In this issue:

Russia, France, Germany in Consultations on Iraq

Putin Visits Italian Prime Minister

Breakthrough in Russian-Saudi Diplomacy

A Vision of Russia as East-West Bridge

Russian-European Aerospace Cooperation on the Rise

Science Magazine Features Russian Nuclear-Powered Rocket Program

Gazprom To Join in Kra Isthmus Pipeline Project

Glazyev Election Coalition Gains Momentum

Vladimir Gusinsky Arrested In Greece

Afghan Drugs Endanger Russia

From Volume 2, Issue Number 36 of Electronic Intelligence Weekly, Published Sept. 9, 2003
Russia and Central Asia News Digest

Russia, France, Germany in Consultations on Iraq

Russia, France, and Germany, leaders of efforts earlier this year to block the Iraq war, are in close consultations about a new UN mandate for Iraq. With the 2003 UN General Assembly session drawing near—it opens Sept. 16—Russian President Vladimir Putin conferred by phone with French President Jacques Chirac and German Chancellor Gerhard Schroeder the weekend of Aug. 30, in addition to meeting in Sardinia with Italian Prime Silvio Berlusconi; he also spoke to President Bush, in a joint phone call with Berlusconi. The Foreign Ministers of Russia, France, and Germany were also in contact by phone.

Schroeder reiterated through a spokesman on Sept. 1, that Germany's position against sending its troops to Iraq has not changed, and that he is working with Chirac and Putin on a UN resolution, to define a strong UN role for a real reconstruction mandate for Iraq. Chirac, Schroeder, and their Foreign Ministers met in Dresden on Sept. 4 (see Europe News Digest).

Russia's official view was presented to the UN Security Council by Ambassador Sergei Lavrov at the end of August. He called for "a comprehensive approach, including further enhancement of the role of the United Nations ... for direct participation in the political process, in the carrying out of constitutional reforms, in the organization of elections and in the formation of an internationally recognized government on the basis of a clearly defined plan for restoring the sovereignty of Iraq." This should occur "within a specific, maximum time," Lavrov said, adding that only with such an approach, would it "be realistic to consider also the status and parameters of an international military presence." That mandate, if given by the United Nations, "should be subordinated to the goal of providing secure and favorable conditions for the Iraqi people to realize their right to determine their future in an independent way." Russian assistance in bringing about such a perspective for Iraq was what the international community could expect, whereas other, "unrealistic approaches" would not find Russia's backing.

Putin Visits Italian Prime Minister

Russian President Putin began a weekend visit to Italian Premier Berlusconi on Aug. 29 at Berlusconi's private villa in Sardinia. For the occasion, a Russian naval squadron composed of a Moskva-class missile-launcher and two other warships arrived Aug. 27 in Sardinian waters. The location was right in front of the U.S. nuclear submarine base at Maddalena island; the Russian squadron docked where the U.S. repair ship Emory Land is usually moored. Exchange visits between Russian and Italian officers were arranged. Such a naval deployment is highly unusual, leading some Italian commentators to say that Putin wanted to show that Russian military forces are alive and well.

Berlusconi and Putin discussed bilateral trade and energy issues, as well as international issues, in preparation for the UN General Assembly and the EU-Russian summit, scheduled for November in Italy. Italian papers reported that Rosario Alessandrello, head of the Italy-Russia Chamber of Commerce, wants the EU and Russia to denominate their trade in euros (instead of dollars).

Breakthrough in Russian-Saudi Diplomacy

A five-year cooperation agreement was signed between Russia and Saudi Arabia Sept. 2, during Saudi Crown Prince Abdullah bin Abdelaziz's visit to Russia. Energy Ministers Igor Yusufov and Al Naimi signed the accord, covering the oil and gas sectors, at a Moscow ceremony attended by the Crown Prince and Russian President Putin—their presence underscoring that both sides view the agreement as "strategic." It was the first-ever visit of such a high-ranking Saudi leader to Russia.

Under the agreement, a joint Saudi-Russian expert working group will explore options for joint ventures in oil and gas exploration and production, and joint research projects on advanced technologies for oil prospecting, output, refining, storage, and transport. Conferences, seminars, and exhibitions will be organized, and the agreement includes consultations on oil prices and marketing.

Four other agreements were signed during the visit: 1) a memorandum on cooperation between the Russian Academy of Sciences and the Saudi Arabian Center for Science and Technology; 2) a memorandum on cooperation between the Russian Chamber of Commerce and Industry and the Council of Saudi Chambers of Commerce and Industry; 3) a memorandum on sports and youth exchange; 4) the formation of a joint expert group for the fight against terrorism.

Furthermore, an investment cooperation agreement was signed among Saudi Oger, Russia's Stroytransgas and Aramco, on joint projects in the exploration of oil and gas fields, production and marketing of oil and gas. Saudi Oger, a leading Saudi firm in the railway sector, is also interested in Russian railway technology, especially for some lines to be constructed in the northern Saudi mineral fields in which Saudi Oger is engaged. The role of Aramco in that is of special interest here, as its business relations with the Western seven oil sisters is at an absolute low, because Saudi Energy Minister Ali al-Naimi (who negotiated the strategic deal with the Russians) has let the Westerners know that Aramco and other Saudi companies will be able to do the job of exploration and production alone, if the pricing and other conditions set by the oil sisters don't correspond to Saudi national interests.

A Vision of Russia as East-West Bridge

Russia could become the East-West transport bridge, wrote Prof. Yuri Scherbanin, vice-president of the Eurasian Transport Union (EATU), in a Sept. 1 RIA Novosti commentary, occasioned by the Third International European Transport Conference. He noted that in the three years since transport specialists of Europe and Asia last met, Russia has increased its international and domestic transport capability. The goal of the upcoming meeting, which opens Sept. 11 in St. Petersburg, is to "tie up Russia's geopolitical interests with those of neighboring states, both East and West, and to integrate more intimately into international transport projects, scheduled by the EEC and UN ESCAP and other international organizations. St. Petersburg will probably bring up the issue of a future common Eurasian transport zone."

Transport costs in Russia are two to three times those in Europe, Shcherbanin wrote, due to vast distances. poor logistics, and technological backwardness. Recent improvements, however, include completion of the electrification of the Transsiberian Railroad, which is now performing better than before, thanks to fiber optic communications. In the Asia-Pacific, transport integration is still behind Europe, but is improving. "International transport corridors (ITCs) are coming into operation, ground transport is getting renewed facilities, and new ports, bridges and tunnels are being built."

He listed international Eurasian transport projects:

*The International Working Group for the Lianyungang, China to Kazakhstan-Russia-Belarus-Poland (the Second Eurasian Continental Bridge), set up in 1999.

*A working three-way transit agreement among Russia, China and Mongolia.

*The Baikal-Amur Mainline (BAM) in Russia has to be revived.

*The North-South ITC project, begun by Russia, India and Iran, and joined by Kazakhstan and Belarus.

Russian-European Aerospace Cooperation on the Rise

The number of European-Russian aerospace cooperation projects is increasing, Russia wire agencies reported Aug. 25. At the MAKS 2003 international aerospace exhibition in Moscow, officials of the European Aerospace and Defense Agency (EADS) said cooperation projects (mostly Airbus-related) are under way with Russian aircraft producers. Among them is the A400M military version of the Airbus, details of which have not yet been made public.

Apart from deals involving EADS, special emphasis is given to the German-Russian contract, signed at MAKS 2003, for five German military spy satellites to be launched in 2005-2007, from the Russian Space Forces' northern site at Plesetsk. The Germans will use these satellites to operate their SAR-Lupe camera, a new kind of radiometric surveillance system. The launches from Plesetsk include the use of the Rokot launch vehicle, a joint project of EADS and Russia's Krunichev rocket-developing agency.

Science Magazine Features Russian Nuclear-Powered Rocket Program

In the context of reporting the Russian announcement of preliminary plans for a manned mission to Mars, with a 2018 tentative launch date, Science magazine of Aug. 15, 2003 reprised the Soviet-era effort to develop a nuclear-powered rocket engine called the IRGIT. The report, leading the News section of the weekly organ of the American Association for the Advancement of Science, may be related to recent statements by President Putin and others, regarding Russian nuclear weapons development. (See InDepth this week, "Russia Reacts to Cheney Nuke-War Policy Threat.")

The unveiling of the manned Mars program, at a June 9-11 meeting in Moscow, was treated with skepticism: "Gorshkov [of the Moscow aerospace firm, Energia] and his Russian colleagues claim that such a mission could be pulled off for anywhere from $14 billion to $20 billion. But many Western experts think that's pure fantasy." The bulk of the article, however, reviewed the secret, Soviet Cold War program to develop a nuclear rocket, which was still going strong in 1987, and evidently got much further than its U.S. counterparts, which were all shelved by the 1970s. The heart of the Russian program was an advanced nuclear reactor facility Baikal-1, which involved testing new forms of nuclear fuel such as carbides of plutonium and uranium. Although barely funded since 1992, Baikal-1 is still operational.

All space missions to date have used chemical-powered rockets, which burn most of their fuel in leaving Earth, and coast the rest of the way to their target. A more energy-dense source, such as nuclear fission, could allow a rocket to be powered the whole way to Mars and back, cutting the round trip time from two years to a few weeks. A U.S. program to develop a nuclear-powered aircraft began before the end of World War II, according to one of the veterans of this secret program by Hughes Aircraft, Dr. Robert J. Moon. This was followed by the 1950s Project Orion to build a rocket engine using pulsed nuclear explosions, killed in the 1960s (see Marsha Freeman's review in 21st Century, Fall 2002), and Project Rover/NERVA to build a rocket-carried reactor, which was killed in 1973.

Gazprom To Join in Kra Isthmus Pipeline Project

The Russian natural gas giant, Gazprom, will participate in a Thailand pipeline project across the Kra Isthmus, Bangkok Business Day reported Aug. 25. The 210-km pipeline will go from Satun on the Andaman Sea to Songkhla in the Gulf of Thailand, with tank farms at either end. Like the proposed Kra Canal, the pipeline will allow faster delivery of oil from the Persian Gulf, and avoid the crowded sea lanes through the Malacca Straits. The $450-million project is now 45% Thai, 45% Omani, and 10% Canadian.

Glazyev Election Coalition Gains Momentum

On Aug. 25, economist and politician Sergei Glazyev announced progress toward forming what he has called a "broad popular coalition in the overall national interest, with participation of many electoral groupings," to gain a dominant influence on the Russian State Duma in December 2003 elections. Glazyev's initiative, centered on the Congress of Russian Communities movement and the Party of Russian Regions, both of which he heads, has been joined by Duma Foreign Affairs Committee Chairman Dmitri Rogozin, former Central Bank head Viktor Gerashchenko, former Commander of the Airborne Forces Gen. Georgi Shpak, Duma security Viktor Ilyukhin, and others.

Viktor Volkonsky, husband of Schiller Institute collaborator Tatyana Koryagina and an expert on the economics of energy systems, has also officially joined Glazyev's initiative. Academician Dmitri Lvov is reportedly closely involved, albeit in the background. The coalition's economic program will include some form of Lvov's proposal to drastically increase state revenues by charging special taxes to raw-materials firms for the exploitation of natural resources, and shifting to a science-driver mode of economic development.

Other supporters of the coalition include the veteran intelligence expert Nikolai Leonov, and publicist and television personality Alexander Krutov, who is closely tied to sections of the Russian Orthodox Church. On Aug. 24, 17 smaller parties and political organizations, including the Party "Regions of Russia," "The Union of Students," the "Association of Social Democrats," and also Alexander Dugin's shadowy "Eurasian Party," signed an agreement to join the coalition. At the press conference with Glazyev, Rogozin declared that 20 more Duma members from various parties would soon join the coalition. Viktor Gerashchenko said he intended to contribute to a greater competence in financial policies, drawing on his 43 years' experience in national and international banking.

Glazyev declared that "the door is still open" to the Communist Party (CPRF), the largest party in Russia. CPRF leader Gennadi Zyuganov has so far rejected Glazyev's initiative, while CPRF publications attack Glazyev for allegedly trying to "split the left" in the interest of "dark forces" in the Kremlin.

Vladimir Gusinsky Arrested In Greece

Businessman Vladimir Gusinsky, one of the first persons to be dubbed an "oligarch" after amassing a fortune during Russia's crime-ridden economic liberalization in the 1990s, was arrested in Greece the evening of Aug. 20, on an international warrant requested by Russia. Gusinsky fled Russia in 2000. When arrested, he was arriving at the Athens international airport on a flight from Tel Aviv. The charges against Gusinsky, who holds dual Israeli and Russian citizenship, include fraud amounting to $250 million, and money-laundering. A security official at the Athens Airport told wire services, "Extradition to Russia is an option. It all rests with the prosecutor and what he will decide."

Afghan Drugs Endanger Russia

Visiting Tajikistan on Aug. 27, Russian drug control chief Viktor Cherkesov urged the international community to put combined pressure on Afghanistan to reduce opium production. On the same day, Russian border guards made record seizures of 260 kg of heroin from 10 drug smugglers, entering from Afghanistan. Cherkesov's deputy, Alexander Mikhailov, said that only 10% of such transshipments are seized. "The heroin attack from the south has become the most acute problem for us," he said. According to Russian figures, the country has 3 to 4 million drug users out of a population of 145 million, and heroin consumption grew 23-fold between 1998 and 2002. About 70% of the heroin in Russia originates in Afghanistan, which accounts for almost three-quarters of world opium production. While Moscow, St. Petersburg, and the Baltic enclave of Kaliningrad have remained the main drug hubs, many smaller cities also now have drug addicts, Mikhailov said.

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