The government is fighting for its fiscal life to repay crushing debts that could sink the stagnant economy, but it also must enact reforms meant to spur companies to action, first by paying taxes and secondly by paying each other.

Russia feeds itself from its dachas -- country houses where workers unpaid for months spend their weekends growing potatoes to tide them by until companies pay their dues and the economy gets back on its feet after half a decade of crisis.

There is a lot to pay. Factories and firms owed overdue arrears of a startling 1.07 trillion roubles ($173 billion) in June, four per cent more than in May, including 70 billion roubles ($11 billion) in overdue wages.Most Russian companies limp by, selling a tenth or a fifth of their wares for cash, bartering for supplies and building uparrears to employees and other firms with nowhere else to go.

Meanwhile, in Moscow's shiny new office towers, young turks make grim jokes about the markets, watching stock major indices which have lost almost two-thirds of their value this year.

"I didn't guess this would happen," said one shocked young economist at a Western firm in Moscow. He and his colleagues have an office sweepstake on when the rouble will slip out of control. "The most popular dates are not far away," he said. A stable rouble and low inflation are the clearest and widest indicators of confidence in the government. The rouble's post-reform strength is the result of the central bank's refusal to print money or give baseless credits to industry.

During 10 months of crisis there has been no run on the banks, indicating some popular belief in the government, though Russians have tucked away at least $20 billion in hard currency, the largest hoard of US dollars outside the United States.

The crisis is in the markets where nervousforeigners threaten to take home funds they have invested in Russian rouble debt, up to a third of the $65 billion market, which would leave Russia scrambling for funds and the rouble weak as dollars fled.

However, the key is not the size of Russia's total debt, less than 50 per cent of gross domestic product, but when it is due.

"If you look at the numbers in Russia, they're not frightening," said Mohamed El-Erian, head of European emerging market research at Salomon Smith Barney investment bank. "The big question is how do you deal with the maturity of the debt."

Russia has issued mostly short-term T-bills, which has proved a nightmare since chill Asian winds swept into the country, upsetting investor confidence and sparking a home-grown crisis.

About two-thirds of Russia's rouble debt is due within a year and the government, which already spends every third rouble on debt payments, would double the debt in no time if it rolled over $40 billion at current rates of over 70 per cent.

If it could notrepay or manage the debt, it might have to freeze it, or simply start up the rouble printing presses.

The government has bought itself time to impress investors and improve its own finances by rescheduling about $4.4 billion short-term debt.

That leaves about $12 billion falling due within three months, the window in which the anti-crisis programme of prime minister Sergei Kiriyenko must start to bite.

"November is the first month when we should get full returns from all of the newly introduced taxes and balance the budget," he said after getting an International Monetary Fund promise of $11.2 billion in new aid this year.An IMF-agreed plan calls for second half federal revenues to rise by 25 per cent against the first half to 161 billion roubles.

Taxes have already been raised, spending cut, and now Russia and investors are waiting for the government to get tough.

"Weaknesses in implementation have been the Achilles heel of Russia's economic policies in the past," said Stanley Fischer, the IMF'sdeputy managing director. The tough new head of the state tax service, former banker Boris Fyodorov, has said Russia should gather most of its taxes from personal income tax. More than half the population don't pay taxes.

The IMF agreed for now that Russia should create a special unit for large taxpayers, especially those with major arrears such as Gazprom, the largest natural gas company in the world and Russia's largest taxpayer.

Gazprom owes the federal government about $2 billion in tax arrears. It promised to pay $650 million cash a month, beginning in July, after the government seized Gazprom property.

If Gazprom fails to pay up, and unofficial sources say it won't, the government has threatened seizure again.

But Gazprom is not simply a company that refuses to pay taxes -- it also keeps the country going by supplying natural gas, without getting paid, to companies and the government.

Such tangled webs keep the lights flickering in the far east. The non-payments crisis of the real economyaffects the government, too. It owes Gazprom slightly over $2 billion for gas it has used, leaving it the net debtor.

"Gazprom has to be careful it doesn't shut the whole economy down, but it has to make people aware that if they don't pay for the gas, they ain't going to get the gas," said one Western oil and gas analyst in Moscow. The IMF agreement calls for Russia to increase cash payments for gas to 20 per cent of domestic sales by the end of the year, and cash payment for electricity should rise to 30 per cent.