Russian President Vladimir Putin said Monday that Russia's main political task was to develop as a free, democratic nation with European ideals, and stressed that individual freedoms would not be compromised by the state's own strengthening. "We are a free nation and our place in the modern world will be defined only by how successful and strong we are," Putin said in his annual state of the nation address. Lawmakers from Russia's lower and upper houses of parliament, government officials, governors and religious representatives gathered in the Kremlin's Marble Hall for the speech. The address _ Putin's sixth of his two-term presidency _ was to outline the main trends of Russia's domestic and foreign policy. It was Putin's second state of the nation speech since he was overwhelmingly re-elected to a second term in 2004. Putin said the nation's main challenges now were to strengthen the state, boost the rule of law and judicial institutions and deepen respect for both individual liberties and the activities of non-governmental organizations. On the economy, Putin said tax inspectors don't have the right to terrorize business, and he called on the government to lower the statute of limitations to three years for challenging the results of past privatization deals. He said Russia needed foreign investment, but added that such investment comes only to those countries where the "rules of the game" are clear. Putin said that the threat of terrorism in Russia remained high, and he said that parliamentary elections scheduled for later this year in Chechnya should lay the basis for stability and democracy in the region. He also stressed that the volatile, impoverished south Caucasus region in particular needed new jobs and infrastructure to boost stability.