Consular assistance in Russia

Russia is currently at war in Ukraine. Are you in Russia and need consular assistance? Find your country’s embassy in Russia on EmbassyPages.

Home News Sanctioned Putin ally to step down as head of Russian railways

Sanctioned Putin ally to step down as head of Russian railways

Published on 18/08/2015

The powerful president of Russia's state-owned railway company, Vladimir Yakunin, confirmed late Monday that he would step down next month after a decade in the top post and expects to become a senator.

Yakunin, 67, is a long-time confidant of President Vladimir Putin and on the United States sanctions list over the Ukraine crisis. He has headed Russian Railways, or RZD, since 2005.

Known for his Orthodox Christian beliefs, he is set to become a senator in the upper house of parliament representing Russia’s westernmost region of Kaliningrad.

The upper house is seen largely as a rubber-stamp body for laws backed by the Kremlin.

Yakunin told RIA Novosti state news agency that he expected to quit his post after a governor is elected in the Kaliningrad region at a September poll and then appoints new senators.

“I plan to leave the company after the elections are finished,” Yakunin said.

The Vedomosti business newspaper wrote Tuesday that Yakunin is considered “one of the functionaries closest to Putin.”

Yakunin has known Putin since the early 1990s and was one of the co-founders of the so-called Ozero (Lake) Dacha, an influential group of luxury real estate owners close to Putin.

This link was cited by the US Treasury as it slapped sanctions on Yakunin and others seen as close to Putin in March last year.

Yakunin’s job change represents one of the biggest shifts by a close Putin ally since the start of the Ukraine crisis.

Such a shakeup within Putin’s inner circle would not happen without his consent, political analyst and former Kremlin advisor Gleb Pavlovsky told Vedomosti.

Yakunin — believed to have served as a Soviet intelligence officer — has brushed off the US sanctions saying they were “like mosquitos in Siberia. They bother you but everyone gets on with life just the same.”

– Alleged wealth –

Opposition leader and anti-corruption campaigner Alexei Navalny in 2013 published a detailed report accusing Yakunin of possessing vast undeclared property and business assets, which he denied.

Yakunin, unlike most top Russian officials, declined to publish his annual income declarations, saying it was “unseemly” to talk about one’s pay.

He told Russian Forbes magazine in May that his monthly pay was up to 5.5 million rubles ($83,000).

This year it received subsidies of 30 billion rubles ($458 million at the current exchange rate) while last year it made a loss of 99.3 billion rubles.

Russia’s sprawling railway network fully connects the country from Kaliningrad in the west to Vladivostok in the far east. For passengers, trains are punctual if often shabby.

Under Yakunin, Russian Railways has privatised some of its functions and introduced high-speed trains on flagship routes but has struggled to expand lucrative freight traffic.

Yakunin was not able to adapt to the harsh period of economic crisis, Konstantin Kalachev of the Moscow-based Political Expert Group think tank told Rosbalt news agency.

“Such a leader, when it was just a question of assimilating huge budgetary funds was appropriate in the ‘fat years’ but now a lot of projects are being frozen,” Kalachev said.

An engineer by training, Yakunin served as a diplomat to the United Nations in the late Soviet era. Under Putin, he served as deputy transport and railways minister.

He heads a foundation that espouses traditional Orthodox family values and brings holy relics for believers to worship in Russia. He has made a number of anti-Western statements in articles and lectures.