Transcript of the beginning of the meeting:

Vladimir Putin: Good afternoon, Mr Volkov,

The situation in your republic is slowly improving, but you are still facing quite a few problems. What are your main challenges?

Alexander Volkov: Our main challenge is the development of IzhAvto. I'd like to thank you, Mr Prime Minister, for greenlighting its development plan. IzhAvto is one of the most important brands for the city and the republic. The company employs quite a lot of people at the manufacturing plant and throughout the enterprise as a whole.

The celebrations for the 250th anniversary of Izhevsk and today's ceremony at Izhstal have put us in good spirits. I can't say there are no problems in other areas but we'll make it through, I'm sure.

Vladimir Putin: Yes, the ceremony at Izhstal gives us a reason to be optimistic. Through this project, the company will increase labour productivity - this is a very good example of actual modernisation. And what's no less important, this project will help improve environmental conditions in the city. It received ample funding, which went toward the purchase of modern equipment.

Alexander Volkov: Yes, this was done very well. .

Vladimir Putin: The workers look so enthusiastic because all the equipment is brand new.

This may be a somewhat tardy congratulation but still I'd like to congratulate you and your republic on the anniversary.

Alexander Volkov: Thank you.

Vladimir Putin: You've built a fine embankment. It's a good present for the city.

Alexander Volkov: Thank you.

Vladimir Putin: But still, what problems are you facing? Let's focus on problems.

Alexander Volkov: Before we move to problems, I'd like to note that despite difficulties in the industries, we've made some good progress, for example, we reduced unemployment.

Vladimir Putin: By how much?

Alexander Volkov: It stood at 3.3%, and today it is only 2%. The number of those officially registered as unemployed fell from 30,000 to 20,000. The number of employees having to work part-time decreased by 10,000, from 23,000 to 13,000.

Industrial production is also on the rise. We increased tax revenues by 17%. We managed to deal with the situation successfully and to continue development.

We also increased the number of schools: four new schools opened on September 1, and a new orphanage was built.

Vladimir Putin: Excellent.

Alexander Volkov: These are modern schools with computer labs and comprehensive physics and chemistry classrooms, gyms and stadiums. The quality of the new school facilities is especially evident if compared with the wooden buildings that housed schools previously.

Vladimir Putin: Of course.

Alexander Volkov: We are carrying on with our development programme. We survived the recent wildfires even though the situation was critical - the fire alert was raised to level 5 in our republic, as well as in the neighbouring regions.

Our urgent response, specifically the reorganisation of the Forestry Ministry - we started this in 2007 - allowed us to ensure the effective coordination of firefighting efforts.

We started extinguishing fires before they reached the forests. This was crucial because once the grass catches fire, the flames spread to the forests. We put out 400 fires in the fields, and I'd like to note that there were only 300 forest fires in our republic.

Despite the drought, because of which we'll produce 50% less grain and forage crops than planned, we'll do everything in our power to preserve livestock.

I'd like to thank the federal government and you personally on behalf of the people living in rural areas for issuing loans worth 800 million roubles. The regional government provided them with an additional 200 million roubles in the form of subsidies. These funds, 1 billion roubles in total, will be used to purchase fodder from other regions. We prepared it in the Perm Territory, and now buy it from the Kirov Region.

Vladimir Putin: Your neighbours are doing fine...

Alexander Volkov: Hopefully, we'll preserve our livestock at least.

I'd like to emphasise that we have managed to sustain production.

I hope we'll survive the winter and continue to do well.