From Volume 36, Issue 48 of EIR Online, Published Dec. 11, 2009
Russia and the CIS News Digest

Putin: Russia Has 'Ambitious Plans for Nuclear Power'

Dec. 3 (EIRNS)—The Russian government has "ambitious plans for the development of nuclear power engineering," Russian Prime Minister Vladimir Putin said today, during his annual question-and-answer webcast with the Russian people, Russia Today reported. "While 35 to 38 nuclear power units were built during all the decades of the Soviet period, today 30 to 32 nuclear power units are in the pipeline for the coming 10 years. This calls for enormous investments, and the Federal Agency for Atomic Energy (Rosatom) has the funds for that," he said.

Putin said Russia's power industry overall would grow rapidly, to ensure economic development. He dismissed as groundless, the crisis mentality that demands cuts in investment in the power industry. "We cannot afford to be late in developing our power industry, in order to face a deficit in generation capacity in the period of economic restoration," Putin said. "Our plans will be fulfilled. In the past 10 years we built 13,000 MW of power generation capacities. Within two years we should put 10,000 MW of them into operation. Our plans are very big and there are no doubts that they will be realized."

In August, Russia adopted an energy strategy through 2030, for large-scale investment. The plan calls for investing 60 trillion rubles ($2.1 trillion), Energy Minister Sergei Shmatko announced on Oct. 26, although much of this would be in oil and gas extraction.

Putin also emphasized that the new owners of power companies, formed by the breakup of United Energy Systems, the national electric power utility, now have to invest. "When this reform was being worked out, its authors hoped that the realization of assets would help modernize and expand power generation capacities," Putin said. "The new owners received benefits, but they should fulfil their obligations." These included pledges to invest $820 billion in new technology.

Putin also said that there has been growth in key industries, like space, defense, and agriculture, despite the crisis. "In those branches of industry, which the state considers its direct responsibility, we are observing a more-or-less acceptable level [of production]." Putin also said that Moscow will support the steel industry, through increasing spending by Russian Railways, and the auto industry.

The Russian state nuclear company Atomenergoprom has announced recently that it will have no problems placing a billion-dollar-plus bond issue, because of the stability provided by state ownership, Novosti reported. Atomenergoprom wants to raise its share of Russian electricity production from 17% to 25% in 2030, investment head Anton Kovalevsky said. "We have unprecedented backing from the state. It currently provides 60% of our funds, but within five years we plan to be raising all money ourselves. Last week we issued a $1.7 billion bond, and will invest $68 billion in Russian electricity production by 2015."

Russia-China Cooperation Features High-Tech, Putin Says

Dec. 4 (EIRNS)—During his Dec. 3 webcast, Prime Minister Putin also fielded questions on the Russian-Chinese relationship. This came up in reply to a question about the closing of the Cherkizovsky market in Moscow, where many Chinese and Central Asian merchants sell their wares. The market was closed by Moscow city authorities, allegedly because the owner of the property, an Azeri named Telman Izmailov, had angered authorities. The incident also led to something of a diplomatic incident with China, as many Chinese merchants were affected by the closing.

In his comments, Putin said, "Indeed, our foreign partners, including our Chinese friends, drew our attention to the on-the-ground problems at the Cherkizovsky market. Why do you think they did this? This does not require an answer.... But we must protect the interests of our producers, of the men and women employed by our companies, for instance in the Ivanovo Region, where the economic situation is very grave. If fake and smuggled goods gain the upper hand, our producers will never make it. We must build relations with our partners, including our Chinese partners. We have developed very good relations with them recently."

In reply to a questioner who asked if the Turkmenistan supply of natural gas to China would impede Russia-China gas deals, Putin talked about the important nuclear agreements signed in October. "Both Russia and China emphasize the need to see development in their high-tech sectors. Energy projects do not detract from these policies; in fact, they support them. Russian-Chinese cooperation is much broader than oil and gas. Russian companies are currently building the Tianwan Nuclear Power Plant in China. We have recently agreed with Chinese partners, that Russian engineers will be directly involved in building more nuclear power generation units. This energy sector also forms part of the high-technology sphere. We are also interested in expanding our high-tech equipment's export to China. We also welcome cooperation in other areas, and we also welcome China's initiatives. Our cooperation is a two-way street."

Commenting on Putin's remarks, Lyndon LaRouche noted the vital Chinese interest in obtaining high-tech imports, which Chinese representatives raised in exasperation in recent meetings with the EU.

In response to the question, "Will Russia help the United States after its collapse?" Putin replied, "If this happens, there will be a lot to pay, because the United States is the world's biggest power, economic power, and we have extensive links with it. It is one of our most important partners, and the global economy is very closely intertwined with the U.S. economy. Therefore, it would be inappropriate to wish problems on any country. We would all be better off living in a prosperous world, rather than in a world of disasters."

Strategic Shift in India-Russia Relations

Dec. 5 (EIRNS)—The nuclear power agreement and a new ten-year defense agreement, both likely to be signed between India and Russia when Indian Prime Minister Manmohan Singh visits Moscow Dec. 6-8, could transform their relationship, India's Business Standard reported yesterday. The umbrella nuclear agreement could lead to as many as 10-12 Russian nuclear reactors being sold to India in the next 10 years. (See EIR, Nov. 27, 2009.)

Most important, the civil nuclear cooperation agreement is expected to provide for sales of nuclear fuel and allow Indian reprocessing of the fuel for all future Russian reactors supplied to India—which the so-called 123 agreement with the United States strictly prohibits. India will also be allowed to enrich Russian-supplied uranium up to 20%. In contrast, the Standard reported, when Singh was in the United States last month, President Obama's "over-zealous bureaucrats, well-versed in the minutiae of non-proliferation matters, prevented a signature on a nuclear fuel processing agreement between India and the U.S."

High-level sources told The Hindu—considered close to India's External Affairs Ministry—that while Russia balked at explicitly including enrichment and reprocessing technology, this was now subsumed under broad-based cooperation in nuclear R&D. The agreement also includes built-in reprocessing consent rights for all future Russian reactors supplied to India, and provides for India to enrich Russian-supplied uranium up to 20%, the level necessary for the production of medical isotopes.

"Russian leaders have realized that global power is fast gravitating to the Asia-Pacific region, where India is an increasingly important player," Andrei Volodin of the Russian Institute of Oriental Studies, told Indo-Asian News Service, in an interview published yesterday. Economic ties with the Asian region are instrumental for the success of Russian plans to redevelop Siberia and the Far East, he said. "Indian elites have awakened to the fact that the Pax Americana is a thing of the past and they should not put all their eggs in the U.S. basket."

The Standard quotes high-level sources in both Delhi and Moscow, indicating that Russia could expand the number of nuclear plants to be built in Kudankulam, in the state of Tamil Nadu, from four to six. Russia is already building two plants there. It could also expand the plants to be built at Haripur, West Bengal, from two to four. Overall, these agreements would show a shift of joint trade from commodities to high technologies.

Russian Prime Minister Putin will visit India in March 2010, when the long-delayed agreement over the Admiral Gorshkov aircraft carrier and MiG-29K fighter jets could finally be signed.

There are other indications of a shifting relationship. Prime Minister Singh called Russia a "world power" in his interview with Russia media two days ago, and said that India-Russia economic cooperation should expand, despite the effect of the world crisis on the Russian economy.

Nuclear Power Agreement Between Russia and Ukraine

Dec. 3 (EIRNS)—Russia is renewing its nuclear power agreement with Ukraine, Ukrainian Prime Minister Yulia Tymoshenko said Nov. 21. The two sides have prepared a strategic cooperation contract for the nuclear energy sphere until 2020, she said, after a meeting with Russian Prime Minister Vladimir Putin in Yalta. "I think that we will soon finalize another important document, which will ensure stability in our [nuclear] cooperation for years to come." Ukraine has no capacity to enrich the uranium it produces, so all fuel for its five nuclear power plants and two research reactors is supplied by Russia.

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