Putin hints at government return by ex-FinMin Kudrin

Reuters News
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Posted: Dec 15, 2011 6:18 AM
Putin hints at government return by ex-FinMin Kudrin

By Douglas Busvine and Oksana Kobzeva

MOSCOW (Reuters) - Russian Prime Minister Vladimir Putin, bidding to return to the Kremlin, said on Thursday that ex-Finance Minister Alexei Kudrin could have a future role in government despite their differences over this month's parliamentary election.

"Such people were needed and will be needed in past and future governments," Putin told an annual televised call-in show in response to a question on Kudrin's political future.

Kudrin quit in September after 11 years in the job, directly after Putin announced his plan to seek a third term as president. At the time, he criticized a major increase in defense spending as a threat to the stability of state finances.

Investors would welcome a return to government by Kudrin, a fiscal hawk who restored state finances to health after Russia's domestic debt default of 1998, running fiscal surpluses and building the world's third-largest foreign exchange reserves.

"Kudrin bridges a gap in that he is a proven technocrat and very close to Putin -- he is respected in government and by investors," said Roland Nash, chief investment strategist at Moscow hedge fund Verno Capital.

"It would be surprising if he did not come back to government."

CRITICAL STANCE

Kudrin has, however, emerged as a critic of the conduct of the December 4 election and distanced himself from both Putin and the policy agenda of the ruling United Russia party that saw its parliamentary majority cut in the vote.

Speaking on Thursday, Kudrin strengthened his criticism of the election in which, the opposition alleges, United Russia's vote was inflated by ballot stuffing, multiple voting and doctoring of election lists.

"I myself support honest elections," Kudrin said. "The elections just held took place with major violations and we have not yet heard an adequate answer from those responsible, and in general from the powers that be."

He also took aim at disparaging comments by Putin during the call-in in which the premier said he had mistaken the white ribbons worn by protesters for condoms and said students had been paid to turn out.

"I don't agree with this attitude towards the protesters ... there is no need to provoke them," Kudrin told reporters.

LIBERAL PROJECT

Rather than publicly setting his sights on a return to government, Kudrin has said he could envisage taking a leading role in a future liberal party that could fill a political void left by the parliamentary election.

No liberal party won representation in Russia's lower house, with the liberal Right Cause party flopping after its billionaire leader, Mikhail Prokhorov, was ousted after a clash with the Kremlin. Prokhorov has declared his candidacy for the March 4 presidential vote but remains a rank outsider.

Putin, who said he had meet Kudrin this week, acknowledged that the two did not agree on everything but said their differences were not "cardinal."

"Alexei Leonidovich Kudrin has not left my team. We are old comrades, he's my friend," Putin said. "He did a lot for the country. I'm proud that this man worked in my government."

There has been speculation that Kudrin could become prime minister should Putin, as appears likely, be elected and should outgoing President Dmitry Medvedev not be appointed to the role.

"Kudrin is very close to Putin and the strength of his expression -- that Kudrin had never left his team -- was notable," said Tom Mundy, chief strategist at Otkritie, a Moscow brokerage.

"There is clearly space for Kudrin in the next cabinet. This will be welcomed by the market as he is a very respected politician."

(Writing by Douglas Busvine, editing by Gleb Bryanski and Rosalind Russell)