UPDATE 2-Russia's Kudrin to speak about asset sales on Weds

* Government to meet on Thursday to debate budget

* Kudrin warns Russia may run budget deficits until 2015

* Investors applaud plan, say transparency of sales key

(Adds more quotes, details)

By Dmitry Sergeyev and Lidia Kelly

MOSCOW, July 27 (Reuters) - Russia's Finance Minister Alexei Kudrin said he would answer questions on Wednesday about his ministry's plans to sell $29 billion worth of assets in the country's biggest privatisation since the 1990s.

If approved at a government meeting on Thursday as part of 2011-2013 draft budgets, the sale would become Russia's most ambitious since President Boris Yeltsin's era, when well-connected tycoons snapped up some of the biggest oil and metals firms at low prices.

Asked about the plans, Kudrin told reporters on Tuesday he would answer questions about privatisations on Wednesday at a scheduled briefing about Thursday's budget debate.

"I won't comment today. I will answer all questions tomorrow," he said during a briefing about transport taxes.

Investors have applauded the plan to sell minority stakes in ten major state firms in the next three years but have said they are keen to see if foreigners are allowed to bid.

The plan could help Putin and President Dmitry Medvedev plug budget holes ahead of the 2012 presidential election but investors remain concerned about how transparent the process will be.

"Many investors would give the thumbs up to the new policy ... If the process is well prepared and transparent, I think demand would be there," said Zeljko Bogetic, the World Bank's lead economist for Russia [ID:nLDE66Q0MN].

Sources told Reuters over the weekend the government wants to sell minority stakes in firms such as Russia's biggest oil producer Rosneft (ROSN.MM), lender VTB (VTBR.MM) and oil pipeline monopoly Transneft (TRNF_p.MM). [ID:nLDE66P0S0]

ELECTION FACTOR

Charles Ryan, Chairman at Deutsche UFG Asset Management, told Reuters he would welcome a mixture of sale tactics, including initial public offerings.

"For some of these companies, clearly, the best route will be to do an IPO, maybe some on international markets. For some companies a more appropriate approach might be a domestic IPO, for some the best approach might be a trade sale," he said.

The plan ensures Russia will keep control in the firms in a clear signal the Kremlin is not parting away from the resource nationalism it has developed over the past decade of high commodity prices.

For a factbox on the proposed asset sales, please click on [ID:nLDE66P1DU]

Putin's spokesman Dmitry Peskov said on Tuesday the government will meet on Thursday to discuss draft budgets but declined to comment on asset sales.

The plan could offer the government an alternative to higher taxation in its battle to reduce budget deficits but Kudrin, seen as the government's main proponent of tight budgets, also called on Tuesday for cuts in state spending.

Many analysts have said calls for lower spending are not realistic at least until after 2012 because the Kremlin wants to keep social spending high to ensure good approval ratings.

On Tuesday, Kudrin said Russia was unlikely to balance its budget deficit until 2015. In May, he said Russia may be able to erase the deficit earlier [ID:nLDE64H0CC]

The government wants to cut its budget deficit to 4 percent of gross domestic product in 2011 and 2.9 percent in 2012, from around 5 percent -- or $80 billion -- this year. (Reporting by Dmitry Sergeev, Gleb Bryanski, Denis Dyomkin and Lidia Kelly, Writing by Dmitry Zhdannikov; Editing by Ruth Pitchford)