello Vladimir Vladimirovich, hello Yekaterina, hello Sergei.

Behind me, on the other side of the mountain, is Georgia. On the opposite side is a mountain you can’t see, unfortunately, and that is where Chechnya begins. We are up here in the mountains, up amongst the clouds, and the beauty of these places is really indescribably.

People in Dagestan say that Botlikh is not just a place name but a moral category. In 1999, people rose up to fight off a bloody and barefaced attack by Wahhabites. People remember here at what cost they stood up for themselves, and they also remember that you came here back during those tragic days.

Here today are people from Botlikh and also from the surrounding villages. We will give them the chance to speak with the President, but the commander of the motorised rifle mountain brigade has convinced me that he has something to say to the Commander-in-Chief, so I will give him the floor first.

Sokolov: Comrade Commander-in-Chief, I am Colonel Sokolov, commander of the 33rd motorised rifle mountain brigade. I wish you health!

Vladimir Putin: Good afternoon.

Sokolov: Comrade Commander-in-Chief, in accordance with your decree of June 2006, the 33rd motorised rifle mountain brigade was formed in the Botlikh District of the Republic of Dagestan in the North Caucasus Military District. The formation of this brigade will be completed by October 25 this year. The brigade now has all the arms, military equipment and material supplies it needs to carry out its missions. The infrastructure is all in place. A general school and a kindergarten opened their doors on September first.

Comrade Commander-in-Chief, Colonel Sokolov has completed his report.

I.Kanavin: Do you have a question for the President?

Sokolov: Yes.

Comrade Commander-in-Chief, our unit includes servicemen who are contract soldiers, people who have decided to devote their lives to serving in the Russian Armed Forces, but unlike the officers and warrant officers, who have service housing, they cannot bring their families here, and this forces them to have to choose between their service and their families. What plans do you have for resolving this problem?

Vladimir Putin: Before answering your question, I would like to greet all the residents of Botlikh. I remember my visit there and I remember quite a different picture. Rather than being met by well-dressed women and children and quiet, dignified elders and men, I found myself surrounded at that time by people with guns in their hands.

I remember the part Botlikh played in resisting the attack by international terrorists and Wahhabites. People of their own accord, without any call from outside or from the federal authorities, took up arms in defence of Russia’s interests and their own homes.

What really made an impression on me was that when the federal troops did arrive, the elders asked the unit commanders why they did not fire on the villages occupied by the terrorists. The answer was also unexpected. Our officers said that they did not want to damage the villagers’ homes. Building a home up in the mountains is hard work. Families work on their houses for generations. But the elders’ reply surprised me even more. “Don’t pity our homes”, they said. This was an example of exceptional patriotism, an example of not just local Dagestani patriotism but of national patriotism.

We also remember other towns where people showed just as much heroism, the Tsumadinsky District, for example. Now we have stationed a mountain brigade there and this is part of the work to develop the armed forces. We had all but lost these kinds of units with their special equipment and training, but they are part of the defence of Dagestan and Russia’s southern borders in general, and they protect above all the security of the people living in these areas. We remember how back in 1999 it took more than a day for marines from Kaspiisk to reach the area, while now we have troops stationed right here. But I want the development of the mountain brigade’s facilities and infrastructure to go hand in hand with infrastructure development in general in the Dagestani villages themselves, with the construction of new roads, schools and hospitals. I know that some work has already been done, as we agreed. And if not everything has been done, I promise you that we will complete all of this work.

I also hope that relations between the servicemen and the local population will be the best possible, not just friendly relations but fraternal relations, and I very much ask the local population to support our servicemen.

Regarding your question about the contract soldiers, yes, it is true that during the first three years of contract service, servicemen cannot benefit from the preferential military mortgage loan system, but they gain this right when they sign their second contract. This was done to encourage people to continue contract service.

With regard to contract servicemen who have families and who are sent to serve in remote areas where it is assumed they are not going to have permanent housing, the only possible solution is to build new family hostels or houses with small but comfortable apartments that would be made available to servicemen as service housing. There are examples of this kind of accommodation and money is being allocated for these purposes. This is the work of the relevant ministry itself, the Defence Ministry. This is how the border guards, for example, deal with this issue. True, the border guards have fewer servicemen to make arrangements for, but I think that their experience could serve as a model for the Armed Forces too.

Question (Botlikh, Dagestan): Good afternoon, Vladimir Vladimirovich!

Haybulla Ahmedalievich Haybullaev from Botlikh.

In 1999 we fought the militants lead by Basayev and Khattab with hunting rifles, and some of us were unarmed. You could say that we were part of the militia then, but our status, the status of militiamen, is not fixed by law.

Ilya Kanavin: You fought then?

Answer: Yes. For us, this is a significant issue, because it's a question of pensions, benefits and many other things. Can you help resolve this issue?

Vladimir Vladimirovich, there’s something else that’s just as important for us. It’s been eight years, but it’s painful to watch as one Caucasian republic after another becomes unstable. First it was Chechnya, now it’s Ingushetia, and there are troubles in Dagestan. It makes us wonder when order will finally return to the Northern Caucasus and when will peace and quiet rule where we live?

Thank you.

Vladimir Putin: First of all, about the status and the hunting rifles. When I went there, I frankly did not see hunting rifles in the hands of your men, or perhaps in your hands. I saw hand-held machine guns, grenade launchers and other automatic weapons, and men were all bound up with machine-gun tape, like the revolutionary sailors in 1917. But I know that some people did fight with hunting rifles. That really did happen.

With regard to status: I can’t tell you now how quickly and to what extent we can deal with these problems, but I promise you that I will certainly instruct the government to look into this. And I think this is only fair, because I have seen people in Moscow clinics and in the south of the country who have greatly suffered at the hands of international terrorists. We must also take care of these people on an individual basis.

Now, with regard to the situation in the south and in the Caucasus as a whole. Of course we have to say straight out that the situation is far from satisfactory. However, you and I know that the situation has completely changed since 1999. In the final analysis, the terrorists, the people who are trying to inflame the situation in the Caucasus, have no chance, and the sentiment of the people there is the proof. This is the ultimate answer to your question about “when will order finally return”. Of course you know that a great deal has happened as a result of the federal authorities’ attempts to resolve social problems, employment problems, and so on.

But much of the unrest is initiated abroad, by the so-called international terrorist centres. We will step up our federal efforts. We have created an Anti-Terrorist Centre, and it operates much more efficiently than the collection of federal agencies did in the mid-90s. The consistent decline in the number of terrorist acts is proof of that. In 2005, there were somewhere in the vicinity of 250, I think; in 2006, it was only a hundred and something, 130, I think. In the first eight months of this year, 25 of them have been identified. These are not hyped-up figures, they’re real, but there are still a number of disturbing things. All the same these raids still occur and people are dying. I want to reiterate that the federal centre will build on these efforts, including the deployment of our armed forces, the way we did where you are in Botlikh.

That said, I want to point out that the most important guarantee of success in the fight against this contagion is the attitude of local citizens.

Think of what is happening in the Chechen Republic. There things are not so poignant anymore, because people are fed up with confrontation and bloodshed, and they have already had a taste of normal human life and of a better future.

I am very much counting on achieving this in other regions of the North Caucasus and of southern Russia in general in the near future. The people must reject any kind of extremism, not to mention terrorism. Success in resolving these problems depends on our overall relationship with you.

<…>

Fatima Aliyev: Fatima Aliyev, Botlikh, Dagestan.

Hello, dear Vladimir Vladimirovich!

You visited Botlikh in the darkest days of August 1999. It was a horrible time. Your visit meant a lot to us, and we felt your support and concern. That meant a lot to us then. Thank you very much. The people of Dagestan will never forget it. Then you saw the demolished villages and the burned fields. Come for a visit now and you will see how everything has changed, and see how our region has been transfigured and improved.

Vladimir Vladimirovich, as someone who lives in the mountains and a mother, I would like to say the following. Please tell me how the problem of youth employment in the region will be resolved, so that they don’t go off into the woods with the bandits but stay to work and earn a salary? Are the federal authorities going to examine the issue of jobs in the Caucasus?

There’s something else: I can’t leave unmentioned a very important issue for Botlikh and other mountainous regions, and that is the Makhachkala-Botlikh road. The rebuilding of this road and the road tunnel has been delayed. We would like you to help us resolve this problem that affects us all.

Thank you.

Vladimir Putin: I was on the point of asking you about the construction of the road, but you are way ahead of me.

In deciding on the deployment of a mountain brigade, from the beginning we assumed — and it was a joint decision with your leaders — that the infrastructure should be developed and all the people who live there should benefit from it.

I promise you that we shall without question see this matter through to the end, without question. There will be a road and the tunnel will be built, along with the development of the social infrastructure.

I think we also talked about building schools and clinics, because the funds that go into the local budget from various activities in the Botlikh region are sufficient to meet these challenges. And we said that this is how we’ll proceed: the money will be aimed primarily at addressing social challenges.

As for job creation, this is now the key challenge for southern Russia, especially for the North Caucasus. We don’t have many special-purpose federal programmes for the regions. For southern Russia the emphasis is on job creation in the republics of the northern Caucasus. As you know, one of the ideas is to create special tourist zones, and this will bring about a whole range of benefits for Russia as a whole. I am really counting on the creation of such zones in the republics of the North Caucasus, including Dagestan. But of course we cannot stop there. We must build on traditional industries and create new ones. We made allowance for this in the context of the special-purpose federal programmes.

<…>

Nikolai Koshchev (Tatarstan, Kazan): Hello, Vladimir Vladimirovich! Nikolai Koshchev, state employee.

Like you, I don’t belong to a political party, and like you I voted for United Russia. But in the last election you weren’t on the party’s electoral list. In your opinion, how does the upcoming election compare?

Thank you.

Vladimir Putin: Thank you.

First of all, I want to welcome you and say that I envy you standing there where you are now because I love the Kremlin in Kazan. It’s a beautiful place. I always have a special feeling when I go to Kazan, to Tatarstan. I like it not only because it’s beautiful, but because it’s a very good example of coexistence, not just peaceful but fraternal coexistence of different cultures and religions. Here’s what a journalist just said: we are here beside a mosque and an Orthodox church that was built under Ivan the Terrible. Indeed, the government of the republic had a choice whether to raze the church in this venerable place and build a mosque. In fact, they handled it differently: they preserved the church and built the mosque. [Tatarstan President] Mintimer Shaymiyev says it is the biggest mosque in Europe, but I still think the biggest mosque in Eastern Europe is in St Petersburg. (By the way, in St Petersburg it’s called the Tatar mosque.) But it’s obvious that the Kremlin in Kazan is one of the most beautiful and perhaps one of the biggest. And it constitutes a very visible proof of the soundness of the development strategy chosen by the republic’s leaders, relying on the cooperation of everyone who lives there to strengthen the Federation as a whole.

Now, with regard to your question about United Russia: Nikolai, I did say at a United Russia assembly that I was not a member of a political party, but that I was ready to lead, and I did give my consent to heading the United Russia electoral list. Why?

You will remember the early 1990s. With a dysfunctional parliament, a dysfunctional Duma, it was impossible to make the slightest adjustment to any ruling that was made. The result was populist decisions that drove the country’s economy and social sphere into a blind alley. And as a matter of fact not a single decision the Duma took could be located in the jet stream of economic or social development.

At the same time the Duma made decisions that devalued everyone’s income. They were populist decisions taken about the government’s various social obligations. It was impossible to implement them, because they cost several times more than the budgetary revenues.

In 2007 and 2008 there will be parliamentary and presidential elections. A new person will occupy the Kremlin. In these circumstances it is essential for the state to maintain its steady course of development, to maintain continuity in the implementation of the decisions that have been taken recently.

I have already spoken of national projects for the development of agriculture, health care, education, the Armed Forces and on many other fronts. Take housing and public utilities, or replacing dilapidated facilities, or the development of innovative industries: here we haven’t simply made certain decisions. What have we done? We have set aside public resources for many years to come to implement these goals. What if a bunch of people breeze in who do not care about these decisions? It’s very easy to redirect those resources, to distribute evenly between the country poulation, to reduce gold reserves, for example, and I can tell you what this would mean for the country. We would destroy the whole positive set of tools that enable us to grow and that are crucial for the country's future development.

It is therefore essential that after the elections in 2007 the parliament be operational. United Russia has been the key element in making parliament operational in recent years. That is why I decided to head its list.

<…>

Leah Husainova (Kazan, Tatarstan): Hello, Vladimir Vladimirovich!

I'm in graduate school and my name is Leah Husainova. In addition to my research activities in the future I would also like to study languages. Your German is excellent and you speak English. Recently in a speech in Guatemala you spoke French. With all the different things you have to do, with your extremely busy schedule, how do you find time to study languages?

Thank you very much.

Vladimir Putin: I must confess that I don’t feel particularly gifted in this regard. Until I went to Germany and lived in that linguistic environment, I didn’t speak the language well. But I spent five years there and was in constant contact with our German colleagues and German friends. After five years even someone with modest linguistic abilities can master a foreign language. They can teach bears in a circus to ride a bicycle, but for us that is nothing special. Neither is what I did, all the more so because I was living there.

With regard to English, I only study it from time to time, for 10–15 minutes at a time, but fairly regularly. What do I use it for? Of course not to speak at international gatherings in a foreign language — incidentally, it’s better to speak in one’s own language at international gatherings; let the others learn Russian — but in normal working relations with colleagues there should be no language barrier. It is not always possible to talk about everything with an interpreter present.

With regard to French, it was at the request of some members of the International Olympic Committee. As a sign of respect for French-speaking countries, including French-speaking Africa, they simply asked me to say a few words in French. Some believe that I did it, but to say that I am fluent in French, this is simply not the case. I just learned a sentence or two to show consideration and respect for the French-speaking members of the International Olympic Committee.

But on a broader scale a foreign language is not just a gateway to communication, it’s a gateway to the culture of another people. It is very interesting, it opens up a whole world. In fact, having a second language is like living another life. Of course now that Russia has become an open country, we need to work at the study of foreign languages, and we will do so.

Sergei Brilyov: But in addition to it there was the speech you gave in Tatar in Kazan, Vladimir Vladimirovich, that was longer than the one in French in Guatemala.

Vladimir Putin: Regarding the speech in Tatar, it was also given as a sign of respect for the Tatar people, the second largest nation in our country. There are five million people who said in the census that they consider themselves Tatars.

I think there are one and a half million of ethnic Tatars in Tatarstan, or about two million. All the other ethnic Tatrs live in other regions of the Russian Federation. Incidentally, this should be borne in mind when we work out federal relations. What do I mean by that? We cannot allow certain regions to have special privileges. For example, why should Tatars living in Tatarstan enjoy better economic conditions than Tatars living in Moscow, St Petersburg or in other cities of the Russian Federation? All citizens of the Russian Federation, wherever they live, should enjoy the same economic and social rights.

<…>

Yekaterina Andreeva: We also have questions today via the internet, sent to the Hot Line site at www.president-line.ru. We have already received a enormous number of questions. Now you can see how they rated in terms of popularity.

Here’s one, chosen at random from the site: “Dear Mr President! Like many, I am interested in the programme for the return of Russian nationals. Unfortunately here in Germany there is very little information about where to go for specific information. I would like to know more about the possibility of the quickest possible return to Russia.”

This man went to Germany from Kazakhstan. And he writes that this is not the best time to be in Germany. He would very much like to return to Russia with his family, to be a citizen of this great country.

“Thank you very much. Andrei Nagorny, Koblenz-Rostock.”

Vladimir Putin: I have already talked about the resettlement programme in the Russian Federation for fellow nationals. I don’t know how advantageous it will be for those living in European countries, for two reasons. Firstly, because as I was saying we have now chosen twelve pilot regions. And these are mostly in eastern Russia, east of the Urals and in the Far East.

Secondly, by way of initial support there is a lump sum of 60 thousand rubles. Then there’s a monthly allowance for those who have not received or cannot find work immediately. There are other forms of support. But I would reiterate that it is difficult to say whether this will be advantageous for people living in European countries. Yet I can say for sure that we will seek to remove administrative barriers to obtaining residence permits and citizenship in the Russian Federation.

<…>

Natalia Plotnikova (Sochi): Good afternoon, Vladimir Vladimirovich!

My name is Natalia Plotnikova. I own a restaurant.

First, I want to thank you for the role you have played in our city’s destiny. We are very glad that we won. But since our victory real estate prices have skyrocketed. And there’s another issue. We are all perfectly aware that for the next seven years our city will become one large construction site. And how will Sochi’s inhabitants survive these years? Because we all know that the well-being of local residents depends on the flow of vacationers. Who wants to go to a large building site to relax? What are we to do? What assistance can we expect from the government?

One last question: will they close the city completely during this time, as some people are saying?

Thank you.

Vladimir Putin: No, of course no one is going to close the city.

As for construction on such a large-scale, and how it will affect life in the largest resort in Russia, people’s incomes and the revenues of Sochi’s sanatoria, these are certainly issues that deserve special attention.

There is something in this regard that I would like to draw to your attention. I have already talked about plans to spend 12 billion dollars on the development of the resort of Sochi and the capital of the Olympic Games in 2014. I want to draw your attention to the fact that two thirds of this will be spent on the development of infrastructure: roads, tunnels, electricity, water and sewerage. As a resort Sochi desperately needs all of these things. And if we do this — and I am confident that we will do it without fail — the influx of tourists, the influx of vacationers in Sochi will multiply many times, just as, I hope, the revenues of the businesses that are taking care of the vacationers’ needs will increase. I am sure that vacationers and tourists from abroad will come to Russia.

Will there be any difficulties for people who want to holiday in Sochi if they arrive in the midst of the construction? I don’t think so, because all these infrastructure projects should not prevent the arrival of tourists who are on holiday. Look, between the Adler airport and the city centre there is a bit of repair work on the roads. In principle I suppose it will affect circulation a little, but in general it won’t obstruct movement on these routes. And the new routes will be built so that they don’t interfere with any movement on this particular one.

But without sewerage can we talk about a normal existence for Sochi’s residents and vacationers? We will never make the city a holiday destination for Russians if we do not resolve the basic issues involved in supplying electricity. Indeed, every winter there are power outages in the mountains. You and I both know about this. So we need all this construction anyway.

Now as for what is directly related to sports facilities: on this we intend to spend a little more than 10 percent of all the money to be invested in the development of Sochi. Where will the facilities be built? One site will be close to the airport and the others in the mountains. Vacationers don’t go there now. The first facility will be built from scratch, on a brand new site. Therefore, the most part the builders can’t get in anyone’s way. I am sure that this will not affect the viability of the resort.

As for the price of land, yes, we definitely should have anticipated this. Of course I personally knew that land prices would increase many times. We have now passed a law concerning the Olympics that will result in changes to some other legislation. All land-use issues should be resolved taking into account the interests of the people who live there, but in the framework of existing legislation and without speculation.

Sergei Brilyov: Just now, we actually have a number of Olympic installations with which we have established a direct link-up.

Vladimir Putin: Sergei, I’m sorry to interrupt you. I am looking at a line on the screen. Where is that from?

Sergei Brilyov: It’s text messages.

<…>

[Vladimir Putin]: ”Will the CIS come to resemble the EU?” I don’t think so. Regarding the Eurasian Economic Community, in which there are six states, I have already spoken about this: we have taken the first step towards this, I mean the agreement on the establishment of a Customs Union.

”What do you need to become president?“ You must take part in the presidential election and win it.

Now: ”What is your favorite soccer club? ‘ I root for the Russian Federation national team.

Sorry, we’re digressing.
SERGEI BRILYOV: When you just said that, I …

Vladimir Putin: … These questions turned out to be interesting.

Sergei Brilyov: We were talking about the “Olympic cluster”. We have now been in touch with Sochi, but we have one more …

Vladimir Putin: Excuse me, I’m sorry to interrupt you. Here’s a very important question: ”Will you increase the retirement age?“ I think there is no need to raise the retirement age in the Russian Federation.

<…>

Question (Sochi): Dear Vladimir Vladimirovich, hello!

My name is Roman, I am a student in high school number eight. I am concerned about the following: which of the issues of public importance that you have had to resolve during your presidency seemed to you the most difficult?

Thank you.

Vladimir Putin: The most difficult is of course the fight against poverty, but I must point out that we are gradually resolving this problem. Today it is not just the fight against poverty but a situation in which there is a very large disparity between the incomes of those whom we consider the rich in Russia, and those we consider people with low incomes. This is the greatest challenge today. How can we face this challenge? In a broad sense can it be resolved? Of course, we can raise the salaries of military personnel, the wages of state employees, doctors and so on, and support the development of small and medium-sized businesses. We must strive to ensure that the middle class continues to grow. The trend is clearly positive. We must attend to this constantly. And we will do so without fail in the future.

<…>

Vasily Koretsky (Krasnaya Polyana): Good afternoon, Vladimir Vladimirovich!

Vasily Pavlovich Koretsky, resident of Krasnaya Polyana, retired.

Vladimir Vladimirovich, I have a specific question about construction sites. We are currently building an enormous number of Olympic sites, mostly in Krasnaya Polyana. Foreigners and Russians are building these facilities. But as a resident of Krasnaya Polyana, Russia, I believe that for the general good the majority should be built by Russians. I believe that the money should stay here in Russia and then we will learn how to build and there will be jobs.

Thank you very much.

Vladimir Putin: Thank you very much for your question. I think that all of us, and I include myself in this, welcome the sort of economic patriotism that you have just articulated. But I think that you will agree with me as well: for you and for those who live in Krasnaya Polyana, and even more so for the hundreds of thousands of our citizens who will come to enjoy these facilities, what is important is the question of quality. In the modern economy, there are disadvantages and advantages. In any event, open competition is a significant advantage. I think that we should give the right to work on building the necessary facilities for the Olympics to companies that offer us the best quality and the lowest price. And we will take this route. Of course Russian construction companies have acquired very considerable experience in recent years. They have mastered the latest technology and have all the advantages in terms of market presence, because they know best how to perform all sorts of tasks in the territory of the Russian Federation. Let them profit from these advantages. But the company that makes the best bid should be the one chosen.

<…>

Marina Bondarenko (Krasnaya Polyana): Hello, Vladimir Vladimirovich! I am Marina Georgievna Bondarenko, a teacher.

The Olympics will take place in Russia in seven years. Those who want to take part in them must start preparing now. But the trouble is children's sports in our country are no longer available to the masses. They have become a luxury, because many sports facilities are privately owned. How can we make children’s sports more accessible?

Thank you.

Vladimir Putin: That is a very important question. Just recently we discussed the topic at the Council for Sport and Preparation for the Olympic Games to be headed by the Prime Minister of the Russian Federation.

I am deeply convinced that the very fact of holding the Olympic Games in Sochi in Russia in 2014 will be a good occasion for the development of sports in the Russian Federation. Unfortunately we have lost a great deal from the Soviet era, things we benefited from that we thought would be ours forever. As soon as the state gets a little distracted from attending to such problems, they tend to snowball.

However, in recent years much has been done to develop sports for young people. I can tell you that we have increased by 40 % the number of boys and girls involved in sports schools for children and youth. We talked about this, as I said, at the most recent meeting of the Council for Sport. And the development of children's and youth sports will be one of the priorities of federal agencies, as well as regional ones. I hope that you will participate as actively as possible in this.

<…>

Vladimir Putin: Just a second, can I interrupt you?

Here’s another text message with what I think is a very important question. I don’t know if it will be heard or not: ”Will there be a banking crisis?“ No, there will not.

”Will there be currency reform in Russia or not?“ No, it’s not in the works.

”When will you remove he slot machines from Moscow?“ I must tell you that we have made a decision about this. If need be, I will come back to this issue. In many parts of the Russian Federation virtually all the slot machines have been removed from areas where there is a significant number of people. In accordance with the law adopted, in 2009 all gambling activities must be concentrated in four areas. I have already talked about this. But the transition period will be long so as not to destroy this business per se. We want to create conditions that will enable people who engage in this type of business to prepare calmly and as far in advance as possible for the move into these zones, which are designated by law for gambling activities.

I repeat, in some regions such decisions have already been taken. It depends on the regional authorities.

Sergei Brilyov: Vladimir Vladimirovich, you have not responded to a question which has come up again and again: how many hours a day do you sleep?

Vladimir Putin: Enough to be able to respond to your questions.

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Alexander Galkin (Telephone question): Hello, dear Mr President!

This is Alexander Vasilyevich Galkin from Ekaterinburg with a question.

There has been more talk about a law on corruption. Up until now it’s impossible to get anything without a bribe. Do you think that the new Prime Minister, Viktor Zubkov, can cope with this evil? He is a financial intelligence agent and should know the corrupt officials by name.

Thank you.

Vladimir Putin: I hope he does. Indeed, Viktor Alekseevich Zubkov knows a lot about this subject. And I have to say that he has coped very effectively with the challenge that he faced. He started from nothing, from scratch, and created a new, highly efficient service, which was called upon to fight against the legalisation of money acquired through criminal and illegal activity. His direct involvement has created this service and defined the parameters of its work for years to come.

But efforts by the Prime Minister are not enough. In addition we must strengthen and improve our legal framework. To do this we must create a climate of intolerance in society for such things, from small bribes on the roads to major government orders and contracts.

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Vladimir Putin: … I think this is an important question: ”Will the payments of maternity capital as per the decision adopted concerning maternity capital continue beyond 2008?“ Yes, they will.

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Margarita Sashkina (Telephone question): Hello, Vladimir Vladimirovich!

My name is Margarita Nikolaevna Sashkina. I live in the city of Georgievsk. I have the following question.

At the moment, a great deal of attention is being paid to mothers and children, particularly the birth of children. Meanwhile, many families who want children cannot have them. The only solution remains in vitro fertilization, but it is very expensive. Why can’t we solve this problem by making it a national project and doing it more cheaply?

Thank you.

Vladimir Putin: It’s an important question, and it really does affect many families, especially those who want to have children, but for one reason or another cannot. It is indeed a costly operation, and this is the main reason why we don’t perform them that often.

Now, if my memory serves, around 1700 are carried out in Russia. The cost of such an operation is about 150 thousand rubles, and for that amount we provide a so-called state-guaranteed order. If we do the calculation, 1700 such operations at 150,000 rubles each makes for about 200 million rubles that we spend on this. Such operations, free of charge, paid for by the state, are performed in four federal centres, but the number of medical facilities where such a service could be provided is much higher, around 50, I think. What is the problem and what is the issue at stake? In fact, the basic problem is money. Bearing in mind that the demographic situation constitutes one of our most important problems, I think that you are right to draw attention to this issue, and I think we will need to increase federal funding, to increase state-guaranteed orders that enable us to perform this operation for free. To what extent? In a first phase I think it is possible to increase it by a factor of at least three, and I know where we can find the money. We have some savings in certain areas of the national projects, and an increase in funding for these purposes, three times 200 million, is certainly possible, as I suggested. Then we will see whether the medical institutions destined to receive this funding can cope with such a workload. We are ready to take the next step.

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N.Chebukova (Rzhev, Tver region): First of all, on behalf of the residents of Rzhev I would like to thank you for designating Rzhev a City of Military Glory. We have waited for this for a long time.

And my question is this: now a great deal of attention is being paid to the mega-cities, major cities such as Moscow and St Petersburg. With the introduction of a national project on agriculture attention has been paid to the villages. But today in Russia small towns are still forgotten. As a resident of Rzhev, what my city will be tomorrow matters to me. I am concerned about its future. It interests me.

Vladimir Putin: First, in regard to the status of City of Military Glory: of course cities such as Rzhev have long deserved this. Indeed, in 1942–43, it was troops who fought there that prevented Hitler's forces from organising an attempt to launch a second large-scale attack on Moscow. It was a very important milestone in the development of the situation on the fronts of the Great Patriotic War. That is the first thing.

Secondly, in regard to small towns: as you know, we have more than 1700 – I don’t remember exactly. If you calculate the average number of residents who live there, they account for 40% of the entire population of Russia. And not only you are concerned and worried about the future of these cities, but of course all of us, including me, should be concerned about them. I think that to this point we have not done enough to maintain the pace of development in these cities, especially infrastructure. Support for the appropriate level of development has always been a regional affair, carried out at the regional and municipal levels. And this of course is not enough.

As you may know — I hope you have heard of or have some idea of this – the federal government has decided to send a specific amount for the development and maintenance of small town infrastructure. We have recently issued 10 billion from the federal centre for the roads and the improvement of Russian cities. First and foremost, this was destined for small and medium-sized cities in Russia. We decided to set aside 240 billion, an astronomical sum for us, to address the problems of housing and community services and the resettlement of those in dilapidated and emergency housing (incidentally, here in the text messages, I also saw issues of this kind being raised). This 240 billion is to be utilised during the next four to five years. Let me draw your attention to the fact that in previous years we have allocated one or two billion for these purposes. And now, 240 billion! That is an extraordinary increase. And a significant portion of these resources should be used to address the problems of Russia’s small and medium-sized cities. We also expect that the national projects you mentioned, in education, agriculture and medicine, will have a beneficial impact. After all, equipping primary health clinics or medical transportation, for example, should involve not only large mega-cities, but also Russia’s small and medium-sized cities.

I have already mentioned that we have decided to significantly increase the minimum wage. There’s no point in denying that people with low incomes live in Russia’s small and medium-sized cities. I hope this decision will affect a certain number of people who live there, in addition to raising the wages of those working in the state-financed areas, as I also mentioned earlier. All of this taken together constitutes a positive sign. A special, target-based programme for architecture maintenance and development in Russia’s small and medium-sized cities will provide around 5 billion in the first phase.

I hope that all of this together will have a positive effect.

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Ruslan Vinogradov (Rzhev): I know that national projects have been launched in Russia, including in health care, and there have been concrete results. I am happy for our general practitioners, whose wages have gone up significantly, and there is new equipment in the clinics. The fleet of ambulances has been updated. In maternity clinics childbirth certificates are being used.

I am interested in whether you are planning on improving the hospitals and in-patient clinics? The fact is that we have, for example, artificial ventilation lung machines that were bought in the 1960s. Only one of them is new; and we also have an intensive care unit. Our portable x-ray machine breaks down more often than it takes pictures. Operating tools generally are in poor condition. It would be nice to have a ultrasound machine. We are dealing with patients who are seriously ill, and the outcome of the treatment depends upon the quality of the health services rendered.

I would like to know how health reform will develop in the future and what we specialists working in in-patient clinics can expect from this reform?

Thank you for your attention.

Vladimir Putin: Ruslan Yurevich, you yourself said that given the complexities of the problem, it is only within the framework of a national project that we can resolve these issues and bring about the desired and required effect. We have begun to refurbish primary health care, with a large-scale reequipment on a scale that would not have been possible before. But we have agreed from the outset to use federal funds to acquire the necessary technological equipment. However, bringing order to the premises must still be done at the regional and municipal level, in order to adjust the equipment and install it in the right way. But that's not all.

We have committed ourselves to the creation of new high-tech centres in the Russian Federation. There was a good deal of disagreement about this, and I know that some of my regional colleagues were unhappy with this decision. They believe that it is better to give money to those centres that are already in place. True, we must support and develop them too, but we need to put high-tech medical care closer to the regions of the Russian Federation. And I think that in the final analysis those who say no, we need these centres where there were none before, and of course we have to supply them with staff as well, I think these people are right. This is no easy task. We need people who can work on this equipment, but it is better to do this than to leave everything until some undefined “future”. I can only assure you that this work will continue.

As for the reforms in the health sector as a whole, here we can take the direction that we have talked about many times. Given that we are obliged to provide free medical care, we need to create an environment in which professionals receive money for the quality of service provided. When the money goes for patients, for cured patients, when the money goes for the quality of services provided, we will have achieved the greatest success.

Take the example of childbirth certificates. Women are given these maternity certificates. If they are happy with the way they are treated in the medical institutions, they turn in the certificate, and that means an immediate amelioration, including cash income for the medical staff. This principle is not necessarily the technology you’re talking about, but it should be used in medicine as a whole.

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Question (Kaliningrad): Our neighbours in Poland, the Kaczynski brothers, are tirelessly engaged in anti-Russian exercises and as we speak are ready to expand their American missile defense system. Dear Vladimir Vladimirovich, is it worth deploying the Russian ABM in the Kaliningrad region to save Poland from Iranian and Korean missiles?

Thank you.

Vladimir Putin: Thank you for that question. I do not think that we should make efforts to ensure security in other parts of Europe, if the leaders of those countries do not consider the security interests of their neighbours, especially our security and yours. But we have made some proposals in this regard. What are they?

First: we must determine together – with the Americans and Europeans – the nature and the substance of these potential missile threats. We have to understand if the threat comes from Iran, or North Korea, or some terrorist organisation, or does not really exist. That’s the first thing.

Second: we proposed the creation of a clear and understandable mechanism to give access in the future to any anti-missile system, democratic access, so that we would understand how and by whom it is administered and what role Russia would play in such a system. This will enable us to unite our technological capabilities and the resources available in the CIS countries, including the monitoring of missile launches that we use according the relevant treaties, and those that exist in the Russian Federation. Recent contacts with our American counterparts show that they are really considering our proposals and looking for solutions to problems and ways of allaying our concerns.

Therefore, I do not think we should try to escalate the situation here, but we have said loudly and clearly to all our partners that if these decisions are made without taking into account the security interests of the Russian Federation, we will take retaliatory steps that would of course ensure the safety of Russia’s citizens. I assure you, these steps are planned, and we will take them. Where to put the missiles is the prerogative of military specialists, especially the specialists of the General Staff of the Russian Army.

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Anna Isachenko (Kaliningrad): Hello, Vladimir Vladimirovich!

My name is Anna Isachenko. I am a resident of Kaliningrad. This is my question. Russia and the European Union are signing a document concerning the facilitation of the visa regime. But for us residents of Kaliningrad it is becoming more difficult to cross into Poland and Lithuania. Perhaps our Ministry of Foreign Affairs should be more aggressive?

Thank you.

Vladimir Putin: Regarding the movement of the citizens of Kaliningrad, I would like to note two things and you certainly know about them.

First: citizens of the Russian Federation living in Kaliningrad and the Kaliningrad region are guaranteed freedom of movement to other Russian territories. And here, in concert with our European partners, we have introduced the so-called simplified documents for transit and multiple trips. And we have agreed that such a regime of free movement for Russian citizens living in the Kaliningrad Region, through neighbouring states and to the territory of the Russian Federation, will be maintained in the future, including after the entry of Poland – in this case, Lithuania is most important – into the Schengen zone.

We are negotiating with our European partners about the facilitation of a mutual visa regime. Now residents of the Kaliningrad region must obtain a visa, like every other citizen in the Russian Federation. We have agreed, for example, with Lithuania to introduce a mutual visa system free of charge to residents who live in the surrounding regions. This decision, if it comes about, must be approved by the European Commission.

In fact, Russia’s Ministry of Foreign Affairs will work step by step to increase the various categories of Russian citizens (and Europeans), who enjoy certain preferential procedures in obtaining a visa, as a stage on the way to abolishing the visa regime between the EU and the Russian Federation as a whole.

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Yekaterina Andreeva: Vladimir Vladimirovich, in preparation for Hot Line, according to tradition, you always choose some questions yourself, so now we are ready …

Vladimir Putin: There’s an interesting question right here: ”When will the ruble be a fully convertible currency? ‘

I must say that after making the decision to liberalise on the monetary side, we have done everything to make the ruble a freely convertible currency. What does this mean? This means that the citizens of the Russian Federation can freely and without any notification open accounts in foreign banks if they need to, if they see this as somehow in their economic interest. This means that all capital that enters the Russian Federation can be freely withdrawn from the territory of Russia, without any encumbrance from the state or the Central Bank. Incidentally, this has led to the result many experts expected: unlike previous years, we have seen no outflow of foreign exchange earnings from Russia and large inflows. Last year it was 41 billion dollars, this year, already 70. True, we have seen a small outflow of so-called speculative capital, but on the whole the balance is more than positive and better than last year.

Now about those questions that I selected.

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”When will the president and his administration eliminate corruption in the agencies of Internal Affairs? ‘ An Internal Affairs officer is asking this question. He says that he is forced to release scotfree people who have some special connection with the authorities.

What can I say about this? In the last nine months 47468 crimes were committed by officials of the MIA [Ministry of Internal Affairs]. These are grim figures: 30,000 employees, more than 30,000 officers guilty of taking bribes – that is 40% of the total number of offenses. Of these, the same number, 40%, were brought to responsibility by their own security service, and 60% aftter citizens’ applications.

What can you do in these cases? Since you, a staff member of the MIA, had the courage to raise this with me in this way (I will not give your surname), then what you can do, what in fact any Russian citizen can do is very simple: first of all go through the appropriate channels in the security service of the Ministry of Internal Affairs. In recent years it has been working reasonably well. I know that this is clearly not enough. I have already talked about how to fight corruption. We must create in society as a whole a climate of intolerance and make the legislation in this area more stringent.

”As an internet user I am interested in your views on censorship of the Russian part of the net. Do you think it is right to spy on the World Wide Web, as they do in China and a number of other countries?” Nikolay Pavlovich Zykov, a student, Permsky Krai.“

The Russian Federation has no control over the World Wide Web or over the Russian segment of the internet. I think that such control offers little from the point of view of a technological solution to this problem. Of course, in this environment, as well as other environments, we have to think hard to ensure that Russian laws are respected, so that child pornography doesn’t proliferate and that no financial crimes are committed in this environment. But this is already the business of law enforcement officials. Total control and the work of law enforcement agencies are very different things.

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Now … This is Lydia Vasilyevna Ivanov, a pensioner, Krasnoyarsk Territory. ”Those living in our city are worried that there will be a default soon. Please tell me if a default is expected or whether there will be one in general?”

No, there won’t, Lydia Vasilyevna, there won’t be a default. And I can tell you why. What is a default? Firstly, it is the inability of the state to pay its external debts. And, secondly, the inability of the state and the Central Bank to ensure the necessary volume of foreign currency for those involved in economic activity in our own country.

What happened in 1998? The volume of external debt was colossal, the value of our gold reserves, minimal. And in the face of adverse market conditions (at that point the price of oil had dropped to 12 and even 8 dollars a barrel) the government and the Central Bank simply had no foreign exchange reserves to ensure that the needs of the market, banks and other participants in economic activity were met. Where did this lead? This led to a devaluation of the national currency. What was the result? Galloping inflation. I cannot remember how much it was in 1997 (I think about 28% ), but then it rose to more than 80%. The citizenry’s supplies were depleted and consequently many prices rose. Why is this is not possible today? First, we have no such external debts, we have settled all our accounts. The ratio of our external debt to GDP is the best in Europe. That’s the first reason.

Second: we have important gold reserves, 424 billion American dollars. According to this indicator, they are the third largest in the world after China and Japan. And many experts say that this constitutes an ”air bag“ for the overall economy and for all citizens. This is what prevents our economy from getting into the condition that it was in in 1998. And that is precisely why we must treat these reserves with caution.

During the election campaign, there has been a lot of talk about how to distribute the money. It is very easy to hand it all out. But the question is not how to distribute it but how to effectively utilise these opportunities. The issue is to create an environment for the positive and progressive development of the entire economy. And this is precisely the role of gold reserves.

Our budget and our foreign trade are both in surplus. And this too is an important condition which allows us to say with full confidence that there will be no default. And investment is also a very important element in the stability of the economy. I have already spoken about how our investment, including foreign investment, has grown many times, increased many-fold. And that also has a stabilising effect on the economy.

Regarding foreign-travel passports. Dmitry Stanislavovich Shapkin, Moscow: ”How long will this sophisticated farce of the external passport system go on? Why do foreigners manage with one passport and Russians need two?” Yes, and for only five years at that: “Isn’t that rather often, to change one’s passport every five years?”

This is the position of the Ministry of Foreign Affairs and Ministry of Internal Affairs of the Russian Federation. Experts believe that five years in someone’s life can produce significant changes. And for that reason they insist that the five-year time limit for an external passport be retained. Many countries have the same system, 5 or 10 years. In general, of course, with the stabilisation of our internal political life and our economic life, while continuing our active efforts in the fight against terrorism and crime, this period will be increased.

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Anna Sergeyevna Kuznetsova: ”I am 9 years old. Since I was five, I have dreamt of being the President of Russia. Question: Do you think that a woman has the chance to become the President of Russia? If so, in what institute do they train the President of Russia? ‘

I think that any citizen of the Russian Federation, woman or man, should have such a chance. Certainly for women there is such a chance. Unfortunately, in our country, in administrative circles and in the higher echelons of power, there have been very few women up until now. But you may have noticed that in the government of the Russian Federation, the number of women in the top posts, with ministerial responsibilities, has increased. And these are very good professionals. I am sure that their number will increase. And the role and importance of women in the life of the country will eventually be such that the vast majority of citizens will not see the man or the woman, but will be looking for personal and business-related qualities. And there are enough people in Russia who are able able to fulfill the tasks facing the head of state.

Yekaterina Andreyeva: Thank you, Vladimir Vladimirovich.

Today’s live broadcast is coming to an end. This was the sixth ”Hot Line with the President of the Russian Federation“. Six times Channel One, the Rossiya TV channel and we have invited the President of our country to talk directly with our citizens.

Vladimir Vladimirovich, thank you for finding time in your overloaded schedule to be with us six times. I don’t even know if somewhere on such a scale there is another such project that has lasted as long, or whether in some other country someone could duplicate it.

Sergei Brilyov: We have collected some statistics of sorts that suggest some of the results of these years. We have been in touch with 67 cities and towns, including foreign countries and the near abroad, like today. Of course 99% were in the Russia Federation. Again, looking at and measuring these years has shown that the ratings have gone consistently up, which from the professional and television point of view is very important. And from the political point of view, I would dare to say that it is obviously important that the programme set as its ultimate priority to ensure that people were interested, and able to learn first-hand what power does and how it goes about doing it.

Therefore, a special thanks to all those who sent in their questions this time and in years past. And, of course, thank you, Vladimir Vladimirovich, for the fact that this link with the people was forged and has existed for so many years.

Vladimir Putin: For my part I would like to thank the emcees and all of your colleagues who worked in the regions. But a special word of thanks, of course, to all the citizens who have taken an interest in this joint work. This is very important for the entire leadership of the country and for me in particular, because it gives a clear idea of what concerns citizens of the Russian Federation, what they are most interested in, how they live and what problems they think about. This compels all of us, including me, to concentrate our attention on the vital issues for our citizens and the vital issues of the development of the Russian Federation.

Thank you very much for your attention. All the best!

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