Russia's deputy prime minister dismissed critics who claim the country is becoming an authoritarian state, insisting that the government remains committed to democracy and a market economy.

Alexander Zhukov (search), the highest-ranking Russian attending the World Economic Forum (search), appeared on a panel entitled "The Russian Riddle" with two critics on Friday. Zhukov defended President Vladimir Putin's (search) economic policies, recent social reforms and political openness.

"If anybody today believes there is a choice between democracy and authoritarianism, we don't see any choice," he said. "There is no question that Russia will remain a democracy and integrate into the world economy."

Zhukov stressed that "Russia will do everything possible, will bend every effort, to ensure that it is integrated in the world economy," noting that this year it plans to bring its accounting methods up to global standards.

Putin has come under attack for scrapping elections for the country's 89 governors, calling for an end to direct election of lawmakers in the lower parliament house, the State Duma, and other Kremlin-sponsored political reforms that critics say will strengthen the president's grip on Russia at the expense of democracy.

His crackdown on the Yukos oil giant, which has virtually collapsed under a $28 billion tax claim, and the sell-off of its main production unit in December to a state-owned oil company sparked criticism that Russia was moving to recapture key chunks of national industry.

The Kremlin insists the cases against Yukos — and its jailed founder Mikhail Khodorkovsky — were the result of a just probe into shady business practices, but observers consider it a politically motivated attack.

Vladimir Ryzhkov, an independent lawmaker in the State Duma, told the panel that "Russia's leadership has lost strategic vision on how to run the country," which has become more unstable with increasing crises. He cited Yukos, Russia's meddling in Ukraine's election and the mishandling of recent social reforms that have sparked pensioner protests.

He said the government is divided, with one part working against another on a host of issues including the budget, revitalizing the stock market and liberalizing taxes.

"The result is a Russian paradox," Ryzhkov said. "The quantitative indicators are better, but the qualitative indicators are worse."

Corruption is increasing, life expectancy is decreasing, courts are in a "catastrophic" situation, the role of parliament is in "catastrophic" decline, human rights have been curtailed and there is de facto censorship, he said.

"Effectively, there is a one-party parliament and media control, which is the hallmark of an authoritarian regime," he said.