In his state of the nation address to parliament in May, Vladimir Putin called the decline in population by 700,000 a year the country's biggest problem, and cited three ways to deal with the crisis: a higher birth rate, a lower mortality rate, and an effective migration policy.
"People over 65 make up 13.7% [of the population] at the moment, which means our rate is twice as high as the international standard for an aged society," the president told legislators' council.
He said population had been steadily shrinking in the past 13 years. "In these years, the death rate has exceeded the birth rate by 11.2 million people," the president said.
The Russian leader also said alcohol abuse was one of the reasons for the high death rate in the country. Alcoholism is particularly corroding Russian provinces where economy and infrastructure are poorly developed and provide no jobs to people.
"Experts say that the majority of deaths are caused by alcohol abuse and could have been prevented," Putin said, adding that other causes of early deaths included cardiovascular diseases and unnatural external factors such as road accidents, alcohol poisoning and crimes.
The president said the problem of falling population could be resolved by increasing child benefits and privileges to parents, and by streamlining the nation's migration policy to make up for shortages in the workforce.
"The system of allowances and benefits, which will come into force in 2007, is definitely a substantial aid, but it falls short of making much difference to a family's income," he said. "We must go further and create conditions for parents to earn decent wages."
In his May address to parliament, Putin said monthly child benefits should be raised from 800 rubles to 1,500 rubles ($55) for the first child, and mothers should be paid 3,000 ($110) a month for their second child. The government should give women at least 250,000 rubles ($9,225) as financial aid following the birth of a second child.
Another solution, Putin told legislators, lies with the 12 "pilot" regions in the voluntary repatriation program for Russians living abroad, which will be launched next year. The program is designed to make up for workforce deficit in some regions - primarily the border regions of Primorye and the Khabarovsk Territory in the Far East and some areas in European Russia.
The Soviet Union experienced several major waves of emigration, the most recent taking place in the 1990s before and after the country's demise, an event that triggered widespread economic and social hardships. Following the collapse of the Soviet Union in 1991, millions of Russians likewise remained in former Soviet republics.
Putin said migration compensated decline in population in 1992 by nearly 100% whereas in 2005 it only covered 12.5%. "Therefore attracting our compatriots from abroad remains a priority," he said.
"I hope pilot programs in federal districts and their municipalities will provide repatriates with all the required support, particularly in primary accommodation, pre-school and school education," Putin said.
In October, the president said the government would allocate 4.6 billion rubles ($171.13 million) for the repatriation program next year.