Authorities began cracking down on millions of illegal migrants throughout Russia Monday as new rules tightening government control of migration came into effect, prompting concerns that the country could face serious shortages of low-wage laborers.

The rules ease stringent procedures for citizens of most former Soviet republics who enter Russia from Jan. 15 to obtain work permits, but they also increase fines for businesses that employ illegal migrants.

And in a related measure, a government decree that took effect Jan. 1 restricted the number of non-Russians in the retail trade outside stores to 40 percent and to zero from April 1.

Alec, an Azerbaijani fruit and vegetable seller at a central Moscow market that is staffed almost entirely by foreigners, said that he and many of his fellow migrants would have to leave Russia.

"They don't like the color of our skin here," the 26-year-old said, declining to give his last name because of concerns for his safety.

The issue of immigration has become a lightning rod for President Vladimir Putin's government amid rising popular resentment of migrants — in particular, dark-skinned workers from former Soviet republics in the Caucasus and Central Asia.

Racist attacks and hate crimes are on the rise, and the Movement Against Illegal Immigration — a far-right, grass roots political organization — has exploded in popularity in recent months.

Under the new rules, authorities are carrying out strict checks of the estimated 10 million to 12 million foreigners who are already working in Russia, most of them illegally.

Businesses who employ people without proper documents face fines of up to $30,100 and a three-month suspension of activities, under the new rules, which also set a quota of 6 million foreign workers for 2007.

Migrants from former Soviet republics, most from Azerbaijan, Georgia or poor nations in Central Asia, are the main source of cheap labor in Russia, doing menial jobs for low pay that Russians refuse to do.

Putin last year ordered new measures to reduce the employment of foreign workers, especially at Russia's busy indoor and outdoor markets, alleging they were crowding out native Russian producers and retailers.

In the Far Eastern city of Khabarovsk, which lies on the Chinese border, Chinese market vendors have been packing up their unsold goods and heading back home. One clothes trader, Li Chen Tsza, said he had marked down his prices by 50 percent to get rid of his inventory.

"They told us that from New Year's, we won't be able to sell our goods here anymore," he said in televised comments.

Critics said the authorities' moves against migrants would only encourage xenophobic sentiments already on the rise in Russia, fuel inflation and accelerate the nation's population decline.

Russia's population is dropping by about 700,000 a year and has fallen below 143 million, a demographic crisis blamed on the economic turmoil that followed the Soviet collapse. The population decline would be even more catastrophic were it not for immigration.