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 Medvedev took the oath of office in the Kremlin's golden-hued Andreyevsky Hall, bringing to an end Vladimir Putin's eight years as president. But Putin is sure to continue to wield huge influence in the country.
Little more than two hours after becoming president, Medvedev nominated Putin to be prime minister.
Medvedev has pledged to continue the policies pursued by Putin, and some observers see him as more likely to be a handmaiden than an independent leader.
But in his inaugural address, Medvedev referred to civil rights issues several times
-- a possible indication that his presidency would take a different course from his mentor's.
Under Putin, Russia's economy soared from near-disaster to astonishing prosperity. But the role of civil society came under question, as opposition groups were marginalized and non-governmental organizations came under heavy pressure.
In his address, Medvedev said that one of his most important tasks would be "the development of civil and economic freedom."
The March election of Medvedev was seen by many as one of the most marked signs of Russia retreating from democracy. Most of the prominent opposition aspirants to the post were kept off the ballot.
But Medvedev highlighted civil rights on Wednesday.
"Human rights and freedoms ... are deemed of the highest value for our society and they determine the meaning and content of all state activity," he said.
The 42-year-old president, formerly a first deputy prime minister and chairman of the state-controlled natural gas giant Gazprom, also pledged to fight endemic corruption, a problem that Putin has been unable to stifle.
"I'm going to pay special attention to the fundamental role of the law. We must achieve a true respect in law, overcome the legal nihilism which is hampering modern development," Medvedev said.
He pledged to help make life "comfortable, confident and secure" for Russians and to modernize industry and agriculture, encourage the development of new technologies and attract investment.
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 Russia's economic boom has been driven largely by soaring world prices for its vast oil and gas exports. Concerns are high that the country is vulnerable to a downturn in commodities prices unless it diversifies its economy and expands its manufacturing and services sectors.
Putin, in a short address to the crowd of Russian dignitaries and foreign ambassadors in the lavish hall, declared that when he became president in 2000, "I made a commitment to work openly and honestly, to faithfully serve the people and the state. And I did not violate my promise."
He also took an apparent swipe at critics, saying Medvedev's election and the transfer of power were conducted in "strict adherence to the laws and principles of democracy."
The nomination of Putin as prime minister is expected to be voted on Thursday in the parliament, where approval is a virtual certainty.
His transfer to the premiership has raised wide question about how much power Medvedev will actually wield and even whether Putin would try to undermine him.
Medvedev obliquely touched on the issue in his address, thanking Putin for his support and saying, "I'm sure it will be this way in the times ahead."
The inauguration ceremony, although awash in pomp, including goose-stepping guards, was low on drama and lasted less than a half-hour.
Putin arrived first, shown in live TV broadcasts as he strode across one of the Kremlin's squares, bid brief farewell to presidential guards regiment and entered the Grand Kremlin Palace.
Medvedev came next, in a black Mercedes limousine. He was shown making a long and solemn walk through two sprawling reception halls before entering the Andreyevsky Hall
-- which had also been a throne room in czarist times.
[Associated
Press; By JIM HEINTZ]
Copyright 2008 The Associated
Press. All rights reserved. This material may not be published,
broadcast, rewritten or redistributed.
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