Russia: Domestic Politics and Economy

Russia: Domestic Politics and Economy

Russia: Domestic Politics and Economy
September 9, 2020
Over the course of his 20 years of rule, Russian President Vladimir Putin has
consolidated an authoritarian system of governance that has benefitted himself and a
Cory Welt
close group of colleagues and led Russia to take increasingly aggressive actions abroad.
Specialist in European
At the same time, Russia exhibits some signs of political and economic change. Russia’s
Affairs
economic growth has slowed, popular support for Putin has declined, and expressions of

public discontent have appeared more frequently.
Rebecca M. Nelson
Specialist in International
Since 2020, the Coronavirus Disease 2019 (COVID-19) pandemic has negatively
Trade and Finance
affected the Russian economy further and appears to have led to a new drop in public

approval of the Russian government. In June 2020, the International Monetary Fund

projected that Russia’s gross domestic product (GDP) will contract by 6.6% in 2020.
Although it is difficult to predict the course of developments, many observers express a new level of uncertainty
about Russia’s political and economic future.
U.S. policymakers, including in Congress, have long been attentive and responsive to domestic developments in
Russia. U.S. policy toward Russia includes democracy and civil society assistance, human rights-related
sanctions, and diplomacy that calls attention to human rights abuses. In December 2012, Congress passed and the
President signed into law the Sergei Magnitsky Rule of Law Accountability Act of 2012 (P.L. 112-208/H.R. 6156,
Title IV; 22 U.S.C. §5811 note). In addition to the Magnitsky Act, Congress has used other legislation to respond
to human rights abuses in Russia, including the Global Magnitsky Human Rights Accountability Act (P.L. 114-
328/S. 2943, Title XII, Subtitle F; 22 U.S.C. §2656 note) and the Support for the Sovereignty, Integrity,
Democracy, and Economic Stability of Ukraine Act of 2014 (SSIDES; P.L. 113-95/H.R. 4152, as amended; 22
U.S.C. §§8901 et seq.). Amendments to SSIDES were introduced in the Countering Russian Influence in Europe
and Eurasia Act of 2017 (CRIEEA; P.L. 115-44/H.R. 3364). SSIDES also established sanctions on Russian
government officials and associates responsible for acts of significant corruption worldwide. As of September 1,
2020, the Trump Administration has not designated Russian persons under this authority; however, the
Administration has designated several “oligarchs and elites who profit from [Russia’s] corrupt system” pursuant
to authorities related to Russia’s invasion of Ukraine.
In September 2020, German officials concluded, based on German medical assessments, that Alexei Navalny, a
leading Russian opposition figure and anti-corruption advocate, had been poisoned in Russia with a chemical
nerve agent known as a Novichok. Prior to receiving his diagnosis, Navalny was evacuated to Germany for
medical care. In response to a previous Novichok attack against a United Kingdom national and his daughter in
2018, the U.S. Administration imposed two rounds of sanctions on Russia pursuant to the Chemical and
Biological Weapons Control and Warfare Elimination Act of 1991 (CBW Act; P.L. 102-182/H.R. 3364, Title III;
22 U.S.C. §§5601 et seq.). In response to the attack on Navalny, the Administration may consider making a new
determination that Russia has used a chemical weapon in contravention of international law and potentially could
impose additional sanctions.
This report addresses Russian domestic politics, the Russian economy, and related U.S. policy. For background on
Russian foreign policy, see CRS Report R44775, Russia: Background and U.S. Policy, and CRS In Focus
IF11625, Russian Armed Forces: Military Doctrine and Strategy, by Andrew S. Bowen. For more information on
U.S. sanctions, see CRS In Focus IF10779, U.S. Sanctions on Russia: An Overview, and CRS Report R45415,
U.S. Sanctions on Russia.
Congressional Research Service

link to page 4 link to page 5 link to page 6 link to page 9 link to page 12 link to page 15 link to page 17 link to page 19 link to page 20 link to page 25 link to page 26 link to page 29 link to page 30 link to page 30 link to page 34 link to page 38 link to page 41 link to page 5 link to page 30 link to page 34 link to page 35 link to page 36 link to page 37 link to page 38 link to page 39 link to page 40 link to page 13 link to page 35 link to page 43 Russia: Domestic Politics and Economy

Contents
Introduction ..................................................................................................................................... 1
Politics ............................................................................................................................................. 2
Vladimir Putin ........................................................................................................................... 3
Other Government Officials and Oligarchs ............................................................................... 6
Legislative and Judicial Branches ............................................................................................. 9
Opposition and Protest ............................................................................................................ 12
Coronavirus Disease 2019 Response ............................................................................................. 14
Corruption ..................................................................................................................................... 16
Human Rights ................................................................................................................................ 17
U.S. Policy and Human Rights-Related Sanctions ........................................................................ 22
Related Sanctions .................................................................................................................... 23
Other Actions .......................................................................................................................... 26
Economy ........................................................................................................................................ 27
Economic Trends ..................................................................................................................... 27
Energy ..................................................................................................................................... 31
U.S.-Russian Trade and Investment ........................................................................................ 35
Outlook .......................................................................................................................................... 38

Figures
Figure 1. Russian Federation ........................................................................................................... 2
Figure 2. Economic Growth in Russia, 1994-2020 ....................................................................... 27
Figure 3. Russia’s Budget Balance ................................................................................................ 31
Figure 4. Russian Oil and Natural Gas Production and Consumption .......................................... 32
Figure 5. Oil, Natural Gas, and Coal Production and Consumption ............................................. 33
Figure 6. Russian Primary Energy Consumption .......................................................................... 34
Figure 7. U.S. and Russian Export Markets .................................................................................. 35
Figure 8. U.S. Merchandise Trade with Russia, 2010-2019 .......................................................... 36
Figure 9. Payments for Russia’s Exports: Currency Composition ................................................ 37

Tables
Table 1. Election Results to the State Duma, September 18, 2016................................................ 10
Table 2. Select World Rankings of Russia’s Energy Portfolio, 2019 ............................................ 32

Contacts
Author Information ........................................................................................................................ 40

Congressional Research Service

Russia: Domestic Politics and Economy

Introduction
The Russian Federation (hereinafter Russia) is a global power with a multifaceted and often
contentious relationship with the United States. Russia is the world’s largest country by territory;
a permanent member of the United Nations Security Council; a European, Asian, Arctic, and
Pacific power; a leading nuclear-armed power, military spender, and arms exporter; and a leading
producer and exporter of oil and natural gas. The World Bank classifies Russia as an upper-
middle income country based on its level of economic development. Its economy is the 11th
largest in the world (6th on a purchasing power parity basis).
Russia has been led for more than 20 years by Russian President Vladimir Putin. Putin presided
over Russia’s recovery from the economic collapse of the 1990s and reemergence as a global
power, which earned him popular support. At the same time, Putin consolidated an authoritarian
system of rule that has benefitted himself and a close group of colleagues and led Russia to take
increasingly aggressive actions abroad.
Russia’s political and economic environment
Russia at a Glance
has exhibited some signs of change in recent
Population: 144.4 mil ion (2020 est.)
years. Some of Putin’s previously close
Comparative Area: About 1.8 times the size of the
colleagues have lost power, and the
United States
government has incorporated younger
Capital: Moscow
politicians and officials into its ranks. Russia’s
Ethnic Composition: 78% Russian, 4% Tatar, 1%
economic growth has slowed, popular support
Ukrainian, 1% Bashkir 1% Chuvash, 1% Chechen (2010
census)
for Putin has declined, and expressions of
GDP/GDP per capita: $1.7 tril ion/$11,585 (2019)
public discontent have appeared more
frequently. Although it is difficult to predict
Top Exports: Mineral fuels (oil, natural gas, coal), iron
and steel, precious metals and stones (gold, platinum,
the course of developments, many observers
diamonds)
express a new level of uncertainty about
Leadership: President Vladimir Putin, Prime Minister
Russia’s political and economic future.
Mikhail Mishustin, Defense Minister Sergei Shoigu,
Foreign Minister Sergei Lavrov, State Duma Chairman
Since Russia’s 2014 invasion of Ukraine, U.S.
Vyacheslav Volodin, Federation Council Chairwoman
policy toward Russia has focused on
Valentina Matviyenko
countering Russia’s aggressive actions abroad.
Sources: World Bank, Trade Data Monitor, Russian State
U.S. policymakers, including in Congress,
Statistics Service
have long been attentive and responsive to
Note: Population does not include Ukraine’s occupied region
domestic developments in Russia as well. U.S.
of Crimea.
policy toward Russia includes democracy and
civil society assistance, human rights-related sanctions, and diplomacy.
This report focuses on Russian domestic politics, the Russian economy, and related U.S. policy. It
first addresses Russia’s political structure, power dynamics, and recent developments. It next
examines the political impact of the Coronavirus Disease 2019 (COVID-19) pandemic in Russia.
It follows with sections on corruption and human rights, including related U.S. policy. Finally, it
analyzes the Russian economy, including the economic impact of the COVID-19 pandemic,
Russia’s energy sector, and U.S.-Russian economic relations. Russian foreign and security
relations and related U.S. policy is not within the scope of this report.1 For a detailed report on
U.S. sanctions on Russia, see CRS Report R45415, U.S. Sanctions on Russia.

1 For background, see CRS Report R44775, Russia: Background and U.S. Policy, by Cory Welt. On Russia’s invasion
of Ukraine, see CRS Report R45008, Ukraine: Background, Conflict with Russia, and U.S. Policy, by Cory Welt.
Congressional Research Service

1

Russia: Domestic Politics and Economy

Figure 1. Russian Federation

Sources: Graphic produced by the Congressional Research Service (CRS). Map information generated by CRS
using data from the Department of State and Esri.
Politics
Russia is the principal successor to the United States’ former superpower rival, the Union of
Soviet Socialist Republics (USSR, or Soviet Union). In its modern form, Russia came into being
in December 1991, after its leaders joined those of neighboring Ukraine and Belarus to dissolve
the USSR. From 1922 to 1991, Soviet Russia was the core of the USSR, established in the wake
of the 1917 Bolshevik Revolution and the civil war that followed. The USSR spanned much the
same territory as the Russian Empire before it. Russia’s multiethnic federal structure is inherited
from the Soviet period and includes federal subjects called regions (oblasts), republics, territories
(krais), and other units.
Russia’s constitution, adopted in 1993 and most recently amended in 2020, references the
continuous development and “thousand-year” history of the Russian state. The amended
constitution refers to Russians as the country’s constituent (literally “state-forming”) nation, part
of the Russian Federation’s “multinational union of equal nations.”2
Under the leadership of President Vladimir Putin (2000-present), Russia has experienced a steady
rise in authoritarian rule. At the start of the 2000s, the U.S.-based nongovernmental organization
(NGO) Freedom House classified the Russian government as a “hybrid” regime, with democratic
and authoritarian elements. By the end of Putin’s second term in 2008, Freedom House
considered Russia to be a consolidated authoritarian regime. This status persisted during Dmitry
Medvedev’s tenure as president (2008-2012), despite some signs of liberalization (Putin served as
prime minister during this time). After Putin’s return to the presidency in 2012, observers noted a

2 Constitution of the Russian Federation, Articles 67.2 and 68.
Congressional Research Service

2

link to page 8 link to page 8 Russia: Domestic Politics and Economy

new deepening of authoritarian governance. Freedom House currently assigns Russia a “global
freedom” score of 20 out of 100 (“not free”), placing it as somewhat less authoritarian than China
or Venezuela but more authoritarian than Egypt or Rwanda.3
Vladimir Putin
Russia’s constitution provides for a strong presidency and central state authority. The government
is accountable primarily to the president, not the legislature, and observers consider the
presidential administration rather than the cabinet (headed by a prime minister) to be “the true
locus of power.”4
President Putin has led Russia since 2000 and currently is serving his fourth term as president.
Putin also has served as prime minister: in 1999 and from 2008 to 2012. Putin’s current term
expires in 2024. Constitutional amendments adopted in 2020 allow Putin to be reelected for up to
two more six-year terms, potentially allowing him to serve as president until 2036 (see “Resetting
Putin’s Term Limits” below).
Vladimir Putin: Political Biography
After serving for more than 15 years in the Soviet Union’s Committee for State Security (the KGB), Vladimir Putin
(currently aged 67) held a variety of governmental positions from 1990 to 1998, first in the local government of St.
Petersburg (his native city) and then in Moscow. In 1998, Russian President Boris Yeltsin appointed Putin head of
the Federal Security Service (FSB), a successor agency to the KGB, and prime minister a year later, in August
1999.
Unpopular and in poor health, Yeltsin unexpectedly resigned on New Year’s Eve, 1999, several months before the
end of his term. Putin became acting president and then was elected president in March 2000, with 53% of the
vote. He served two four-year terms as president before stepping down in 2008, in compliance with constitutional
limits on more than two successive terms. His successor was Dmitry Medvedev, a trusted former presidential
chief of staff, deputy prime minister, and board chairperson of the state-owned energy company Gazprom. As
prime minister from 2008 to 2012, Putin governed in tandem with Medvedev, who remained informally
subordinate to Putin.
In 2011, Medvedev announced that he would not run for reelection, paving the way for Putin to return to the
presidency. In what Russian observers likened to a chess game’s “castling” move, Medvedev now was to become
prime minister. Putin’s return to the presidency was always plausible, but the announcement was met with some
discontent, particularly in Moscow. A series of major protests—Russia’s largest since the Soviet Union’s
col apse—fol owed the December 2011 parliamentary elections, which observers considered to be marred by
fraud and other violations. In March 2012, Putin won the presidency for the third time, officially with 64% of the
vote (and 65% turnout). His term lasted until 2018, as then-President Medvedev had extended the presidential
term to six years before leaving office in 2012. Putin was reelected for a fourth term in 2018, officially with 77% of
the vote.
Notes: Profiles of Putin include Masha Gessen, The Man Without a Face: The Unlikely Rise of Vladimir Putin (New
York: Riverhead Books, 2012); Karen Dawisha, Putin’s Kleptocracy: Who Owns Russia? (New York: Simon and
Schuster, 2014); Fiona Hil and Clifford G. Gaddy, Mr. Putin: Operative in the Kremlin, revised and expanded ed.
(Washington, DC: Brookings Institution Press, 2015); and Steven Lee Myers, The New Tsar: The Rise and Reign of
Vladimir Putin (New York: Alfred A. Knopf, 2015). An early autobiographical work is Natalia Gevorkyan, Natalya
Timakova, and Andrei Kolesnikov, First Person: An Astonishingly Frank Self-Portrait by Russia’s President Vladimir Putin
(New York: PublicAffairs, 2000).

3 Freedom House ranks all countries in the world by a “global freedom” score, which includes measures of political
rights and civil liberties. Freedom House also ranks post-communist states by a “democracy” score that ranges between
1 (least democratic) and 7 (most democratic). Russia’s “democracy score” is 1.39 (“consolidated authoritarian
regime”). Scores reflect the state of affairs at the start of the year. Freedom House, Freedom in the World 2020;
Freedom House, Nations in Transit 2020.
4 Karen Dawisha, Putin’s Kleptocracy: Who Owns Russia? (New York, NY: Simon and Schuster, 2014), p. 2.
Congressional Research Service

3

link to page 8 Russia: Domestic Politics and Economy

Russia’s most recent presidential election was held in March 2018, on the fourth anniversary of
Russia’s purported annexation of Ukraine’s Crimea region. Putin declared his candidacy three
months before the election and conducted what many considered to be a perfunctory campaign
backed by state-controlled media.5 Some observers maintained that other candidates were
approved—possibly even handpicked—by authorities in the hopes they would provide a veneer
of democratic legitimacy and boost turnout without being disruptive at the ballot box or in
protests.6 In a minimally competitive political environment, Putin secured reelection against
seven other candidates, officially receiving 77% of the vote (with 68% turnout).
Russia’s nondemocratic environment makes it difficult to assess public attitudes about President
Putin, but opinion polls appear to reflect shifting levels of presidential approval over time.
Regular polls conducted by the Russia-based nongovernmental Levada Center suggest a
substantial boost to Putin’s popularity in the wake of Russia’s 2014 invasion of Ukraine. Over the
two years prior to the invasion, Putin’s approval rating was in the low 60s. Afterwards, Putin
regularly received approval from more than 80% of poll respondents.7
After Putin entered his fourth presidential term, however, his approval ratings declined to
between 65% and 70%. Some observers suggest the decline was sparked by an unpopular pension
reform that raised the retirement age.8 Putin’s ratings stayed at these lower levels until the onset
of the coronavirus pandemic in 2020, when they again declined. In April 2020, the Levada Center
recorded Putin’s approval rating at 59%, the lowest since he first became president 20 years
before.9
Putin has maintained a sense of uncertainty about his political plans after completing his fourth
presidential term in 2024. Some observers believe Putin’s interest in cultivating uncertainty lies
behind what appeared to have been an orchestrated maneuver in early 2020 to reset Putin’s
presidential term limits. This move enables Putin potentially to serve as president until 2036 (see
“Resetting Putin’s Term Limits” below). Some observers believe Putin took this step not only to
enable him to remain president but also to avoid being a “lame duck” if he chooses to leave office
before then. The possibility that Putin will stay on as president could help ensure the loyalty of
elites to him personally and forestall destabilizing infighting among potential successors.10
In addition to resetting Putin’s term limits, constitutional amendments adopted in 2020 preserved
and strengthened the powers of the presidency while somewhat increasing the authority of
Russia’s bicameral legislature. New powers to strengthen the presidency include procedures that
enable the president to initiate the removal of Constitutional Court and Supreme Court judges and
to reject ostensibly unconstitutional legislation after review by the Constitutional Court.11 The

5 Oliver Carroll, “Russia Election 2018: On the Road with Vladimir Putin’s Weird, Non-Existent Presidential
Campaign,” Independent, February 9, 2018; Carl Schreck, “50 Ways To Love Your Putin: Russian TV Fawns Over
Election Drive,” RFE/RL, January 17, 2018.
6 Kathrin Hille, “Putin’s Poll Rivals Gain a Platform but Cannot Win,” Financial Times, February 13, 2018.
7 Levada Center, at https://www.levada.ru.
8 Samuel Greene and Graeme Robertson, “Vladimir Putin’s Approval Ratings Are Dropping. This Is Why,”
Washington Post, July 19, 2018.
9 Moscow Times, “Putin’s Approval Rating Drops to Historic Low: Poll,” May 6, 2020.
10 Mark Galeotti, “Putin Wants the World to Keep Guessing,” Foreign Policy, March 12, 2020; Economist, “Prisoner in
the Kremlin: Why Vladimir Putin Cannot Retire,” March 14, 2020; Henry E. Hale, “Putin’s End Game?” PONARS
Eurasia, George Washington University, March 2020.
11 Tatiana Stanovaya, “President Putin’s Constitutional Reform: A Political Coup?” Institute Montaigne, March 2,
2020; Maria Domanska, “‘Everlasting Putin’ and the Reform of the Russian Constitution,” Centre for Eastern Studies
(OSW), March 13, 2020; William Partlett, Russia’s 2020 Constitutional Amendments: A Comparative Perspective,
Congressional Research Service

4

Russia: Domestic Politics and Economy

amendments also grant constitutional status to the State Council, an advisory body of regional
governors that the president chairs; some observers have suggested that Putin could try to
maintain his political influence after leaving the presidency by retaining chairmanship of the State
Council. The amendments also include a firm limit of two presidential terms and give the State
Duma (the lower house of the legislature) greater responsibility in appointing members of the
government.
Resetting Putin’s Term Limits
In 2018, government officials openly began to discuss the possibility of amending Russia’s
constitution, seemingly in order to preserve Putin’s political leadership after the expiration of his
fourth presidential term in 2024.12 In January 2020, Putin proposed constitutional changes that
appeared to provide him the means to remain Russia’s uncontested leader but in a different post,
such as chairman of the State Council. Some observers interpreted the proposals as a sign that
Putin intended to stay on as president.13
In March 2020, as part of a larger package of constitutional changes proposed by the president, a
senior legislator in the State Duma offered an amendment to allow Putin to serve as president for
two more six-year terms. Both houses of the legislature and Russia’s regional legislatures voted
in favor of the amendment package, and the Constitutional Court ruled the amendments were
legal (although it was unclear whether the Court had the authority to review the legality of
constitutional amendments).14 The law introducing the amendments included the novel provision
that the amendments would be put to a national vote prior to their entry into force.15
The vote on the constitution was scheduled for April 2020 but postponed due to the COVID-19
pandemic. Citing the pandemic, authorities conducted the vote over a seven-day period from June
25 to July 1, 2020. They also established an extensive remote (and, for some regions, online)
voting system. Some observers believed this was done to boost turnout and facilitate fraud; some
media reports indicated authorities had decided to conduct remote voting by late February 2020,
prior to the emergence of serious concerns about COVID-19.16
Election officials reported that 79% of voters approved of the constitutional amendments with
68% turnout. Unofficial observers and analysts said the vote was marred by high levels of fraud,
including inflated turnout and voter bribery.17 The package of amendments included provisions

University of Melbourne, June 2020.
12 Bloomberg News, “Russia Contemplates Constitution Changes as Putin Faces Term Limits,” December 26, 2018;
Chris Miller, “Putin’s Not Ready to Call It Quits,” Foreign Policy, July 22, 2019; Mike Eckel, “Change the Russian
Constitution? Might Be a Good Idea, Says Putin Confidant,” RFE/RL, September 16, 2019.
13 Anton Troianovski, “Big Changes? Or Maybe Not. Putin’s Plans Keep Russia Guessing,” New York Times, January
21, 2020; Tatyana Stanovaya, “Russia Prepares for a New Tandemocracy,” Moscow Times, January 20, 2020; Andrew
Higgins, “Putin Outlines Political Overhaul, Including Possible Post for Himself,” New York Times, January 20, 2020.
14 Anton Troianovski, “Putin Endorses Brazen Remedy to Extend His Rule, Possibly for Life,” New York Times, March
10, 2020; Denis Dmitriev, “The Constitutionality of Six Terms,” Meduza, March 10, 2020; Andrew Higgins, “Russia’s
Highest Court Opens Way for Putin to Rule Until 2036,” New York Times, March 16, 2020.
15 Meduza, “Not Very: How Legal is the Mad Dash to Overhaul Russia’s Constitution?” March 11, 2020.
16 Meduza, “Russian Government Plans Massive Remote Ballot Effort to Increase Turnout in Constitutional Reform
Vote,” February 20, 2020; Moscow Times, “Russia to Allow Remote Voting for Putin’s Constitutional Amendments,”
May 13, 2020.
17 Matthew Luxmoore, “Election Monitors Find ‘Unprecedented’ Levels of Fraud in Russian Vote on Extending
Putin’s Rule,” RFE/RL, July 3, 2020; Patrick Reevell, “Election Monitors Allege Putin Referendum Saw
Unprecedented Ballot Fraud,” ABC News, July 5, 2020.
Congressional Research Service

5

Russia: Domestic Politics and Economy

observers believed were included to mobilize Putin’s support base, including defining marriage to
exclude same-sex unions and asserting the role of divine belief in Russia’s national character.18
Other Government Officials and Oligarchs
Vladimir Putin is widely considered to be the most powerful person in Russia. Putin does not rule
alone, however. He presides over a network of government officials, heads of strategic state-
owned enterprises, and business leaders. In Russia’s political system, formal positions do not
always reflect the relative power and influence of officeholders; deputy chiefs of staff,
presidential aides, and heads of state-owned companies can hold as much political influence as
cabinet members (or more).19
For much of Putin’s tenure, an influential leadership circle below Putin has included several
individuals Putin knew from his time in the Soviet KGB or when he worked in the St. Petersburg
local government in the early 1990s.20 Many of these acquaintances benefitted politically and
economically from their close association with Putin. Those still in power today include Sergei
Chemezov, chief executive officer (CEO) of Rostec, a large state-owned defense and technology
conglomerate; Nikolay Patrushev, secretary of the Security Council; and Igor Sechin, CEO of the
state-owned oil company Rosneft.21 Some of Russia’s most prominent businesspeople also are
longtime colleagues of Putin, including Arkady and Boris Rotenberg, Nikolay Shamalov, and
Gennady Timchenko.
In recent years, observers have noted some changes to Russia’s system of governance. The first
change is a gradual reduction in political influence of Putin’s longtime associates. Since 2014,
several senior officials with longstanding ties to Putin have retired, otherwise left office, or
seemingly been demoted. Some observers believe that even longtime colleagues who still hold
high positions, like Chemezov and Sechin, wield less influence than before.22
A related change is the rise of officials at least a decade younger than Putin who have risen as
subordinates more than as Putin’s colleagues. Former president and prime minister Medvedev
straddles this divide. Medvedev worked with Putin in St. Petersburg and was Putin’s handpicked
successor to the presidency (2008-2012) after Putin’s first two terms; he then served as prime
minister for eight years. In January 2020, Medvedev was demoted to the position of deputy
chairman of the Security Council.
Other subordinate officials have gained relatively powerful positions. This includes Prime
Minister Mikhail Mishustin, who served as director of the Federal Tax Service for 10 years before
being appointed prime minister in January 2020, and Minister of Emergency Situations Yevgeny
Zinichev, who served in the presidential security service (i.e., protective service) for a decade.23

18 Vladimir Isachenkov, “Putin’s New Amendments Revere God, Ban Same Sex Marriages,” Associated Press, March
2, 2020.
19 For recent overviews of Russia’s political and economic system, see Brian D. Taylor, The Code of Putinism (Oxford:
Oxford University Press, 2018), and Anders Aslund, Russia’s Crony Capitalism: The Path from Market Economy to
Kleptocracy (New Haven and London: Yale University Press, 2019).
20 For more, see Dawisha, Putin’s Kleptocracy.
21 Other longtime colleagues of Putin currently in office include presidential aide Andrei Fursenko, Sberbank chief
executive officer (CEO) German Gref, deputy presidential chief of staff Dmitry Kozak, Gazprom CEO Alexei Miller,
Foreign Intelligence Service director Sergei Naryshkin, and Transneft CEO Nikolai Tokarev.
22 Anders Aslund, “Putin’s Great Purge,” American Interest, August 24, 2016; Tatiana Stanovaya, The Putin Regime
Cracks, Carnegie Moscow Center, May 7, 2020.
23 Three other officials who once served in the presidential security service have gone on to serve as regional
Congressional Research Service

6

Russia: Domestic Politics and Economy

Others include Presidential Chief of Staff Anton Vaino, First Deputy Presidential Chief of Staff
Sergei Kiriyenko, and central bank chairwoman Elvira Nabiullina.
A government reshuffle in January 2020 continued the process of elevating more junior cadres to
power. According to one analysis, in the new cabinet 75% of ministers (6 out of 8) were under the
age of 45 at the time of their appointment, and 5 out of 9 deputy prime ministers were under the
age of 55. Several of the new cabinet members have technocratic backgrounds.24

Top Russian Officials Under Putin (September 2020)
Alexander Bastrykin: Chairman of the Investigative Committee (a law enforcement agency)
Andrey Belousov: First Deputy Prime Minister
Alexander Bortnikov: Director of the Federal Security Service (FSB)
Sergei Chemezov: Chief Executive Officer (CEO) of Rostec (defense-technology state conglomerate)
Sergei Kiriyenko: First Deputy Presidential Chief of Staff
Sergei Lavrov: Minister of Foreign Affairs
Mikhail Mishustin: Prime Minister
Elvira Nabiullina: Chairwoman of the Central Bank
Nikolay Patrushev: Secretary of the Security Council
Dmitry Peskov: Deputy Presidential Chief of Staff and Press Secretary
Igor Sechin: CEO of Rosneft (state oil company)
Sergei Shoigu: Minister of Defense
Anton Siluanov: Minister of Finance
Sergei Sobyanin: Mayor of Moscow
Anton Vaino: Presidential Chief of Staff
Vyacheslav Volodin: Chairman of the State Duma
Sources: Dmitry Orlov, “Russia’s 100 Top Politicians in 2019,” Nezavisimaia Gazeta, January 13, 2020 (in Russian),
at https://www.ng.ru/ideas/2020-01-13/7_7766_people.html; Minchenko Consulting, The Politburo 2.0 and the Anti-
Establishment Wave, Summer 2019.
Notes: Russian newspaper Nezavisimaia Gazeta listed the above, with the exception of Prime Minister Mishustin
and First Deputy Prime Minister Belousov (appointed in January 2020), as Russia’s top politicians after Putin in
2019. In 2019, the Russia-based Minchenko Consulting group listed Chemezov, Patrushev, Sechin, Shoigu, and
Sobyanin as among Russia’s nine most influential figures under Putin, together with businessmen and longtime
Putin associates Yuri Kovalchuk, Arkady Rotenberg, and Gennady Timchenko (as well as then-prime minister
Dmitry Medvedev).
Observers have debated the role of wealthy businesspeople in Russia’s political system. Many of
these businesspeople are often referred to as oligarchs due to their closeness to Putin, enrichment
from state contracts, or prior acquisition of privatized state resources. Although several so-called
oligarchs appear to have become wealthy due to their direct connections to Putin, others have
acquired wealth by other means but are politically compliant. Many are believed to directly
finance or serve as intermediaries for the financing of off-budget projects, ranging from

governors; two still are in office. Oleg Kashin, “How Do You Get to Be a Governor in Vladimir Putin’s Russia?,” New
York Times, September 8, 2016; Andrey Pertsev, “Changing the Guard: The End of Russia’s Bodyguards-Turned-
Governors,” Carnegie Moscow Center, June 10, 2019.
24 Meduza, “Who Are Russia’s New Cabinet Members?” January 22, 2020; Tatiana Stanovaya, “Russia’s New
Government Is Its Least Political Yet,” Carnegie Moscow Center, January 23, 2020.
Congressional Research Service

7

Russia: Domestic Politics and Economy

infrastructure, social welfare, and prestige projects to political influence operations and armed
interventions abroad.25
Domestic Security Agencies: Structures and Disputes
Russia’s internal security affairs are managed by multiple, overlapping, and competitive security and law
enforcement agencies. Local police and investigative forces are under the command of the Ministry of Internal
Affairs (MVD), headed by career police officer Vladimir Kolokoltsev. Russia’s primary internal security organization
is the Federal Security Service (FSB), which inherited most of Russia’s internal security responsibilities from the
Soviet-era KGB. The FSB is considered the most powerful of Russia’s security agencies and is headed by
Alexander Bortnikov. The agency responsible for the protection of the president and government personnel is the
Federal Protective Service (FSO) headed by Dmitry Kochnev. The Office of the Prosecutor General plays an
important role in domestic security; in January 2020, Igor Krasnov was appointed to replace longtime Prosecutor
General Yury Chaika.
In addition to the MVD, FSB, and FSO, which trace their lineages to the Soviet Union, new domestic security
organizations have been created, sometimes as the result of competition among agencies. In 2011, the investigative
powers of the Prosecutor General’s Office were transferred to a new organization, the Investigative Committee,
under the command of Alexander Bastrykin. In 2016, Putin created the National Guard (Rosgvardiya) under the
command of former presidential bodyguard Viktor Zolotov. The National Guard took control of close to 200,000
public order, special police, and internal troop forces previously under the command of the MVD. Many observers
believe the National Guard was established in part to ensure the loyalty of forces used to crackdown on protests
and political opponents.
Many observers have reported extensive personal, factional, and organizational competition across and within
Russia’s security and law enforcement agencies. This includes efforts to gain relative power and influence, as well
as opportunities for corruption by securing control over investigations related to lucrative issue areas (such as
financial crime). Interagency competition sometimes escalates into larger conflicts requiring Putin’s direct
intervention (such as in 2016 when the Federal Drug Control Service, or FSKN, was disbanded and its roles
transferred to the MVD).
Competition among domestic security agencies frequently is factional, and personnel can form alliances that cross
organizational lines. Such competition has taken the form of arrests and prosecutions between agencies,
commonly due to corruption allegations, as agencies seek to undermine others both institutionally and in the eyes
of the political leadership. Agencies and factions have sought to install their own officers in senior positions within
targeted agencies to gain control of politically and economically important sections and divisions.
Sources: Andrei Soldatov and Irina Borogan, The New Nobility: The Restoration of Russia’s Security State and
the Enduring Legacy of the KGB (New York: PublicAffairs, 2010); Mark Galeotti, Russian Security and Paramilitary
Forces Since 1991 (Oxford: Osprey, 2013); Mark Galeotti, “Iron Fist: National Guard’s Influence Grows in
Russia,” Jane’s Intelligence Review (August 2017), pp. 36-41; Joss I. Meakins, “Squabbling Siloviki: Factionalism
Within Russia’s Security Services,” International Journal of Intelligence and Counterintelligence 31, 2 (2018), pp.
235-270; Tatiana Stanovaya, “Why the Kremlin Can’t Keep its Chekists in Check,” Riddle, July 25, 2019.
Note: Prepared by Andrew S. Bowen, Analyst in Russian and European Affairs.
During Putin’s rule, observers also have debated the relative power and influence of officials
broadly characterized as representing one of two governing camps: the siloviki (leading or former
members of law and security structures who are typically more resistant to reform) and
technocrats (who are often but not always more economically liberal and internationally
oriented).26 Many, but not all, of Russia’s relatively younger officials are considered to be in the

25 Joshua Yaffa, “Putin’s Shadow Cabinet and the Bridge to Crimea,” New Yorker, May 22, 2017; Maxim
Trudolyubov, “Vladimir Putin’s Parallel State,” Kennan Institute, February 21, 2018; Andrew E. Kramer, “With
Savings to Burn, Russia Turns (Again) to a State-Led Spending Plan,” New York Times, February 6, 2019; Testimony
of Michael Carpenter, in U.S. Congress, House Foreign Affairs Subcommittee on Europe, Eurasia, Energy and the
Environment, Undermining Democracy: Kremlin Tools of Malign Political Influence, hearings, 116th Cong., 1st sess.,
May 21, 2019.
26 Ol’ga Kryshtanovskaya and Stephen White, “Inside the Putin Court: A Research Note,” Europe-Asia Studies vol. 57,
no. 7 (November 2005): 1065-1075; Vladimir Pribylovsky, “Clans Are Marching,” openDemocracy, May 30, 2013;
Congressional Research Service

8

Russia: Domestic Politics and Economy

technocratic camp.27 At the same time, several adult children of oligarchs and senior officials
have been appointed to senior positions in state-owned companies and government agencies.28
Legislative and Judicial Branches
Russia’s bicameral legislature is the Federal Assembly. The upper chamber, the Federation
Council, has at least 170 senators, two each from Russia’s 83 regions and republics (including
Russia’s two largest cities, Moscow and St. Petersburg) and four from Ukraine’s occupied region
of Crimea. Senators are not directly elected but are chosen by regional executives and
legislatures. The President may appoint up to 30 additional senators to the Federation Council.
Retired presidents also may serve as senators.
The Federal Assembly’s lower house, the State Duma, has 450 deputies, of which half are elected
to a five-year term by proportional representation and half are elected in single-member districts.
The State Duma also includes members from Ukraine’s occupied Crimea region.29
Legislative Powers. As discussed above, the 2020 constitutional amendments enlarged the
powers of the Federal Assembly while also strengthening the presidency.30 The State Duma now
approves the candidacies of deputy prime ministers and most cabinet ministers as submitted by
the prime minister; the president is obliged to appoint the Duma’s approved candidates. The
Duma also approves the prime ministerial candidate as submitted by the president.31 This,
however, does not appear to grant the Duma more power than it had before; previously, the Duma
granted its “consent” to the president’s prime ministerial appointment. In addition, the Duma does
not approve the candidacies of the five “power ministries” of defense, internal affairs, justice,
foreign affairs, and emergency situations, whom the president appoints directly. The president
retains the right to dissolve the Duma and to appoint a prime minister unilaterally if the Duma
rejects a candidate three times.32
The 2020 constitutional amendments gave some new powers to the Federation Council while
removing at least one of its appointment powers. The Federation Council retains the power to
appoint Supreme Court and Constitutional Court justices proposed by the president, and the

Karina Orlova, “Putin the Not-So-Omnipotent,” American Interest, September 25, 2019; Sharon Werning Rivera and
David W. Rivera, “Are Siloviki Still Undemocratic? Elite Support for Political Pluralism during Putin’s Third
Presidential Term,” Russian Politics 4 (2019): 499-519; and Tatiana Stanovaya, The Putin Regime Cracks, Carnegie
Moscow Center, May 7, 2020.
27 Kathrin Hille and Henry Foy, “The Russian Election and the Rise of Putin’s Young Technocrats,” Financial Times,
March 15, 2018.
28 Stephen Grey and Elizabeth Piper, “Rising Stars Among Children of Russia’s Elite,” Reuters, November 10, 2015;
Brian Whitmore, “The Heirs of Putinism,” RFE/RL, November 12, 2015; Bartosz Bieliszczuk and Agnieszka Legucka,
Kremlin Kids: The Second Generation of the Russian Elite, Polish Institute of International Affairs, November 2019.
29 See U.S. Department of the Treasury, “Treasury Sanctions Individuals for Activities Related to Russia’s Occupation
of Crimea,” press release, November 14, 2016.
30 William Partlett, Russia’s 2020 Constitutional Amendments: A Comparative Perspective, University of Melbourne,
June 2020; Yevgenia Kuznetzova et al., “How the Constitution of Russia Will Change: Major Amendments” (in
Russian), RBC, July 2, 2020, at https://www.rbc.ru/politics/02/07/2020/5e689b689a7947e1824b2770.
31 Constitution of the Russian Federation, Article 83 and Article 112.2.
32 Previously, the president was required to dissolve the State Duma if it rejected the prime ministerial candidate three
times; the president now has the option to exercise this right. The 2020 amendments also gave the president the right to
dissolve the State Duma and appoint deputy prime ministers and all cabinet members unilaterally if the Duma rejects
more than one-third of the prime minister’s candidates three times. Constitution of the Russian Federation, Article
111.4 and 112.4. Also see Dmitry Kartsev, “‘Giving Up Significant Powers’: Putin Says That Amending the
Constitution Will Allow Russia’s Parliament to Appoint the Prime Minister. This Isn’t True,” Meduza, June 15, 2020.
Congressional Research Service

9

link to page 13 link to page 13 Russia: Domestic Politics and Economy

Council now appoints the chairman of the accounts chamber. The Council gained the power to
dismiss Supreme Court and Constitutional Court justices, as well as lower court judges, as
proposed by the president under certain conditions. The president now is to consult with the
Federation Council before appointing the heads of the power ministries and agencies. The
Federation Council no longer appoints the Prosecutor General; instead, the President is to consult
with the Federation Council before appointing the Prosecutor General, deputy prosecutors, and
other regional and specialized prosecutors.33
Parliamentary Elections and United Russia. Elections to the State Duma were last held in
2016. With a voter turnout of 48%, the ruling United Russia (UR) party won with 76% of the
seats (in 2011, under a fully proportional system, it won 53% of seats). All other seats went to
parties and deputies considered to be the loyal (or systemic) opposition: the Communist Party of
the Russian Federation (KPRF, led by Gennady Zyuganov), the Liberal Democratic Party of
Russia (LDPR, led by Vladimir Zhirinovsky), and A Just Russia (led by Sergei Mironov). These
three parties criticize the government, if not Putin, but typically support its legislative initiatives.
No parties genuinely in opposition (sometimes termed the liberal or non-systemic opposition)
won any seats (see Table 1).
Table 1. Election Results to the State Duma, September 18, 2016
Party List
Party List
Single-

%
Seats
Member Seats
Total Seats
% of Seats
United Russia (UR)
54.2%
140
203
343
76.2%
Communist Party
(KPRF)
13.3%
35
7
42
9.3%
Liberal Democratic
Party of Russia (LDPR)
13.1%
34
5
39
8.7%
A Just Russia
6.2%
16
7
23
5.1%
Othersa
11.2%
0
3
3
0.7%
Yabloko
2.0%
0
0
0
0.0%
PARNAS
0.7%
0
0
0
0.0%
Total
98%
225
225
450
100%
Source: Central Election Commission of the Russian Federation, at http://www.vybory.izbirkom.ru.
Note: Total party list percentage is calculated out of the total number of valid and invalid ballots.
a. Includes several small parties that did not meet the 5% threshold for party list representation. Yabloko and
PARNAS are liberal opposition parties.
After the 2011-2012 protests and in advance of the 2016 elections, the Russian government took
measures to restrict political party competition, including by restoring a mixed electoral system.34
Election observers and analysts concluded that the 2016 elections were marred by fraud.35 At the

33 Constitution of the Russian Federation, Article 102.
34 Elections to the State Duma were held under a fully proportional system from 2003 to 2011. Vladimir Gelman,
“Correction of Errors: How the Kremlin Re-equilibrated Authoritarian Elections in 2016,” PONARS Eurasia, George
Washington University, August 2016; Felix Riefer, “Russian Parliamentary Elections to Take Place Under New
Rules,” Deutsche Welle, August 16, 2016; Nikolay Petrov, “Putin’s Gamble on Russia’s Duma Elections,” European
Council on Foreign Relations, September 8, 2016; and Yelena Plotnikova and Robert Coalson, “Samara Governor
Offers a Stark Choice: United Russia or the CIA,” RFE/RL, September 10, 2016.
35 OSCE/ODIHR International Election Observation Mission, Russian Federation—State Duma Elections, “Statement
Congressional Research Service

10

Russia: Domestic Politics and Economy

same time, UR benefited from a surge in patriotic sentiment generated by Russia’s purported
annexation of Ukraine’s Crimea region, Russia’s so-called defense of pro-Russian populations in
eastern Ukraine, and appeals for national solidarity in the face of Western sanctions and
criticism.36 UR also experienced a certain renewal in advance of the 2016 elections; party
primaries promoted the rise of many candidates new to national politics and eliminated a number
of sitting deputies.37
UR traditionally polls lower than Putin, who does not formally lead the party. Since 2018, UR has
received under 30% support among all respondents and 45%-47% among likely voters in public
opinion polls.38 In 2019 local elections to the Moscow city council, all government-backed
candidates ran as independents, seemingly in tacit acknowledgement of UR’s relative
unpopularity.39
Judicial Branch. Many observers contend that Russia’s judiciary suffers from corruption and
lacks independence from the executive branch.40 Some argue the courts have greater autonomy on
matters that are of less importance to executive authorities.41 The 2020 constitutional amendments
gave the president and the Federation Council the right to dismiss Supreme Court, Constitutional
Court, and appellate court judges who “commit acts that besmirch the honor and dignity of the
judiciary” or who are unable to exercise their authority.42
The Constitutional Court rules on the legality and constitutionality of governmental acts and on
disputes between branches of government or federative entities.43 A 2015 law gave the
Constitutional Court the authority to disregard verdicts by interstate bodies that defend human
rights and freedoms, if the court concludes such verdicts contradict Russia’s constitution. The
2020 constitutional amendments enshrined the primacy of the constitution over international
treaties.44

of Preliminary Findings and Conclusions,” September 18, 2016; Leonid Bershidsky, “Russia Proves Vote Fraud Can
Happen Anywhere,” Bloomberg, September 26, 2016; and Olga Sichkar, Jack Stubbs, and Gleb Stolyarov, “Phantom
Voters, Smuggled Ballots Hint at Foul Play in Russian Vote,” Reuters, September 20, 2016.
36 Denis Volkov, “How Long Will It Be Before 2011-2012 Style Mass Protests Reemerge?,” Intersection, September 8,
2016.
37 Darrell Slider and Nikolai Petrov, “United Russia’s ‘Primaries’: A Preview of the Duma Elections?,” Russian
Analytical Digest no. 186 (July 15, 2016).
38 Levada Center, “Possible Voting by Party” (in Russian), March 10, 2020, at https://www.levada.ru/2020/03/10/
vozmozhnoe-golosovanie-za-partii-2/.
39 Robert Coalson, “Hiding in Plain Sight: United Russia’s Bid to Distance Itself from Moscow Polls Falls Flat,”
RFE/RL, August 23, 2019.
40 Maria Popova, Politicized Justice in Emerging Democracies: A Study of Courts in Russia and Ukraine (New York:
Cambridge University Press, 2012); Maria Popova, “Putin-Style ‘Rule of Law’ and the Prospects for Change,”
Daedalus (Spring 2017), pp. 64-75; Olga Romanova, “The Problem with the Russian Judiciary,” Carnegie Moscow
Center, January 22, 2018; Ivan Nechepurenko, “After Exposing Corruption in Russian Courts, He’s Now in Jail
Himself,” New York Times, March 27, 2020.
41 Kathryn Hendley, “Justice in Moscow?” Post-Soviet Affairs 32, 6 (2016), pp. 491-511; Alexei Trochev, “Legitimacy,
Accountability and Discretion of the Russian Courts,” in Politics and Legitimacy in Post-Soviet Eurasia, eds. Martin
Brusis, Joachim Ahrens, and Martin Schulze Wessel (London: Palgrave MacMillan, 2016).
42 Constitution of the Russian Federation, Article 83.
43 On the Constitutional Court, see Alexei Trochev and Peter H. Solomon Jr., “Authoritarian Constitutionalism in
Putin’s Russia: A Pragmatic Constitutional Court in a Dual State,” Communist and Post-Communist Studies 51 (2018),
pp. 201-214.
44 Constitution of the Russian Federation, Article 79. Some observers believe the intent of this law was to enable Russia
to ignore rulings by the European Court of Human Rights (ECHR), which Russia joined in 1996. ECHR has delivered
multiple judgments against Russia. In 2019, ECHR said it made 186 judgments concerning Russia that involved at least
Congressional Research Service

11

Russia: Domestic Politics and Economy

Regional Governors and Local Elections
Formally, Russia has a robust system of subnational elections; in practice, the country’s top-down system provides
considerable central control over local government structures and key issues. Regional and municipal councils are
directly elected, as are the leaders of most of Russia’s 83 regions (e.g., governors) and ethnic-based republics (e.g.,
heads). Russia also is divided administratively into eight federal districts, to which the President appoints a
plenipotentiary envoy (presidential representative). Although Russian law allows for the direct election of city
mayors, regional governments have eliminated most direct mayoral elections.
Kremlin-backed politicians dominate regional government structures. All but seven of Russia’s 83 regional and
republican leaders are United Russia (UR) members or government-backed independents; the rest are from
Russia’s three loyal opposition parties. UR also has majorities, typically substantial ones, in all but six regional
councils. UR has a minority in the Siberian region of Irkutsk and the Far Eastern region of Khabarovsk, and
pluralities in four regions, including the capital city of Moscow. Only a handful of regional deputies across the
country are affiliated with the liberal opposition.
The president retains the power to remove regional leaders on the basis of inadequate performance or loss of
confidence. In addition, many unpopular or problematic governors have been asked or compelled to resign before
the end of their terms, enabling the president to appoint acting governors to compete in elections. Several
governors have been arrested on corruption-related charges and dismissed. In recent years, regional leadership
positions have undergone considerable rotation. Almost seventy percent of sitting governors and republic heads
entered office in 2016 or later.
Governors who have resigned or been removed from office include some relatively independent-minded
politicians. These include the fol owing: Kirov region ex-governor Nikita Belykh, who was arrested in 2016 on
charges of bribery and sentenced in 2018 to 8 years in prison; Irkutsk ex-governor and Communist Party member
Sergei Levchenko, who was the first candidate in 2015 to defeat a government-backed opponent since direct
elections were reintroduced in 2012 and reportedly pressured to resign from office in 2019; Khabarovsk ex-
governor Sergei Furgal (Liberal Democratic Party of Russia), who was arrested in July 2020 on murder-related
charges linked to acts allegedly committed in 2004-2005.
Sources: Natalya Zubarevich, “The Fall of Russia’s Regional Governors,” Carnegie Moscow Center, October 12,
2017; Andrey Pertsev, “System Failure in Russia: The Elections That Didn’t Go as Planned,” Carnegie Moscow
Center, October 2, 2018; Taisia Bekbulatova, “Why is the Kremlin Replacing Multiple Regional Governors Right
Before Russia’s Fall Elections?” Meduza, March 20, 2019; Meduza, “How is Putin Able to Remove Popularly Elected
Governors?” July 21, 2020; CRS calculations.
Opposition and Protest
Popular protests against Putin or the Russian government have arisen on occasion over the last
decade. Putin’s 2011 declaration that he intended to return to the presidency and the electoral
fraud in 2011 parliamentary elections triggered a wave of protests that appeared to herald the rise
of a revitalized opposition.45 Russia’s 2014 invasion of Ukraine and purported annexation of
Ukraine’s Crimea region met with widespread public approval but generated another, smaller,
protest movement. Since 2017, protests linked to various political, economic, and social concerns
have arisen, particularly in Moscow but also in other parts of the country.46 In the summer of

one violation of the European Convention on Human Rights. Carl Schreck, “Russian Law On Rejecting Human Rights
Courts Violates Constitution, Experts Say,” RFE/RL, December 16, 2015; Library of Congress Law Library, “Russian
Federation: Constitutional Court Allows Country to Ignore ECHR Rulings,” May 18, 2016; European Court of Human
Rights, “Russia,” updated July 2020, at https://www.echr.coe.int/Documents/CP_Russia_ENG.pdf.
45 On the 2011-2012 election protests, see articles in Problems of Post-Communism vol. 60, no. 2 (March-April 2013),
pp. 3-62, and openDemocracy Russia, “Dissecting Russia’s Winter of Protest, Five Years On,” December 5, 2016.
46 Alexei Kozlov, “What Can We Learn from Russia’s Spring of Protest?” openDemocracy, May 23, 2017; Nataliya
Vasilyeva and Jim Heintz, “People Across Russia Rally Against Raising Pension Age,” Associated Press, September 9,
2018; Konstantin Gaaze, “As Putin’s Authority Dwindles, Protests in Russia Are Newly Effective,” Carnegie Moscow
Center, June 26, 2019; Evgeniya Chirikova, “Russia is a Land of Protests and Activism. Really,” Washington Post,
September 12, 2019; and Samuel A. Greene and Graeme B. Robertson, Putin v. the People: The Perilous Politics of a
Congressional Research Service

12

link to page 20 Russia: Domestic Politics and Economy

2020, the arrest, dismissal, and replacement of the ex-governor of the Khabarovsk region, LDPR
member Sergei Furgal, with an outside official led to unexpectedly large mass protests.47
Observers have noted the rising participation of youth in protests.48
Rising dissent has yet to translate into political gains for genuine opposition parties, which the
Russian government suppresses (for more, see “Human Rights” below). No liberal opposition
party won Duma seats in the 2011 or 2016 elections. In 2013, a prominent anticorruption activist
and protest leader, Alexei Navalny, was permitted to compete in Moscow’s mayoral election; he
came in second place with 27% of the vote.49 Since then, Navalny and his political party have
been repeatedly denied the opportunity to compete in elections.50 In 2019 local elections, Navalny
called on supporters to cast ballots for the candidate most likely to defeat the ruling party. In
Moscow, this strategy of so-called smart voting appeared somewhat successful; although UR-
backed candidates received the most seats (25 out of 45), their numbers declined by a third
compared to the previous election in 2014.51
Russian opposition leaders repeatedly have been subject to persecution. In 2015, one of Russia’s
leading opposition figures, former deputy prime minister and governor Boris Nemtsov, was killed
on the streets of central Moscow.52 Navalny was subjected to house arrest for almost one year and
has been convicted three times (once on retrial) on charges related to alleged embezzlement. He
was given suspended sentences, although in one of the cases his brother was sentenced to three-
and-a-half years in prison.53 Navalny himself has been imprisoned several times for participation
in unsanctioned protests. He was attacked twice with a chemical substance in 2017, potentially
poisoned in 2019 while in prison, and reportedly seriously poisoned in August 2020, leading to
his evacuation to Germany for medical care.54 In September 2020, German officials publicly cited

Divided Russia (New Haven, CT, and London: Yale University Press, 2019).
47 Andrew Higgins, “Protests Rock Russian Far East with Calls for Putin to Resign,” New York Times, July 11, 2020;
Yelena Rykovtseva and Robert Coalson, “‘Not Just Trolling, But Humiliation’: Putin’s Choice to Replace Khabarovsk
Governor Unlikely to Calm Unrest,” RFE/RL, July 21, 2020; Henry Foy, “Protesting Putin: Kremlin Faces Revolt in
the Regions,” Financial Times, August 6, 2020.
48 Andrew Higgins and Andrew E. Kramer, “In Protests, Kremlin Fears a Young Generation Stirring,” New York Times,
March 27, 2017; Nataliya Vasilyeva, “Young Russians Taking the Lead in Anti-Putin Protests,” Associated Press,
September 14, 2018; Olga Khvostunova, “Russian Youth in the Moscow Protests,” Atlantic Council, October 28, 2019.
49 Incumbent Sergei Sobyanin, a former presidential chief of staff and deputy prime minister, won the election with
51%.
50 Vladimir Kara-Murza, “Kremlin Bars Key Challenger from the Ballot – Again,” Washington Post, June 7, 2019.
51 Reuters, “Russia’s Ruling Party Loses a Third of Moscow Election Races After Protests,” September 9, 2019; Leonid
Bershidsky, “The Kremlin Won – and Proved It Can’t Win Fair,” September 9, 2019; Leonid Ragozin, “Moscow’s
Elections Show Putin Is Losing the War at Home,” Time, September 10, 2019.
52 Joshua Yaffa, “The Unaccountable Death of Boris Nemtsov,” New Yorker, February 26, 2016; David Satter, “Who
Killed Boris Nemtsov?” Hudson Institute, October 31, 2017.
53 David M. Herszenhorn, “Aleksei Navalny, Putin Critic, is Spared Prison in a Fraud Case, but His Brother is Jailed,”
New York Times, December 30, 2014; Alec Luhn, “Alexei Navalny: Russian Opposition Leader Found Guilty of
Embezzlement,” Guardian, February 8, 2017; RFE/RL, “Oleg Navalny Released from Russian Prison after 3 ½ Years,”
RFE/RL, June 29, 2018.
54 RFE/RL, “In and Out: All the Times Aleksei Navalny Has Been in Jail,” July 25, 2019; Damien Sharkov, “What is
Zelenka and Why Does Kremlin-Critic Navalny Keep Getting Splashed with It?,” Newsweek, April 28, 2017; Henry
Foy, “Jailed Russian Opposition Leader Alexei Navalny Poisoned, Says Lawyer,” Financial Times, July 29, 2019; Bill
Chappell and Rob Schmitz, “Navalny Was Poisoned, but His Life Isn’t in Danger, German Hospital Says,” NPR,
August 24, 2020.
Congressional Research Service

13

Russia: Domestic Politics and Economy

“unequivocal” evidence that Navalny had been poisoned in Russia with a Novichok chemical
nerve agent.55
Coronavirus Disease 2019 Response
Russia has the fourth-largest number of reported Coronavirus Disease 2019 (COVID-19) cases in
the world, after the United States, Brazil, and India. As of September 1, 2020, the Russian
government had reported more than one million COVID-19 cases and more than 17,200 deaths
attributed to the virus.56 Reported cases and deaths initially were concentrated in the capital city
of Moscow and the surrounding region, which have accounted for about 33% of reported cases
and 35% of reported deaths.57 Many believe the number of deaths in Russia is greatly
understated; observers contend that health officials have recorded many coronavirus-related
deaths as caused exclusively by pneumonia, organ failure, or other health conditions.58 Prime
Minister Mikhail Mishustin, three other cabinet members, and press secretary Dmitry Peskov are
among the government officials who have tested positive for COVID-19.
The number of confirmed COVID-19 cases in Russia increased relatively slowly. Russian
officials reported the first two cases (of Chinese nationals) on January 31, 2020; a third confirmed
case (a Russian national) was reported on March 2.59 Russia’s first coronavirus-related death was
reported on March 19.60 By April 9, the number of confirmed cases in Russia had surpassed
10,000, with 76 reported deaths.61 Confirmed daily cases peaked at more than 11,000 on May 11.
By July 20, confirmed daily cases had declined to under 6,000.
In response to the pandemic, federal and local governments adopted measures similar to those in
other countries. These included border closures, restrictions on international air travel, the
quarantining of foreign travelers, school closures, mask usage, mass testing, and restrictions on
large gatherings. Putin acknowledged the seriousness of the pandemic on March 25, 2020, when
he announced that the next week would be a paid “non-working period” for most employees and
called on Russians to stay home.62 The national “non-working period” was extended through May

55 Robyn Dixon and Loveday Morris, “Russian Opposition Leader Navalny Poisoned with Nerve Agent Similar to
Novichok, Germany Says,” Washington Post, September 2, 2020; Michael Schwirtz and Melissa Eddy, “Aleksei
Navalny Was Poisoned with Novichok, Germany Says,” New York Times, September 2, 2020.
56 Coronavirus Disease 2019 (COVID-19) data is from media reports and the Johns Hopkins University of Medicine
Coronavirus Resource Center.
57 Meduza, “Coronavirus in Russia: The Latest Data” (in Russian), at https://meduza.io/feature/2020/04/17/
koronavirus-v-rossii-poslednie-dannye.
58 Ivan Nechepurenko, “A Coronavirus Mystery Explained: Moscow Has 1,700 Extra Deaths,” New York Times, May
11, 2020; Charles Maynes, “Russia Defends Its Tally of Coronavirus Deaths after Reports of Undercounting,” NPR,
May 14, 2020.
59 RFE/RL, “Russia Confirms First Two Cases of Coronavirus, Two Chinese Nationals Quarantined,” January 31,
2020; Pjotr Sauer and Evan Gershkovich, “Litany of Blunders: Treatment of Coronavirus Patient Highlights Russia’s
Shortcomings,” Moscow Times, March 2, 2020.
60 Gleb Stolyarov and Tom Balmforth, “First Coronavirus Death Reported in Russia, Which Plans to Quarantine All
New Arrivals,” Reuters, March 19, 2020; Trevor Nace, “Confirmed Coronavirus Cases Are Growing Faster in the
United States than Any Other Country in the World,” Forbes, March 20, 2020.
61 Scott Neuman, “Russia Tops 10,000 Coronavirus Cases with Moscow at the Epicenter,” NPR, April 9, 2020.
62 Officials clarified that those who could work from home were expected to do so. Alexander Marrow, “Putin Offers
Week-long Holiday for Russians in Social Package to Combat Coronavirus,” Reuters, March 25, 2020; Jake Rudnitsky
and Ilya Arkhipov, “Putin’s Virus Staycation Isn’t A Holiday After All, Kremlin Says,” March 27, 2020.
Congressional Research Service

14

link to page 8 Russia: Domestic Politics and Economy

11, the day Russia recorded its highest number of cases; restrictions began to ease thereafter at
varying paces across the country.63
Moscow has been at the center of Russia’s pandemic, and the city took the lead on several
response measures and introduced some of the strictest measures in Russia. Mayor Sergei
Sobyanin issued a citywide stay-at-home order on March 30 and later introduced measures
including digital travel passes, geolocation tracking of those diagnosed with COVID-19, and
facial-recognition surveillance to identify stay-at-home violators.64 Moscow’s stay-at-home
orders were gradually eased from mid-May; the stay-at-home order was lifted on June 9 and most
other restrictions on businesses and people were lifted by June 23.65 Many observers contend that
this timeline was set in order to open Moscow in time for a rescheduled June 24 Victory Day
parade (commemorating the 75th anniversary of the end of World War II) and a weeklong national
vote on constitutional amendments (see “Resetting Putin’s Term Limits” above).66
The pandemic appears to have led to a decline in public approval of the central government. Putin
avoided taking a leadership role in national response efforts and mainly placed responsibility on
local governments. Mixed signals by government officials, including Putin, reportedly led to
confusion among the public and signs of disorganization.67 In April 2020, the Levada Center
recorded Putin’s public approval rating at a historically low 59%.68
Russia has engaged in intensive, and potentially illicit, efforts to develop a COVID-19 vaccine. In
July 2020, UK, U.S., and Canadian officials jointly attributed to Russia a series of cyberattacks
against “organizations involved in COVID-19 vaccine development ... likely with the intention of
stealing information and intellectual property relating to the development and testing of COVID-
19 vaccines.”69 Media reports alleged that members of the Russian political and economic elite
had “been given early access to an experimental vaccine.”70 Russian authorities have said they
intend to start mass vaccinations among volunteers in October 2020.71

63 Henry Foy, “Putin Backs Plan to Ease Lockdown Despite Rise in Covid-19 Cases,” Financial Times, May 6, 2020;
TASS Russian News Agency, “Putin: Russia’s Non-Working Holiday Will End May 12, Mass Events Won’t Resume
Yet,” May 11, 2020.
64 Alexa Lardieri, “Moscow Orders Citywide Quarantine Amid Coronavirus Pandemic,” U.S. News and World Report,
March 30, 2020; Mary Ilyushina, “How Russia Is Using Authoritarian Tech to Curb Coronavirus,” CNN, March 29,
2020; Meduza, “Surrender Everything: Moscow Officials Are Launching an App to Monitor Coronavirus Patients’
Compliance with Home Isolation,” April 1, 2020; Mary Ilyushina, “Moscow Rolls Out Digital Tracking to Enforce
Lockdown. Critics Dub It a ‘Cyber Gulag,’” CNN, April 14, 2020.
65 Moscow Times, “Which Coronavirus Restrictions Is Moscow Lifting?” June 8, 2020.
66 Lucian Kim, “Moscow Eases Coronavirus Lockdown Ahead of Military Parade and Referendum,” NPR, June 8,
2020; BBC News, “Russia Holds World War Two Victory Parade in Coronavirus Shadow,” June 24, 2020.
67 Ilya Klishin, “As Russia Battles the Coronavirus Crisis, Why Is Putin So Absent?”, Moscow Times, April 3, 2020;
Henry Foy and Max Seddon, “Putin Leaves Tough Coronavirus Decisions to Regional Aides,” Financial Times, April
4, 2020; Michele A. Berdy, “How Russia’s Coronavirus Crisis Got So Bad,” Politico, May 19, 2020.
68 Moscow Times, “Putin’s Approval Rating Drops to Historic Low: Poll,” May 6, 2020.
69 National Cyber Security Centre, “Advisory: APT29 Targets COVID-19 Vaccine Development,” July 16, 2020;
National Security Agency, “NSA Teams with NCSC, CSE, DHS CISA to Expose Russian Intelligence Services
Targeting COVID-19 Researchers,” press release, July 16, 2020; Kitty Donaldson, Ryan Gallagher, and Chris Strohm,
“Russian Hackers Are Linked to Sweeping Bid to Steal Vaccine Data,” Bloomberg, July 16, 2020.
70 Stepan Kravchenko, Yuliya Fedorinova, and Ilya Arkhipov, “Russian Elite Given Experimental Covid-19 Vaccine
Since April,” Bloomberg, July 19, 2020.
71 Moscow Times, “Russia to Start Mass Deliveries of Coronavirus Vaccine Next Month,” August 31, 2020.
Congressional Research Service

15

Russia: Domestic Politics and Economy

Corruption
Observers contend that Russia’s political system is characterized by a high level of corruption.
The U.S. State Department’s 2019 Human Rights Report notes that corruption in Russia is
“widespread throughout the executive branch ... as well as in the legislative and judicial branches
at all levels. Its manifestations [include] bribery of officials, misuse of budgetary resources, theft
of government property, kickbacks in the procurement process, extortion, and improper use of
official position to secure personal profits.”72 Transparency International (TI), an international
NGO, ranks Russia 137 out of 180 countries on its 2019 Corruption Perception Index.73
Many Russians share these perceptions of corruption. In a February 2020 poll by the Levada
Center, 39% of respondents identified “corruption and bribery” as a serious problem, making it
the second most frequent response after rising prices.74 In other polls, similar percentages
expressed the belief that Vladimir Putin represents the interests of oligarchs, bankers, and large
enterprises and that those in power care only about their privileges and incomes.75
Observers maintain that corruption has led to a high level of wealth disparity in Russia. Credit
Suisse’s 2019 Global Wealth Report estimates that the top 1% of Russians hold 58% of Russia’s
total wealth (compared to 35% in the United States, 43% in India, and 30% in China).76
Observers note that Russia has a disproportionately high number of billionaires per capita relative
to the size of its economy, and their wealth disproportionately stems from businesses linked to the
state (including natural resources and regulated industries).77
Independent investigations assert that billions of dollars have fled Russia via a series of illicit
financial schemes. In 2014 and 2017, investigative journalists reported on an alleged scheme that
resulted in the outflow of more than $20 billion between 2011 and 2014.78 In 2016, an
investigation based on a data leak from the Panamanian law firm Mossack Fonseca tracked the
movement of roughly $2 billion among Panama-based shell companies allegedly owned or
controlled by individuals within Putin’s inner circle.79
Many observers, including within the U.S. government, believe that Putin personally has
benefited from corruption. In a 2016 interview, then-Acting Under Secretary of the Treasury for
Terrorism and Financial Intelligence Adam Szubin said that Putin “supposedly draws a state
salary of something like $110,000 a year. That is not an accurate statement of the man’s wealth,

72 U.S. Department of State, Country Report on Human Rights Practices for 2019: Russia.
73 Transparency International, Corruption Perceptions Index 2019.
74 Levada Center, “The Most Acute Problems,” March 5, 2020 (in Russian), at https://www.levada.ru/2020/03/05/
samye-ostrye-problemy-4/.
75 Elena Mukhametshina, “Almost 40% of Russians Believe that People in Power Care Only About Their Incomes,”
Vedomosti, March 10, 2020 (in Russian), at https://www.vedomosti.ru/society/articles/2020/03/10/824751-lyudi-vlasti;
Angelina Flood and Simon Saradzhyan, “Russians See Putin as More of a Champion of the Oligarchs, Polls Show,”
Russia Matters, April 15, 2020.
76 Credit Suisse Research Institute, Global Wealth Databook 2019.
77 Raam op Rusland, transcript of lecture by Sergei Guriev, “Russian Corruption Can and Should Be Fought,” October
23, 2019.
78 Organized Crime and Corruption Reporting Project (OCCRP), The Russian Laundromat, August 22, 2014; OCCRP,
The Russian Laundromat Exposed, March 20, 2017.
79 International Consortium of Investigative Journalists (ICIJ), The Panama Papers: Exposing the Rogue Offshore
Finance Industry, at https://www.icij.org/investigations/panama-papers/; ICIJ, “All Putin’s Men: Secret Records
Reveal Money Network Tied to Russian Leader,” April 3, 2016; Luke Harding, “Revealed: The $2bn Offshore Train
That Leads to Vladimir Putin,” Guardian, April 3, 2016.
Congressional Research Service

16

Russia: Domestic Politics and Economy

and he has longtime training and practices in terms of how to mask his actual wealth.”80 Russian
government officials reject all such claims.
Officially, the Russian government claims to combat corruption. At the end of 2017, then-
Prosecutor General Yuri Chaika (whom many consider benefited from corruption) estimated that
since 2015 total corruption-related losses in Russia had amounted to more than $2.5 billion (albeit
with a 60% rate of recovery).81 In 2019, the Prosecutor General’s Office said that more than 1,300
officials had been dismissed on the basis of corruption-related concerns in 2018.82 Traditionally,
Russian courts have prosecuted mainly cases of smaller-scale corruption, although the number of
cases involving larger bribes and/or larger companies recently has grown.83
Senior Russian officials are infrequently prosecuted on corruption-related charges. When they
are, observers believe cases are selectively prosecuted and often reflect infighting among different
power bases or the intent to remove a problematic politician rather than a sincere effort to combat
corruption.84 Observers suspect charges sometimes are fabricated. Since 2015, ex-officials
convicted or arrested on corruption-related charges include a minister of economic development,
a minister of open government affairs, several governors, a director and deputy director of the
Federal Penitentiary Service, and officials from an economic crimes unit of the FSB, an economic
security and anticorruption unit of the Ministry of Internal Affairs, and the Investigative
Committee (another law enforcement body).85
Human Rights
Putin’s authoritarian consolidation of power has involved a wide range of nondemocratic
practices and human rights abuses, according to most external assessments. The U.S. Department
of State’s 2019 human rights report, for example, recounts multiple human rights issues,
including extrajudicial killings, enforced disappearances, pervasive torture, arbitrary and unjust
arrests and imprisonments, suppression of freedom of expression and media, peaceful assembly,
and association, restrictions on religious freedom, and limits on participation in the political
process.86

80 BBC News, “Russia BBC Panorama: Kremlin Demands ‘Putin Corruption’ Proof,” January 26, 2016.
81 TASS Russian News Agency, “Top Prosecutor Shows Corruption in Russia Caused Losses of $2.5 billion over Past
Three Years,” December 7, 2017.
82 Moscow Times, “More than 1,300 Russian Officials Fired for Corruption in 2018 – Prosecutors,” March 27, 2019.
83 Noerr, “Compliance in Russia: Seven Lessons from Recent Anti-Bribery Enforcement,” June 3, 2020; Dada Lindell
and Margarita Alekhina, “The Number of People Convicted of Large Bribes in Russia Reached a Record High” (in
Russian), RBC, April 30, 2020, at https://www.rbc.ru/society/30/04/2020/5e9daa0e9a794771cc07e9bd.
84 Masha Gessen, “The Non-Political Political Arrest of Nikita Belykh in Russia,” New Yorker, July 1, 2016; Ilya
Shumanov, “Back to the USSR: Why the Latest Anti-Corruption Crusade is Doomed to Fail,” Moscow Times, August
5, 2016; Joss I. Meakins, “Squabbling Siloviki: Factionalism within Russia’s Security Services,” International Journal
of Intelligence and Counterintelligence 31, 2 (2018): pp. 235-270.
85 See, for example, Warsaw Institute, “Yet Another Dismissal, a Shock for the System of Power,” April 28, 2017;
Olga Romanova, “The Billionaire Advisor: A Story of Russia’s Anti-Corruption Campaign,” Carnegie Moscow Center,
October 16, 2017; Meakins, “Squabbling Siloviki,” op. cit.; Economist, “Russia’s New Purges Rattle the Elite,” March
28, 2019; Anastasia Stognei and Roman Badanin, “Rise and Fall of an FSB-Run Money Laundering Empire,” Bell,
August 3, 2019; and Realnoe Vremya, “What Governors are Jailed for in Modern Russia,” July 15, 2020.
86 U.S. Department of State, 2019 Country Reports on Human Rights Practices: Russia.
Congressional Research Service

17

Russia: Domestic Politics and Economy

Freedom of Assembly. Since 2012, the Russian government has imposed increasingly broad
restrictions on the practice of freedom of assembly.87 Public demonstrations require official
approval, and the fine for participating in unsanctioned protests can be thousands of dollars.
Police routinely break up unsanctioned protests by force, detaining participants on a mass scale.
Human rights monitors reported detentions of at least 1,675 individuals during nationwide
protests in March 2017, at least 1,770 in June 2017, 1,600 in May 2018, 1,200 in September
2018, and 1,400 in July 2019.88
Detained protestors risk longer-term imprisonment. Some receive short-term sentences (e.g., 10
to 15 days), while others receive multiyear sentences for alleged crimes like rioting or assault
(charges which observers say are frequently unfounded). A 2014 law criminalizing repeat
nonviolent participation in unauthorized rallies has led to two individuals receiving prison
sentences: one in 2015 for 2.5 years (reduced on appeal from 3 years) and one in 2020 for 1.5
years (reduced from an initial 4 years after Putin called for the sentence to be reevaluated). In
2017, Russia’s Supreme Court overturned the 2015 conviction after the accused had served about
half his sentence.89
Freedom of Expression, Access to Information, and Media. Since 2012, the Russian
government has enacted a series of laws that human rights monitors view as restricting freedom
of expression, access to information, and digital privacy. Laws have established expansive and
poorly defined categories of prohibited “extremist” organizations, speech or content, and
activities, including anti-state criticism on social media. They also have established a blacklist of
websites that allegedly advocate “extremist” activity or publish “extremist” content; a
requirement that individual bloggers with large numbers of followers follow certain media
regulations; and a prohibition against offending the “religious feeling of believers.”90 In 2019,
legislation was enacted to prohibit the online dissemination of intentionally “false information”
that could cause public harm or disorder, as well as online expressions of “blatant disrespect” for
the state and society.91
Russian authorities have enacted laws and implemented policies to enable widespread digital
surveillance.92 This includes requiring websites and internet service providers to store personal
data of Russian citizens on servers located inside Russia; digital and telecommunications
companies to retain data on web traffic and communications; and online messaging applications
to enforce non-anonymous user registration and provide the means for authorities to decrypt
secure communications.93 In 2019, new “sovereign internet” legislation was enacted that is

87 Amnesty International, A Right, Not a Crime: Violations of the Right to Freedom of Assembly in Russia, June 2014.
88 Amnesty International, “Russian Federation: The Right to Freedom of Peaceful Assembly – Freedom in All But
Name,” March 15, 2018; Human Rights Watch, World Report 2019; Henry Foy, “Police Arrest 1,400 in Crackdown on
Moscow Pro-Democracy Rally,” Financial Times, July 28, 2019.
89 Tanya Lokshina, “Russian Court Sentences Activist to Four Years in Prison,” Human Rights Watch, September 5,
2019; Moscow Times, “Russian Opposition Activist Kotov’s Prison Term Shortened,” April 20, 2020.
90 Human Rights Watch, Online and On All Fronts: Russia’s Assault on Freedom of Expression, July 2017.
91 Moscow Times, “Putin Signs ‘Fake News,’ ‘Internet Insults’ Bills Into Law,” March 18, 2019.
92 Andrei Soldatov and Irina Borogan, “Inside the Red Web: Russia’s Back Door Onto the Internet,” Guardian,
September 8, 2015; Human Rights Watch, Online and On All Fronts: Russia’s Assault on Freedom of Expression, July
2017; Damir Gainutdinov, “Russia’s Surveillance State Is Giving Us A False Sense of Security,” openDemocracy,
August 25, 2017; Zack Whittaker, “Documents Reveal How Russia Taps Phone Companies for Surveillance,”
TechCrunch, September 18, 2019.
93 On attempts to enforce such laws, see, for example, Ingrid Lunden, “Russia Says ‘Nyet,’ Continues LinkedIn Block
after It Refuses to Store Data in Russia,” TechCrunch, March 17, 2017; Vlad Savov, “Russia’s Telegram Ban is a Big,
Convoluted Mess,” Verge, April 17, 2018; and Maria Kolomychenko, “Russia Tries More Precise Technology to Block
Congressional Research Service

18

Russia: Domestic Politics and Economy

intended to enable authorities more easily to block internet access and permit the central
management of internet networks in Russia in the event of threats to their “stability, security, and
integrity.”94
Journalists are frequently harassed and detained and sometimes imprisoned. In 2019,
investigative journalist Ivan Golunov was arrested on alleged drug trafficking charges, reportedly
in retaliation for reporting on corruption schemes in Moscow with purported links to the FSB.
Golunov’s arrest led to a rare degree of public outcry and the charges were dropped.95 In July
2020, a journalist and media advisor to the Russian space agency Roskosmos, Ivan Safronov, was
arrested on charges of treason.96 Also in July 2020, radio journalist Svetlana Prokopyeva was
found guilty of allegedly “justifying terrorism” and fined almost $7,000.97 In the summer of 2020,
media reports indicated that journalists were investigated and fined for publishing allegedly false
information related to the coronavirus pandemic and for critical coverage of the July 2020 vote on
constitutional amendments.98
Sexual and Gender Identity. Some Russian laws and government policies restrict the rights of
lesbian, gay, bisexual, transgender, and intersex (LGBTI) individuals. A 2013 law bans
“propaganda” to minors that encourages individuals to consider “non-traditional sexual
relationships” as attractive or socially equivalent to “traditional” sexual relationships. On the
basis of this law, authorities have fined individuals, prohibited rallies and performances, and
blocked websites.99 In 2020, an amendment to the constitution was passed that declares the state
has the authority to defend “the institution of marriage as a union of a man and a woman.”100 A
bill was subsequently introduced in the State Duma to ban same-sex marriages and adoptions,
which Russian authorities generally do not recognize.101 In 2017, authorities removed two foster
children from a home in which they suspected one parent of being transgender; in 2018,
authorities investigated the adoption of two children by a same-sex couple.102
In 2017, Russian media reported that local authorities in the Chechen Republic (Chechnya), a
region in Russia’s North Caucasus, had rounded up more than 100 men on the basis of suspected

Telegram Messenger,” Reuters, August 30, 2018.
94 Human Rights Watch, “Russia: New Law Expands Government Control Online,” October 31, 2019; Alena
Epifanova, Deciphering Russia’s “Sovereign Internet Law,” German Council on Foreign Relations (DGAP), January
16, 2020.
95 Alexey Kovalev, “Russian Officials Tried to Frame Ivan Golunov. Instead They Made Him a Hero,” Guardian, June
11, 2019; Billy Perrigo, “‘He Had Powerful Enemies.’ Russian Journalist Ivan Golunov Has Been Released, but Media
in Russia Still Can’t Work Freely,” Time, June 12, 2019.
96 Andrew Higgins, “Russia Arrests Space Agency Official, Accusing Him of Treason,” New York Times, July 7, 2020.
97 Vladimir Isachenkov, “Russian Journalist Fined in Case That Drew Broad Outrage,” Associated Press, July 6, 2020.
98 Committee to Protect Journalists, “Russian Journalists Investigated, Fined Over COVID-19 Reporting,” June 16,
2020; Committee to Protect Journalists, “Russian Journalists Attacked, Harassed While Covering Vote for Putin to
Remain in Power,” July 1, 2020.
99 Human Rights Watch, No Support: Russia’s “Gay Propaganda” Law Imperils LGBT Youth, December 2018;
Amnesty International, “Russia: Feminist Activist Fined for ‘Gay Propaganda’ and Facing Criminal ‘Pornography’
Charges,” December 11, 2019.
100 Constitution of the Russian Federation, Article 72.
101 Associated Press, “Russian Constitution Change Ends Hopes for Same-Sex Marriage,” July 13, 2020; Moscow
Times, “Russia Moves to Ban Gay Marriage,” July 15, 2020.
102 Kaitlin Martin, “Russian Court Says Foster Mother Unfit Because of ‘Male Behavior,’” Human Rights Watch,
February 15, 2018; Emily Sherwin, “Russia Launches Criminal Case Over Gay Adoption,” DW (Germany), July 18,
2019.
Congressional Research Service

19

Russia: Domestic Politics and Economy

homosexuality.103 Human rights monitors reported that detained individuals were beaten and
tortured and that at least three died as a result of the roundup (including two reportedly killed by
relatives after their release from detention).104 Although the Russian government belatedly said it
would open an investigation, in May 2018, Russia’s Minister of Justice said it was unable to
confirm the allegations.105 In the winter of 2018-2019, human rights monitors reported on a
second round of detentions and torture of individuals whom Chechen authorities suspected were
gay.106
Religious Practice. Some Russian laws have targeted minority religious communities. Since
2015, authorities increasingly have used a two-decade long ban on the Islamic organization Hizb
ut-Tahrir to imprison both Muslims in Russia and members of the Crimean Tatar community in
Ukraine’s occupied Crimea region (Hizb ut-Tahrir is legal in Ukraine).107 Russia considers Hizb
ut-Tahrir a terrorist organization, although its members and many observers say it is a nonviolent
movement. Some observers believe that the arrest and imprisonment of suspected Hizb ut-Tahrir
members in Crimea has been a pretense to eliminate potential sources of resistance to Russia’s
illegal occupation of the region.108
Authorities have used a 2016 law on extremism that imposes restrictions on locations of religious
worship and proselytization to target Jehovah’s Witnesses and other evangelical Christians. In
2017, Russia’s Supreme Court upheld a ban on the operations of Jehovah’s Witnesses, after
which members reported increased instances of harassment and violence.109 Authorities escalated
their campaign against Jehovah’s Witnesses in 2018. As of April 2020, human rights monitors
reported that over 330 Jehovah’s Witnesses faced charges, were on trial, or had been convicted of
extremism (including a Danish citizen who in 2019 was sentenced to six years in prison).110
Human rights monitors have reported allegations of torture against Jehovah’s Witnesses.111
Civic Association. The Russian government has imposed increasing restrictions limiting the
ability of civic and media organizations to receive financial support from abroad. According to
the State Department’s 2019 human rights report, Russian NGOs have been “harass[ed]” and
“stigmatize[d],” including through a 2012 law that requires foreign-funded organizations that

103 Human Rights Watch, They Have Long Arms and They Can Find Me: Anti-Gay Purge by Local Authorities in
Russia’s Chechen Republic, May 2017; Masha Gessen, “The Gay Men Who Fled Chechnya’s Purge,” New Yorker, July
3, 2017.
104 Human Rights Watch, They Have Long Arms and They Can Find Me, p. 15.
105 Moscow Times, “Russia Tells UN There Are No Gays in Chechnya,” May 15, 2018.
106 Human Rights Watch, “Russia: New Anti-Gay Crackdown in Chechnya,” May 8, 2019.
107 Mairbek Vatchagaev, “Russian Authorities Launch Crackdown on Hizb ut-Tahrir,” Eurasia Daily Monitor,
Jamestown Foundation, October 23, 2015; Human Rights Watch, “Crimea: Persecution of Crimean Tatars Intensifies,”
November 14, 2017; Alona Savchuk, “How Russia’s Security Services Target Crimean Tatars as ‘Islamic Terrorists,’”
openDemocracy, June 19, 2018.
108 Authorities also have imprisoned alleged members of the religious organization Tablighi Jamaat and followers of
the late Turkish theologian Said Nursi. Maria Kravchenko, Inventing Extremists: The Impact of Russian Anti-
Extremism Policies on Freedom of Religion or Belief, United States Commission on International Religious Freedom,
January 2018.
109 Jason Le Miere, “Jehovah’s Witnesses Ban Appeal Rejected by Russia’s Supreme Court, Allowing Government to
Seize Worship Halls,” Newsweek, July 17, 2017.
110 Human Rights Watch, “Russia: Escalating Persecution of Jehovah’s Witnesses,” January 9, 2020; Memorial Human
Rights Center, “Memorial Recognizes a Further 130 Jehovah’s Witnesses as Victims of Politically Motivated
Prosecutions,” April 15, 2020.
111 Amnesty International, “Russian Federation: Effectively Investigate Allegations of Torture Against and Persecution
of Jehovah’s Witnesses,” February 25, 2019.
Congressional Research Service

20

Russia: Domestic Politics and Economy

engage in activity seeking to affect policymaking (loosely defined) to register and identify as
“foreign agents.” In 2017, the law was extended to apply to media organizations and, in 2019, to
individuals.112
As of September 1, 2020, 68 NGOs, as well as U.S.-funded broadcasters Radio Free
Europe/Radio Liberty, Voice of America, and various affiliates, have been registered as foreign
agents.113 This number is down from a high of over 150, as many designated organizations
subsequently have chosen not to receive foreign funding or been forced to shut down.114 In 2014,
Russia’s main domestic election-monitoring organization, Golos, was the first organization to be
so classified. Just before 2016 Duma elections, a well-known polling organization, the Levada
Center, was branded a foreign agent; a prominent human rights organization, Memorial, also was
labeled a foreign agent. In 2019, Russia’s Supreme Court ordered the closure of another
prominent human rights organization, For Human Rights, it previously had labeled a foreign
agent.115
A 2015 law enables the government to classify as “undesirable” foreign organizations engaged in
activities that allegedly threaten Russia’s constitutional order, defense capability, or state security,
and to close their local offices and bar Russian citizens from working with them.116 As of
September 1, 2020, a total of 29 organizations and subsidiaries are barred from Russia for
“undesirable” activity. These include the National Endowment for Democracy, Open Society
Foundations, National Democratic Institute, International Republican Institute, Open Russia, the
German Marshall Fund, the Atlantic Council, and the Jamestown Foundation.117
Human rights activists and environmental defenders have been negatively affected by these laws.
Observers note that several have suffered wrongful imprisonment or been victims of physical
attacks that authorities do not investigate adequately.118 This includes, for example, LGBTI
activist Yelena Grigoryeva, who was killed in July 2019.119
Political Prisoners and Prison Abuse. Increasing restrictions on human rights and a growing
willingness of authorities to crack down on alleged violators of these restrictions has led to a rise
in the number of individuals human rights monitors consider to be political prisoners. The

112 Moscow Times, “Russia’s New ‘Foreign Agent’ Law, Explained,” December 2, 2019.
113 The list of organizations currently classified as “foreign agents” is available on the website of the Russian Ministry
of Justice (at http://unro.minjust.ru/NKOForeignAgent.aspx). On media, see David Filipov, “Russian Parliament Bars
Radio Free Europe and Voice of America from Premises,” Washington Post, December 5, 2017.
114 In February 2017, Human Rights Watch noted that 158 organizations had been classified at some point as foreign
agents. Human Rights Watch, “Russia: Government vs. Rights Groups,” February 6, 2017.
115 RFE/RL, “Russia’s Supreme Court Orders Closure of ‘For Human Rights’ Group,” November 1, 2019.
116 For background, see International Center for Not-for-Profit Law, “Civic Freedom Monitor: Russia,” at
http://www.icnl.org/research/monitor/russia.html.
117 The list of organizations classified as “undesirable” is available on the website of the Russian Ministry of Justice at
https://minjust.gov.ru/ru/documents/7756/.
118 Amnesty International, Unfair Game: Persecution of Human Rights Defenders in Russia Intensifies, September
2019; Crude Accountability, Dangerous Work: Reprisals Against Environmental Defenders, 2019, pp. 46-62; Damelya
Aitkhozhina, “Russian Authorities’ Bad Cheer to Environmental Defenders,” Human Rights Watch, December 24,
2019.
119 Reis Thebault, “A Horror-Themed Website Told Readers to ‘Hunt’ Gay People. Then an Activist was Stabbed to
Death,” Washington Post, July 24, 2019; Matthew Luxmoore, “A Grim Death, A Confession—But No Closure in
Russian LGBT Activist’s Killing,” RFE/RL, September 18, 2019.
Congressional Research Service

21

Russia: Domestic Politics and Economy

Russian human rights organization Memorial has observed at least a sixfold increase in the
number of political prisoners in Russia from 2015 to 2020.120
As of April 2020, Memorial recognized at least 318 individuals as political prisoners. This
included 256 alleged members of prohibited religious organizations (mostly members of banned
Islamic movements but also Jehovah’s Witnesses). It also included 62 other individuals, many of
whom were imprisoned for alleged participation in “extremist” activities or organizations.121 In
August 2020, Ukrainian officials reported that 133 Ukrainians (including 97 Crimean Tatars)
were political prisoners in Russia or occupied Crimea.122
Russian prisoners have been subject to torture and abuse. Several publicized cases of abuse and
deaths in prison have led to public outcry and the removal and arrest of former prison guards.
Observers debate the extent to which Russian authorities are committed to prison reform.123
Killings and Poisonings. Over the years, a number of Russian journalists, human rights activists,
politicians, whistleblowers, and others have been killed or died under mysterious circumstances,
in Russia and overseas. This includes former Russian spy Alexander Litvinenko (in London) and
investigative journalist Anna Politkovskaya in 2006; human rights lawyer Stanislav Markelov,
journalist Anastasia Baburova, and human rights activist Natalya Estemirova in 2009; opposition
politician Boris Nemtsov in 2015; and former Chechen military commander Zelimkhan
Khangoshvili in Berlin in 2019. Although those who commit such crimes may be prosecuted,
suspicions frequently exist that those who order such killings remain free. Some critics and
opponents of the Russian government, including British citizen and alleged double agent Sergei
Skripal, a former Russian military intelligence officer, and opposition figure Alexei Navalny have
survived poisoning attacks that could have been either assassination attempts or attacks intended
to threaten but not to kill.124
U.S. Policy and Human Rights-Related Sanctions125
Domestic developments in Russia often have elicited U.S. reactions. In particular, U.S. officials,
including Members of Congress, have called attention to human rights abuses in Russia,
including in annual human rights and religious freedom reports. In February 2019, on the fourth
anniversary of Boris Nemtsov’s killing, the State Department called for Russia to “allow

120 Moscow Times, “Russia’s Political Prisoner Population Grew Sixfold in 4 Years – NGO,” July 10, 2019.
121 Memorial Human Rights Center, “Memorial Publishes New Lists of Political Prisoners,” April 14, 2020. Also see
Perseus Strategies with support from Memorial Human Rights Center, The Kremlin’s Political Prisoners: Advancing a
Political Agenda by Crushing Dissent, May 2019.
122 RFE/RL, “Russia Holds 133 Ukrainians on Politically Motivated Charges, Ombudswoman Says,” August 10, 2020.
Also see RFE/RL, “Abductions, Torture, ‘Hybrid Deportation’: Crimean Tatar Activist Describes Six Years Under
Russian Rule,” March 17, 2020.
123 See, for example, RFE/RL, “Russian Authorities Probe Alleged Abuses in Prisons after Torture Video Emerges,”
July 27, 2018; Jan Strzelecki, Russia Behind Bars: The Peculiarities of the Russian Prison System, Centre for Eastern
Studies (OSW), February 7, 2019; BBC News, “Dead Within Three Hours of Arrival at a Russian Prison,” February
23, 2020.
124 For more on the Skripal poisoning and U.S. sanctions imposed in response, see CRS In Focus IF10962, Russia, the
Skripal Poisoning, and U.S. Sanctions, by Dianne E. Rennack and Cory Welt. Also see Elias Groll, “A Brief History of
Attempted Russian Assassinations by Poison,” Foreign Policy, March 9, 2018; Neil MacFarquhar, “Fears of Navalny
Poisoning Are Rooted in Previous Attacks on Kremlin Foes,” New York Times, July 29, 2019; and Amy MacKinnon,
“Why Russia Keeps Poisoning People,” Foreign Policy, August 1, 2019.
125 This section draws on material co-authored by Dianne E Rennack from CRS Report R45415, U.S. Sanctions on
Russia, coordinated by Cory Welt.
Congressional Research Service

22

Russia: Domestic Politics and Economy

journalists, civil society activists, and political opposition members to exercise their universal
human rights of freedom of expression, association, and peaceful assembly without fear of
violence or other forms of reprisal.”126
In January 2019, the State Department stated that it was “deeply disturbed by credible reports out
of Chechnya about renewed attacks against individuals perceived to be members of the LGBTI
community.” The State Department called on Russia “to live up to its international obligations
and commitments and its own constitution, and launch an immediate investigation into these
human rights abuses,” as well as to “ensure that the rights of all human rights defenders are fully
respected in Chechnya.”127
U.S. officials have focused attention on Russia’s human rights abuses in Ukraine’s occupied
Crimea region. In March 2018, the State Department stated that in Crimea, “Russia has engaged
in a campaign of coercion and violence, targeting anyone opposed to its attempted annexation
[including] Crimean Tatars, ethnic Ukrainians, pro-Ukrainian activists, civil society members,
and independent journalists.”128 In September 2019, the State Department welcomed Russia’s
release of 35 Ukrainians as part of an exchange of detained persons and called on Russia “to
immediately release all other Ukrainians, including members of the Crimean Tatar community,
who remain unjustly imprisoned.”129
The U.S. Mission to the Organization for Security and Co-operation in Europe (OSCE) frequently
addresses Russian human rights abuses. In October 2019, the U.S. Permanent Representative to
the OSCE, Ambassador James Gilmore, expressed U.S. concern “about Russia’s repression, with
impunity in cases of threats and violence against human rights defenders, journalists,
environmental activists, political rivals, members of ethnic and religious minorities, and those
who do not conform to so-called ‘traditional values.’”130
Russian authorities have detained and imprisoned U.S. citizens. High-profile cases include the
December 2018 detention of former U.S. Marine Paul Whelan, who in June 2020 was sentenced
to 16 years imprisonment on alleged espionage charges, and the February 2019 detention of
private equity firm founder Michael Calvey, who remains under house arrest on alleged
embezzlement charges.131 The State Department’s Travel Advisory for Russia reports that
“Russian authorities arbitrarily enforce the law against U.S. citizen religious workers and open
questionable criminal investigations against U.S. citizens engaged in religious activity.”132
Related Sanctions
In December 2012, Congress passed and the President signed into law the Sergei Magnitsky Rule
of Law Accountability Act of 2012 (hereinafter the Magnitsky Act).133 This legislation bears the

126 U.S. Department of State, “Boris Nemtsov,” February 26, 2019.
127 U.S. Department of State, “Attacks on LGBTI Community in Chechnya,’ January 17, 2019.
128 U.S. Department of State, “Crimea Is Ukraine,” March 14, 2018.
129 U.S. Department of State, “Ukraine-Russia Prisoner Swap,” September 8, 2019.
130 U.S. Mission to the OSCE, “USOSCE Ambassador James Gilmore Calls Out Russia’s ‘Evil Conduct,’” October 18,
2019.
131 U.S. Department of State, “The Conviction of U.S. Citizen Paul Whelan in Russia,” June 15, 2020; Ivan
Nechepurenko and Andrew Higgins, “Russian Court Sentences American, Paul Whelan, to 16 Years on Spy Charges,”
New York Times, June 15, 2020; RFE/RL, “Moscow Court Extends House Arrest of U.S. Investor Calvey,” May 7,
2020.
132 U.S. Department of State, “Russia Travel Advisory,” updated February 10, 2020.
133 The act was enacted as Title IV of the Russia and Moldova Jackson-Vanik Repeal and Sergei Magnitsky Rule of
Congressional Research Service

23

Russia: Domestic Politics and Economy

name of Sergei Magnitsky, a Russian lawyer and auditor who died under suspicious
circumstances in prison in November 2009 after uncovering massive tax fraud that allegedly
implicated government officials. The act requires the President to impose sanctions on those he
identifies as having been involved in the “criminal conspiracy” that Magnitsky uncovered and in
his subsequent detention, abuse, and death.134 The act also requires the President to impose
sanctions on those he finds have committed gross violations of internationally recognized human
rights against individuals who are fighting to expose the illegal activity of Russian government
officials or who are seeking to exercise or defend internationally recognized human rights and
freedoms.
As of September 1, 2020, the Treasury Department has designated 54 individuals and 1 entity
pursuant to the Magnitsky Act. Forty designees are directly associated with the alleged crimes
that Magnitsky uncovered or his subsequent ill-treatment and death. Treasury also has designated
11 individuals and 1 entity from the Chechen Republic for human rights violations and killings in
that region or for the 2004 murder of Paul Klebnikov, the American chief editor of the Russian
edition of Forbes.135 Two designations target the suspected killers of former Russian spy
Alexander Litvinenko in London in 2006.136 Another designation targets an overseer of prison
abuse in Russia’s Karelia region.
Congress passed the Global Magnitsky Human Rights Accountability Act in 2016.137 This act
authorizes the President to apply globally the human rights sanctions authorities originally set out
in the Magnitsky Act aimed at the treatment of whistleblowers and human rights defenders in
Russia. The Global Magnitsky Act also authorizes the President to impose sanctions against
government officials and associates responsible for acts of significant corruption. In December
2017, President Trump issued Executive Order 13818 to implement the Global Magnitsky Act, in
the process expanding the target for sanctions to include those who commit any “serious human
rights abuse” around the world, not just gross human rights violations against whistleblowers and
human rights defenders.138 Currently 100 individuals and 103 affiliated entities are designated
under the Global Magnitsky Act. Two of these are Russian nationals, including the son of
Russia’s then-Prosecutor General.139
In addition to the Magnitsky Act and the Global Magnitsky Act, Congress has used other
legislation to respond to human rights abuses in Russia. In FY2008, Congress began including a
requirement in annual State Department and Foreign Operations Appropriations Acts that the

Law Accountability Act of 2012 (P.L. 112-208).
134 Sergei Magnitsky Act, §404(a)(1); 22 U.S.C. §5811 note.
135 On the murder of Paul Klebnikov, see Otto Pohl, “The Assassination of a Dream,” New York, November 2004;
Bermet Talant, “American Journalist Paul Klebnikov’s Alleged Killer Arrested in Kyiv,” Kyiv Post, November 19,
2017.
136 On the murder of Alexander Litvinenko, see Alex Goldfarb with Marina Litvinenko, Death of a Dissident: The
Poisoning of Alexander Litvinenko and the Return of the KGB (New York: Free Press, 2007), and Luke Harding, A
Very Expensive Poison: The Assassination of Alexander Litvinenko and Putin’s War With the West (New York:
Vintage Books, 2017).
137 P.L. 114-328, Title XII, Subtitle F; 22 U.S.C. §2656 note. For more, see CRS In Focus IF10576, The Global
Magnitsky Human Rights Accountability Act, by Dianne E. Rennack.
138 Executive Order 13818 of December 20, 2017, “Blocking the Property of Persons Involved in Serious Human
Rights Abuse or Corruption,” 82 Federal Register 60839. The National Emergencies Act, which EO 13818 invokes,
requires the President to extend annually any national emergency declaration (otherwise, it lapses). The President most
recently extended EO 13818 on December 18, 2019.
139 Treasury also has designated under the Global Magnitsky Act a former Ukrainian special police force commander
who has dual Ukrainian-Russian citizenship.
Congressional Research Service

24

Russia: Domestic Politics and Economy

Secretary of State shall deny entry into the United States of certain foreign officials involved in
the corrupt extraction of natural resources. This provision has gradually been broadened and now
requires the denial of entry of foreign government officials and their immediate family members
for whom there is credible information that the individual has been involved, “directly or
indirectly, in significant corruption […] or a gross violation of human rights.”140 As of September
1, 2020, the State Department has publicly designated nine Russian nationals for human rights
abuses under these Section 7031(c) authorities: head of the Chechen Republic Ramzan Kadyrov
and three immediate family members, two other senior Chechen officials and one family member,
and two regional officials for their alleged involvement “in torture and/or cruel, inhuman, or
degrading treatment or punishment” of Jehovah’s Witnesses.141
The Support for the Sovereignty, Integrity, Democracy, and Economic Stability of Ukraine Act of
2014 (SSIDES) establishes sanctions on those responsible for “the commission of serious human
rights abuses in any territory forcibly occupied or otherwise controlled” by the Russian
government.142 In November 2018, President Trump designated two individuals and one entity for
committing serious human rights abuses in Russia-controlled Ukrainian territories.143
SSIDES also established sanctions on Russian government officials and associates responsible for
acts of significant corruption worldwide. As of September 1, 2020, the Administration has not
designated Russian persons under this authority. In April 2018, however, the Department of the
Treasury designated several “oligarchs and elites who profit from [Russia’s] corrupt system”
pursuant to other authorities related to Russia’s invasion of Ukraine.144
In response to a Russian chemical agent attack against a United Kingdom national and his
daughter in 2018, the Administration imposed two rounds of sanctions on Russia pursuant to the
Chemical and Biological Weapons Control and Warfare Elimination Act of 1991 (CBW Act).145
In response to the August 2020 attack on Navalny, which German officials concluded was a
chemical nerve agent attack, the Administration may consider making a new determination that
Russia has used a chemical weapon in contravention of international law and potentially impose
additional sanctions.

140 Most recently, Section 7031(c) of the Department of State, Foreign Operations, and Related Programs
Appropriations Act, 2020 (Division G, P.L. 116-94, Further Continuing Appropriations Act, 2020). Section 7031(c)(3)
authorizes the Secretary of State to waive designating an individual if the Secretary determines “that the waiver would
serve a compelling national interest or that the circumstances which caused the individual to be ineligible [to enter the
United States] have changed sufficiently.” For more, see CRS In Focus IF10905, FY2020 Foreign Operations
Appropriations: Targeting Foreign Corruption and Human Rights Violations, by Liana W. Rosen and Michael A.
Weber.
141 The act provides for private designations as well; designations are to be reported regularly to the Foreign
Relations/Affairs, Appropriations, and Judiciary Committees. Department of State, “Public Designation Due to
Involvement in Gross Violations of Human Rights of Vladimir Yermolayev and Stepan Tkach, Officials of the
Investigative Committee in the Russian Federation,” September 10, 2019.
142 SSIDES, P.L. 113-95, as amended, Sections 9 and 11; 22 U.S.C. §§8908, 8910. Amendments to SSIDES were
introduced in Sections 227, 228, and 230 of the Countering Russian Influence in Europe and Eurasia Act of 2017
(CRIEEA; P.L. 115-44), which is Title II of the Countering America’s Adversaries Through Sanctions Act (CAATSA).
143 U.S. Department of the Treasury, “Treasury Sanctions Officials and Targets Entities Supporting Russia’s
Occupation of Crimea and Forcible Control of Eastern Ukraine,” press release, November 8, 2018.
144 U.S. Department of the Treasury, “Treasury Designates Russian Oligarchs, Officials, and Entities in Response to
Worldwide Malign Activity,” press release, April 6, 2018.
145 P.L. 102-182, Title III; 22 U.S.C. §§5601 et seq. For more, see CRS In Focus IF10962, Russia, the Skripal
Poisoning, and U.S. Sanctions, by Dianne E. Rennack and Cory Welt.
Congressional Research Service

25

Russia: Domestic Politics and Economy

Other Actions
In 2018, under the International Religious Freedom Act of 1998, as amended, Secretary of State
Michael Pompeo included Russia for the first time on the Special Watch List identifying
“governments that have engaged in or tolerated severe violations of religious freedom.”146 The
Special Watch List was established in 2016 to publicly name countries that have severe religious
freedom violations but whose treatment of religious freedoms was judged by the President to not
meet the criteria for designation as a Country of Particular Concern (CPC). A Special Watch List
designation may serve as a warning that the United States could designate the foreign nation as a
CPC in a subsequent year. If Russia were to be designated a CPC, it would become subject to
potential diplomatic and economic sanctions that could range from private demarches to
prohibitions on export licensing, procurement contracts, and transactions through U.S. financial
institutions.147 In 2019, the U.S. Commission on International Religious Freedom, a bipartisan
federal government commission, recommended that Russia be designated as a CPC.148
Pursuant to the Trafficking Victims Protection Act, the State Department every year since 2013
has identified Russia as a Tier 3 nation that fails to meet minimum standards for the elimination
of human trafficking and is not making significant efforts to do so. As a result of the 2019
designation, the President in October 2019 limited assistance to Russia’s government and denied
U.S. support for multilateral development loans or other funds to Russia’s government.149
The Department of State, Foreign Operations, and Related Programs Appropriations Act, 2020
(P.L. 116-94, Division G), generally prohibits funds from being made available to Russia’s central
government (§7047(a)), a restriction in place since FY2015 as a consequence of Russia’s 2014
invasion of Ukraine. The act also requires country notification procedures to be invoked for
foreign aid to Russia (§7015(f)).
As in previous years, FY2020 foreign operations appropriations makes funds available “to
support democracy programs in the Russian Federation … including to promote Internet
freedom” (P.L. 116-94, Division G, §7047(e)). FY2020 appropriations require the Secretary of
State, in consultation with the USAID Administrator, to submit to Congress “a comprehensive,
multiyear strategy for the promotion of democracy” in Russia and other countries in Europe,
Eurasia, and Central Asia. In addition to their relevant democracy and human rights programs, the
State Department and USAID utilize congressionally appropriated foreign aid resources to
provide emergency assistance to human rights defenders, civil society activists, and journalists
globally, potentially including individuals and organizations in Russia. In addition, the National
Endowment for Democracy, a private foundation for which Congress appropriates funds, reports
grants to Russia-based organizations totaling over $25 million between 2016 and 2019.150

146 P.L. 105-292, 22 U.S.C. §§6401 et seq. U.S. Department of State, “Briefing on Religious Freedom Designations,”
December 11, 2018.
147 Actions against CPCs are subject to potential exceptions and waivers. For additional information, see CRS In Focus
IF10803, Global Human Rights: International Religious Freedom Policy, by Michael A. Weber.
148 U.S. Commission on International Religious Freedom, 2019 Annual Report, April 2019.
149 Presidential Determination No. 2020-02, “Presidential Determination With Respect to the Efforts of Foreign
Governments Regarding Trafficking in Persons,” Federal Register (84 FR 59521), October 18, 2019. For additional
information on the trafficking in persons report and associated aid restrictions, see CRS Report R44953, The State
Department’s Trafficking in Persons Report: Scope, Aid Restrictions, and Methodology, by Michael A. Weber,
Katarina C. O'Regan, and Liana W. Rosen.
150 Available at https://www.ned.org.
Congressional Research Service

26

link to page 30
Russia: Domestic Politics and Economy

Economy
Russia’s economy is significant globally due to its size and role in energy markets. Russia’s
economy is the sixth largest in the world, on a purchasing power parity (PPP) basis, after China,
the United States, India, Japan, and Germany.151 Russia is rich in natural resources; it is one of the
world’s largest producers and exporters of natural gas and oil. Russia has a population of 145
million, roughly one-third the size of the U.S. population. The World Bank classifies Russia as an
upper-middle income country based on its level of economic development.
Economic Trends152
The Russian economy has gone through periods of decline, growth, and stagnation since the
dissolution of the Soviet Union in 1991. Given the importance of oil to Russia’s economy,
fluctuations in Russia’s economy are closely correlated with fluctuations in global oil prices
(Figure 2). In the first seven post-Soviet years (1992-1998), Russia experienced an average
annual decline in gross domestic product (GDP) of 6.8%.153
A decade of strong economic growth followed, in which Russia’s GDP increased on average
6.9% per year. The surge in economic growth—largely the result of increases in world oil
prices—helped to raise the Russian standard of living and brought a significant degree of
economic stability.
The 2009 global financial crisis resulted in a
sharp economic contraction in Russia (7.8%),
Figure 2. Economic Growth in Russia,
but the economy rebounded relatively quickly
1994-2020
and Russia experienced modest economic
growth from 2010 to 2013. In 2014, Russia
was hit with two simultaneous shocks: a
collapse in oil prices and international
sanctions.154 Growth slowed to 0.7% in 2014
and the economy contracted by 2.0% in 2015.
The IMF estimates that the fall in oil prices
had about three times the effect of sanctions
on Russia’s GDP.155 As oil prices recovered,
Russia’s economy stabilized and grew at a
modest pace between 2016 and 2019 (on
average 1.5%). One policy expert
characterized the Russian economy as

Source: IMF, World Economic Outlook, April 2020
and June 2020.

151 Illustrative rankings based on 2019 gross domestic product (GDP) adjusted for purchasing power parity (which
accounts for differences in prices across countries). Ranking for illustrative purposes; using a different GDP measure
(such as nominal GDP) yields slightly different rankings. IMF, World Economic Outlook, April 2020.
152 GDP data in this section is from the IMF’s World Economic Outlook, April 2020 and June 2020, unless otherwise
noted.
153 World Bank, World Development Indicators.
154 On Russia sanctions, see CRS Report R45415, U.S. Sanctions on Russia, coordinated by Cory Welt.
155 In August 2019, the IMF estimated that sanctions led growth to fall short of expectations by about 0.2% per year
since 2014. In comparison, the IMF estimated the decline in global oil prices caused Russian growth to be about 0.6%
Congressional Research Service

27

link to page 15 Russia: Domestic Politics and Economy

“surviving, but not thriving” during this period.156
At the same time, real incomes have fallen over the past five years, contributing to popular
discontent (see “Opposition and Protest” above). In 2018, pension reforms that raised the
retirement age, among other changes, led to protests.157 In 2019, Putin unveiled a six-year,
approximately $100 billion infrastructure program to revive economic growth and promote
regional development.158 Some critics say the program was designed more to promote exports and
to compensate large businesses and oligarchs for sanctions-related losses.159 Authorities
introduced the infrastructure program as one of several ambitious “national projects” for which
the government pledged to raise nearly $400 billion in public and private funding, including via
an unpopular value-added-tax (VAT) hike.160 Prior to the onset of the coronavirus pandemic,
media reports indicated that implementation of these projects was behind schedule and was
unlikely to promote economic growth.161
The coronavirus pandemic has negatively affected the Russian economy further, as it has
economies around the world. Additionally, in spring 2020, conflict between Russia and Saudi
Arabia over oil production levels led to a sharp drop in oil prices; the pandemic also has led to
lower oil prices. In June 2020, the IMF projected that Russia’s GDP will contract by 6.6% in
2020 and grow by 4.1% in 2021. This is a sharper contraction and slower recovery than in other
emerging-market and developing countries, which on average are forecast to contract by 3.0% in
2020 and grow by 5.9% in 2021.
Key Sectors
Energy is the most important sector in Russia’s economy. Oil and natural gas account for more
than half the value of Russia’s total merchandise exports, with oil and oil products accounting for
about 80% of the total value of Russia’s oil and natural gas exports (for more, see below).162
Russia is a significant producer of many metals and minerals, including iron and steel, aluminum,
platinum, palladium, nickel, gold, and precious stones. Russia also has a sophisticated and large
defense sector and is a major arms exporter. Russia also has a large services sector. Although
Russia’s agricultural sector is relatively small, Russia is a major producer of barley, wheat,
potatoes, and milk, among other products.163

lower than expectations each year since 2014. IMF, Russian Federation: Staff Report for the 2019 Article IV
Consultation, August 2019, p. 5.
156 Rachel Ziemba, testimony at U.S. Congress, Senate Committee on Banking, Housing, and Urban Affairs, Russia
Sanctions: Current Effectiveness and Potential Future Steps, 115th Cong., 2nd sess., September 6, 2018.
157 RFE/RL, “Putin Signs Unpopular Bill Raising Retirement Ages by Five Years,” October 3, 2018; Andrei Movchan,
“Putin’s Botched Pension Reform,” Project Syndicate, October 3, 2018.
158 Moscow Times, “Russia’s Massive Infrastructure Overhaul, in 5 Examples,” April 3, 2019.
159 Anatoly Kurmanaev, “U.S. Sanctions Bring Kremlin, Russian Oligarchs Closer Together,” Wall Street Journal,
November 29, 2018; Fred Weir, “To Make Russia Great Again, Putin is Building Roads and Bridges,” Christian
Science Monitor, March 13, 2019.
160 Fabrice Deprez, “Putin’s May Decrees and the 12 ‘National Projects’ Take Shape, but Lacunae Remain,” bne
IntelliNews, January 24, 2019; Naira Davlashyan and Alice Tidey, “Russia Unveils €390 Billion Plan to Overhaul its
Economy,” Euronews, February 11, 2019.
161 Henry Foy, “Russians Skeptical of Putin’s Grand Projects as Economy Founders,” Financial Times, September 2,
2019; Moscow Times, “Putin’s $400Bln National Projects Will Barely Boost Russian Economy, Study Finds,” October
31, 2019.
162 IMF, Russian Federation: Staff Report for the 2019 Article IV Consultation, August 2019.
163 U.S. Department of Agriculture, Russian Federation: Agricultural Economy and Policy Report, July 19, 2018.
Congressional Research Service

28

Russia: Domestic Politics and Economy

Russia’s major exports, in addition to oil and natural gas, include iron and steel, coal, precious
metals and related products (especially gold, platinum, diamonds, and silver), industrial
machinery (especially turbojets and nuclear reactors and parts), wood, fertilizers, and cereals
(wheat, barley, and corn).164 Russia imports many manufactured products. Its top imports include
industrial machinery, electrical machinery and equipment, vehicles and parts, pharmaceutical
products, and plastics.
Government Ownership and Market Concentration
Many sectors of the Russian economy are characterized by a small number of government-
controlled firms (state-owned enterprises, or SOEs). Despite privatization efforts in the 1990s (the
process by which a business grows from being government owned to being privately owned), the
Russian government retains ownership of many companies in Russia, including lucrative energy
and defense companies and financial institutions. In 2018, the Russian government fully owned
more than 850 companies and had ownership stakes in more than 1,100.165 According to an
estimate in a 2019 study, the Russia government accounted for one-third of economic output in
2016.166 In recent years, Russia’s ownership stake in the banking sector has expanded further.167
Since 2014, the government also has been pushing the development of domestic industries, such
as agriculture and manufacturing, as a way to reduce its reliance on western countries, a strategy
called import substitution. Questions exist about the extent to which such initiatives have been
successful.168
Many sectors are dominated by one or a small number of large firms. For example, energy
company Gazprom is the largest publicly-listed natural gas company in the world; Rusal, an
aluminum company, is the second largest in the world; the Russian banking sector is dominated
by two major banks (Sberbank and VTB); and Rostec is a large defense conglomerate. Of these
examples, all but Rusal is at least partially owned by the Russian government. Rusal is a private
company, but its founder had close ties with the Kremlin and resigned from its board following
U.S. sanctions.
Labor Force
Two-thirds of Russians are employed in the services sector, about 25% work in the industry
sector, and about 6% work in agriculture.169 Two-thirds of the labor force has a college degree or
completed other tertiary education.170
Before the coronavirus pandemic, official unemployment in Russia was relatively low (4.6% in
2019) and 13% of Russians lived below the national poverty line (2018).171 The pandemic caused
both unemployment and poverty levels to rise in Russia. The Economist Intelligence Unit

164 Federal Customs Service of Russia, as accessed from Trade Data Monitor.
165 U.S. State Department, 2019 Investment Climate Statement: Russia.
166 Gabriel Di Bella, Oksana Dynnikova and Slavi Slavov, “The Russian State’s Size and its Footprint: Have They
Increased?,” IMF Working Paper WP/19/53, March 2, 2019.
167 Karina Orlova, “Russia’s Great Bank Takeover,” American Interest, January 1, 2018.
168 Paul Goble, “Import Substitution in Russia Failing as Moscow Buys Products Not Technologies,” Eurasia Daily
Monitor, Jamestown Foundation, March 28, 2019.
169 International Labour Organization, ILOSTAT, Employment by Sector, updated August 24, 2020.
170 World Bank, World Development Indicators, accessed on August 24, 2020.
171 Ibid.; World Bank, “Poverty & Equity Brief: Russian Federation,” April 2020.
Congressional Research Service

29

link to page 19 Russia: Domestic Politics and Economy

forecasts that unemployment in Russia will rise to 6% in 2020, and GDP per capita in Russia is
projected to fall by 6% in 2020.172 According to Russian news reports, some economists believe
the number of newly unemployed workers could be three to four times higher than reflected in
official government statistics.173
Business Environment and Needed Reforms
The World Bank’s Doing Business report, which aims to measure the cost to local firms of
business regulations in 190 countries around the world, suggests a relatively positive business
environment in Russia. In its report for 2020, the World Bank ranked Russia as the 28th easiest
place to do business in the world, up from 31st in the previous year.174 Russia is ranked below
Austria and above Japan, and Russia scores higher than several EU countries, including Spain and
France. Because the Doing Business report focuses on regulatory barriers to local firms, it does
not capture the difficulties facing non-local firms (including U.S. firms) seeking opportunities and
operating in Russia, as discussed in more detail below.
Despite this positive assessment, corruption is a serious problem (for more, see “Corruption”
above). According to Transparency International’s Corruption Perceptions Index, which scores
countries based on how corrupt a country’s public sector is perceived to be by experts and
business executives, Russia scores 28 out of 100 (where 0 is “highly corrupt” and 100 is “very
clean”).175 Ranked from least to most corrupt, Russia ranks 137th in the world, tied with a number
of countries including Lebanon, Liberia, and Kenya. Russia ranks lower than the other BRICS
countries (Brazil was 106th, China and India were two of five countries tied for 80th, and South
Africa was 70th).
In addition to corruption, Russia’s economy faces a number of structural issues that make the
economy rigid and less competitive. The IMF has called on Russia to diversify its economy,
enhance economic competition, reform public procurement, reduce barriers to trade and foreign
investment, increase fiscal transparency, and improve accountability and governance of SOEs.176
Russia’s aging population and inadequate infrastructure also create long-term challenges to
economic growth.
Public Finances
The Russian government has little debt and high levels of reserves. Russia’s public debt was 16%
of GDP in 2019 compared to 53% of GDP on average for emerging markets and developing
economies.177 The government also maintains a sovereign wealth fund, the National Wealth Fund
(NWF).178 With assets of $177 billion as of August 2020, the NWF supports Russia’s pension
system and funds the government’s budget when oil prices are low.179 Since 2017, the Russian

172 Economist Intelligence Unit, Russia Country Report, July 2020.
173 Moscow Times, “Russia’s Unemployment Rate Jumps 30%,” May 20, 2020.
174 World Bank, Doing Business 2020; World Bank, Doing Business 2019.
175 Transparency International, Corruption around the World in 2019.
176 IMF, Russian Federation: Staff Report for the 2019 Article IV Consultation, August 2019.
177 IMF, World Economic Outlook, October 2019.
178 In 2008, the Russian government split the Stabilization Fund of the Russian Government into two funds: the
Reserve Fund (a “rainy day” fund of $25 billion) and the National Welfare Fund (funded with $125 billion primarily to
support pensions). The Reserve Fund was depleted following the oil price crash in 2014, and was closed in January
2018.
179 Ministry of Finance of the Russian Federation, National Wealth Fund Data, accessed on August 22, 2020.
Congressional Research Service

30

link to page 34 link to page 35
Russia: Domestic Politics and Economy

government has transferred the profits from oil sales above $40 a barrel to the NWF. The fund is
counted as part of the central bank’s reserves, although it is administered by the Ministry of
Finance. As of the end of July 2020, Russia’s central bank total reserve holdings were $592
billion.180
Russia’s budget balance fluctuates. Oil is a
major source of revenue for the government,
Figure 3. Russia’s Budget Balance
and trends in the budget are correlated with
global oil prices (Figure 3). Russia ran
budget surpluses when oil prices were high in
the 2000s, but ran budget deficits around 3%
of GDP in 2015-2016 when oil prices were
low. After oil prices rebounded, government
surpluses resumed.
In 2019, oil and gas accounted for about 40%
of federal government revenues.181 Other
main sources of revenue included social
security and welfare taxes and a VAT.
Government spending was focused on social

security and welfare benefits, subsidies, and
government worker compensation.
Source: IMF, World Economic Outlook, April 2020.

In April 2020, the IMF projected a budget deficit for Russia of 4.8% of GDP in 2020, Russia’s
largest deficit since the global financial crisis. Russia’s revenue is falling, because oil prices are
low and economic downturns generally result in lower tax revenue. At the same time, government
spending has increased, as the government addresses the health and economic consequences of
the coronavirus pandemic. The government’s fiscal response to the pandemic to date is estimated
at 3.4% of GDP.182 It includes a range of policies, including increased compensation for medical
staff; enhanced unemployment benefits; lump sum payments for children; interest rate subsidies
for certain businesses; grants to small- and medium-sized enterprises; subsidies to airlines,
airports, automakers, and other sectors; and zero import duties on medical supplies, among other
measures. Despite the range of policies, Russia’s fiscal responses have been criticized as too slow
and may be fueling public resentment.183 Russia’s central bank also took a number of actions to
support the economy during the pandemic, including cutting interest rates to a historic low of
4.5%, selling foreign exchange reserves from the National Welfare Fund to support the value of
the ruble, and granting temporary regulatory forbearance for banks.
Energy184
Russia is a leading producer, consumer, and exporter of energy, especially oil and natural gas (see
Table 2). The Russian government uses the country’s vast energy resources to acquire foreign

180 Bank of Russia, International Reserves of the Russian Federation (End of period), accessed on August 22, 2020.
181 IMF, Russian Federation: Staff Report for the 2019 Article IV Consultation, August 2019, p. 27; Ministry of
Finance of the Russian Federation, at https://minfin.gov.ru/ru/statistics/fedbud/.
182 IMF, Policy Responses to COVID-19: Policy Tracker, accessed on August 22, 2020.
183 For example, see Economist Intelligence Unit, Russia Country Report, July 2020.
184 This section was written by Michael Ratner, Specialist in Energy Policy.
Congressional Research Service

31

link to page 35
Russia: Domestic Politics and Economy

currency, secure government revenues, maintain domestic subsidies, and exert geopolitical
leverage.185
Table 2. Select World Rankings of Russia’s Energy Portfolio, 2019

Reserves
Production
Consumption
Exports
Oil
6th
3rd
5th
2nd
Natural Gas
1st
2nd
2nd
1st
Coal
2nd
6th
6th
3rd
Electric Generation
NA
4th
4th
14th
Source: BP Statistical Review of World Energy, 2020; CIA World Handbook, 2020.
Note: NA=not applicable.
After the dissolution of the Soviet Union in 1991, Russian energy production and consumption
fell significantly (see Figure 4). The largest post-Soviet declines were in the first five years
(1992-1996). In 1997, oil production began to recover. Oil production has continued to rise with
minor setbacks through 2019. At the same time, oil consumption has remained below late Soviet-
era levels. This has widened the gap between Russia’s oil production and consumption, leaving
more oil for export. Excess oil reached its highest level ever in 2019. Production and
consumption of natural gas did not decline as much as oil, but they also have not increased as
much in recent years. The gap between Russia’s natural gas supply and demand has remained
relatively constant since 1991.
Figure 4. Russian Oil and Natural Gas Production and Consumption
1990-2019

Source: BP Statistical Review of World Energy, 2020.
Notes: oil units = thousand barrels per day (’000 BPD); natural gas units = bil ion cubic meters (BCM).

185 For more on Russian natural gas exports, see CRS Report R42405, European Energy Security: Options for EU
Natural Gas Diversification, coordinated by Michael Ratner; CRS In Focus IF11138, Russia’s Nord Stream 2 Pipeline:
A Push for the Finish Line, by Paul Belkin, Michael Ratner, and Cory Welt; CRS In Focus IF11177, TurkStream:
Russia’s Newest Gas Pipeline to Europe, by Sarah E. Garding et al.; and CRS In Focus IF11514, Power of Siberia: A
Natural Gas Pipeline Brings Russia and China Closer, by Michael Ratner and Heather L. Greenley.
Congressional Research Service

32

link to page 36
Russia: Domestic Politics and Economy

Energy Production
Russia has a vast supply of most forms of energy, particularly hydrocarbons. Russia’s combined
production of oil, natural gas, and coal greatly exceeds its consumption, enabling Russia to export
excess supplies (see Figure 5). Overall hydrocarbon production did not rebound to 1990 levels
until 2015. In 2019, hydrocarbon production was greater than 1990 levels by 13%. The rise in
Russia’s oil production, especially after 2000, has provided a growing source of revenues and
foreign currency for the Russian government.
Figure 5. Oil, Natural Gas, and Coal Production and Consumption
Five-Year Comparison

Source: BP Statistical Review of World Energy, 2020.
Notes: A Joule is a measure of energy and used to compare energy sources in a common unit. An exajoule is
one quintil ion (e.g., a bil ion bil ion) Joules.
Russia’s largest oil and gas companies are state-owned enterprises. Russia’s private energy
companies also have close ties to the state. Russia’s main natural gas company is Gazprom,
which is majority-owned by the Russian government. Gazprom is Russia’s largest company, the
largest natural gas company in the world by revenue, and the largest exporter of natural gas.
Gazprom is responsible for about two-thirds of Russia’s natural gas production. Russia’s second-
largest natural gas company, the privately-owned Novatek, was responsible for about 10% of
Russia’s natural gas production in 2019.186
A diverse array of companies are responsible for Russia’s oil production. Russia’s largest oil
company, Rosneft, is 40% owned by the Russian government.187 British oil company BP and a
subsidiary of the Qatar Investment Authority each own about 20% of Rosneft. Rosneft (together

186 Analytical Center of the Government of the Russian Federation, Fuel and Energy Complex of Russia – 2019, June
2020 (in Russian), at https://ac.gov.ru/publications.
187 Prior to April 30, 2020, Rosneft was majority owned by Russian state company Rosneftegaz. The Russian
government reduced Rosneftegaz’s ownership stake in Rosneft as part of an effort to protect Rosneft from U.S.
sanctions on Rosneft subsidiaries engaged in trading Venezuelan oil. In exchange for transferring its Venezuela assets
to another state-owned company, Rosneft received 9.6% of its own shares (held by a Rosneft subsidiary). Economist,
“Why Putin’s Favourite Oil Firm Dumped its Venezuelan Assets,” April 2, 2020; Vladimir Soldatkin and Gabrielle
Tetrault-Farber, “Russian State Holding Gives Up Control of Rosneft after Venezuela Exit,” Reuters, May 22, 2020.
Also see CRS Report R44841, Venezuela: Background and U.S. Relations, coordinated by Clare Ribando Seelke.
Congressional Research Service

33

Russia: Domestic Politics and Economy

with subsidiary Bashneft) was responsible for about 38% of Russian oil production in 2019.
Russia’s next largest oil companies, the privately-owned Lukoil and Surgutneftegaz, were
responsible for about 15% and 11%, respectively.188
Russia’s oil and gas companies are run by influential government officials and oligarchs. Rosneft
CEO Igor Sechin is Putin’s longtime colleague and a former deputy prime minister (2008-2012);
observers believe that Sechin has unofficial ties to elements of the FSB.189 Gazprom CEO Alexei
Miller is another of Putin’s longtime colleagues. Novatek CEO Leonid Mikhelson and Lukoil
CEO Vagit Alekperov are considered to be among Russia’s five wealthiest individuals;
Surgutneftegaz CEO Vladimir Bogdanov also is a billionaire.190 Mikhelson, Alekperov, and
Bogdanov have headed their respective companies since the early 1990s.
Russia is a major exporter of nuclear power reactors, fuel, and related services and a key
developer of next generation nuclear technology. The Rosatom State Atomic Energy Corporation
runs the country’s nuclear enterprises, Rosenergoatom is Russia’s domestic nuclear utility, and
Atomstroyexport is the Rosatom subsidiary in charge of exports. Russia is the world’s leading
exporter of nuclear reactors and parts.191 It is constructing or planning to construct plants in
China, Iran, India, Turkey, and elsewhere and offers financing, owner-operator, and fuel take back
options. Rosatom also exports nuclear fuel and sells uranium enrichment services.192
Figure 6. Russian Primary Energy Consumption
1990-2019

Source: BP Statistical Review of World Energy, 2020.
Notes: Primary energy is composed of commercially traded fuels, including modern renewables used to
generate electricity. A Joule is a measure of energy and used to compare energy sources in a common unit. An
exajoule is one quintil ion (e.g., a bil ion bil ion) Joules.

188 Oil production data by company for 2019 from Bloomberg L.P. (subscription required), as reported by Russia’s
Central Dispatching Department of Fuel and Energy Complex (CDU TEK).
189 Tatiana Stanovaya, “Why the Kremlin Can’t Keep its Chekists in Check,” Riddle, July 25, 2019.
190 Forbes, World’s Billionaires List: The Richest in 2020, available at https://www.forbes.com/billionaires/.
191 Economist, “Russia Leads the World at Nuclear-Reactor Exports,” August 7, 2018; Ben Aris, “Russia’s Nuclear
Power Exports are Booming,” bne IntelliNews, May 8, 2019; World Nuclear Association, “Nuclear Power in Russia,”
updated July 2020;
192 World Nuclear Association, “Russia’s Nuclear Fuel Cycle,” updated June 2020.
Congressional Research Service

34

link to page 37 link to page 38 link to page 38
Russia: Domestic Politics and Economy

Domestic Energy Consumption
Russia’s domestic energy consumption is dominated by hydrocarbons, natural gas in particular
(see Figure 6). In 2019, natural gas, oil, and coal made up 88% of Russia’s primary energy;
natural gas alone made up more than half the country’s energy consumption. Nuclear and
hydroelectric power made up 12% of Russia’s energy mix; renewables such as wind and solar
made up an insignificant amount. Since 1990, Russia’s overall energy consumption has declined
by almost 18%.
Russia is the fourth-largest consumer of energy in the world, after China, the United States, and
India. On a per capita basis, Russia ranks 17th in primary energy consumption, which is much
lower than other major energy producers. Russia also is the fourth-largest emitter of carbon
dioxide globally, behind China, the United States, and India.193 Given Russia’s lack of renewable
energy sources and investment, and reliance on hydrocarbons, it is unlikely that Russia will make
significant strides to decrease its carbon dioxide emissions.
U.S.-Russian Trade and Investment
Even before the United States introduced sanctions on Russia for the 2014 invasion of Ukraine,
Russia was not a major economic partner of the United States. In 2019, Russia accounted for less
than 1% of U.S. imports, U.S. exports, U.S. foreign direct investment (FDI), and FDI in the
United States. Both the United States and Russia have much stronger economic relationships with
other countries. For example, the EU, Canada, and Mexico account for almost half of U.S.
exports, whereas Russia accounts for 0.4% (Figure 7). More than half of Russia’s exports go to
the EU and China; 3% of Russia’s exports go to the United States (Figure 7).
Figure 7. U.S. and Russian Export Markets

Source: Created by CRS using data from the U.S. Census Bureau and the Federal Customs Service of Russia,
accessed through Trade Data Monitor.
Even though total trade and investment flows between the United States and Russia are low
overall, ties at the firm level in some cases are substantial. U.S. sanctions prohibit transactions
with specific Russian companies and individuals, or types of transactions with certain Russian
sectors, but many U.S.-Russia transactions are permitted and continue.194 For example, the U.S.-
Russia Business Council, a Washington-based trade association that provides services to U.S. and
Russian member companies, has a membership of around 140 companies. Their membership
includes many large U.S. companies from a wide range of industries, including energy;

193 BP Statistical Review of World Energy, 2020, London, June 2020, p. 13.
194 For more, see CRS Report R45415, U.S. Sanctions on Russia, coordinated by Cory Welt.
Congressional Research Service

35

link to page 39
Russia: Domestic Politics and Economy

technology; business, financial, and legal services; pharmaceuticals; food; consumer goods; and
manufacturing.
Bilateral Trade and Investment Flows
In terms of trade in merchandise, the United
States runs a trade deficit with Russia. In
Figure 8. U.S. Merchandise Trade with
2019, the United States exported $6 billion in
Russia, 2010-2019
merchandise to Russia, and imported $22
billion in merchandise from Russia.195 U.S.
merchandise imports from Russia have
increased by about 50% since 2016, whereas
U.S. merchandise exports have held relatively
steady (Figure 8). U.S. merchandise imports
from Russia are primarily oil, which
accounted for about 60% of total U.S. imports
from Russia in 2019. Other major

merchandise imports from Russia include
precious metals, stones, and related products
Source: Created by CRS using data from the U.S.
Census Bureau, accessed through Trade Data
($2.2 billion, comprised mainly of platinum,
Monitor.
diamonds, and gold); iron and steel ($1.4
billion); and fertilizers ($1.0 billion). Top U.S. exports to Russia include industrial machinery
($1.2 billion), aircraft ($1.2 billion), and vehicles and parts ($725 million).
In terms of services trade, the United States runs a trade surplus with Russia. The United States
exported $5.1 billion in services to Russia in 2019, primarily financial services ($1.5 billion) and
travel ($1.2 billion).196 The United States imported $1.8 billion in services from Russia in 2019,
primarily financial services ($403 million), business services ($357 billion), and travel ($363
million).
U.S. investment in Russia increased from $10.2 billion in 2014 to $14.4 billion in 2019, despite
the imposition of U.S. sanctions on Russia.197 Russian investment in the United States, $4.4
billion in 2019, has been relatively stable in recent years.
Challenges Facing U.S. Businesses in Russia
Beyond the due diligence required to comply with U.S. sanctions and geopolitical considerations,
Russia can be a difficult business environment for U.S. companies. The International Trade
Administration, part of the U.S. Department of Commerce, stresses significant challenges facing
U.S. businesses seeking to operate in Russia. In addition to sanctions, ITA notes that increasing
state dominance in the economy, lack of broad economic reform, and weak rule-of-law are
challenges facing U.S. businesses seeking opportunities in Russia’s large market.198
Frictions also exist in the U.S.-Russia trade relationship. As required by U.S. law, the U.S. Trade
Representative (USTR) reports to Congress annually on the implementation and enforcement of

195 Merchandise trade data from U.S. Census Bureau, as accessed from Trade Data Monitor.
196 Services trade data from the U.S. Bureau of Economic Analysis.
197 Investment data from the U.S. Bureau of Economic Analysis.
198 U.S. Department of Commerce, International Trade Administration, Russia Commercial Guide, Accessed August
20, 2020.
Congressional Research Service

36

Russia: Domestic Politics and Economy

Russia’s World Trade Organization (WTO) commitments (Russia joined the WTO in 2012).199
The 2019 report stresses that although Russia has taken some steps to implement its obligations
under the WTO, “Russia appears to have done little to foster an open market based on WTO
disciplines.”200 The report notes concerns about Russia’s retaliatory tariffs in response to
increased tariffs on U.S. imports of steel and aluminum under Section 232 of the Trade Expansion
Act of 1962 (as amended), Russia’s control of exports through tariffs or quantitative restrictions,
and Russia’s prevalent use of non-tariff barriers, such as “cumbersome and opaque” import
licensing regimes and technical requirements.201 The report also raises concerns about Russia’s
array of import substitution policies and restrictions on foreign ownership in certain sectors.
De-dollarization Efforts
Although there is relatively little bilateral U.S. and Russian trade and investment, Russia, like
most countries, has relied on the U.S. dollar and the U.S. financial system to conduct cross-border
transactions. In particular, oil markets, Russia’s biggest export, are traditionally conducted in
dollars. Most transactions involving U.S. dollars are processed through the U.S. financial system,
even when both parties in the transaction are located outside the United States. Access to the U.S.
dollar and the U.S. financial system is a source of U.S. economic leverage with many countries,
including Russia, and a reason that many of the enacted and proposed U.S. sanctions on Russia
focus on the financial sector.
Figure 9. Payments for Russia’s Exports: Currency Composition

Source: Bank of Russia, External Sector Statistics, Accessed August 20, 2020.
Russian President Putin has long decried the dominance of the dollar. In response to sanctions,
the Russian government has made a concerted and multipronged effort to reduce Russia’s
reliance on the dollar. For example, Russia is increasingly seeking out and conducting trade in
currencies other than the U.S. dollar, particularly euros and rubles. Russia’s shift from dollars in
trade with Europe has been slow but steady; Russia’s shift from dollars in its trade with the other

199 In 2012, Congress passed and the President signed legislation that allowed the President to extend permanent normal
trade relations to Russia (P.L. 112-208). Section 201(b) establishes the annual reporting requirement.
200 U.S. Trade Representative, 2019 Report on the Implementation and Enforcement of Russia’s WTO Commitments,
February 2020.
201 The United States and Russia have initiated WTO disputes regarding U.S. Section 232 tariffs and Russian retaliatory
tariffs. For more information, see CRS Report R45249, Section 232 Investigations: Overview and Issues for Congress,
coordinated by Rachel F. Fefer.
Congressional Research Service

37

link to page 40 Russia: Domestic Politics and Economy

BRICS countries (Brazil, Russia, India, China, and South Africa) has been more significant and
rapid (Figure 9).202 Additionally, the Russian central bank has reduced its dollar holdings in favor
of euros and China’s renminbi, the Russian government has developed its own financial payment
systems, and the Russian Finance Ministry has pivoted from dollar-denominated sovereign bonds
to sovereign bonds denominated in euros and rubles. The Russian government at varying times
has also considered creating a state-backed cryptocurrency, the CryptoRuble, but the central bank
has expressed reservations. The extent to which Russia can successfully pivot away from use of
the dollar could have ramifications for efficacy of current and any potential future U.S. financial
sanctions. However, many experts question the extent to which Russia will be able to de-dollarize
given the continued prevalence of the dollar in global markets.203
Outlook
After more than 20 years of rule by Vladimir Putin, Russia is exhibiting some signs of political
and economic change. At the same time, human rights abuses in Russia have persisted and even
increased. The United States and others have called attention to such abuses and responded via
sanctions and other actions. Scenarios for future developments tend to center on succession
politics, whether engineered by Putin or arising from unexpected circumstances. Other scenarios
involve a loss of control by Putin or his inner circle, as a result of a collapsing economy,
weakened state apparatus, or the unintended effects of another war.
Questions that Members of Congress may consider in seeking to understand and respond to
domestic developments in Russia could include the following:
 Will Putin seek to stay in power after 2024, or will he attempt to hand off power
to a successor?
 Will Putin maintain strong centralized control over the state apparatus, or will
different factions become increasingly independent of the president and jockey
for power?
 Will the Russian government seek to appease the Russian population through
new economic stimulus measures or military actions abroad, or will there be a
substantial rise in popular dissatisfaction and protest?
 What will be the effect of Alexei Navalny’s poisoning on civil society and the
political opposition?
 What are the most effective U.S. policy options for promoting democracy and
human rights in Russia? How effective are sanctions against human rights
abusers? Should human rights-related sanctions against Russia be broadened?
 How can the United States effectively coordinate with the EU and other
stakeholders to encourage Russia to improve its democracy and human rights
record?
 Given restrictions on foreign financial support, how effective is Western support
for Russian civil society today? What avenues exist for stepped-up Western
engagement with Russian civil society?
 How is the Russian government’s policy response to the two simultaneous
shocks to Russia’s economy—low oil prices and the COVID-19 pandemic—

202 Bank of Russia, External Sector Statistics, Accessed August 20, 2020.
203 For example, see Henry Foy, “Can Russia Stop Using the US Dollar?,” Financial Times, October 3, 2018.
Congressional Research Service

38

Russia: Domestic Politics and Economy

affecting popular support for Putin? How will the Russian government handle the
looming budget crunch, stemming from lower oil revenues and higher
expenditures due to the pandemic?
 Is there popular support for lifting coronavirus-related restrictions on the
economy even as approximately 5,000 new daily cases were being registered at
the start of September 2020? Is a robust economic recovery possible if the
pandemic is not under control?
 How have international sanctions affected Russia’s oil and gas sector? What are
the sector’s prospects for future growth?
 How do Russia’s import substitution and de-dollarization initiatives impact U.S.
economic leverage vis-à-vis Russia?

Congressional Research Service

39

Russia: Domestic Politics and Economy

Author Information

Cory Welt
Rebecca M. Nelson
Specialist in European Affairs
Specialist in International Trade and Finance

Acknowledgments
Andrew Bowen, Analyst in Russian and European Affairs, and Michael Ratner, Specialist in
Energy Policy, contributed to this report, as did Dianne E Rennack, Specialist in Foreign Policy
Legislation, who co-authored material drawn from CRS Report R45415, U.S. Sanctions on
Russia. Calvin DeSouza, Geospatial Information Systems Analyst, Amber Wilhelm, Visual
Information Specialist, and Jamie Hutchinson, Visual Information Specialist, helped create the
graphics in this report.

Disclaimer
This document was prepared by the Congressional Research Service (CRS). CRS serves as nonpartisan
shared staff to congressional committees and Members of Congress. It operates solely at the behest of and
under the direction of Congress. Information in a CRS Report should not be relied upon for purposes other
than public understanding of information that has been provided by CRS to Members of Congress in
connection with CRS’s institutional role. CRS Reports, as a work of the United States Government, are not
subject to copyright protection in the United States. Any CRS Report may be reproduced and distributed in
its entirety without permission from CRS. However, as a CRS Report may include copyrighted images or
material from a third party, you may need to obtain the permission of the copyright holder if you wish to
copy or otherwise use copyrighted material.

Congressional Research Service
R46518 · VERSION 4 · NEW
40