In this issue:

Putin Tours Southeast Asia

'Russia Is a Bridge Between Christendom and Islam'

Putin: No Troops, No Money for Iraq

Putin: Russia Is Where East Meets West

Foreign Ministers of India, China, and Russia To Meet Again

China Wants New Cross-border Railroads To Russia

Putin: No Arm-Twisting on Energy Prices

Russia and Brazil To Cooperate in Space and Aviation

Malaysian Cosmonaut Will Fly With Russians

Moody's Upgrade Fuels New Speculation in Russia

Russian Scientists and Science Impoverished

From Volume 2, Issue Number 42 of Electronic Intelligence Weekly, Published Oct. 21, 2003
Russia and Central Asia News Digest

Putin Tours Southeast Asia

Russian President Vladimir Putin left Moscow Oct. 15, for a nine-day Asian trip. After taking part in the Organization of the Islamic Conference (OIC) summit in Malaysia, he travels to Thailand for the Asia Pacific Economic Cooperation (APEC) summit. At an October briefing on the APEC agenda, Russian Foreign Ministry officials said that Russia was coming to the meeting with new proposals for industrial-sector regional cooperation, such as a "non-ferrous metals initiative" and other plans, as well as an orientation towards Russia's role as a transport bridge between Asia and Europe.

At the same time, Russian papers note that the agenda of the APEC event is not restricted to economic issues. "In particular, Japan would like to discuss the situation in North Korea", writes Argumenty i fakty. "The United States also constantly attempts to politicize APEC's agenda, despite objections from China." The paper reports that Putin's schedule at the APEC summit includes a meeting with U.S. President George W. Bush, as well as with China's President Hu Jingtao.

Putin will return to Moscow via Kyrgyzstan, where he will address an international investment forum and open Russia's military air base in Kant.

'Russia Is a Bridge Between Christendom and Islam'

For the first time, the OIC summit was addressed by a non-member country, when President Putin spoke before the meeting in Malaysia on Oct. 16. Russian national TV carried extensive excerpts from Putin's speech, which began with his expression of gratitude for the invitation, which came thanks to Malaysian Prime Minister Mahathir Mohammad.

"Russia has served as a bridge between the Christian and Islamic civilizations," Putin said, "The past decade was a time of revival of Islamic faith in Russia. Today, we have 100 medrese and other religious schools. The number of mosques exceeds 7,000 today, while in late 1980s there were only 870." His words were greeted with applause.

The Russian delegation included the Presidents of four republics within Russia, where the population is traditionally Islamic: Tatarstan (Mintimer Shaimiyev), Bashkiria (Murtaza Rakhimov), Chechnya (Ahmad Kadyrov) and Kabardia-Balkaria (Valery Kokov); and, some federal officials who hail from these areas: Minister of Property relations Farid Gazizulin (a Tatar) and Jokhan Pollyeva (Turkmen), deputy head of the Presidential staff.

Putin said that terrorism should not be associated with any particular confession, tradition, or way of life. "The attempts to provoke Islamophobia in our country have completely failed," he said, "Russian Moslems are an indispensable part of the nation." On the eve of his trip, Putin met with Patriarch Aleksi II of Moscow and All Russia, who endorsed the Russian President's participation in the OIC summit. Observer status for Russia in the OIC has been under discussion, but, Izvestia reports, is opposed by "a number of Moslem states."

Putin also had bilateral talks with Mahathir, President Musharraf of Pakistan, and President Khattami of Iran.

On Oct. 17, the Arabic-language TV channel Al Jazeera broadcast an interview with Putin, made at the OIC meeting. He reiterated that Russia opposes equating any religion to terrorism, and thanked OIC and Arab League observers for their work in Chechnya. "Two-thirds of Russia is in Asia," he said, "Our Orthodox Church is the eastern flank of Christianity, with specific features which are similar to some Islamic traditions, and with very friendly relations with Russia's other traditional religion."

Putin: No Troops, No Money for Iraq

In his Al Jazeera interview, President Putin said, about the differences between Russia's and the USA's stances on Iraq: "We assumed a rather tough stand. I do not think it was pleasing for our American partners, but it was consistent, predictable, and absolutely honest." Regarding the United Nations, he said: "If all countries easily agreed to the policy pursued by the United States with regard to Iraq, the UN should have been disbanded right away. Who needs an organization where no one can express his opinion, where no one has the courage, or the possibility to defend his opinion?"

Regarding the latest UN resolution, which Russia supported, Putin made clear it doesn't mean very much. "The new resolution is another step forward," he said, because it "increases the role and the importance of the UN in the Iraqi settlement, but does not create the necessary conditions for the full-scale participation of the UN in the settlement.... Therefore, the Russian military contingent is unlikely to be sent to Iraq, as well as financial and material resources for the restoration of the country, since the country does not have proper conditions."

Putin highlighted one part of the resolution, which stipulates that the military presence may remain only until a government is formed. A legal government could turn to the UN, to request "to prolong the term of the military contingent presence in the country. It is only the UN Security Council that decides whether to prolong the term or not."

Putin: Russia Is Where East Meets West

Rudyard Kipling was wrong to say "never the twain shall meet," wrote Vladimir Putin in an Oct. 10 Wall Street Journal op-ed headlined "Where East Meets West." Without Russia's active and equal participation in international affairs, he declared, not a single major global or regional problem could be solved. Russia's foreign policy now focusses "on developing relations in the priority vectors of Europe and the Asia-Pacific region." For example, Russia is deepening its cooperation with its partners in the Asian Pacific Economic Cooperation Forum (APEC), which it joined in 1998.

Foreign Ministers of India, China, and Russia To Meet Again

Indian External Affairs Minister Yaswant Sinha told The Hindu in an exclusive interview, published Oct. 11, that the Foreign Ministers of India, China, and Russia will soon meet again, in Russia. He said the proposal was floated by Russian Foreign Minister Igor Ivanov at their recent three-way meeting—the second such—during the UN General Assembly in New York, and accepted by the Chinese Foreign Minister, Li Zhaoxing.

Sinha said, "We have set the stage for greater understanding and cooperation. We agreed that on Iraq and United Nations reform, our Permanent Missions in New York will be in close touch and work together.... This time the atmospherics were very good. No contentious issues were raised. On whether the trilateral cooperation could be elevated to summit level, Sinha replied: "We haven't thought of it so far.... Let the stage be reached. These are things on which we should move with caution, patience and deliberation."

China Wants New Cross-border Railroads To Russia

The Russian Far Eastern Railway announced Oct. 11 that China wants to build new rail lines across the border between the two countries, Itar-Tass reported. Russia considers the proposal for a railroad from Dunin to Ussuriysk (near Vladivostok) the "most interesting." This rail line would make it possible to ship coal from northeastern China to the Russian seaports, for delivery to Asia and the Pacific Rim.

Another proposed project would link China's Mishan, near Lake Hasan in Heilongjiang province, with Turiy Rog in Russia. Turiy Rog is already connected with the Trans-Siberian Railroad. Only 12 additional kilometers of rail line have to be built, to link it to China, which would then make this rail line profitable.

Putin: No Arm-Twisting on Energy Prices

The Eighth European Gas Conference began in Paris, Oct. 13, with "creation of a single economic space between the EU and Russia" at the top of the agenda, according to an EU Commission spokesman. The discussion will focus on "long-term deals."

The issue of the terms of energy-resource trade and pricing has become very hot in recent weeks. In remarks to Russian and German businessmen made Oct. 9 in Yekaterinburg, where he met with German Chancellor Gerhard Schroeder, Russian President Putin said that Russia's application to joint the WTO has been stymied by WTO demands that Russia raise domestic energy prices to international levels. The EU has also called on Russia to adopt such measures, which Putin said would mean "a catastrophe for the Russian economy." "They tried to twist Russia's arm,' he remarked, "but nothing came of this. Russia has strong arms now."

The same day, however, Izvestia reported what it called "a tectonic change," namely that the Russian natural gas company, Gazprom, made a concession in its recent bilateral agreement with the Italian energy company ENI. This document allows ENI to resell Gazprom's gas to other European companies, in exchange for ENI's go-ahead for other Italian companies besides itself to strike deals with Gazprom. Izvestia then extrapolates, suggesting that the liberalization of foreign trade is also a first step towards deregulation of the domestic natural-gas market—a notion directly contradicted by Putin's remarks.

Russia and Brazil To Cooperate in Space and Aviation

Russia and Brazil consider themselves strategic partners, and intend to expand cooperation in space and aircraft industries, the defense ministers of the two countries announced at a joint press conference given in Brasilia Oct. 11, at the conclusion of a visit by Russian Defense Minister Sergei Ivanov to Brazil. The two nations had signed a defense cooperation accord in 2002, and continuing this military and military-technological cooperation, particularly in the space and aircraft industries, was the primary topic of Ivanov's visit.

Ivanov announced that the high-level Russian space team sent to Brazil to help investigate the cause of the explosion in August of Brazil's VLS rocket, would stay as long as required to find the cause. The investigation could take months, Defense Minister Jose Viegas noted. The two also discussed possible Russian assistance in manufacturing liquid-fuel carrier rockets. Brazil's VLS rockets have all been propelled by solid fuel, which is more flammable than liquid rocket fuel. Viegas reported that Brazil had been working on the development of liquid fuel propellants before the accident. "Russia has vast experience in developing and using such carriers, and we do not exclude the possibility of mutual cooperation in the development of spacecraft," Ivanov commented. Viegas expressed his thanks for the Russian assistance in the investigation, calling its "indicative of the high level of cooperation between Russia and Brazil."

Viegas said that Russian aircraft companies Sukhoi and MiG, which are participating in the bidding for procurement of advanced fighters for the Brazilian Air Force, have realistic chances to win, Pravda.ru reported.

Malaysian Cosmonaut Will Fly With Russians

The Russians will train and fly a Malaysian cosmonaut as part of a deal for Malaysia to buy Russian arms. Malaysian Deputy Defense Minister Mohammad Shafie Apdol told his nation's Parliament on Oct. 9, that the deal has been finalized for Russia to buy $300 million worth of palm oil, and will train and fly a cosmonaut from Malaysia as part of a $1 billion deal, in which Malaysia will buy 18 Sukhoi 30-MKM fighter jets. Payment will be made over five years, with the fighters due for delivery in 2006-2007. Malaysia is the world's largest palm-oil producer, accounting for about half of world output.

Prime Minister Mahathir has promoted bringing Malaysia into the high-technology age, reflected in the country's interest in cooperation in space flight. Russia, and the Soviet Union before it, have made available their "guest cosmonaut" program for decades, to both provide foreign currency and promote political relations with nations.

Moody's Upgrade Fuels New Speculation in Russia

The rating agency Moody's has upgraded Russian state debt two notches to Baa3, which is so-called "investment grade" and the highest rating Russia has ever had. The rating allows various institutional investors, like pension funds, to buy Russian paper. Together with continuing mania over possible foreign acquisition of large Russian companies, this drove the Moscow stock market, the RTS, to its all-time highs during the week of Oct. 13—above the levels that preceded the 1998 government bond default and stock-market crash.

In addition to continuing speculation over an ExxonMobil takeover of Yukos Oil (despite President Putin's cautionary statements concerning such a deal), Russian papers report that Danone, the French food company, wants to acquire Wimm Bill Dann Food Products, Russia's largest producer of milk and juices. But such a takeover would require changes in Russian antitrust laws, reported Vedomosti of Oct. 9. Such deals bring new investment and technology into Russia, but also increase the influence of transnational capital—"which is hard to deal with."

Russian Scientists and Science Impoverished

The latest Russian Nobel laureate in physics, Vitali Ginsburg, age 87, gave an interview to Vedomosti of Oct. 8, in which he said he would give the prize money to his grandsons. Still, he admitted that he needs money, too: "My salary today is 2,700 rubles a month" ($80).

Vedomosti wrote that scientific discoveries made by Lev Landau, Vitali Ginsburg, Igor Tamm, and other top Soviet physicists, have created a market with an annual turnover of $10 billion. Medical equipment, based on the theory of superconductivity, saves tens of thousands of lives. "The Nobel Prize for Ginsburg and Abrikosov is very favorable for the international reputation of Russian science", Interros vice president Sergey Aleksashenko told Vedomosti. "But until the state resumes investments in applied science, new achievements are unlikely."

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