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Today in Russian Business – March 20th, 2009

Unemployment has hit 8.5% of Russia’s workforce, according to new data.  More than 11,000 people in the Urals city of Nizhny Tagil could lose their jobs when cargo wagons producer Uralvagonzavod halts a conveyor next month, and the company blames a broken contract from Russian Railways.  Armenia is also accusing the company of a breach of contract, alleging that it made only 30% of its planned investments last year.  Prime Minister Vladimir Putin’s revised budget, to be sent to the Duma for approval, ‘diverted funds from key areas like agriculture and the police to support social programs and pensions’.  Putin said that the Kremlin would rather borrow than resort to printing money to cope with budget deficits.  ‘Resorting to a printing press would be unwise and extremely dangerous.’  The government could buy a stake in Vladimir Yevtushenkov’s Sistema Shyam TeleServices, an Indian mobile-phone unit, to help his holding company AFK Sistema pay off its debts, but First Deputy Prime Minister Igor Shuvalov wants to deter companies from relying on the state.  Russia’s dairy industry is suffering, prompting the government to launch a new advertising campaign aimed at raising milk consumption.