Transcript of the beginning of the meeting:

Vladimir Putin: Good afternoon, Mr Karlin.

Alexander Karlin: The current situation in the Altai Territory, although difficult due to certain circumstances, is still stable and under control. We have managed to prevent the economic indicators from plummeting. Moreover, certain economic sectors, particularly, agriculture, processing and the food industry, have seen the growth of production both last year and in the first two months of 2009. This is what the experts had forecast, and we were well aware of the situation on the domestic markets. 

Overall, the agriculture production index has shown a 2% growth despite low production volumes in January and February, with milk and meat sales only. The production index growth in the food and processing industry amounted to 15%, which is a very good indicator. 

According to our estimates concerning raw materials, industrial production volumes and industrial capacities, the growth will continue. 

At the moment, we are implementing anti-crisis measures by placing our major resources to support the real sector and the rural areas to use local processing capacities to the full and deliver agricultural products not only to the local residents, but to the whole of Siberia and the Far East.  This is a seminal task, and we are going to continue implementing it. 

Such vital economic sectors as the energy industry, housing and utilities, and transport show have remained stable, with no serious emergencies or breakdowns during the winter despite low temperatures and abundant snow. 

The territory's social sector reveals its stability as well. We have been fulfilling to full extent our obligations to the residents that we incurred in the sector in the past three years, accumulating resources in the sector. 

The territory has no pay arrears for the employees of the social sector.  

The programmes aimed at supporting the local low-income population, the elderly and disabled, as well as children and families, are being implemented to full extent. These are large-scale programmes, and have received considerable funding from the state budget. 

However, in January there was a substantial reduction in local industrial production, particularly in the engineering industry. Production figures are slightly lower than the average for the country. February figures reveal a decrease in comparison to the last year's volumes. Preliminary estimates show that we are going to have a 9-10% reduction against 2008. Nevertheless, none of the territory's companies have stopped production. 

The number of the unemployed officially registered in the territory currently stands at 51,000, which is 16,000 more than in early November 2008, but lower than in February 2008, when the number of the unemployed was 62,200. Three years ago, the region had some of the highest unemployment rates in Russia with its 85,000 unemployed registered at the beginning of 2006. We have managed to reduce the number by creating jobs at local manufactures, in industry and engineering. 

Vladimir Putin: What about the programme to combat unemployment in the territory? 

Alexander Karlin: Mr Putin, we were among the first territories in Russia to develop the Programme to Ease Tensions in the Labour Market." The programme was prepared on January 15, following the Government's decree of December 31, and was submitted to the Ministry of Healthcare and Social Development for consideration. On February 2, the programme was approved by Deputy Prime Minister Alexander Zhukov, and on February 9 we signed an agreement with the Federal Service for Labour and Employment. 

Yesterday, we introduced amendments to the territory's budget, allocating an additional 39 million roubles ($1.09 million) for this purpose by reducing expenses for public administration and optimising administrative personnel. 

Vladimir Putin: That was a reasonable decision. 

Alexander Karlin: Thank you for the additional 750 million roubles allocated from the federal budget. We have already planned how to spend these 750 million, plus our own 39 million, and they will go towards all four strategies implied in the program, namely retraining, organising temporary and public works, stimulating migrants to be engaged in other sectors, and supporting self-employed entrepreneurs. We have vast resources in this regard as well.  

Vladimir Putin: Do you expect a major shortfall in the local budget revenues this year? 

Alexander Karlin: Honestly, according to yesterday's calculations the budget revenues account for only 80% as compared to last year. 

Vladimir Putin: I see. 

Alexander Karlin: The territory's economy is highly subsidised, though we have managed to reduce our dependence on subsidies. Three years ago, the local budget covered 49% of our expenses. 

Vladimir Putin: Have you agreed with the Ministry of Finances on receiving additional financing? 

Alexander Karlin: We have settled the issue of a budget credit. This will be a small but urgently needed amount - 300 million roubles. We are continuing negotiations. Although we have not introduced major changes into the budget after yesterday's adjustments, I have to say that the budget funding is being spent prudently. We will adjust the territory's budget after the amendments are introduced to the federal budget, given that we are highly dependant on it.  

Vladimir Putin: Are there any wage arrears for state-budget paid employees? 

Alexander Karlin: We have no delays or arrears in the sector. Those paid from the state budget had received their December wages by January 1, 2009, which makes it slightly easier in January and February, with employees receiving wages twice a month as the law requires. 

Vladimir Putin: That's good.