Great sushi, shame about the election

John Kampfner in Moscow finds mega malls on the horizon and some of Europe's most fashionable bars a

As the presidential election campaign gathers pace this month, there are only two places for a self-respecting Muscovite to be seen: Chelsea and Courchevel. That is the paradox of Vladimir Putin's Russia. The economy is growing fast. The new middle class is spending and travelling as never before. And yet politics is returning to some degree to the old days - a resurgent bureaucracy, an all-powerful Kremlin, pliant media and a vote that counts for little.

I was, between meetings at the Kremlin, pondering the contradictions of post-post-Soviet life with a friend I had known a decade ago. Pyotr, who works for an investment bank, was explaining the difficulties of booking decent hotel rooms at French ski resorts inundated by Russians. He and his comrades now charter their own planes to take them to the slopes.

The other popular destination, of a Saturday afternoon, is Stamford Bridge in west London, by private jet naturally, to watch Roman Abramovich's Chelski. Abramovich is one of the more clever oligarchs. He has so far avoided being thrown into jail, a fate that befell Mikhail Khodorkovsky last October. The multi-billionaire oil magnate is now languishing in Matrosskaya Tishina, the prison that housed the leaders of the failed Soviet coup back in my time as a correspondent here.

The lesson, according to Anatoly Salutsky, a political analyst, is: "You can go into business to make big money, or you can go into politics. You cannot combine the two." Khodorkovsky, it is said, had bought up a large part of the Duma, the parliament. That is why Putin finally went for him. Investors were alarmed at the arrest, but only briefly. "It would be naive to deny that the move didn't affect the stock markets," says Sergei Prikhodko, Putin's senior adviser on foreign affairs. "But our courts have to take notice of the law, not share prices."

That law is being flexibly applied. The courts are delivering for the president. The new parliament, now shorn of the liberals of the long-forgotten 1990s, is expected to do the same. Even Putin's people admit that anyone of any stature would not stand against him in the presidential campaign. With disarming candour, Sergei Yastrzhembsky, one of the few top officials to have made the transition from the discredited Yeltsin era, describes Putin's ratings - currently around 80 per cent - as "paralysingly high", and says that he cannot reproach the better-known politicians for their "pragmatism" in refusing to be candidates in the 14 March election.

So insignificant are the six challengers that Putin is not bothering to debate with them. So insignificant is parliament that he is not bothering to represent the main party, United Russia. There is no outward sign of campaigning. The Central Electoral Commission has decreed that each candidate must have equal airtime on television. But Putin is the president, and the president's every word and every action are chronicled by broadcasters who have learned not to cross the powerful.

The one story that has caught the popular imagination is that of Ivan Rybkin. One of the six minnow candidates, he went missing earlier this month after the electoral commission said it was investigating him for possible fraud during the collection of the two million signatures required to stand for president. Rybkin reappeared in Kiev, saying he needed a rest, then popped up in London, where he suggested that malign forces had drugged him and tried to extract some kind of compromising material.

The anti-Putin conspiracy theorists point to allegations made by Rybkin about links between the president and big-business corruption. The pro-Putin conspiracy theorists insist that a man who at best was heading for 1 per cent of the vote was either seeking publicity or trying to undermine the campaign; they see the hand of Rybkin's funder, the exiled oligarch Boris Berezovsky, behind the adventure.

Political intrigues, rarely as tantalising as the Rybkin case, pass most people by. For the poor, life is as grim as ever. For the burgeoning middle classes, life is looking up. The traffic jams may have got worse, particularly after the recent bomb on the Metro which has dissuaded some from travelling by public transport, but the cars have become swankier. The super-rich consumer revolution of the early 1990s has been superseded by shops catering for the middle income. Lawrence McDonnell, a Londoner who runs Pravda PR, a small but fashionable agency, is particularly pleased with an advertising campaign for one of the new out-of-town shopping centres, called "MegaMall". The slogan reads: "Give yourself up to shopping."

That, it seems, is exactly what people are doing. Moscow is awash with some of Europe's most fashionable restaurants, bars and clubs. Some of the best sushi chefs outside Japan are now to be found in the Russian capital.

After the shock therapy of the early 1990s and the economic crash of 1998, business is beginning to boom again. Investors are more wary now, but there is money to be made as long as "rules" are observed. The most important of those is to ensure that government authorities both at national and regional level are, as one industrialist puts it, "kept happy". They, too, want a share.

Western diplomats are worried by recent developments - Khodorkovsky's arrest, the conduct of the parliamentary elections, pressure on neighbouring Georgia and the war on Chechnya to name but four. During a recent visit, Colin Powell, the US secretary of state, gently admonished his hosts, but as the Americans share a common interest with the Russians in the "war on terror", he trod gently.

The Russians are confident that, partly because of Iraq and partly 9/11, they have carte blanche in Chechnya. And yet they seem to have no idea about how to bring that war to an end. Yastrzhembsky, Putin's chief aide on the conflict, admits political talks are over, accepts that the threat of terrorism is ever-present now in Moscow, and claims that some of the money the government has put in to try to rebuild Chechnya has been handed on by locals to separatist fighters. But still, he says, Russian forces will use every means at their disposal to "eliminate" the rebels.

British displeasure at all of this is softened by growing economic links. BP has signalled a huge expansion on the Russian stage by bringing in an additional 150 British managers. The Russians do not appreciate London becoming a focal point for discontented exiles. They could not understand why Tony Blair did not intervene with the courts to allow the extradition of one of the more moderate Chechen leaders whom prosecutors want in Moscow. But business is business.

Kremlin aides say that Putin's second term - there are no "ifs" about that - will be about increasing the pace of economic reform. They insist they want a more "mature" democracy and a more vigorous presidential election in 2008. That may still happen. People in charge here have yet to conclude whether the events of the past six months mark a temporary retrenchment on the way to a more liberal future or a long-term, harsher reality.

Then again, Russians have been asking themselves such questions for centuries.