• Total prison population: 864,590 prisoners
• Crime trend: Down 14% in 2000–2002

Crime rates

Policing cannot keep pace with the formidable levels of crime in Russia.

Intergang violence accounts for a recent rise in the murder rate. Street crime has also increased in the larger cities. Corruption is rife, particularly in the regions. The Russian mafia profits from protection rackets, prostitution, smuggling operations, and narcotics, and is also active in western Europe.

Public fear resulting from the level of crime and high-profile attacks by separatists has contributed to a rise in popularity for authoritarian political platforms.

Overcrowding, poor conditions, and disease are major problems in prisons.

• Annual defense budget: $48bn

RUSSIAN ARMED FORCES

• Army: 21,870 main battle tanks (T-34, T-55, T-62, T-64, T-72, T-80, T-90) (321,000 personnel)
• Navy: 53 submarines, 1 carrier, 14 destroyers, 7 cruisers, 10 frigates, 88 patrol boats (155,000 personnel)
• Air force: 2434 combat aircraft (MiG-25/29/31, Su-24/25/27, Tu-22) (184,600 personnel)
• Nuclear capability: 735 ICBM, 13 SSBN, 100 ABM

The loss of the 118-man Kursk nuclear submarine in 2000 symbolized the long-term decline in Russia's military might. Maintaining and using the enormous former-communist war machine has proved too expensive. Reforms aimed to cut troop numbers by hundreds of thousands by 2004, while the proportion of professional units is rising. Public anger at conditions has led to pay increases.

Spending on nuclear forces is limited to the physical protection of warheads. In 2002, Russia agreed to cut its nuclear arsenal further, slashing the number of warheads by 60%. It also dropped previous objections to the proposed US national missile defense system.

The Northern and Pacific navy fleets are inactive and deteriorating fast. A major naval exercise attended by President Putin in the run-up to the 2004 presidential election was marred when missiles failed to fire.

• Gross National Product (GNP): $307bn

Score card

• World GNP ranking: 16th
• GNP per capita: $2130
• Balance of payments: $35.8bn
• Inflation: 13.7%
• Unemployment: 9%

Exports

Imports

Economic performance indicator

Strengths

Huge natural resources, in particular hydrocarbons, precious metals, fuel, timber. Potential from future international oil pipelines. Enormous engineering and scientific base. Massive arms export industry: world's largest in 2002. Government revenue increased by tax reforms. Lucrative privatizations. Recognized as a market economy in 2002, encouraging foreign investment.

Weaknesses

Crumbling infrastructure. Attempts by government to exert control over commercial sector, particularly oil. Privatized companies asset-stripped by former managers. Organized crime controls huge areas of the economy. Regional investment hindered by uneven implementation of federal laws. Tax evasion and corruption remain widespread. Oil giant Yukos in crisis. Rising wages and strengthening rouble have promoted boom in imports, narrowing trade gap, harming local production, and stifling small enterprises.

Profile

The few gains made in the early postcommunist era were swept aside in the 1998 economic crisis. Powerful financial "oligarchs" emerged, and organized crime moved into most areas of the economy. However, the devaluation of the rouble ironically served to promote a miniboom in the last years of the 20th century. Real wages fell, encouraging small enterprises to expand, while the devaluation made imports too expensive for the average consumer – promoting local production. Industrial production increased and GDP grew by 7.6% in 2000. Putin has moved to dismantle the power of the economic elites. The private sale of land was permitted from 2001, and a new 13% flat rate of income tax promised to help reduce widespread tax evasion. However, while the economy weathered the 2001 global slowdown, the rise in real wages and the strengthening of the rouble have begun to offset the previous years' gains. Some 50% of the economy is conducted on the black market.