Russia-Past Successes & Future Challenges *

Abstract:

The caselet discusses the initiation of reforms in Russia after its formation in 1991. It follows the path of rapid progress that Russia made, surprising the world. The caselet also gives an overview of the challenges that the country may face in the future.

Issues: » Economic reforms in Russia. » Russia's GDP growth. » Reasons for growth of Russian economy. » SMEs posing a challenge to economic development in Russia. Introduction Despite being hit by one crisis after the other, over the decades, Russia has always managed to emerge as a survivor. The very mention of Russia reminds one of communism, World War II, the Cold War and political and economic upheavals. Majority of the economic disturbances were experienced by Russia when the country was transforming itself from a centrally planned economy to a free market economy after the dissolution of Soviet Union and the formation of Russia in 1991.

Questions for Discussion:

1. "It is difficult to say whether Russia plans to follow the road of political freedom or whether it could be the beginning of the end for Russia's fledgling democracy." Comment.
2. Do you agree with Putin's view that centralized authority is required for Russia's economic and political development for the foreseeable future rather than a more decentralized authority? Justify your answer.

Key words:
Communism, centrally planned economy, free market economy, fiscal reforms, short-term borrowings, Ruble, foreign direct investments (FDIs), inflation, gross domestic product, unemployment rate, small and medium-sized enterprises (SMEs), oligarchs, World Bank

* This caselet is intended for use only in class discussions.
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