Putin announces more anti-crisis aid

By Gleb Bryanski and Denis Pinchuk

ST PETERSBURG, Russia (Reuters) - Vladimir Putin pledged on Saturday to widen Russia's anti-crisis aid package with a car scrappage scheme and mortgage support to jolt the economy out of the worst recession in 15 years.

Putin, who now serves as Russia's prime minister after eight years as Kremlin chief, vowed to restore boom-time levels of economic growth after an 8.0-8.5 percent decline in gross domestic product this year.

Speaking to members of his United Russia party at a congress in St Petersburg, Putin said he saw a rise in cargo turnover and electricity demand in 2010, two key indicators of economic activity. He did not mention taxation policy or interest rates.

"The decline in GDP by the end of the year will not be as big as we thought -- the figure of 10 percent or even more was calculated -- it will be less: about 8 or 8.5, but that is still a great deal," Putin said in a speech lasting more than an hour.

His remarks followed a brief opening speech from President Dmitry Medvedev lasting around 10 minutes which concentrated on the need for United Russia to modernise and largely avoided the economy.

"In the next 2 to 3 years, we must not only fully restore the pre-crisis level of the economy -- this is of course essential, as it is also with people's incomes -- but more importantly, also achieve major changes " said Putin.

A decline in annual GDP of 8.0 to 8.5 percent would be Russia's worst economic result since 1994, when the economy, trapped in the chaos which followed the 1991 fall of the Soviet Union, contracted by more than 12 percent.

Alexander Shokhin, who heads Russia's main business lobby, the Union of Industrialists and Entrepeneurs, said after the speech that tax reform should be a priority for the government.