Russia underwent a smooth transfer of power in 2008, with former President Vladimir Putin stepping down and his handpicked successor Dmitry Medvedev taking over.

The new system of power seemed to function well during the past several months in spite of the Caucasus crisis, NATO's eastward expansion and the global financial crisis. The new head of state has continued the policies of his predecessor, whose eight-year presidency was characterized by a booming economy and political stability at home.

MEDVEDEV-PUTIN TANDEM

Medvedev, the former first deputy prime minister, was sworn in as Russia's new president in May, succeeding his long-time mentor two months after an overwhelming victory in the country's presidential election.

At Medvedev's inauguration ceremony, Putin called on the entire nation to support the new president and firmly advance along the path of national development.

Meanwhile, Medvedev repeatedly pledged adherence to Putin's policies, which have "set up strong foundations for long-term development, for decades of free and stable development."

Medvedev subsequently appointed Putin prime minister and sent him into power in the quickest way.

So far, Medvedev and Putin have worked in tandem under the constitution. In a swift adjustment to his new role, Medvedev has held talks with European partners, paid a visit to Latin America, and dispatched troops to Georgia's breakaway South Ossetia. He is seen as a housekeeper worth his salt and loyal to his predecessor as well.

When Putin decides to come back to the presidency, Medvedev will return the keys to him without hesitation, analysts said.

In his first state-of-the-nation address on Nov. 5, Medvedev proposed extending the presidential and parliamentary terms from four years to six and five respectively. The bill, passed by both houses of the parliament within weeks, was described by Putin as reasonable during a later televised question-and-answer session.

While Medvedev said the extension of the presidential term enables more effective implementation of reforms, it was seen by some analysts as an attempt to pave the way for Putin's return to the Kremlin.

However, in response to a question as to how he felt being prime minister, Putin said he was happy, dismissing speculation that he was planning a quick return to the presidency.

Putin, widely regarded as one who enjoys being a back-seat driver, added that his power tandem with Medvedev was very effective.

But Putin did not rule out the possibility of a second presidential term, telling reporters he would think about it and make a decision by 2012.

Once he decides to do so, Putin would be looking at up to 12 years in power, long enough to carry out his plans.

PLANS TO REFORM

During the past half year at the Kremlin, Medvedev spared no efforts on addressing the urgent need to eliminate corruption, promote the rule of law, and diversify the economy beyond the oil and gas industries.

The president last month delivered a passionate commitment to liberal values in his annual state-of-the-nation address, which was described by Putin adviser Sergei Karaganov as "the most liberal presidential speech in the Russian history."

Speaking before the Federal Assembly in the white-columned Grand Kremlin Palace, Medvedev criticized the government for ineffectiveness and called for efforts to bolster democracy.

Ten proposed reforms to the parliamentary election procedure were then listed by the president, a former law professor.

First, smaller parties that may garner five to seven percent of the votes in parliamentary elections will be granted one or two seats in the State Duma.

In the second measure, Medvedev proposed that the power to nominate regional governors be given to majority parties in regional parliaments instead of the president. The initiative would offer the United Russia party a far stronger foothold because it controls most of the regional legislative assemblies.

He also proposed a gradual decrease in the number of signatures needed for parties to take part in elections, the cancellation of electoral fees, and even a reduction in the minimum number of members an organization must have in order to be registered as a party.

Analysts believe that the idea of the constitutional amendments, which represents a logical step in the country's political system reform, could be traced back to the Putin administration.

This package of measures began to be developed a long time ago when Putin was president, said Dmitry Badovsky, a deputy director of the Social Systems Institute.

Throughout the address, Medvedev also underlined the necessity of curbing "legal nihilism" and protecting small businesses from unnecessary red tape.

If Medvedev succeeds in these nuts-and-bolts reforms, Russia is certain to gain streamlined politics and become a more efficient and richer country, analysts say.

PERIOD OF STABILITY

It is widely believed that Russia has entered a period of political stability because of the Putin-led United Russia party's victory in last December's parliamentary election.

Now that the pro-Kremlin party holds two-thirds of the seats in the State Duma, authorities are able to push forward policies almost without obstacles. The party's influence was proved when constitutional changes were rushed through both houses of the parliament in November.

The 2-million-member party, founded in December 2001, is a steadfast supporter of Putin, to whom the party owes the large support it has gained.

Analysts said Putin's leadership of the party is closely connected with Russia's political reform process, as the post gave him a power base in the parliament.

At United Russia's 10th congress last month, Putin spoke highly of the party's contribution to the continuity and stability of the Russian administration.

In the face of the spreading world financial crisis, he told hundreds of fellow members that the party's grip on power depends on its ability to protect Russia from danger.

The party leader also reassured Russians concerning the international economic turmoil, vowing the use of all means within the government's reach to prevent a repeat of the economic shocks in the 1990s.

On the international stage, western threats to isolate Russia as punishment for a brief military conflict with Georgia failed to be fruitful.

Furthermore, NATO foreign ministers earlier decided to delay Ukraine and Georgia's admission to the Membership Action Plan, a key step for entry into the military alliance.

Putin was even confident enough to say that the new U.S. administration might be thinking twice about plans to deploy a missile shield in central Europe. The proposed shield has drawn sharp criticism from Russia.

The fairly stable domestic and international scenario is undoubtedly favorable to Russia's progress toward set targets and its course of resurgence as a world major power.