PRESIDENT PUTIN offered to pay Russian women to have more children in an attempt to stem a demographic crisis that has shrunk the Russian population by five million since 1991.

In his annual state-of-the-nation address yesterday, Mr Putin also hit back at Western critics, defending Russia’s record as an energy supplier and accusing Washington of putting its own interests before democracy.

Mr Putin sought to address Western concerns about his commitment to democracy and the free market, issues which threaten to cloud the G8 summit in St Petersburg in July.

Dick Cheney, the US Vice-President, last week accused Russia of rolling back democratic reforms and using its energy supplies to blackmail neighbours. Mr Putin responded yesterday by pledging to meet European energy needs, and accused Washington of double standards on human rights and democracy.

But the Kremlin leader highlighted the population decline, and not the new chill in relations with the West, as the “most acute problem facing modern Russia”.

Pointing out that his country’s population was contracting by 700,000 a year, Mr Putin said: “We have often raised this subject but, to be frank, little has been done,” he said.

Russia’s population has fallen from 148 million when the Soviet Union collapsed to less than 143 million today, because of a low birth rate and a huge number of alcohol-related deaths. Average male life expectancy is only 58.8 years.

Experts have said that the population could drop as low as 100 million within half a century, and urged the Kremlin to allow millions of immigrants to supplement the workforce.

But nationalists and leaders of the Orthodox Church firmly oppose that, fearing that a flood of Muslim and Chinese immigrants from ex-Soviet republics would corrupt what they see as Russia’s Slavic and Christian identity.

Mr Putin, an only child and the father of two girls, proposed using some of Russia’s oil wealth to lower the mortality rate, increase the birth rate and entice ethnic Russians back from abroad. He said that the Government should increase monthly handouts for a first baby from 700 roubles (£14) to 1,500 roubles by the end of this year, and start paying 3,000 roubles a month for a second child. He also suggested a one-off payment of 250,000 roubles for each second child.

The State should pay women on maternity leave up to 40 per cent of their salaries and improve incentives for couples to adopt orphans, he said.

Times Recommends

• No apology for Germany’s own Nazi victims
• Intricate web of fear and hope tying down deal
• Victims remembered a year after Mumbai attacks