Transcript of the beginning of the meeting:

Vladimir Putin: Let's begin with agriculture. This year has been an unfavourable one, not just for drought-affected regions, but also for regions such as yours that were hit by floods. What's the situation like now?

Oleg Kozhemyako: Here's how things stand at the moment: we've harvested 53% of the farmlands, but due to the excessive amount of moisture, weed has covered the fields all over, reducing the crops by half. Our grain harvest this year is between 10 and 11 centners per hectare, against 20 in previous years. The high water content in grain makes the crops contract once they dry out. So, in the final analysis, we'll barely manage to reach our minimum targets for stocking feed for meat and dairy cattle. And bearing in mind the need for a seed stock as well, we'd like to ask the government for assistance in forming both the seed stock (some 30,000 tons) and one for animal feed, because, as the excessive moisture leads to contractions of 14%, the amounts of threshed grain we've already counted will decrease even further.

Vladimir Putin: How much do you need for feed?

Oleg Kozhemyako: About 60,000 tons of feed and 30,000 tons of grain, that's the amount that will meet our needs. We've just launched a project to develop meat and dairy livestock farming and are making headway already. We've come out with mini-packages for children's whole milk, which is probably the first such type of packaging to be produced locally. Generally speaking, our goal is to become a leader in basic food production in Russia's Far East.

The situation is a little bit better with soy. We expect a certain decline, but if all goes well in September (that's when the harvesting season begins here), we could still exceed last year's figures, which was also the case in 2009. We hope to thresh more than 440,000 tons, all in all.

Vladimir Putin: Do you have an official letter of request for the grain and feed you mentioned?

Oleg Kozhemyako: Yes.

Vladimir Putin: Let me have it. But we also discussed another acute problem, that of resettling tenants from housing in urgent need of repair. How much residential space needs to be vacated in your region?

Oleg Kozhemyako: We've got a lot of dilapidated housing, but the situation is the most dramatic in the Baikal Amur Railway area. Some 8,000 people live in that zone. Most of the housing facilities there is makeshift, and we cannot even put it on the official list as a result. The local residents have been living in these substandard conditions since the 1970s. In keeping with the [government's] modernization strategy, we've prepared some documents to make the Housing programme work and to have an opportunity to obtain some 500-600 million roubles for 2011-2012, at least under a shared financing scheme.

Vladimir Putin: And how much have you requested this year?

Oleg Kozhemyako: This year, it'll take us 70 million roubles to complete the construction of an apartment block we need to resettle 60 households now living in makeshift housing, built more than three decades ago. We'll then be able to solve the problem for people who are going to work at the Nizhne-Bureiskaya hydroelectric power plant.

Proceeding from yesterday's discussions, builders will resume work on that project Monday, under our guarantees. As I reported earlier, the ground work is done now. We hope to be able to show people their future apartments before the end of this year. And in the first half of 2011, we'll have that building commissioned.

Vladimir Putin: Do you have an official letter of request?

Oleg Kozhemyako: Yes.

Vladimir Putin: Please give it to me.

Oleg Kozhemyako: Many thanks.

Vladimir Putin: Now let's get back to the resettlement problem in the Baikal Amur Railway area. How many people there need new housing and how much money will it take, do you think? And who's making the estimates, by the way?

Oleg Kozhemyako: We've developed a programme for that, actually. With an estimated cost of 7 billion roubles, for those 8,000 residents [of the Baikal Amur Railway zone]. But we're aware, of course, of the federal budget's limits and those of our own. As we see it, this programme could be co-financed, at least 30% to 70%, and we'll do our best to do our part. We've asked for some 500-600 million roubles [in federal budget allocations] for next year or this year so that we can make some headway on that. I have an official letter to this effect with me. For our part, we'll add around 300-400 million for a total of 1 billion, and in three to five years' time, the problem will be solved.

The problem is really acute for the Baikal Amur Railway area. Tynda is a town with good prospects, considering the Elginsky Basin's 9 million tons [of coal to be mined], the Olyokminsky iron ore mine's reserves, and the construction there of a plant to produce titanium sponge.

Vladimir Putin: And where are you going to construct those residential facilities?

Oleg Kozhemyako: That depends on where the need arises. This will be mainly low-rise buildings to accommodate people working on the railway. We plan to resettle those interested in the south of the region. We have areas with a rather mild climate. We're pursuing this programme already. This year, we've been busy building houses for the first ten households from Kazakhstan, families of compatriots currently living in Kazakhstan. These houses are being constructed in the village of Ushakovo, in the Shimanovsky District, near the [Russian-Kazakh] border. Under this same scheme, we could also resettle...

Vladimir Putin: Okay, let me have your letter. I'll instruct the ministries of economic and regional development to make all the estimates again together with you. We should move toward a resolution of this problem.

Oleg Kozhemyako: Good.

Vladimir Putin: What's your general economic situation like now?

Oleg Kozhemyako: Well, there have been ups and downs.

Vladimir Putin: What about the first half of the year?

Oleg Kozhemyako: We finished 2009 among Russia's top ten regions in terms of management efficiency, according to the Regional Development Ministry's rankings, and were awarded a bonus of 34 million roubles. Now the regional economy is gaining momentum in all major sectors. The only sector lagging behind is agriculture, specifically grain production.

Vladimir Putin: That's understandable.

Oleg Kozhemyako: We'll probably make up for it owing to this.

Vladimir Putin: Yes, I know. But what exactly do you mean by "momentum"?

Oleg Kozhemyako: We've been growing at a rate of 12%.

Vladimir Putin: Economic growth, you mean?

Oleg Kozhemyako: Yes.

Vladimir Putin: Good.

Oleg Kozhemyako: We're moving forward. We have a ship-building yard that is operational, and we're manufacturing fishing boats for Kamchatka, Sakhalin and the Pacific Coast. We've turned out six boats to date, and have another three on staples. We're providing support for the assembly of combine harvesters at our plants, providing guarantees to these enterprises and subsidizing interest rates for them. We're not just relying on direct budget spending, but rather we're using the budget as an instrument to enable economic operators to expand their businesses. That kind of assistance is always helpful. And we're heading in that same direction in construction as well.

Following the recent meeting you chaired in Volgograd, Mr Putin, we made a number of decisions. Beginning in 2011, we'll use funds from the regional budget to fund the construction of all necessary infrastructure, setting up sites and resettling people, both under and the Programme on Dilapidated Housing and outside of it. We'll provide guarantees and subsidize interest rates for builders at the region's expense, so that we can get some new housing before we start moving people out of their old dwellings, and so that we can avoid problems with shareholders and companies that fail to complete projects. This is why we're using all these instruments in full measure now. I believe this is providing a boost in the right direction.

Vladimir Putin: Do you have any serious problems on the labour market?

Oleg Kozhemyako: No, not really. Unemployment is down. Until recently, the jobless rate in the Amur Region has been consistently higher than average, topping 5%. This was a consequence of the [post-Soviet] collapse of collective farming. Now we've managed to bring the rate down to 4%, which isn't too high for us. Our current unemployment programme is proving quite effective.

Vladimir Putin: Isn't 4% still a bit too high?

Oleg Kozhemyako: Well, maybe, but there is a downward trend at least. As for socially-oriented projects, we've joined the programme for perinatal centres, and are now having these facilities built in cities across the region.