Install

Get the latest updates as we post them — right on your browser

. Last Updated: 07/27/2016

Duma Adopts First Draft of Budget for 2000




The State Duma finally passed the first reading of the 2000 budget Tuesday, although a top deputy said the International Monetary Fund might reject the changes needed to get it through.


Kremlin spokesman Dmitry Yakushkin quoted President Boris Yeltsin as saying he was happy the finance bill had been passed.


The president had sharply criticized the lower house of parliament Monday for dragging its feet on the budget, which had been rejected once in a first reading and had debates on it postponed twice.


The government increased projected revenue and spending by 6 billion rubles ($233 million) to push the bill through the recalcitrant Duma, dominated by leftist parties, and the head of the Duma budget committee said the IMF might not like the amendments.


"According to my information, the IMF considers the increase of the 2000 budget revenue largely unrealistic and therefore might not accept the budget version approved today by the State Duma," committee head Alexander Zhukov said on Ekho Moskvy radio.


Finance Minister Mikhail Kasyanov said the government would have to prove that it had got its sums right to the IMF, from which Russia is hoping to win $640 million in new aid from a $4.5 billion loan program.


"We will have to discuss additional revenue with the IMF experts again and prove our arguments are reasonable. I hope they will believe they are realistic," Kasyanov told reporters.


First Deputy Prime Minister Viktor Khristenko said the revised draft targeted revenues at 797.2 billion rubles ($25 billion at the projected exchange rate of 32 rubles per dollar) and spending at 855.1 billion rubles.


The budget deficit is seen at just over 1 percent of gross domestic product, while the primary surplus, which excludes debt servicing, is set at 3 percent of GDP - within IMF targets.


"The [budget] deficit remains on the same level ... There is no additional debt burden," Khristenko told reporters.


Zhukov said the second reading might take place Nov. 5 and the third before Nov. 28, so that the fourth and final reading would be held before the Dec. 19 parliamentary election.


"We will plan the extraordinary meeting [of the Duma] at the beginning of November," Zhukov told reporters.


The budget has to be approved in four Duma readings, passed by the upper house of parliament and signed by Yeltsin to become law.


Khristenko, seeking to balance the wishes of left-wing lawmakers without jeopardizing the program agreed to with the IMF, told deputies the government had found extra funds to meet demands for supporting key sectors.


Although Russia is keen to show it is following its economic program to win more IMF aid, the Fund is actually holding up the next $640 million loan tranche for other reasons as well.


The Fund has said it wants guarantees of financial transparency, after a suspected Russian money-laundering scheme in the United States.