MELISSA BLOCK, HOST:
Vladimir Putin is still defiant. The Russian president delivered his annual state of the nation address in Moscow today. There was no signal that he's backing down on the issues that have set his country at odds with the West. That's even as Russia faces low oil prices, international sanctions and, today, a serious militant attack on its own territory. NPR's Corey Flintoff reports from Moscow.
COREY FLINTOFF, BYLINE: The Russian leader began his speech with a defense of the move that got his country into the difficulties it faces today - the decision to take the Crimean Peninsula from Ukraine. He said Russia has a spiritual claim on the region based on Crimea's link to the early days of Orthodox Christianity.
(SOUNDBITE OF SPEECH)
VLADIMIR PUTIN: (Through translator) This gives us every reason to say that Crimea is of great civilizational and sacred importance for Russia, like the Temple Mount in Jerusalem for those who practice Islam or Judaism. This is how we will treat it now and forever.
FLINTOFF: That claim to a sacred link would seem to make it impossible for Putin or any Russian leader to give the region back under any circumstances. Putin went on to blame the West for the current conflict in Ukraine. And he specifically cast Russia as the victim of constant Western efforts to crush its power.
(SOUNDBITE OF SPEECH)
PUTIN: (Through translator) I'm sure that even if the coup in Ukraine had not happened, some other excuse would've been invented to contain the growing potential of Russia. This policy of containment was not invented yesterday. It's been carried out against our country for many years - for decades, if not centuries.
FLINTOFF: Putin's tone seemed to confirm a gloomy assessment that President Barack Obama gave at a Wall Street Journal forum this week.
(SOUNDBITE OF WALL STREET JOURNAL FORUM)
PRESIDENT BARACK OBAMA: He has been improvising himself into a nationalist, backward-looking approach to Russian policy that is scaring the heck out of his neighbors and is badly damaging his economy. And sanctions are having a big bite on their economy.
FLINTOFF: Putin did address the economy, calling for government efforts to develop domestic industries, spur technological innovation and fight corruption. The last item is a particular concern, especially since a new report from Transparency International shows Russia slipping to 136th place out of 175 countries on its Corruption Index. But Putin showed that he had more important priorities than stopping criminality. He promised total amnesty for any Russian who brings money back into the country.
(SOUNDBITE OF SPEECH)
PUTIN: (Through translator) He won't be asked about the sources of that capital or how it was obtained. He won't face criminal prosecution. Let's do this now, but just once.
FLINTOFF: It's an important concession for Russia, where people have been getting their money out of the country as fast as possible. The Russian Central Bank estimates that the country will lose as much as $128 billion in capital flight this year. Putin's speech came against the backdrop of a militant attack last night in one of its most volatile regions - the Caucasus Mountains. People in Grozny, the capital of the Russian republic of Chechnya, woke to the sound of heavy gunfire.
(SOUNDBITE OF GUNFIRE)
FLINTOFF: Chechen officials say that at least 10 police officers were killed and 28 wounded in fighting with militants who took over a publishing house and a school in the center of town. Officials say at least six militants were killed, but it's not clear whether others are still at large and whether the fighting is ongoing. In his speech, Putin said he was sure that local law enforcement in the region would deal with the attackers. But though he frequently suggests that Russia is surrounded by enemies, the latest attack suggests that he may soon be facing more threats from inside the country. Corey Flintoff, NPR News, Moscow. Transcript provided by NPR, Copyright NPR.