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President of Russia Vladimir Putin: Mr Vasilyev, Mr Melikov, good afternoon.

Mr Vasilyev, how many years have you been working in Daghestan?

Vladimir Vasilyev: It has been three years recently.

Vladimir Putin: These years probably just flew by, haven’t they?

Vladimir Vasilyev: Exactly, Mr President. It is an interesting job. It is dynamic.

Vladimir Putin: This is an interesting job, the people are interesting, as well as the republic.

Vladimir Vasilyev: The people are wonderful.

Vladimir Putin: Everything is unique there.

You have done much for the republic’s development, especially in these difficult times. You were not afraid to assume responsibility for many things, and you have fulfilled your duty very well.

What do you think about the situation in the republic, Mr Vasilyev?

Vladimir Vasilyev: Mr President, first of all, thank you for appreciating my work. I believe the situation in the republic is stable, with a trend towards improving.

When you gave me instructions, you visited Dagestan and talked to veterans in 2017, after my appointment, for which I am grateful. You will remember they told you that Daghestan was a donor region in the Soviet Union. At that point, you gave me the task of removing the layer of bribe takers between the budget and the people. I even remember your gesture. This is where we started our work.

I owe many thanks to the law-enforcement bodies. At that time, we became national champions in the number of officials brought to justice. This was helpful. Of course, it was difficult work for law enforcement, for those who had to deal with this, but it was necessary.

This work immediately produced an effect. First, overt stealing and overstated production figures went down, and the quality of performance improved. Federal structures began to trust us. Many thanks to you for your instructions. Representatives from practically all ministries and agencies visited us and helped us to arrange consistent work.

Mr President, as a result, the budget, which until recently stood at 100 billion, is now in excess of 170 billion. This is our joint effort, and the money comes mostly from our Federation. The people understand this clearly. Most importantly, we have also learned how to make money. Not just to save, but to make it as well.

This is happening in a number of areas. For example, oil transshipment and the oil market in general are going through a rough patch. Our port quadrupled oil transshipments and tripled transshipments of general cargo over these years. Thank you very much for that, you have always helped us and been there for us whenever we faced difficulties. You provided a clear opportunity to take a step towards resolving problems in the interest of the republic and the country. Many thanks for this, without this it would be simply impossible.

We have seen significant change in a number of other areas. We have improved the production of agricultural output. In 2019, we allocated, for the first time, 2 billion from our budget, and we began to spend taxes primarily on essentials. We spent 2 billion on household water distribution and 500 million on land reclamation. I do not want to get ahead of myself, but we can already see that there will be growth at the end of this year despite the COVID-related difficulties, including in agriculture with the lack of migrant workers, especially in seasonal jobs.

I would also like to say – you started with this – that our people are just wonderful. The goal at hand would not have been achieved without popular support. People are tired, and fighting corruption and restoring order were among the important issues that were addressed from day one.

We started doing this, including with taxes, focusing on those who illegally obtained disability status or stole electricity. We began to identify violations by the thousands.

And then we realised that we must use the power of the law, but be aware that the authorities’ moves must be supported by the bulk of the population. I think we succeeded.

After the cleanup in the highest echelons of power, we held a contest. Many thanks go to the Presidential Executive Office and everyone else who helped us. There were over 11,000 prospective candidates, an unparalleled contest, which we would not have been able to hold ourselves without the federal centre’s support. Only 54 people came, but, surprisingly, 90 percent of them were Dagestanis, many of whom graduated from our state university, which is important.

Relying on these people, we were able to turn around the situation in a number of areas. I will not bore you with the details, but given the difficult situation in healthcare, I would like to say that funding in healthcare has grown 4.9 times from 2017 to 2020. We started out with about 3 billion, and in 2020, we already had 17.6 billion. Our insurance fund went from 25 billion to 34 billion. We began with a debt of 1.7 billion, and we brought it down 12 times. Our thanks also go to the oversight bodies, without which we would not have coped with the task at hand either, and the federal Mandatory Health Insurance Fund.

As a result, this time we are better prepared to deal with COVID. For example, in 2019, we bought 6.4 times more medications for the group of people entitled to special prices than in 2017. The people could feel the effect. We spent more money on purchasing equipment. We purchased more than 200 ambulances. All our vehicles are under 10 years old. The federal centre did help us, but we – we are proud of this – bought almost 200 vehicles with our own money. We wrote, “Thanks for the taxes,” when we were buying ambulances and school buses.

I told you during our first meeting – you always go deep into the matter – that it was a very difficult situation, and I want to report now. I told you about petrol stations. The situation was challenging. We took a count of our petrol stations. In fact, they engaged in cash-only business. The petrol stations benefitted greatly from our efforts with over 20 percent of them quadrupling tax payments. People are doing so of their own accord. They have created an association, registered employment contracts, and tripled the number of employees. At the same time, taxes have quadrupled, Mr President.

We are learning from them. These people are ahead of us. We – security, taxation and supervision authorities – did not accomplish as much as the Daghestan resident association. Particularly pleasing is the fact that the leader of this association, Magomed, was my advisor in a voluntary capacity. As a person in good standing, he was later elected to the city Duma, and the people supported him.

We are doing the same to improve the situation in the footwear manufacturing industry. We have about 15,000 shoemakers, who have golden hands and are true wizards, despite their hard work that used to be done underground. The decision to install microchips in the shoes beginning next year is a sound one and the businesses and authorities are cooperating now. As the prime minister has just told me, we have started to build a sixth factory to legalise the work of these 15,000 people. We will boost the existing output. We could not even imagine the scale of the operation, and people, including [business] owners and workers, see this happening. Of course, legalising what was an illegitimate business has great potential.

I can also say that having collected funds in the budget we, when we encountered problems, as I said earlier, still bought ambulances and, having secured support from the federal government, we have assigned 900 doctors to hospitals in three years and allocated funds. We were able to allocate 2.8 billion rubles for COVID related purposes, when we desperately needed this money. Thank you very much for your help. The doctors are well aware of this, so are we all. When we had a steep increase in COVID cases, with 700 new patients hospitalised every day, you promptly got involved, and we had support for building hospitals and receiving medicines; also teams of doctors were dispatched to us and two deputy ministers worked in the republic and visited this dangerous red zone, setting an example for us, teaching us how to work more effectively and explaining to our doctors how to use the technologies that were supplied to us. We have been able to deal with the situation. Thank you very much. People see and highly appreciate all these efforts. Thank you for this.

We were able to allocate significant funds – 2.8 billion rubles – this is a considerable sum for us. We used these funds to buy personal protective equipment, pay those categories of health workers that are not included in your executive orders and buy medicines. We allocated 40 million to buy Aktemra, a drug we needed then, thereby resolving the issue.

In other words, people saw taxes not only as some penalty or requirement but also as something that provides for opportunities and helps build the potential and the future of their republic.

Today, on Teacher’s Day, we met with teachers. We are pleased to see that more children are winning various competitions and getting increasingly higher scores on the United State Exam in the republic and compared to the rest of the country.

We are proud that on October 3, Rostov-on-Don hosted the final stage of the education programme on a system-based approach to regional management. It involved the Southern Federal District and the North Caucasus District. The jury awarded the title to the Dagestan team project. Ours was a large team, including executive authority representatives and our social activists, young people – and we won the Best Project award for creating the right conditions for taking the economy out of the grey zone, and forming ‘white’ industrial clusters by developing privileged zones, and the development and implementation of financial and organisational support measures. We are proud of this, especially because those shoemakers were part of it. This is what everyone talked about. It was the youth who talked about it, not us. They defended that project. And scientists, teachers, and experts appreciated it. I talked to them today; they are ready to fight, they are ready to move on.

Therefore, I would say the atmosphere is generally better, and there is something else: last year, we marked 2019 with the security forces, and I still cannot separate myself from them. We called each other until the end of the year and kept asking ourselves whether there would be some kind of incident or not. In 2019, no serious incidents or acts of terror were reported. Many thanks to the security forces, many thanks to the people, the residents, for the atmosphere we have here today. I hope this process will continue.

Thank you.

Vladimir Putin: Mr Vasilyev, I would like to thank you again for the work that you have done in Daghestan. You were faced with very difficult tasks; and you have made significant progress on almost every track. I can feel it, I can see it. I hope the people can see it too. I will probably have the opportunity to thank you personally, and we will do it as soon as possible.

Mr Melikov, you know the Caucasus firsthand, and you know Daghestan well. You paid attention to this in your previous position as Deputy Commander of the National Guard. How would you assess the situation at the moment and if you lead the Republic, what policy priorities would you consider?

Sergei Melikov: Mr President, I would mention three main areas. Mr Vasilyev spoke about the first one. I think this work must be continued. It is aimed at ensuring the safety of our people during the pandemic. This is not only about the life and health of the people but also about the processes that largely negatively affect all aspects of activity. The work that was done by the emergency centre of Daghestan must be continued and probably made even more effective.

The second area is of course the development of the republic’s economy, the economic potential of Daghestan. The potential is very high, but I think it is not being fully realised, in part as regards various investment projects in the republic. Once again, Mr Vasilyev’s efforts have enhanced the investment appeal of Daghestan compared to what it was several years ago.

Therefore, I think all the current processes in Daghestan must be continued and improved and, of course, be aimed at increasing the living standards, something you, Mr President, spoke about recently addressing the Senators. This work will be continued by all means.

And the third area. I believe it is very important to have feedback from all strata of the population and society in the Caucasus. It is from this feedback that we will receive suggestions that we must implement for the people.

In this respect, I would emphasise the political aspect of activities in the republic that will help us understand the political, domestic political processes taking place in the republic and resolve these problems for the benefit of Daghestan and the rest of the Russian Federation.

Vladimir Putin: Mr Melikov, you have explained everything accurately. It is absolutely clear that the efforts to counter COVID remain current. This is an absolutely clear goal, it is on the surface, and we will continue helping the republic. You only need to decide quickly on local specialists and what else must be done, in part, at the federal level.

You brought some other issues, such as growing the economy and overcoming social challenges in healthcare, education, and so forth. Social issues abound everywhere, including in Daghestan.

There are other matters that I believe are quite important, if not critical. Firstly, Daghestan is a multi-ethnic republic. Like a drop of water, Daghestan reflects everything that Russia has: multiple religions and multiple ethnicities. This is Daghestan’s hallmark. Importantly, over the past decades, despite any and all difficulties going back to the 1990s and early 2000s, interethnic and interreligious relations have always been strong in Daghestan. It is imperative to pay attention to this, and this should be taken care of. These things do not arise by themselves. It is important to support the best there is in this sense in Daghestan.

The diverse, very interesting and unique culture of the ethnic groups of Daghestan is something that requires systematic support. This makes Daghestan a strong multiethnic republic.

Of course, sports traditions and martial arts are very popular there, so much needs to be done in this regard. The infrastructure is practically non-existent, especially in small mountain villages. There is nothing there at all. Nevertheless, there are outstanding athletes. This requires our attention.

Finally, we need efforts to continue to decriminalise the republic. Mr Vasiliev has done a lot in this area, he told us about it. But we need to continue to focus our efforts on this matter.

Daghestanis are open and honest people, and are very sensitive to all kinds of injustice, administrative rudeness or improper behaviour on the part of government officials. We need to win their respect and trust. I hope you will be able to accomplish this. You are an experienced person.

Good luck.

Sergei Melikov: Thank you, Mr President.