Big reductions in state benefits announced late last year in Turkmenistan are having a serious impact in the reclusive Central Asian state - particularly on the lives of the elderly who already live marginalized lives in the country of six million people. 

"I went to the post office on 2 January as usual to claim my pension. I was told I was no longer eligible for my monthly money, there was no explanation, no apology. There are thousands like me, how do we survive now?" 74-year-old Svetlana Ivanovna asked as she tried to hawk knitted socks in the Russian bazaar in central Ashgabat to buy food. 

Many pensioners were told it was part of a new reform that sought to eliminate a "mistake" in the previous pension scheme and that the cuts were a temporary measure. Monthly payments to the elderly in Turkmenistan used to average about US $40. 

Turkmen President Saparmurat Niyazov urged his government to proceed with the cuts and "achieve order in the pension system", state news agency Turkmen Khabarlary reported him as saying. 

No official explanation for the decision has been offered although Western diplomats in the capital said a severe shortage in the state pension fund had forced Niyazov to spend hard cash from currency reserves to pay last year's pension bill. 

Under the measure, around 100,000 people of the 400,000 people officially listed as pensioners - have had their pensions completely cut. In addition, there have been reductions of 20 percent in most other state benefits, including maternity and sick leave payments. 

But the situation is already bleak for many elderly in Turkmenistan who are barely able to make ends meet in this gas-rich state. Women who have worked for less than 20 years and men who have been in jobs for less than 25 years are not entitled to any pension payments at all. 

The retirement age in Turkmenistan is currently 62 for men and 57 for women. 

Niyazov declared himself president for life in 1999, using parliament to rubber-stamp the move. Turkmenistan is isolated from the rest of the world through a restrictive visa regime and tight media controls. 

Opposition websites claim pensioners have been dying from heart failure at news of being plunged into instant poverty. Such assertions are difficult to verify in a country where there is so little public information. Reports from the eastern city of Turkmenabad suggest pensioners denied payments have been meeting in private to consider their options. 

The mood in Ashgabat appeared subdued, although a couple of elderly women forced to beg in the frozen streets said they were not afraid to protest - something unheard of in authoritarian Turkmenistan. "What do we have to lose now? Without our monthly money we are finished. Of course we will take to the streets, perhaps we'll be arrested or shot, but how will that look?" one woman muttered as she stamped her feet to keep warm while keeping a watch for police who have been ordered to move any beggars on. 

On Monday, the Turkmen Foreign Ministry, in a statement on a government website, hit back at international criticism of the slash in pensions. While not denying that widespread cuts had taken place, the ministry accused the Russian Interfax and Rosbalt news agencies, along with the Vremya Novostey newspaper, of "direct provocations and openly twisting facts". 

"The amount of social payments is high and in line with the robust social-economic growth of Turkmenistan. The population is also provided with free gas, electricity, drinking water and salt, transport and municipal charges are low. Other benefits are also provided," the ministry said. 

But Viktor, an ethnic Russian who came to work in Turkmenistan as a civil engineer in the 1970s, said that although he enjoyed subsidized power, the removal of his pension - the equivalent of about $43 per month, meant that with no relatives to rely on, he was slowly starving. 

"Look at me, see, I'm already thinner than last year, check this photo. I may not die of cold but I could pass away through lack of food," he said as he contemplated his future. Like many other ethnic Russians of his age, he has no relatives in Russia and few options left in Turkmenistan. 

Rural people have been even worse hit than those in cities. People who used to work on Soviet-era collective farms were already getting less than $10 a month - half the official minimum - and they have now had this amount suspended for the next two years. 

The government believes farmers are receiving inflated pensions and should live off the land. At a former collective farm near Archman, a town about 140 km northeast of Ashgabat, local people were angry at the cuts. "I worked 43 years on the land only to have my pension taken away, I'll have to turn to smuggling petrol to survive," one old man sipping tea in a cafe, said. 

The move is part of a trend away from the old Soviet 'cradle-to-grave' system towards a new privatized era - but without the level of economic development to ensure people can afford to pay for such benefits, critics say. Unofficial figures put unemployment in the country at around 80 percent. 

Observers note that in the health sector for example, although emergency treatment is offered free of charge; most other services are now offered for a fee and are supposed to ensure recovery of hospital operational running costs.