Реферат: Kompaniya Tata na Rossiyskom rynke avtomobilestroeniya v perspektive

Understanding Global Markets

Tata Motors – the best to themasses

Tata’s Entry Into

Russian Automobile Market

Prepared by:

Rashid Mukhamedov

Prepared for :

Eliana Senna

MAIBA January 2006

May 25th 2006

<st1:place w:st=«on»><st1:PlaceName w:st=«on»>Bournemouth</st1:PlaceName><st1:PlaceType w:st=«on»>University</st1:PlaceType></st1:place>
Contents :

Introduction……………………………………………………………..2

Marketopportunities for Tata in <st1:country-region w:st=«on»><st1:place w:st=«on»>Russia</st1:place></st1:country-region>………………………4

Macro-environment…………………………………………………..5

Country’spest analysis………………………………………………5

Political factors………………………………………………………………5

Economical factors………………………………………………………….5

Socio-cultural factors……………………………………………………….6

Technological factors……………………………………………………….7

Industryfactors and competitive forces………………………7

Direct competitors and rivalry among existingcompanies……………...7

Micro-environment…………………………………………………...8

Swotanalysis……………………………………………………………..8

Strengths and weaknesses…………………………………………………8

Opportunities and threats…………………………………………………..8-9

Marketentry mode……………………………………………………9

Marketsegments……………………………………………………….9

Marketingmix………………………………………………………….10

Product ……………………………………………………………………...10

Price …………………………………………………………………..11

Place………………………………………………………………… 11

Promotion……………………………………………………………...11

Conclusion………………………………………………………………12

References………………………………………………………………13

Introduction

“Tata – the best to the Mass”

Today Tata is India’sbiggest car manufacturer with a 59% market chare .Established in 1945 Tata Motors, is one of India's largestautomobile makers, has been manufacturing buses, <a href=«www.hoovers.com/free/co/factsheet.xhtml?COID=58210&cm_ven=PAID&cm_cat=BUS&cm_pla=CO1&cm_ite=»Tata_Motors##" target="_blank">commercial trucks andtractor-trailers, passenger cars (Indica V2, Indigo, and Indigo Marina), lightcommercial vehicles (TATA 407), and utility vehicles (Tata Safari EX+, TataSumo SE+, Tata Spacio) for sale primarily in India but also in other Asiancountries and in Africa, Australia, Europe, the Middle East, and South America.With such a large export presence, the company operates plants in <st1:country-region w:st=«on»>Bangladesh</st1:country-region>, <st1:country-region w:st=«on»>Kenya</st1:country-region>,<st1:country-region w:st=«on»>Malaysia</st1:country-region>, <st1:country-region w:st=«on»>South Africa</st1:country-region>, and <st1:country-region w:st=«on»><st1:place w:st=«on»>Ukraine</st1:place></st1:country-region>. Tata Finance, in whichTata Motors held a 12% stake, has merged with Tata Motors. Tata Motors, aCompany that cares about the future. True to the tradition of the Tata Group,Tata Motors is committed in letter and spirit to Corporate SocialResponsibility. It is a signatory to the United Nations Global Compact, and isengaged in community and social initiatives on labour and environment standardsin compliance with the principles of the Global Compact. In accordance withthis, it plays an active role in community development, serving ruralcommunities adjacent to its manufacturing locations.

TataMotors believes in technology for tomorrow. Its products stand testimony to this. Their annual expenditure on R&D is approximately2% of our turnover

Today ambitious Indian vehicle makers are drivingoverseas to build a global presence for their brands, encouraged by robustdomestic sales. Companies are setting up manufacture and assembly operationsfor everything from tractors to motorbikes in countries like <st1:country-region w:st=«on»>Indonesia</st1:country-region> and <st1:country-region w:st=«on»>South Africa</st1:country-region>, taking advantage of tax benefits and expandingmarkets beyond traditional destinations in <st1:place w:st=«on»>South Asia</st1:place>.

Tata Motors Ltd.,which owns 21 percent of Spanish bus maker Hispano Carrocera and this monthformed a joint venture with Brazilian bus maker Marcopolo, is stepping upproduction at its bus building facility in <st1:country-region w:st=«on»>South Africa</st1:country-region> and is looking to assemble pickup trucks in <st1:country-region w:st=«on»><st1:place w:st=«on»>Thailand</st1:place></st1:country-region> with alocal firm.

Mahindra & Mahindra, which has a joint venture with <st1:country-region w:st=«on»>China</st1:country-region>'s Jiangling Motors for tractors, has plansto assemble pickup trucks in <st1:country-region w:st=«on»>Malaysia</st1:country-region>through a unit of DRB-HICOM, while TVS Motor has entered a joint venture in <st1:country-region w:st=«on»>Colombia</st1:country-region> and is setting up an assembly unit in <st1:place w:st=«on»><st1:country-region w:st=«on»>Indonesia</st1:country-region></st1:place>.

The year 2003 was extremelysignificant for Tata Motors, and not just because the company changed its name.The <st1:City w:st=«on»><st1:place w:st=«on»>high point</st1:place></st1:City>of an eventful 12-month period was the trailblazing debut on European roads ofthe City Rover, an improved version of the Indica. The year also saw TataMotors reaching the 3-million milestone in vehicles produced.

OnJuly 29, 2003 the company changed its name from Tata Engineering to TataMotors. The new name reflects the company’s core business of designing,manufacturing and marketing automobiles. Less than a month later, in August2003, Tata Motors produced its 3-millionth vehicle, reaching a landmark thatexemplifies the company’s ambition and progress.

Market opportunities for Tata in Russia

The next step to exploiting new markets issending absolutely new product of Tata Motors to <st1:place w:st=«on»><st1:country-region w:st=«on»>Russian Federation</st1:country-region></st1:place>. The <st1:place w:st=«on»><st1:country-region w:st=«on»>Russian Federation</st1:country-region></st1:place>is the largest of the 21 republics that make up the Commonwealth of IndependentStates. It occupies most of eastern Europe and north Asia, stretching from theBaltic Sea in the west to the Pacific Ocean in the east, and from the ArcticOcean in the north to the Black Sea and the <st1:place w:st=«on»>Caucasus</st1:place>in the south. It is bordered by <st1:country-region w:st=«on»>Norway</st1:country-region>and <st1:country-region w:st=«on»>Finland</st1:country-region> in thenorthwest; <st1:country-region w:st=«on»>Estonia</st1:country-region>, <st1:country-region w:st=«on»>Latvia</st1:country-region>, <st1:country-region w:st=«on»>Belarus</st1:country-region>,<st1:country-region w:st=«on»>Ukraine</st1:country-region>, <st1:country-region w:st=«on»>Poland</st1:country-region>, and <st1:country-region w:st=«on»>Lithuania</st1:country-region>in the west; <st1:country-region w:st=«on»>Georgia</st1:country-region> and <st1:country-region w:st=«on»>Azerbaijan</st1:country-region> in the southwest; and <st1:country-region w:st=«on»>Kazakhstan</st1:country-region>, <st1:country-region w:st=«on»>Mongolia</st1:country-region>,<st1:country-region w:st=«on»>China</st1:country-region>, and <st1:place w:st=«on»><st1:country-region w:st=«on»>North Korea</st1:country-region></st1:place> along the southernborder.

Atthe start of 1992, <st1:country-region w:st=«on»><st1:place w:st=«on»>Russia</st1:place></st1:country-region>embarked on a series of dramatic economic reforms, including the freeing ofprices on most goods, which led to an immediate downturn. A national referendumon confidence in first president Yeltsin and his economic program took place inApril 1993. To the surprise of many, the president and his shock-therapyprogram won by a resounding margin. In September, Yeltsin dissolved thelegislative bodies left over from the Soviet era.

With the population of142 mln people and unexplored opportunities <st1:country-region w:st=«on»><st1:place w:st=«on»>Russia</st1:place></st1:country-region> creates very attractivemarket for any businesses. According toits slogan, Tata will focus on themiddle class which is 60mln people with average wages 900GBPounds a month (in big cities). In ourcase Tata motors is going to enter this market in spite of strong competitorssuch as Mercedes, BMW, <st1:City w:st=«on»><st1:place w:st=«on»>Toyota</st1:place></st1:City>,Nissan and others.

Macro-environment

<st1:place w:st=«on»>Pest</st1:place>analysis

1.Political factors

<st1:place w:st=«on»><st1:country-region w:st=«on»>Russian Federation</st1:country-region></st1:place>one of thelargest countries on the map in the world consists of 21 republics, 48 regions.President is a chief of the government. The government is divided into 3branches:1. executive 2. judicial 3. legislative

The prime minister is ahead of government and Cabinet of ministers (executive branch) which iscomposed of 12 ministers. The legislative branch comprise Council of Federation( consists of 178 seats) and State Duma(Russian parliament with 450 seats). And the last one is Judicial branch whichconsists of <st1:Street w:st=«on»><st1:address w:st=«on»>Constitutional Court</st1:address></st1:Street>,Supreme Court and <st1:Street w:st=«on»><st1:address w:st=«on»>Arbitral Court</st1:address></st1:Street>. The political andsocial environment of <st1:place w:st=«on»><st1:country-region w:st=«on»>Russia</st1:country-region></st1:place>is stable, and the government is sympathetic and have positive attitude towardsbusiness. Quite strong legal system, stringent guidelines on intellectualproperty, and competitive corporate tax rate shows the government'sunderstanding of the needs of businesses.

2. Economical factors

<st1:place w:st=«on»><st1:country-region w:st=«on»>Russia</st1:country-region></st1:place>ended 2005 with its seventh straight year of growth, averaging 6.4%annually since the financial crisis of 1998. Although high oil prices and arelatively cheap ruble are important drivers of this economic rebound, since2000 investment and consumer-driven demand have played a noticeably increasingrole. Real fixed capital investments have averaged gains greater than 10% overthe last five years, and real personal incomes have realized average increasesover 12%. During this time, poverty has declined steadily and the middle classhas continued to expand. <st1:country-region w:st=«on»><st1:place w:st=«on»>Russia</st1:place></st1:country-region>has also improved its international financial position since the 1998 financialcrisis, with its foreign debt declining from 90% of GDP to around 31%. Strongoil export earnings have allowed <st1:country-region w:st=«on»><st1:place w:st=«on»>Russia</st1:place></st1:country-region> to increase its foreignreserves from only $12 billion to some $180 billion at yearend 2005. Theseachievements, along with a renewed government effort to advance structuralreforms, have raised business and investor confidence in <st1:country-region w:st=«on»><st1:place w:st=«on»>Russia</st1:place></st1:country-region>'seconomic prospects. The middle class’s life standards have increased recently. Russiaposted gross domestic product growth of 8.3 % in 2000 and most of industrialsector posting double digit growth figures, the GDP grew about 5 % in 2001 and4.3 % in 2002 It is expected to grow about 6.5 % in 2003. This is still higherthan most of the other countries.

The Russian GDP, however, hascontracted an estimated 45% since 1991, despite the country's wealth of naturalresources, its well-educated population, and its diverse — althoughincreasingly dilapidated — industrial base.

By the end of 1997, <st1:country-region w:st=«on»><st1:place w:st=«on»>Russia</st1:place></st1:country-region> hadachieved some progress. Inflation had been brought under control, the ruble(national currency unit) was stabilized, and an ambitious privatization programhad transferred thousands of enterprises to private ownership. Some importantmarket-oriented laws had also been passed, including a commercial codegoverning business relations and the establishment of an arbitration court forresolving economic disputes.

3.Socio-cultural factors

The population of <st1:country-region w:st=«on»><st1:place w:st=«on»>Russia</st1:place></st1:country-region> is 142.8 mln people. Nearly100% of population can read and write. Age structure of population is as follows:

0-14 age – 14.2%

15-64 years – 71.3%

65 and over – 14.4%

The average life expectancy is 67 years .Russian is a statelanguage. The dominating religion is Christianity with Russian ortodox 15-20%,Muslims- 15 %, other Christians 2%, the rest are non-believers.

4.Technological factors

<st1:place w:st=«on»><st1:country-region w:st=«on»>Russia</st1:country-region></st1:place>is an attractive market for both big businesses seeking to penetrate post Soviet are markets. <st1:place w:st=«on»><st1:country-region w:st=«on»>Russia</st1:country-region></st1:place>has a strong transport and communications infrastructure that is connected toall the major economies in the world through sea, air and othertelecommunication services.

Industryfactors and competitive forces

Direct and indirectcompetitors

Graph1. Market shares of car manufacturers’ in Russianmarket (2001)

As we cansee from the above graph , market isdominated by German cars( BMW, Mercedes, Audi). But these cars are oriented forupper class of population, whose income is minimum $70-80000 a year. Tata’sdirect competitor will be “Avtovaz” — local domestic company which has beenmanufacturing mostly light passenger cars since 1970s. Its prices vary from $2900 to 6500$ which is moreexpensive than Tata offers. Furthermore “Avtovaz”’s cars do not meet world standards, most of their cars arestill not equipped with basic componets such as ABS braking system,Power-assisted steering, Airbags and others. Considering Russian climate,especially winter Tata’s X-1 models will be exclusively equipped with powerfulignition system which is resistant to low temperature up to -35*C (below zero).

Micro-environment

Swotanalysis

SWOT ANALYSIS

“The overall evaluation of a company’s strength, weakness,opportunity and threat is called SWOT analysis.”(Kotler, 2000:p76). SWOTanalysis includes both internal and external analysis. In SWOT analysis, a firmevaluates its internal factors like strength and weakness in relation to theexternal factors like opportunities and threats.

Strengths

-

Tata holds 59% of Indian market

-

One of the biggest growing car manufacturers in more than 20countries across the world

-

Wide range of world standard design, which may suit to anycustomer

Weaknesses

-

Low brand value when compared to other international wellestablished brands

-

Newcomer in the market compare to world brands

-

Low price may give low brand image

-

Difficulties in competition with world brands

-

Less experience in former soviet zone market

Opportunities

-

Tata is one of the largest growing and well-known world car manufacturers

-

Availability and of Russian TV channels and newspapers toadvertise and promote product

-

Most of the population familiar with brand

-

Access to Russian market is open

-

Stable political and social environment

Threats

-

Strong competition from well established international brands

-

Low quality may be attributed because of its origin

-

Competition from the low priced Chinese and domesticcompanies

Market entry mode

In the opinion of Tata ‘s management licensing would be the most appropriate entrymode for the company. Joint – venture will require large investments ,which isrisky in a new market as we are not sure if new car will be adapted andaccepted by the customers in newmarket. According to Russian law, government, trying to protect and support domestic car manufacturer from foreigncompetitors, adopted high import taxes. Thus export is not suitable for Tataeither. Marketing department elaboratedstrategic plan: at the moment due to high competition Russian car plant“Ij-Moskvich” is on the edge of bankruptcy. Tata is negotiating to licensethem, to send them first 200 car components so they could assemble cars in “Moskvich” plant. The cars will bedistributed through “Moskvich” dealer shops across the country. If everything goes successfully, Tata will restructure “Moskvich” plant and establish long-term business with them onlicensing basis. It is considered that it will be cheaper to manufacture carcomponents in <st1:country-region w:st=«on»>India</st1:country-region>(regardinglabour cost and materials ) and to send these components to <st1:place w:st=«on»><st1:country-region w:st=«on»>Russia</st1:country-region></st1:place>. Finally cars can beassembled in <st1:place w:st=«on»><st1:country-region w:st=«on»>Russia</st1:country-region></st1:place>in “Moskvich “plant.

Segmentation

In the Russian market, Tata will be using variables like gender,age, income and behaviour to segment the market. The targeting strategy wouldbe differentiated global marketing where it offers its cars to five segmentswith multiple marketing mix offerings. The segmentation for the Tata Cars in Russian Market will be as follows.

·

Segment 1 Young people

·

Segment 2 Average income group

·

Segment 3 Mature people(Formal, and casual)

·

Segment 4 Low income

·

Segment 5 WorkingWomen

As it wasmentioned before Russian middle class with average income will consist of 62mln people.

Marketing mix

In marketing,one such conceptual framework that is particular useful in helpingpractitioners structure their about marketing problems is “marketing mix”. Marketing mix includes factors like product, price, place andpromotion, which is commonly known as the 4Ps of marketing. A proper evaluationof the marketing mix has to be done in order to understand how the marketingmix has to be adapted to meet the target market requirements( Baker M. J,2000)

Product ,Price,Place, Promotion

1. Product

The basisof any business is product or offering( Kotler ,1999) A company aims to makethe product different and better in some way that will cause tha target market to favour it and even pay pricepremium.

Let usreturn 15 years back to Russian history. After dissolution of <st1:country-region w:st=«on»>USSR</st1:country-region> and lack of boundary, legislation controlthe fake and law quality products from <st1:country-region w:st=«on»>India</st1:country-region>,<st1:country-region w:st=«on»>China</st1:country-region> <st1:place w:st=«on»><st1:country-region w:st=«on»>Turkey</st1:country-region></st1:place> and other 3rdworld countries bombarded Russian market. An important but unconventionalservice in <st1:place w:st=«on»><st1:country-region w:st=«on»>Russia</st1:country-region></st1:place>'seconomy was «shuttle trading»--the transport and sale of consumergoods by individual entrepreneurs, of whom 5 to 10 million were estimated to beactive in 1996. Traders used to goods in foreign countries such as <st1:country-region w:st=«on»>China</st1:country-region>, <st1:country-region w:st=«on»>Turkey</st1:country-region>,and the <st1:place w:st=«on»><st1:country-region w:st=«on»>United Arab Emirates</st1:country-region></st1:place> then sell them on the domestic market wheredemand is highest. Yevgeniy Yasin, minister of economics, estimated that in1995 some US$11 billion worth of goods entered <st1:place w:st=«on»><st1:country-region w:st=«on»>Russia</st1:country-region></st1:place> in this way. Shuttle tradershave been vital in maintaining the standard of living of Russians who cannotafford consumer goods on the conventional market. Copying international brandslike Panasonic(Chinese versions :Panasoanic, Sany and Adidos), Sony Adidas andothers spoilt business image of these countries .Nowadays anything that comeswith labels “made in China ,India or Turkey” is considered as very lowquality products. Therefore when entering Russian market, Tata’sdepartment of marketing and management decided to cover brand and to change thename of model.

According toDoyle, a positive or successful brand can be defined as follows :

A successful brand is a name ,symbol, design,or some combination which identifies “product” of particular organization ashaving a sustainable differential advantage(cited in Baker J,M pp 295, 2001)

2. Price

Price differs from other three marketing mixelements in that produces revenue, the other elements produce costs.Consequently companies try to increasetheir price as high as their level ofdifferentiation will support. In our case we need to take into considerationthat the market has been formed already, andTata willbe facing quite strong competition from international brands. However Tata carsare oriented on middle class customers with average incomes. Only 3% of Russianpopulation can afford expensive cars such Mercedes, Bmw, <st1:place w:st=«on»><st1:City w:st=«on»>Toyota</st1:City></st1:place> and they will buy them anyway. Highpricing helps to create a brand image inthe market(but not in our case). The penetration pricing policy will be usedbecause of the tough competition in the low price segment from the low priced Chinese and Russian cars.

3. Place

Every sellermust decide how to make its goods available to the target market. The twochoices are to sell the goods directly or to sell them through middlemen.Traditionally automobile manufacturers have sold their cars through franchiseddealers. But in our case it we will license Russian company “Moskvich” to assemble and sell our cars in <st1:place w:st=«on»><st1:country-region w:st=«on»>Russia</st1:country-region></st1:place>.

4. Promotion

X-1 Advertising Campaign

The fourth, promotion, covers allcommunication tools that can deliver message to a target audience: Advertising,Sales promotion, Public relations, Sales force and direct marketing.(Kotler,1999)

Advertising is the most potent tool forbuilding awareness of a company, product, service or idea.

Regarding very strong competition inautomobile market in <st1:place w:st=«on»><st1:country-region w:st=«on»>Russia</st1:country-region></st1:place>massive advertisement needs to be launched across the country. It will costcompany approximately $40 mln. ( equal to 21.9 mln. GBPounds).

This is one of the examples which maybe released on TV, Newspapers and journals This is absolutely new model of Tatawhich was created by Tata ‘s professional engineers ,designers and techniciansin 2006. The new Indica V2 Xeta. In ourcase this car will be renamed to Euro X-1.Its eXtra Efficiency Torque Advantage petrol enginedelivers 12.4 kgm torque, for a smoother and more responsive drive. Withinstant pick up and fewer gear changes in stop-start city traffic.

The technologically superior MPFI engine comes with a 32-bit microprocessor,and sports 12 sensors, including a knock control sensor to reduce damage fromadulterated fuel. The result? Even more enjoyable long drives, with a frugalfuel consumption at 14 kmpl.

Its spacious cabin — the biggest in its class, seats three people comfortablyin the rear, with ample elbow room and generous leg room. The luxurious beigeinteriors come as a standard feature. Just a car to suit you. Only $2200 Car finance is available.First 15 customers will get 5% discount

Conclusion

While considering macro level situation in <st1:country-region w:st=«on»><st1:place w:st=«on»>Russia</st1:place></st1:country-region>, thefuture of the Tata’s cars in Russian market is bright. Using licensins as itsentry strategy, the investment in this aspect would be much lower compared toother entry modes. But massive expenses need to be incurred on advertising andboosting the brand in a dynamic market like <st1:country-region w:st=«on»><st1:place w:st=«on»>Russia</st1:place></st1:country-region>, which is the playground ofhuge international companies. Titan islikely to have initial problems while entering in Russian market because of the presence of international wellestablished firms. But large population and the demand for cheap reliableIndian cars provides a strong base for Tata in the market. After considering the various factors, it is clear that an invest inRussia, provides a huge perspective and successful entry in this market and will open the doorsfor entry into the other Post Soviet Republics as Kazakhstan, Uzbekistan,Tajikistan and others.
References

1. Brassington, F. Pettitt S., 1997 .Principles of marketing.. — <st1:place w:st=«on»><st1:City w:st=«on»>London</st1:City></st1:place>: Pitman

2. Baker, Michael J., 2000- Marketing strategy and management . — 3rd ed.. – <st1:place w:st=«on»>Basingstoke</st1:place>: Macmillan Business

3. Barrell — Exploring and exploiting new markets forprofitable business growth. — <st1:place w:st=«on»><st1:City w:st=«on»>Cambridge</st1:City></st1:place>

4. Kotler, Ph .1999, How to create, win, and dominate markets.- <st1:place w:st=«on»><st1:City w:st=«on»>London</st1:City></st1:place>:Simon & Schuster

5. Lancaster, G. A. 2001.- Marketing management. — 3rd ed.. — <st1:place w:st=«on»><st1:City w:st=«on»>London</st1:City></st1:place>: McGraw-Hill

Electronic sources:

1. www.autoworld.agava.ru

(accessedMay 20, 2006)

2. http://www.cia.gov/cia/publications/factbook/geos/rs

(accessed May 18,2006)

3. www.avtovaz.ru

(accessed May 19,2006)

Appendices

Government

<st1:place w:st=«on»><st1:country-region w:st=«on»>Russia</st1:country-region></st1:place>

Top of Page

Country name:

<img src="/cache/referats/22288/image010.jpg" v:shapes="_x0000_i1031"><img src="/cache/referats/22288/image011.jpg" v:shapes="_x0000_i1032">
conventional long form: <st1:country-region w:st=«on»>Russian Federation</st1:country-region>
conventional short form: <st1:country-region w:st=«on»>Russia</st1:country-region>
local long form: Rossiyskaya Federatsiya
local short form: Rossiya
former: Russian Empire, <st1:place w:st=«on»><st1:PlaceName w:st=«on»>Russian</st1:PlaceName> <st1:PlaceName w:st=«on»>Soviet</st1:PlaceName> <st1:PlaceName w:st=«on»>Federative</st1:PlaceName> <st1:PlaceName w:st=«on»>Socialist</st1:PlaceName> <st1:PlaceType w:st=«on»>Republic</st1:PlaceType></st1:place>

Government type:

<img src="/cache/referats/22288/image010.jpg" v:shapes="_x0000_i1033"><img src="/cache/referats/22288/image012.jpg" v:shapes="_x0000_i1034">
federation

Capital:

<img src="/cache/referats/22288/image010.jpg" v:shapes="_x0000_i1035"><img src="/cache/referats/22288/image011.jpg" v:shapes="_x0000_i1036">
<st1:place w:st=«on»><st1:City w:st=«on»>Moscow</st1:City></st1:place>

Administrative divisions:

<img src="/cache/referats/22288/image010.jpg" v:shapes="_x0000_i1037"><img src="/cache/referats/22288/image011.jpg" v:shapes="_x0000_i1038">
48 oblasts (oblastey, singular — oblast), 21 republics (respublik, singular — respublika), 9 autonomous okrugs (avtonomnykh okrugov, singular — avtonomnyy okrug), 7 krays (krayev, singular — kray), 2 federal cities (singular — gorod), and 1 autonomous oblast (avtonomnaya oblast')
oblasts: Amur (Blagoveshchensk), Arkhangel'sk, Astrakhan', Belgorod, Bryansk, Chelyabinsk, Chita, Irkutsk, Ivanovo, Kaliningrad, Kaluga, Kamchatka (Petropavlovsk-Kamchatskiy), Kemerovo, Kirov, Kostroma, Kurgan, Kursk, Leningrad, Lipetsk, Magadan, Moscow, Murmansk, Nizhniy Novgorod, Novgorod, Novosibirsk, Omsk, Orenburg, Orel, Penza, Pskov, Rostov, Ryazan', Sakhalin (Yuzhno-Sakhalinsk), Samara, Saratov, Smolensk, Sverdlovsk (Yekaterinburg), Tambov, Tomsk, Tula, Tver', Tyumen', Ul'yanovsk, Vladimir, Volgograd, Vologda, Voronezh, Yaroslavl'
republics: Adygeya (Maykop), Altay (Gorno-Altaysk), Bashkortostan (Ufa), Buryatiya (Ulan-Ude), Chechnya (Groznyy), Chuvashiya (Cheboksary), Dagestan (Makhachkala), Ingushetiya (Magas), Kabardino-Balkariya (Nal'chik), Kalmykiya (Elista), Karachayevo-Cherkesiya (Cherkessk), Kareliya (Petrozavodsk), Khakasiya (Abakan), Komi (Syktyvkar), Mariy-El (Yoshkar-Ola), Mordoviya (Saransk), Sakha [Yakutiya] (Yakutsk), North Ossetia (Vladikavkaz), Tatarstan (Kazan'), Tyva (Kyzyl), Udmurtiya (Izhevsk)
autonomous okrugs: Aga Buryat (Aginskoye), Chukotka (Anadyr'), Evenk (Tura), Khanty-Mansi, Koryak (Palana), Nenets (Nar'yan-Mar), Taymyr [Dolgano-Nenets] (Dudinka), Ust'-Orda Buryat (Ust'-Ordynskiy), Yamalo-Nenets (Salekhard)
krays: Altay (Barnaul), Khabarovsk, Krasnodar, Krasnoyarsk, Permskiy, Primorskiy (Vladivostok), Stavropol'
federal cities: Moscow (Moskva), Saint Petersburg (Sankt-Peterburg)
autonomous oblast: Yevrey [Jewish] (Birobidzhan)
note: administrative divisions have the same names as their administrative centers (exceptions have the administrative center name following in parentheses)

<st1:place w:st=«on»><st1:City w:st=«on»>Independence

</st1:City></st1:place>:

<img src="/cache/referats/22288/image010.jpg" v:shapes="_x0000_i1039"><img src="/cache/referats/22288/image011.jpg" v:shapes="_x0000_i1040">
24 August 1991 (from <st1:place w:st=«on»>Soviet Union</st1:place>)

National holiday:

<img src="/cache/referats/22288/image010.jpg" v:shapes="_x0000_i1041"><img src="/cache/referats/22288/image011.jpg" v:shapes="_x0000_i1042">
<st1:place w:st=«on»><st1:country-region w:st=«on»>Russia</st1:country-region></st1:place> Day, 12 June (1990)

Constitution:

<img src="/cache/referats/22288/image010.jpg" v:shapes="_x0000_i1043"><img src="/cache/referats/22288/image011.jpg" v:shapes="_x0000_i1044">
adopted 12 December 1993

Legal system:

<img src="/cache/referats/22288/image010.jpg" v:shapes="_x0000_i1045"><img src="/cache/referats/22288/image011.jpg" v:shapes="_x0000_i1046">
based on civil law system; judicial review of legislative acts

Suffrage:

<img src="/cache/referats/22288/image010.jpg" v:shapes="_x0000_i1047"><img src="/cache/referats/22288/image011.jpg" v:shapes="_x0000_i1048">
18 years of age; universal

Executive branch:

<img src="/cache/referats/22288/image010.jpg" v:shapes="_x0000_i1049"><img src="/cache/referats/22288/image011.jpg" v:shapes="_x0000_i1050">
chief of state: President Vladimir Vladimirovich PUTIN (acting president 31 December 1999-6 May 2000, president since 7 May 2000)
head of government: Premier Mikhail Yefimovich FRADKOV (since 5 March 2004); First Deputy Premier Dmitriy Anatolyevich MEDVEDEV (since 14 November 2005), Deputy Premiers Aleksandr Dmitriyevich ZHUKOV (since 9 March 2004) and Sergey Borisovich IVANOV (since 14 November 2005)
cabinet: Ministries of the Government or «Government» composed of the premier and his deputies, ministers, and selected other individuals; all are appointed by the president
note: there is also a Presidential Administration (PA) that provides staff and policy support to the president, drafts presidential decrees, and coordinates policy among government agencies; a Security Council also reports directly to the president
elections: president elected by popular vote for a four-year term; election last held 14 March 2004 (next to be held March 2008); note — no vice president; if the president dies in office, cannot exercise his powers because of ill health, is impeached, or resigns, the premier serves as acting president until a new presidential election is held, which must be within three months; premier appointed by the president with the approval of the Duma
election results: Vladimir Vladimirovich PUTIN reelected president; percent of vote — Vladimir Vladimirovich PUTIN 71.2%, Nikolay KHARITONOV 13.7%, other (no candidate above 5%) 15.1%

Legislative branch:

<img src="/cache/referats/22288/image010.jpg" v:shapes="_x0000_i1051"><img src="/cache/referats/22288/image011.jpg" v:shapes="_x0000_i1052">
bicameral Federal Assembly or Federalnoye Sobraniye consists of the Federation Council or Sovet Federatsii (178 seats; as of July 2000, members appointed by the top executive and legislative officials in each of the 88 federal administrative units — oblasts, krays, republics, autonomous okrugs and oblasts, and the federal cities of Moscow and Saint Petersburg; members serve four-year terms) and the State Duma or Gosudarstvennaya Duma (450 seats; currently elected by proportional representation from party lists winning at least 7% of the vote; members are elected by direct, popular vote to serve four-year terms)
elections: State Duma — last held 7 December 2003 (next to be held in December 2007)
election results: State Duma — percent of vote received by parties clearing the 5% threshold entitling them to a proportional share of the 225 party list seats — United Russia 37.1%, CPRF 12.7%, LDPR 11.6%, Motherland 9.1%; seats by party — United Russia 222, CPRF 53, LDPR 38, Motherland 37, People's Party 19, Yabloko 4, SPS 2, other 7, independents 65, repeat election required 3

Judicial branch:

<img src="/cache/referats/22288/image010.jpg" v:shapes="_x0000_i1053"><img src="/cache/referats/22288/image011.jpg" v:shapes="_x0000_i1054">
Constitutional Court; Supreme Court; <st1:Street w:st=«on»><st1:address w:st=«on»>Supreme Arbitration Court</st1:address></st1:Street>; judges for all courts are appointed for life by the Federation Council on the recommendation of the president

Economy

GDP (purchasing power parity):

<img src="/cache/referats/22288/image010.jpg" v:shapes="_x0000_i1055"><img src="/cache/referats/22288/image012.jpg" v:shapes="_x0000_i1056"><img src="/cache/referats/22288/image013.jpg" v:shapes="_x0000_i1057">
$1.539 trillion (2005 est.)

GDP (official exchange rate):

<img src="/cache/referats/22288/image010.jpg" v:shapes="_x0000_i1058"><img src="/cache/referats/22288/image012.jpg" v:shapes="_x0000_i1059">
$740.7 billion (2005 est.)

GDP — real growth rate:

<img src="/cache/referats/22288/image010.jpg" v:shapes="_x0000_i1060"><img src="/cache/referats/22288/image012.jpg" v:shapes="_x0000_i1061"><img src="/cache/referats/22288/image013.jpg" v:shapes="_x0000_i1062">
5.9% (2005 est.)

GDP — per capita (PPP):

<img src="/cache/referats/22288/image010.jpg" v:shapes="_x0000_i1063"><img src="/cache/referats/22288/image012.jpg" v:shapes="_x0000_i1064"><img src="/cache/referats/22288/image013.jpg" v:shapes="_x0000_i1065">
$10,700 (2005 est.)

GDP — composition by sector:

<img src="/cache/referats/22288/image010.jpg" v:shapes="_x0000_i1066"><img src="/cache/referats/22288/image012.jpg" v:shapes="_x0000_i1067">
agriculture: 5%
industry: 35%
services: 60% (2005 est.)

Labor force:

<img src="/cache/referats/22288/image010.jpg" v:shapes="_x0000_i1068"><img src="/cache/referats/22288/image011.jpg" v:shapes="_x0000_i1069"><img src="/cache/referats/22288/image013.jpg" v:shapes="_x0000_i1070">
74.22 million (2005 est.)

Labor force — by occupation:

<img src="/cache/referats/22288/image010.jpg" v:shapes="_x0000_i1071"><img src="/cache/referats/22288/image011.jpg" v:shapes="_x0000_i1072">
agriculture: 10.3%
industry: 21.4%
services: 68.3% (2004 est.)

Unemployment rate:

<img src="/cache/referats/22288/image010.jpg" v:shapes="_x0000_i1073"><img src="/cache/referats/22288/image011.jpg" v:shapes="_x0000_i1074"><img src="/cache/referats/22288/image013.jpg" v:shapes="_x0000_i1075">
7.6% plus considerable underemployment (2005 est.)

Population below poverty line:

<img src="/cache/referats/22288/image010.jpg" v:shapes="_x0000_i1076"><img src="/cache/referats/22288/image011.jpg" v:shapes="_x0000_i1077">
17.8% (2004 est.)

Household income or consumption by percentage share:

<img src="/cache/referats/22288/image010.jpg" v:shapes="_x0000_i1078"><img src="/cache/referats/22288/image011.jpg" v:shapes="_x0000_i1079">
lowest 10%: 1.7%
highest 10%: 38.7% (1998)

Distribution of family income — Gini index:

<img src="/cache/referats/22288/image010.jpg" v:shapes="_x0000_i1080"><img src="/cache/referats/22288/image011.jpg" v:shapes="_x0000_i1081">
40 (2002)

Inflation rate (consumer prices):

<img src="/cache/referats/22288/image010.jpg" v:shapes="_x0000_i1082"><img src="/cache/referats/22288/image011.jpg" v:shapes="_x0000_i1083"><img src="/cache/referats/22288/image013.jpg" v:shapes="_x0000_i1084">
11% (2005 est.)

Investment (gross fixed):

<img src="/cache/referats/22288/image010.jpg" v:shapes="_x0000_i1085"><img src="/cache/referats/22288/image011.jpg" v:shapes="_x0000_i1086"><img src="/cache/referats/22288/image013.jpg" v:shapes="_x0000_i1087">
17.5% of GDP (2005 est.)

Budget:

<img src="/cache/referats/22288/image010.jpg" v:shapes="_x0000_i1088"><img src="/cache/referats/22288/image011.jpg" v:shapes="_x0000_i1089">
revenues: $176.7 billion
expenditures: $125.6 billion; including capital expenditures of $NA (2005 est.)

Public debt:

<img src="/cache/referats/22288/image010.jpg" v:shapes="_x0000_i1090"><img src="/cache/referats/22288/image011.jpg" v:shapes="_x0000_i1091"><img src="/cache/referats/22288/image013.jpg" v:shapes="_x0000_i1092">
15.6% of GDP (2005 est.)

Agriculture — products:

<img src="/cache/referats/22288/image010.jpg" v:shapes="_x0000_i1093"><img src="/cache/referats/22288/image011.jpg" v:shapes="_x0000_i1094">
grain, sugar beets, sunflower seed, vegetables, fruits; beef, milk

Industries:

<img src="/cache/referats/22288/image010.jpg" v:shapes="_x0000_i1095"><img src="/cache/referats/22288/image011.jpg" v:shapes="_x0000_i1096">
complete range of mining and extractive industries producing coal, oil, gas, chemicals, and metals; all forms of machine building from rolling mills to high-performance aircraft and space vehicles; defense industries including radar, missile production, and advanced electronic components, shipbuilding; road and rail transportation equipment; communications equipment; agricultural machinery, tractors, and construction equipment; electric power generating and transmitting equipment; medical and scientific instruments; consumer durables, textiles, foodstuffs, handicrafts

Industrial production growth rate:

<img src="/cache/referats/22288/image010.jpg" v:shapes="_x0000_i1097"><img src="/cache/referats/22288/image011.jpg" v:shapes="_x0000_i1098"><img src="/cache/referats/22288/image013.jpg" v:shapes="_x0000_i1099">
4% (2005 est.)

Electricity — production:

<img src="/cache/referats/22288/image010.jpg" v:shapes="_x0000_i1100"><img src="/cache/referats/22288/image011.jpg" v:shapes="_x0000_i1101"><img src="/cache/referats/22288/image013.jpg" v:shapes="_x0000_i1102">
931 billion kWh (2004)

Electricity — consumption:

<img src="/cache/referats/22288/image010.jpg" v:shapes="_x0000_i1103"><img src="/cache/referats/22288/image011.jpg" v:shapes="_x0000_i1104"><img src="/cache/referats/22288/image013.jpg" v:shapes="_x0000_i1105">
811.5 billion kWh (2004)

Electricity — exports:

<img src="/cache/referats/22288/image010.jpg" v:shapes="_x0000_i1106"><img src="/cache/referats/22288/image011.jpg" v:shapes="_x0000_i1107">
24 billion kWh (2003)