Russian Prime Minister Vladimir Putin has publically backed President Dmitry Medvedev's call for radical economic modernization, amid rumors of a clash between the two leaders.

During his state-of-the-nation address on November 12, Medvedev urged Russia to end its dependence on oil and gas exports and modernize the economy, which some analysts interpreted as a challenge to Putin.

"I am sure that this call reflects the mood of all of Russian society," Putin said in a keynote speech to the annual congress of the ruling United Russia party in St. Petersburg.

"The crisis, with all its severity, has shown how costly it is for a country to reject innovation, have low work productivity, waste resources and have a slow bureaucracy," Putin said.

"The president posed the question about the necessary, thorough modernization of the Russian economy - overcoming chronic backwardness and moving the country to a more modern level of development," Putin added.

He also said Russia's GDP would shrink by 8.0 - 8.5 percent this year.

"Bad political habits"

In a brief opening speech, President Dmitry Medvedev also criticized leaders of Russia's ruling party for "bad political habits" and demanded that future elections be conducted fairly.

"Elections which are intended to be…a competition of ideas and programs, are sometimes turned into affairs in which democratic procedures are confused with administrative ones," the president said.

"We need to learn to win - all of us, in fact - we need to learn to win in open contests," he added.

The speeches by Medvedev and Putin were presented to more than 600 party delegates and broadcast live on state television.

Putin did not mention Medvedev's criticism of the political system, but cautioned the United Russia members against viewing their party as an "elite prestige club" for their own benefit.

United Russia holds 315 out of 450 seats in the lower house of parliament. Last month, opposition parties stormed out of the chamber in protest, after claiming vote rigging had helped the United Russia party to win in local elections.


vj/AFP/Reuters/AP
Editor: Andreas Illmer