Other participants in the session included Prime Minister of India Narendra Modi, Federal Chancellor of Austria Christian Kern and President of Moldova Igor Dodon.
The annual St Petersburg International Economic Forum first convened in 1997 to discuss key issues of economic development in Russia, the emerging economies and the world at large. The slogan this year is Achieving a New Balance in the Global Economic Arena.
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Excerpts from transcript of the plenary meeting of the St Petersburg International Economic Forum
Panel moderator, NBC host Megyn Kelly: Welcome, everyone. Thank you so much for being here. I’m Megyn Kelly. And welcome to the St Petersburg International Economic Forum. Welcome to our distinguished guests, to our host President Putin, and to all of you. Thank you for taking the time to be here with us today. Yes, yes, how about it for our host and our guests (Applause).
We’ve been in St Petersburg for a few days and understand that this is an important place, a personal place to President Putin. And now we understand why. It’s incredibly beautiful. The gorgeous rivers, romantic bridges, the beautiful weather (Laughter). And most of all the lovely people who have given us such a warm welcome and – I’ll tell you, just in our few days here – have made us feel like we have far more in common than we do apart. And so, the world leaders need to figure out the differences, but I think the people feel bonded in a lovely way (Applause).
So today we’re going to have some opening remarks, and then we’ll get into some questions and hopefully mix it up a little bit. And with that, I turn it over to our host, Russian President Vladimir Putin (Applause).
President of Russia Vladimir Putin: Ladies and gentlemen, friends,
It is a pleasure to welcome the participants of the 21st St Petersburg International Economic Forum, including directors of international organisations, heads of state, government representatives and business leaders from dozens of countries.
We appreciate your interest in Russia and the dialogue that is aimed at developing partnership. We are open to cooperation, mutually beneficial projects and working together to find solutions to the vital, strategic issues of global development.
Only by combining our efforts will we be able to overcome current imbalances, move towards sustainable global economic development, formulate rules for fair trade and honest competition, reduce poverty, solve acute social issues and deal with major challenges such as terrorism, regional conflicts and the proliferation of nationalism and xenophobia.
We are not just approaching but have already come face to face with formidable challenges to our civilisation. The environmental burden on the planet is growing due to human impact and natural processes. These issues must be thoroughly researched and analysed.
We must act responsibly and coherently when formulating our policies and joint action plans. Only in this way will we be able to implement the necessary resolutions in the interests of harmonious global development.
I would like to add that new technologies are rapidly changing our way of life, leading to the rise of new industries and professions and opening up new development opportunities. However, they are also creating new threats. I know that you worked hard yesterday, holding panel sessions and discussions where you dealt with all of this.
But I would like to repeat that we are facing systemic, long-term challenges, the consequences of which are even difficult to estimate and forecast at this point. So we should not, we have no right to expend ourselves on distractions, to waste our time and energy on quarrels, strife and geopolitical games.
We need wisdom and a sense of responsibility, a joint search for unconventional solutions, new formats of cooperation between states, regional integration associations, business and the scientific community.
To this end, we must make full use of the potential of such a unique, universal organisation as the United Nations. The UN Secretary-General is present here. I know that he came to visit us and I would like to thank him for this. Let us welcome him.
We propose establishing a special international youth section at the St Petersburg Economic Forum because tomorrow is for the younger generation. They are the ones who will build the future and live in it. Participants in this section could analyse, form and shape the image of the future of their countries and civilisation as a whole.
Ladies and gentlemen,
Russia is already making a contribution to resolving global issues and is ready to do more. We are carrying out large-scale environmental programmes, including those in the Arctic, increasing supplies of quality food to world markets and expanding our participation in projects of the World Health Organisation. We are ready to make more active use of the powerful potential of Russian fundamental science to search for ways to address major challenges.
Owing to our excellent schools of mathematics and theoretical physics, we are capable of taking the lead in a number of areas of the so-called new economy, primarily the digital economy. Russian IT companies are certainly competitive on a global scale. Our specialists are not just coming up with the best, unique software solutions but are also creating a new area of knowledge, a new environment for developing the economy and life.
I would like to use this opportunity to congratulate students of the St Petersburg University of Information Technologies, Mechanics and Optics (ITMO), who again, for the seventh time won the international programming contest. Our moderator spoke about the people who live in St Petersburg and she is right. They are respectable people, and the city’s young residents are proving this in the best way.
To build up our work force, intellectual and technological advantages in the digital economy, we intend to take action in areas of systemic importance. What do I mean?
Firstly, it is necessary to draft an entirely new, flexible regulatory foundation for introducing digital technology in all areas of life. Importantly, all decisions must be made with due account of the need to ensure information security for the state, businesses and citizens.
Secondly, the state will support those companies that bring with them developments and competencies in digital technology and have a so-called crossover, intersectoral impact – processing and analysis of big data, artificial intelligence and neurotechnology, and virtual and augmented reality technology, to name a few.
Thirdly, we will build support infrastructure for the digital economy, including secure communications lines and data processing centres with the participation of the state and businesses. In addition, I will note that this infrastructure should be based on the most advanced technology and developments.
Fourthly, we intend to increase many times over the number of graduates specialising in the digital economy. In effect, we will have to resolve a broader task, a task at the national level – to achieve universal digital literacy. To do this, it is necessary to dramatically improve the educational system at all levels – from schools to universities. And, of course, we should launch training programmes for people of all ages.
On my instructions, the Government has drafted a programme for developing the digital economy. To underscore, we must clearly determine the sources, mechanisms and scale of its funding. We will discuss all these issues at the next meeting of the Council for Strategic Developments and Priority Projects.
Colleagues, to reiterate, the digital economy is not a separate industry. In fact, it is the foundation that makes it possible to build innovative models of business, trade, logistics, and manufacturing. It has changed our approaches to education, healthcare, public administration, and communication between people. As a result, it sets a new paradigm for the development of the state, the economy and society as a whole.
This way of thinking will determine how we build our economic and technical policy, industry, and infrastructure, and form an open and free business environment, and a flexible labour market, as well as achieve goals which will ensure long-term growth. We can already say that a new phase of recovery has begun in our economy.
Russia's GDP is growing for the third consecutive quarter. According to preliminary estimates, the economy grew by 1.4 percent in April. Car sales and mortgage loans are on the rise. I am saying this because, as specialists know, experts all over the world consider these indicators as important signs of economic recovery and growing consumer demand.
For reference, I can tell you that car sales rose by 2.6 percent in January-April 2017. We have almost reached inflation benchmarks, and we expect it to be under the target figure, that is, under 4 percent, by year-end. This helps the Bank of Russia gradually cut the interest rate.
By the way, on the sidelines of the forum, international investors and business representatives have noted the high quality of Russia’s macroeconomic policy. Yesterday we discussed this with our colleagues – representatives of major international investment funds. For them, this is a weighty argument in favour of continuing working on the Russian market.
The inflow of foreign direct investment into the Russian economy amounted to $7 billion in the first quarter. Notably, this is the best number for the corresponding period in the past three years. Investments during the first quarter were up 2.3 percent overall.
I would like to note and underscore that the increase in investment is currently outpacing GDP growth, which is another sign of what I have already mentioned: our economy is entering a new phase of growth, and the foundations for its future growth are taking shape. It is important to support and speed up these positive trends, so as to be able to achieve economic growth rates outstripping global ones by late 2019-early 2020.
The key factor here is to increase investment activity, primarily on the part of private businesses. We have done a lot to update federal legislation, to remove administrative barriers, and to streamline oversight and supervision procedures and functions.
According to international experts, Russia boasts the best dynamics internationally over the past five years when it comes to improving its business climate. We went up 80 positions on the famous Doing Business ranking in one go.
Importantly, our regions have joined our efforts to form an open and supportive business environment, including the Republic of Tatarstan, Chuvashia, Moscow, Tula Region, and Kaluga Region. This year, they made it to the top of the national investment climate rankings. They deserve our congratulations. (Applause.)
A number of regions, such as Moscow Region and Kaliningrad Region, and St Petersburg, have drastically improved their business environment. I am pleased to note that our Far Eastern regions –Khabarovsk Territory and Amur Region – have for the first time joined the leaders of change. I am asking the heads of all Russian regions to never stop building on such efforts, and to open up new opportunities for businesses so that they can work successfully and freely.
Effectively protecting rights, businesses and property is critical for entrepreneurs and all citizens, for that matter. In this regard, I would like to say that a package of proposals to improve the judicial system has already been agreed upon. It was discussed and worked through in conjunction with experts and senior officials of the Supreme Court of the Russian Federation.
The has to do with increasing the independence of judges and improving the training of judicial personnel, streamlining the judicial process, and reducing the unreasonable burden on judges. The purpose of these measures is to create additional guarantees of fair and objective judicial proceedings.
Next, we have already created an array of tools to support investment projects. We will develop them, making them more flexible and targeted. What exactly do we suggest doing in this context?
First, a solid systemic foundation needs to be created for the project financing mechanism and investment risks minimised at all stages – from developing projects to implementing them, including by providing partial state guarantees, and drawing resources from different types of investors: banks, investment companies and pension funds.
I am asking the Government and the Bank of Russia to accelerate the enactment of amendments to laws that make the syndicated loan mechanism more flexible. Yesterday, last night, we discussed this with our colleagues, and this should be done, of course, as soon as possible. All of this will ensure a substantial increase in private financial resources for launching new projects in the real economic sector.
Second, to ensure accelerated economic growth rates, we need to significantly increase investment in transport, energy, communications and other infrastructure. Private capital should become a source of additional investment. However, high risks remain an impediment here, as well.
Therefore, it is important to establish understandable, stable rules protecting investors’ rights. Return on their capital investment should be ensured through regular payments that will come from the principal beneficiaries of infrastructure facilities. These are budgets at various levels, natural monopolies and other infrastructure users.
The mechanism of state guarantees can also be used to ensure payments. In other words, this is about introducing a kind of an infrastructure mortgage mechanism where an infrastructure project is in effect bought on a loan received from private investors while the user of that facility gradually repays the loan.
For this model to be launched, I am asking the Government to develop a comprehensive approach toward infrastructure development with the participation of private capital. It should cover all stages: preparation, financing and implementation of these projects.
Ladies and gentlemen, we are interested in investment going to high-tech sectors. A few days ago, the MS-21, an advanced Russian medium-range passenger plane, made its maiden flight. I have already spoken to the company management by telephone and I would like to thank and congratulate all those involved in implementing this project.
In both aviation and other sectors that are critically important for Russia’s development, we need our own developments and competencies. They should be restored or created from the ground up. These include advanced production technologies and materials, power and power storage systems, transport and logistics management, information security systems, Arctic and shelf development technology, modern diagnostic and therapy methods, and agricultural and food processing technologies.
Obviously, we can untie these technological knots only by involving major private investors who are interested both in new technological solutions and in diversifying their own businesses. To enable them to become actively involved in this work, attractive and understandable conditions should certainly be provided for them. This can be done through special so-called investment contracts. I propose considering ways of improving this mechanism.
Generally, it works, but it needs upgrading. It should be made an effective tool. For example, the term of special investment contracts could be extended from the current 10 years to 20 years with provisions to be made for flexible participation not only by federal government bodies, regions and investors, but also by development institutions, banks, natural monopolies and other agencies.
This concerns above all critically important areas and sectors, as well as situations where an investor is unlikely to come without state support, without a clear-cut and understandable system of support, because benefits and profits cannot be immediately made on such projects: This is not quick money.
It is also important to extend demand guarantees to products created within the framework of special investment projects on the part of both the state and companies with state participation.
Another important thing. It is essential to ensure that tax and other conditions related to state regulation remain unchanged throughout the term of a contract’s implementation. As for taxes, I propose extending the current exemption on profit tax until after 2025.
I would like to stress that the pinpoint solutions related to developing critical technology that I have just mentioned must not lead to the destruction of the competitive environment in the economy as a whole. I am asking the Government to analyse all these issues and submit specific proposals. We will discuss the areas of our joint efforts to address technological development goals at one of the next meetings with business representatives.
Next. These days, breakthrough innovative technology is often developed by small companies, so-called start-ups. As a rule, this technology is created by teams of young researchers. I am certain that they can become effective partners for major Russian businesses, and we will expand this partnership, creating essential infrastructure. We intend to begin creating innovative research and technology centres at our leading schools of higher learning. Education, research and high-tech and venture companies will be concentrated here in one place. All of them will be closely integrated with each other.
I am calling for the management of our major companies – Rostec, the Federal Space Agency, the United Aircraft Corporation, the United Shipbuilding Corporation, Rosatom and other domestic high-tech companies – to actively use the opportunities opening up.
It is important to create subdivisions that will work closely with start-ups and small innovative companies, as well as venture funds, to finance such projects. I am asking you to make sure that this does not remain empty rhetoric. I am asking you to do this in practice and as soon as possible.
For its part, big business should have a clear-cut legal mechanism for acquiring or entering the capital of small innovation companies. I am asking the Government and the State Duma to prepare and adopt appropriate amendments to the law.
Dear friends, we are going through a difficult and contradictory but very exciting period that is rich in new ideas, discoveries, projects and rapid change. It takes persistence and strong will to meet the challenges of the times, because this is about building our future, while it has always been shaped by daring, smart, focused and capable people – those who are prepared to translate their intellectual abilities and entrepreneurship into bold innovative plans and efforts that help the country.
It is this kind of people, including very young people, who achieve success in science, develop modern business projects and implement civic and social initiatives. Therefore, we will augment our human capital and I am sure that we will be able to ensure sustainable long-term growth – to qualitatively improve the Russian economy, and to transform Russia and change our citizens’ lives for the better.
Great creative work lies ahead and we invite everyone to participate. I am certain that this partnership will be interesting and mutually beneficial.
We welcome you to work with Russia!
Thank you for your attention. Thank you very much.
Megyn Kelly: Thank you, President Putin. We are going to continue with the speeches in just a minute. But they encouraged me to ask questions in-between if I have any, and I have one that I want to ask Mr President.
You mentioned that Russia is entering a new phase of growth right now. But there remains in Russia a significant income inequality problem. They say that the top one percent here in Russia holds over 70 percent of the wealth. And walking around talking to some of the Russian people, they say they are spending too much money on food, they are spending much money out of their budget on shoes. What’s being done to address that?
Vladimir Putin: To resolve this issue, we need to implement the programme I just mentioned. We need to develop new technologies. This is not about spending money left and right or handing it out, it is about making our economy generate more revenue, so that our people earn higher incomes, accordingly. This can be done only by developing innovative technologies, including digital technologies.
The problem you mentioned is real. It is characteristic not only of Russia, but of many other economies as well. We are aware of it; we acknowledge that it exists, and that it is highly sensitive. This is my first point.
Secondly, we cannot afford to wait too long. Therefore, the state must find ways to redistribute resources using the tools at its disposal in order to support those who find themselves in a difficult situation.
We have many such tools, such as support for low-income families to pay their utility bills. This may not seem very special at first glance, but it is important for the people. They also include the maternity capital that we pay to families with two or more children. I know you have three children. If you were a Russian citizen, you would receive it as well. However, this is not enough.
We must build up targeted support. That is, on the one hand, we should help people who honestly – and I want to emphasise this – honestly earned their capital, and help them invest in expanding our economy, rather than consumption. On the other hand, we should develop targeted support measures for those who need help from the state.
Megyn Kelly: Now we are going to have some questions amongst all the panel, and there’s a lot to cover, so stay with me. So let us start with what has been in the news everywhere, what’s on the minds of a lot of people here today, which is that yesterday, as you gentlemen know, President Trump announced that the United States would withdraw from the Paris climate deal, saying that it will hurt the United States economy and cost jobs. European leaders were quick to react, accusing President Trump of shirking America’s role as a global leader. President Putin, how do you see it?
Vladimir Putin: I do not belong to the category of European leaders, at any rate they do not think I do (laughter, applause), but of course we, I mean Russia, have our own viewpoint. Have you read the Paris Agreement? No, you have not, as I can see.
In general, the Paris Agreement is a good, logical document aimed at resolving one of today’s global problems – preventing climate change. The question is whether we are in a position to avert climate change. What does it do? The goal is to prevent a two-degree rise in temperature.
So far, we do not get the sense here that the temperature is going up rapidly. Actually, we should be grateful to President Trump. I heard it was actually snowing in Moscow today, while here it is raining and quite chilly. Now we can blame everything on him and US imperialism, and say it is all their fault. But we will not.
As for the Paris Agreement, it is a framework document that relegates all decisions to national governments. It does not contain any mandatory requirements. All countries are to make decisions independently. The United States undertook to reduce emissions by 26–28 percent by 2025, as I recall, while Russia committed itself to reduce them by 70 percent of the 1990s level but by 2030.
If memory serves, the United States ratified the agreement whereas we have not done so yet. However, we have not done this because we want to wait for the rules for distributing resources and other strictly technical but important matters to be worked out. The United States assumed an obligation to contribute $100 billion to the so-called Green Climate Fund that is to be used to help developing nations implement environmental programmes. But how these funds are supposed to be transferred and who will dispose of them – these issues have not been resolved yet.
Here is the premise I am working from. To cut emissions by 26–28 percent by 2025 – that is not too far away – obviously, it is essential to modernise production on a really big scale. It is important to force businesses to invest hundreds of millions and maybe billions – that is right, billions of dollars in the economy.
The other side of the coin is that it is necessary to think about what to do with the employees who will be made redundant in the production system today. They need to be employed, and this requires planning ahead and appropriate resources, unless we want them to fall by the wayside and join the army of people living below the poverty line.
I was asked about people with low incomes in Russia. By the way, since 2000, we have almost halved the number of people living below the poverty line, from 40 percent. There are certain fluctuations related to the current crisis but nevertheless, we have managed to do this. So the United States should also think about what to do about people who will end up without a job. These are additional resources.
Therefore, I will not pass judgment on President Trump right now, because President Obama made certain decisions and maybe the incumbent president believes they were not well thought out. Maybe he thinks that there are not enough resources to go round. All of this calls for careful analysis. However, in my view, it was unnecessary to pull out of the Paris Agreement because it is a framework agreement in nature. Now, what could have been done?
The US commitments within the framework of the Paris Agreement could have been changed. However, what is done cannot be undone. What has been said cannot be unsaid, and now it is time to think about how to proceed, what to do next. As for the problem, of course, it should not be ignored. However, as far as I know (granted, I am not acquainted with the text of President Trump’s statement), he said he would like either to review the agreement or sign a new agreement.
After all, he is not refusing to work on this issue. And it seems to me that now it is important not to make a fuss but to create conditions for joint work because if such countries, such large emitters as the United States do not cooperate, then it will be impossible to coordinate and sign any agreement in this area. Therefore, it is essential to make do with what there is and seek to put this work on a constructive track.
Incidentally, this agreement has not even entered into force yet. It should come into force in 2021, so we still have time. If we work constructively, we will still be able to agree on something. Don’t worry, be happy! [last four words said in English]
Megyn Kelly: President Putin, does all this squabbling over NATO help Russia?
Vladimir Putin: Disputes over NATO? Do they help Russia?
Well, in the sense that NATO may fall apart, yes, this may help. However, for the time being, there are no signs of it falling apart. You know, I wondered on many occasions and even asked this question publicly. NATO was created as a Cold War instrument to oppose the Soviet Union and what was known as the Warsaw Pact. Now there is neither the Warsaw Pact, nor the Soviet Union, but NATO is still there.
Hence, the question: why? There is only one answer – no matter what they say, it is an instrument of US foreign policy. If someone likes it that way, so be it. What is important is if the processes that NATO has always mentioned, specifically there was talk of transforming this bloc into a political organisation which would create essential elements of stability across the world, if this happens, then that is probably not a bad thing. However, this has not materialised so far. What we have seen so far is their military infrastructure expanding and approaching our borders. This cannot but cause concern for us, and we have mentioned it many times publicly.
Speaking of the recent summit, the United States is demanding that its allies increase their military spending, while maintaining at the same time that NATO has no plans to attack anyone. If you are not going to attack anyone, why increase military spending? Of course, this raises additional questions on our part.
Therefore, you know, we tried to establish a constructive dialogue with this organisation, and even created the Russia-NATO Council in Rome. However, all this ceased to exist, and not through our fault. The absence of such instruments of cooperation is a bad thing, because it does not allow us to constructively work on the issues on the current agenda.
They say that NATO should step up its fight against terrorism. This is good, and we support this. But, at the same time, what do we see? Look, we have just held a major international conference on security issues at the level of security councils of our partner countries. Representatives from 95 countries attended. Many representatives from the American continent and Europe whispered to us that Brussels and Washington tried to talk them out of going to Russia.
What is that about? People who take such a position, what part of their body do they think with? The professionals are willing to cooperate, they realise the importance of such interaction and information sharing. The politicians ride in armoured vehicles, they are safe, and apparently do not sense any threat to their citizens.
If it stays that way, we will be hit in Germany, Brussels, the United States, and Russia. I said many times that it is necessary to unite efforts in order to fight major threats, one of which is terrorism. If NATO works constructively in this area, we will cooperate, of course.
Megyn Kelly: President Putin, you and Prime Minister Modi yesterday entered into several agreements promising more cooperation between your two countries on things like counterterrorism and agreeing to have Russia set up the final two units of a nuclear power plant in India. What is the significance of this cooperation? And you mentioned your relationship of trust between each other. How does China fit into that relationship?
Vladimir Putin: You know, disagreements always have been and still are part of the fabric of our world. Our task – mine, and President Xí Jinping’s and Prime Minister Modi’s – is to find streets, two-way streets, despite all these disagreements, rather than get stuck in dead ends.
Once the three of us – the President of Russia, and the leaders of China and India – got together here some time in 2005 despite all the difficulties, including regional disagreements. We agreed to get together and resolve common problems. This work was launched despite all the difficulties and disagreements.
It was launched and went so well that Brazil and the South African Republic wanted to join us. This led to the emergence of BRICS, which is a major factor in international affairs today. I believe this is a very positive process, and that is how it is viewed by the People’s Republic of China, by the Chinese leaders.
I spoke about this fairly recently, maybe at yesterday’s meeting with the heads of news agencies – we conducted border talks with China for forty years but owing to the atmosphere that was created in our bilateral relations we managed to find a compromise. Of course, one could say that we gave in on something or China gave in on something, but we got it done and it created more opportunities for advancing relations.
We have never had any problems with India. I hope we never will have any. On the contrary, we have only positives, and there are a great many. I am referring to our historical cooperation. Yesterday we signed a number of agreements that are aimed at developing the already traditional areas of cooperation as well as new ones.
We are trying to find new forms of interaction and, naturally, we want to focus on innovative sectors of the modern economy first and foremost. This certainly applies to the nuclear industry, as you mentioned. A number of units are already operating in India and we have ambitious plans for future cooperation. There are very interesting and promising areas for us to work in.
We will provide comprehensive support to those who are involved in this because such cooperation will benefit the people of both India and Russia and, actually, the entire region. This will also facilitate the implementation of the Chinese leadership’s projects related to the Silk Road. We spoke about coordinating efforts of the Eurasian Economic Union and China’s Silk Road plans. There are always issues that require additional study. But we want to follow this path and we will follow it, and provided there is goodwill, we most certainly will achieve success.
Megyn Kelly: On the subject of relationships, one of the elements between Russia and the United States today, and indeed Russia and Europe today, is the allegation that Russia interfered in elections. Mr Putin, this week you told a French newspaper that Russia is being accused of interfering with the US election by people who lost that election, who don’t want to admit defeat. But all 17 of the United States’ intelligence agencies have concluded the Russians did interfere with our election, and these are non-partisan career professionals.Republicans and Democrats alike on Capitol Hill, including President Trump’s supporters (and some are your defenders) who have seen the classified intelligence report have all accepted this conclusion. And even private non-partisan security firms say the same – that Russia interfered with the US election. Are they all wrong?
Vladimir Putin: Have you read these reports?
Megyn Kelly: I have read the non-classified version.
Vladimir Putin: A non-classified version means no version. “‘Who made the suit?’ ‘Are the pockets good?’ ‘They are.’ ‘Are the buttons sewn on well?’ ‘They are.’ ‘Do you have any complaints about the buttons.’ ‘No, they are sewn tight, but the suit is so ill-fitting I can’t wear it.’” Can such a thing happen? It happened to Arkady Raikin, one of our stand-up comedians.
Now you also say, “a non-classified version.” I have read these reports. There is nothing specific in these reports. There is only supposition and inference in those reports. That is it. You know, if there is anything specific, then there will be something to discuss. As they used to say in the organisation where I worked at one time: “addresses, safe houses, names.” So, where is all that?
As for independent sources, there is nothing independent in this world. Even the recent appointments in your intelligence services show that there are some predilections all the same. Therefore, it seems to me that this useless and harmful idle talk should come to an end.
To reiterate, this is bringing domestic political squabbles in the US out into the world arena. It is an attempt to address a domestic political issues with foreign policy tools.
This is detrimental, damaging to international relations, the global economy, security issues and the fight against terrorism. It is simply harmful. I have just given you the example of Washington warning against attending a counterterrorism event in Russia. This is absolute nonsense.
Somebody is behind this. The people who engage in this nonsense also initiate such reports. I think this needs to come to an end, and the sooner, the better. It is necessary to begin normal cooperation.
What else can I say? There are not so many countries in the world that enjoy the privilege of sovereignty. I do not want to hurt anyone but what Ms Merkel has said was dictated, among other things, by long-standing resentment – I assure you, despite whatever she might have said later – over the fact that sovereignty is in fact limited.
By the way, it is limited officially within the framework of military-political alliances, where it is stipulated what may and may not be done, but in reality, it is even worse: Nothing is permitted except for what is permitted. And who gives permission? The chiefs. And where are the chiefs? They are far away.
To reiterate, there are not so many countries that have sovereignty. Russia treasures its sovereignty, but not as a toy. We need sovereignty to protect our interests and to ensure our own development. India has sovereignty and we know it. Now I would like to say something to the Prime Minister. I have never said this to him, even though yesterday we talked face to face for several hours and before that also for several hours, but now I would like to say it to him publicly.
We know the position of the Indian Prime Minister, of the Indian leadership, the Indian people and the Indian state regarding all the attempts over the past several years to compel India to adopt a position on Russia that is beneficial for someone but not for the Indian people. Relying on its sovereignty, on the character of its leader and on its national interests, India does not let these advisers push it around. However, there are not so many countries like India in the world. That is true. We should simply bear this in mind. India is one such country and so is China. I will not enumerate them all: There are other countries, too, but not many.
If these attempts continue to order people around in or outside a country using unreliable information, it will damage international relations. But to reiterate – and at this point I would like to conclude my answer – this must eventually come to an end.
Megyn Kelly: So one of the reasons the question is relevant is because the United States views this as a matter of its national sovereignty, as does the UK, as does Germany, as does France, and so it keeps coming up over and over. And what they say in response to the question of “Where is the proof?” is that this type of disinformation campaign is intentionally difficult to find hardcore proof of. It is other factors. And what the experts say is that this couldn’t have been faked – that it’s not one factor, it is a hundred factors that point to Russia. They say it is the forensics, it’s the digital fingerprints, it’s the IP addresses, the malware, the encryption keys, the specific pieces of code – that all of them, all of them, point to Russia and none of them points to anyone other than Russia.
Vladimir Putin: What fingerprints? Hoof prints, horn prints? Whose fingerprints are these?
IP addresses can be simply made up. Do you know how many such specialists there are? They will make it look like it was sent from your home address by your children – your three-year old kid, they will organise everything to look like it was your three-year old daughter who carried out the attack. There are such IT specialists in the world today and they can arrange anything and then blame it on whoever.
This is no proof. It is an attempt to lay the blame at someone else’s door. This is not our problem. The problem is in US politics. That is the problem. Trump’s team proved more capable during the election campaign. At times, I actually thought the man was overdoing it, really. That is true. However, it turned out that he was right, that he found a key to those social groups and voters’ groups that he had bet on, and they came out and voted for him.
The other team lost. They are reluctant to acknowledge the mistake. They do not want to admit that they did not get it, that they miscalculated. It is easier to say, “We are not to blame, the Russians are to blame, they interfered in our election, but we are good.” It reminds me of anti-Semitism: the Jews are to blame for everything. The halfwit cannot do anything but the Jews are the ones who are to blame.
However, we know what such sentiments can lead to. They lead to nothing good. The thing to do is simply to work and think of how to get things right.
You have just mentioned disinformation. What disinformation? One of the hackers’ planted stories was that Mrs Clinton’s election campaign managers had acted unfairly with regard to other Democratic Party candidates. However, when that information appeared in the public domain, the campaign manager actually acknowledged that it was true and resigned. Is that disinformation? It is truthful information.
Does it really matter who revealed it? They should have apologised to the public and they should have said before resigning, “We will not repeat these mistakes.” But what did they do? They said, “We are not to blame. It is the Russians.” What have the Russians got to do with it? Did the Russians engage in pushing through one Democratic Party candidate to the detriment of another candidate? Whatever the case might be, we did not do it. They were the ones who did it. Enough. (Applause.)
Megyn Kelly: Even President Trump has said now that he believes Russia did it. So it is not just people who don’t want President Trump in office. And the difference between the hacking and the disinformation…
Vladimir Putin: She just won’t let it go. (Laughter.)
Megyn Kelly: The difference between the hacking and the disinformation – this is not my allegation, this is the conclusion of the 17 US intelligence agencies and the others that I mentioned. What they say is Russia not only that hacked into the Democratic National Committee and hacked into Hillary Clinton’s campaign emails, but that they also perpetuated a campaign of disinformation that involved putting out fake news stories through Russian-controlled entities like RT and Sputnik, and that those then were pushed by aggregators and what are called “bots” on Twitter and elsewhere, and specifically targeted at voters who were potentially pro-Trump, voters in the Rust Belt of America, in Wisconsin, in Michigan, in Pennsylvania, who were potentially gettable for Trump. And that is the conclusion that they have reached.
Vladimir Putin: We should all learn from American journalists. Megyn is doing first-class professional aerobatics. I have just given her an example showing that there was no disinformation, whoever planted the story regarding the manipulations within the Democratic Party during the elections.
There is no getting away from the fact that the campaign manager, managing director (or whatever the position is called there) resigned. I just said it and she goes: “Disinformation.” What disinformation? Where is the disinformation? I simply do not know. Do you understand? I do not know.
She says, specifically President Trump. Again, give me the text showing what he actually said. Did he say he won because of Russian interference? I do not think I ever saw anything like that.
Megyn Kelly: He did. He finally came around to saying “I think Russia did it”, and he said, “I don’t think they’ll do it again.”
Vladimir Putin: She thinks! Listen, these are very serious global political issues, and you think. It is not just any interview or some piece for a newspaper.
As for interference, you should have seen what you colleagues are doing here. They have simply barged into our internal politics with their shoes on. They are walking all over us, chewing gum. They are just having fun.
This is systematic, years-long, gross, absolutely unceremonious interference in our domestic policy, including the level of diplomatic missions. Let us end this. You will feel better, and we will feel better.
Megyn Kelly: Prime Minister Modi, President Putin said the other day that Russia does not engage in state-sponsored interference with other countries’ elections. Do you believe that?
VladimirPutin: Ask Mr Dodon. He knows. (Laughter. Applause.)
Narendra Modi: You are talking about America, Germany, Russia, Trump, Hillary Clinton, Chancellor Merkel and Putin. You are talking about people who, it seems, do not need a judge or lawyer like myself.
Vladimir Putin: It is not all that simple with the Hindus. It is an ancient philosophy. It is only we, ordinary people, who say exactly what we think.
Megyn Kelly: President Putin, there are reports today in the American press that the Trump administration took active steps to ease sanctions on Russia almost immediately after Trump took office. Was this possibility ever discussed between the Trump team and your representatives prior to President Trump being inaugurated?
Vladimir Putin: You know, I saw what was happening. Frankly, I was also amazed. What nonsense they are talking. I do not know where these people who are spreading this information have come from. This is simply disastrous!
Our ambassador met with someone. What should an ambassador do? That is his job. That is what he gets paid for. He should have meetings, discussing current affairs, reaching agreements. What is he supposed to do there? Go to the kind of places that he will be fired for visiting? No. This is his job but he is being accused of meeting with someone. Are you nuts out there or what? This is diplomatic service. This is just amazing.
I saw that President Trump then fired his aide because he was accused of talking to somebody somewhere. You see, I am telling you, but of course those who have a different position will not believe me, but I simply knew nothing about that. Who met with whom there? What did they talk about?
They talked about nothing. There were simply general words, simply general words about the need to think about how to develop our relations. Should we not think about developing our relations, or what? Should we simply act on the spur of the moment? Nothing specific, simply zero, zilch, nothing at all. Just amazing.
This is some sort of hysteria and you cannot stop it. Do you need to take something for that? Does anyone have a pill? Give her a pill or something. (Laughter.) Honestly, frankly, this is amazing.
Megyn Kelly: Let us talk about those sanctions, which have now been in place, by the Europeans and the United States, since 2014 against Russia. Do you believe they have hurt more than helped?
Vladimir Putin: I believe that, firstly, the sanctions have been imposed in violation of all international norms and rules. The United States, for one, has always been upholding the ideas of a free market, open economy, always teaching everyone (now apparently it is giving up on teaching others because it needs some teaching itself) and saying that politics should not influence global economic processes and that politics will only interfere with the economy, but then did precisely what they cautioned everyone against doing.
First of all, I would like to say that the events that happened and served as a cause and pretext for imposing those restrictions were not brought about by our policy. As a matter of fact, they were caused by US policy. Look, they spoke about the “greater” Middle East. Although nobody could formulate what this concept of the “greater” Middle East means.
Then they devastated Iraq and Libya and almost ruined Syria and destabilised and brought Egypt and Tunisia to the point of disaster. I am not even talking about the processes that were already under way in other countries, such as Somalia, and after that, they got to work in the so-called post-Soviet space.
After all, they said openly that they had spent almost $5 billion on supporting the opposition in Ukraine and they supported the coup. What is this? It is support of a military takeover. When we disagreed with that, they imposed sanctions on us. However, we can never agree to this and never will.
When we supported Russian people and people who consider themselves to be close to the Russian world, Russian-speakers in Crimea, who were simply intimidated by the anti-Russian propaganda and the surge in racist sentiments and radical views, as well as physical actions – people were being killed in Kiev – when we supported them and in keeping with international law, supported a referendum, sanctions were immediately imposed. And what did you expect?
Look at what is going on now in Yemen. Its president was also overthrown, and the entire Western world led by the US supports the actions of countries that are in effect conducting hostilities there. Should we, too, have conducted hostilities all over Ukraine or what?
Let us agree on a uniform interpretation of the norms and fundamental principles of international law and adhere to these rules. Because until that happens and as long as the principle that might is right is asserted, we will continue to have problems like the ones we are currently seeing in North Korea.
Smaller countries can see no other way to protect their independence, security and sovereignty but by acquiring nuclear weapons. This is what abuse of power leads to. This gave rise, unfortunately, to the restrictions and limitations in the economy. Who suffered more from them: we or those who imposed them? It is absolutely clear that they have done considerable damage to those who imposed them.
I see here one of the former leaders of the German organisation of the so-called eastern economy which maintains relations with Russia. They calculated that Germany lost several hundred thousand jobs. Did it hurt us? Yes, of course, the restrictions hurt us. This is mainly due to the financing restrictions and the work of our financial organisations, the transfer of technologies. But there is a positive side to it because we were able to ramp up the development of whole sectors of the Russian economy.
Our agriculture grows by more than three percent each year, around three percent, which we have never had before, this is a phenomenon, to be honest. I had some concerns about how we were going to solve the problem. It is indeed being solved. Incidentally, we would not have been able to do that ten years ago, whereas now we can, and we are doing it well. It pushes the development of a number of hi-tech sectors of the economy. We had to use our heads rather than just sit back and enjoy the oil and gas revenues. We had to stoke the development of some technologies, fundamental and applied science, and we see the positive results.
And now we have growing exports in sectors other than raw materials, oil and gas. I do not remember exactly, I spoke about this with my colleagues yesterday, I believe. Those exports have grown by 10 percent this year, and they also grew last year. What does this indicate? It indicates structural changes in the economy itself. This is only the very beginning of the road, we still have a lot to do, there is much that has not been done yet, but it is basically the beginning of the road.
Thus, on the whole there is nothing good about it but it is not going to kill us either. As the Chancellor of Austria said here quoting Mark Twain, “The reports of my death are greatly exaggerated.” about the same is true of the sanctions. But we would rather there were none, and we need to put an end to that.
Megyn Kelly: Thank you for your kind words first of all. Flattery will get you everywhere. I appreciate that.
Let us shift gears if we may to Syria for a minute. President Putin I know that you said that you do not believe…
Vladimir Putin: Christian spoke about the Minsk Agreements here. It is an important issue because it is the Ukraine crisis that lies at the root of today’s problems and sanctions. We keep on hearing “Everything will be all right if Russia complies with the Minsk Agreements.”
Russia cannot unilaterally comply with the Minsk Agreements. We are ready to support this process but we cannot do what Kiev authorities are obliged to do. They do everything to prevent any improvement, absolutely everything. You actually do not take any notice of some things, or pretend not to.
I did not mean you personally, I meant some Western media and my western colleagues. Everybody says there is shooting there but it is not clear who is doing the shooting. There was fire but it is unclear who was behind it. As a result, nothing is done; heavy armaments are not withdrawn from the contact line.
It was agreed to launch economic rehabilitation of those unrecognised republics, those territories. And what is happening in reality? Radicals decided to completely block any movement of people and goods. President Poroshenko tried to open it up again, staged a fight and shooting at the sky. But he still did not achieve anything.
And even though he publicly claimed that those behind it are virtually criminals who should be brought to order, after one or two days, when he realised that he was unable to do anything about it, he issued his own executive order about his joining in and signed off on the blockade officially. But the Minsk Agreements clearly state, I think, in Item 8, to conduct rehabilitation, to take off the blockade. But no, he joined the blockade by an official resolution. What are you demanding from us? What do you want us to do in this case?
Another example. They shut down all Russian media outlets, and they do not let Russian performers and journalists into the country. Now they have closed access to social networks. You are a journalist, where is free information exchange? Who is going to guarantee it, particularly in Ukraine? Why is everybody keeping silent about it? Why are all the demands being directed at Moscow? We will never solve any problem this way.
If you started that ball rolling, and it was indeed largely you who started the ball rolling, then do something to stop this. Just something. It is not enough to point your finger at Russia all the time. I am saying this not so much to you; this will be read and heard by those who take real decisions. They know my stand but I would like them to hear it once again.
Megyn Kelly: Shifting gears to Syria, our president has said that you are backing an evil guy there. He said that Assad is an evil guy. Do you believe that?
Vladimir Putin: What? That Assad is an evil person? Ask other leaders who have met him. After all, since he was elected, he has been to Europe more often than to Russia. We are not defending so much President Assad as Syrian statehood. We do not want Syria to be confronted with a situation similar to that in Libya or Somalia or Afghanistan, where NATO has been present for many years but the situation is not changing for the better.
We want to preserve [Syrian] statehood and once this fundamental matter is resolved, to move further towards settling the Syrian crisis by political means. Yes, perhaps everyone is to blame for something there. But let us not forget that if it were not for active intervention from the outside we would not have had the situation and the civil war that we are seeing now.
What does President Assad stand accused of today? We know about the charges of using chemical weapons. There is absolutely no proof. As soon as that happened we proposed conducting an inspection right there on the airfield from where President Assad’s aircraft had allegedly taken off with chemical weapons on board. I would like to reiterate because not everyone has heard this: if chemical weapons had been used, if some shells with toxic agents had been loaded, modern analysers, modern control systems would definitely have detected that there were chemical weapons there on board this aircraft, on that exact spot.
They declined. Nobody wants to. There is a lot of talk but no practical action. We proposed conducting an inspection in the area of the attack, “Let us see what there is.” No way again. “Why not?” “It is too dangerous there.” “What is so dangerous there if the strike was allegedly carried out against the good part of the armed opposition? These are normal people out there, why would they be dangerous?” “No, it is not possible there either.” However, it is known for certain that in Iraq (an Iraqi representative is present here, and we also welcome him), in Iraqi Kurdistan, militants used chemical weapons and that fact was established by the entire international community. Therefore, they have them. And judging by the statements made by the Organisation for the Prohibition of Chemical Weapons, Syria has destroyed these weapons.
You see, if reasons and excuses are invoked, without any intention of looking into the essence of the problem, then one can talk about anything. Let us get down to the heart of the matter. Has Assad made mistakes? He probably has, and quite a few, too. Now, are the people who are up against him angels? Who is killing people, executing children and beheading people there? Are we supposed to support them?
As you know, we argued with our US colleagues until we were blue in the face about whether certain territories could be attacked. “No, that is off limits.” “Why?” “The healthy part of the opposition is based there.” We say: “But ISIS and Jabhat al-Nusra are still there.” “Yes, but everything is intermingled there, so it is hard to understand who is where.” “Well, separate them then. What are decent, honest people doing with terrorists? Do you have control over them? Let them go and let us fight terrorists.” “No, do not touch them.” Why not? Should we wait until they come to you or to us? We will not. If you want to agree on something, let’s agree.
The Prime Minister is nodding because India is constantly confronted with the terrorist threat. It is not an imaginary problem. According to our preliminary estimate, there are 4,000 people from Russia alone in Syria, plus 4,500–5,000 from the CIS countries, mainly from Central Asia. It is a real threat to us. They are trying to return. Some are in fact returning. This is precisely why we began our operation in Syria, because we realised where things were headed. So, there should be no name-calling. Let us simply work together on the matter at hand. We are prepared for this. What is needed is a constructive position on your part.
Megyn Kelly: So, we know that Assad has used chemical weapons before, and Russia entered into an agreement in 2013 to stop that. I mean, Russia acknowledged that in 2013 to try to stop that by Assad. The only question is whether he launched the chemical weapons attack that happened a couple of months ago. And I just want to ask you, to press you a little further on this, because we all saw the video of the suffering, dying children, and that was the reason that President Trump dropped the bomb. Do you deny – because Assad denies that those tapes are real, he is purporting to tell us not to believe our lying eyes – do you believe those tapes are fake?
Vladimir Putin: Firstly, when President Obama and I agreed to work together on destroying chemical weapons in Syria, we acted on the premise that those weapons were out there. However, we have never acknowledged that Assad used them. I would ask you to be more accurate.
Secondly, regarding the people killed or injured as a result of the use of weapons, including chemical weapons, this is false information. At the moment, we are absolutely certain that it was simply a provocation. Assad did not use those weapons and all of that was done by people who wanted to blame it on him.
Furthermore, our intelligence services received additional information suggesting that there were plans to re-enact a similar scenario in other parts of Syria, including near Damascus. We made that information public. Thank God, the plotters had enough common sense not to follow through.
Megyn Kelly: If I could just follow up on that, though, because the bodies of the victims were autopsied at Turkey’s and our forensic medicine institution. The autopsies were witnessed by officials from the World Health Organisation and from the Organisation for the Prohibition of Chemical Weapons, and they concluded that the victims were attacked with zarin gas. Are we really to believe that the whole thing was staged? That everybody was in on it – the World Health Organisation, the forensic medicine institution, the Organisation for the Prohibition of Chemical Weapons?
Vladimir Putin: The answer is very simple and you know it: it could have been used – however, not by Assad, but by someone else in order to put the blame on Assad. So any further investigation without understanding who did it is senseless. It only plays into the hands of the provocateurs who organised this attack. That is all. What is there you cannot understand? It seems to me that everything is absolutely clear.
However, I would like to ask you a question: why didn’t they immediately go to the spot from where the chemical weapon attack had allegedly been launched? Why did nobody go to inspect the airfield? Why did nobody inspect the aircraft that had allegedly been used to carry out the strike, as we proposed? Why did nobody go to the place of the attack? The answer is simple: because they were afraid that this entire falsification would be uncovered – that is all.
As for what you are telling me, it does not convince me in the least but only goes to show that it would be far better not to indulge in speculation or a tug of war but combine efforts against real threats. We know very well what it is like. America is far away and there was a minor explosion, as a result of which, unfortunately, people were hurt at a well-known athletic event. And do you have any idea of how we have suffered here? We know full well, who we have to deal with.
Under no circumstances can anyone from this environment, which is hostile to modern civilisation, be used to address current political issues. Meanwhile, sometimes we see such attempts: “Let’s use these and those to fight Assad.” Why these and those? Because there is nobody else who can fight. Once you use them today, you will never know what will happen to you tomorrow. Then they will start fighting you.
At one time, Al-Qaeda was created to fight against the Soviet Union in Afghanistan. And then Al-Qaeda carried out the 9/11 attacks in the United States. This is what this can lead to. It is important to think about the possible long-term consequences.
Megyn Kelly: Last question. We have talked a lot today about things that divide us, that divide our countries, each of our countries. And it would be nice if we could end it on what unites us, because there are many things, separate and apart from the disagreements our countries have. President Putin, I will give you the last word.
Vladimir Putin: We are sitting here, discussing numerous problems. There is a representative of India with us today, one of the largest countries in the world. Russia, too, has some importance. There is an EU representative. There is a representative of a small country in the post-Soviet space. In other words, all regions are represented.
Mr Dodon has said that the world ceased to be unipolar. No, an American journalist is sitting here, ordering everyone around and giving the last word. (Laughter.) However, generally speaking, I believe this kind of unipolar world, with this quality of discussion, suits everyone. In any event, let us thank our moderator.
As for what unites us, there is a lot that unites us. The Prime Minister has just talked about fighting terrorism. Should not shared threats unite us? Should not the proliferation of weapons of mass destruction, including nuclear weapons, unite us? We need to understand what is going on and where this can lead us and prevent an unfavourable course of events in a timely manner through joint efforts.
We should understand that poverty is growing all over the world today, in countries from where thousands, hundreds of thousands, millions of migrants are moving to Europe and there is a danger that millions of people from Sub-Saharan Africa may move to Europe in the foreseeable future. If this socioeconomic situation continues, nothing will hold back this flow of people, nothing will stop them in their search for a better life. Therefore, it is necessary to think of what we should do to ensure that people in these countries have acceptable living standards, that they can have, raise and educate their children, get jobs and enjoy modern living standards. Isn’t this a shared challenge?
The same goes for the environment. The Prime Minister said this and all other speakers here said it and you also gave much prominence to it. It is a real challenge. We need to understand what is going on there. It is not an easy job. We also need to work out common rules of conduct. It is very important here – and I believe Christian spoke about this – it is very important to have stability here and together work out a solution, but then we should move together in carrying it out. We have a lot of unifying agendas, a lot. And if we focus on this, on the positive side of our cooperation, then the world will, without any doubt, change for the better.
Megyn Kelly: With that, we thank all of you for your attention and your patience. We thank the beautiful people of St Petersburg for hosting us. And we thank all of you – President Dodon, Chancellor Kern, Prime Minister Modi, and our host President Putin. Thank you very much.
Vladimir Putin: Many thanks again to our moderator.