A day after relinquishing the presidency, Vladimir Putin became Russia's prime minister Thursday, completing a carefully managed transition that keeps him at the center of Kremlin power.

The confirmation of Mr. Putin, nominated by new Russian President Dmitry Medvedev, was a formality, as the party he leads controls more than two thirds of Parliament. Some 87% of deputies voted for him, with only opposition Communists voting against.

Analysts and allies said Mr. Putin, who promised a welter of liberal tax-cutting economic changes in his nomination speech, will remain the most powerful politician in Russia.

"According to the constitution, the president has more powers than the prime minister," said Sergei Markov, a deputy from Putin's United Russia party. "But real political life takes precedence, and the law can be interpreted differently."

He said Mr. Putin would remain the "No. 1 national political leader" until Mr. Medvedev proves himself and lays down a record of achievement comparable to that of Mr. Putin.

Mr. Medvedev spoke briefly Thursday, saying Mr. Putin would play "a key role" in realizing the policy plan, which runs to 2020. "Our cooperation will only get stronger," Mr. Medvedev said.

Russia's RTS stock market index rose 3.5% as investors cheered Mr. Putin's economic agenda. That helped shares in the Kremlin's flagship OAO Gazprom gain 5.8%, making it the world's third-largest public company by market capitalization, after Exxon Mobil Corp. and PetroChina Co., respectively.

The accelerated timing of the nomination hearing and vote meant Mr. Medvedev's first full day as president was dominated by Mr. Putin, whose shadow he must shake if he is to emerge as a strong figure in his own right.

Laying out his program, Mr. Putin focused on domestic policy and the economy. He promised tax cuts for the oil sector, steps to improve the business climate and develop Russia's stock market and higher spending on health, education, pensions and the military. He also promised to tackle rising inflation, one of Russia's top economic problems.

Nick Day, chief executive of Diligence, a business-intelligence company that works with Russian and foreign companies, said the untested and unclear nature of the power-sharing alliance would make life difficult for business.

"It's going to be a rocky place for business over the next year or so, given that business and politics are so entwined," he said, adding that people wouldn't know whether to go to Mr. Putin or Mr. Medvedev for decisions. "There will continue to be fights over assets for control over major industries."

In style and content, Mr. Putin's performance was indistinguishable from his annual policy messages to Parliament, except that he didn't stray into foreign and security matters, which formally aren't his responsibility as prime minister.

In the past, prime ministers have been technical figures implementing day-to-day policies and keeping ministers on track. But politicians and analysts say Mr. Putin will remake the job in his own image and another politician will be appointed to deal with technical issues, freeing Mr. Putin for a more political role.

The Communists, the only opposition force in Parliament, said they couldn't vote for Mr. Putin because he had failed to develop the country's industrial base or democracy. Party leader Gennady Zyuganov said he regarded Mr. Putin's eight years as president as a period of "missed opportunities."

In closing remarks after his confirmation, Mr. Putin dismissed the critique, saying his government's success in raising living standards had deprived the opposition of issues on which to attack him.