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Newsline - August 8, 2006


RUSSIA WANTS UN RESOLUTION THAT LEBANON CAN ACCEPT
Russian Ambassador to the UN Vitaly Churkin said in New York on August 7 that "it is obvious to us that a draft resolution that fails to satisfy the Lebanese side should not be adopted [by the Security Council] because it will only further escalate the violence," RIA Novosti reported. He was referring to the draft resolution sponsored by the United States and France on the current Middle East crisis, which Russia has endorsed (see "RFE/RL Newsline," August 7, 2006). Churkin added that "intensive efforts...are being made...to try to make the resolution more acceptable to Lebanon." He declined to say how long the "contacts and consultations" might take. Churkin noted that "the Lebanese government is demanding a clear resolution that Israel will withdraw from southern Lebanon shortly after the hostilities are over." The draft, however, "envisions a political process" with an Israeli withdrawal at a later date, he added. PM

KREMLIN SLAMS U.S. SANCTIONS...
Kremlin spokesman Dmitry Peskov condemned on August 8 the recently announced U.S. sanctions against Russia's main arms exporter, Rosoboroneksport, and the aircraft manufacturer Sukhoi for alleged violations of the Iran Nonproliferation Act of 2000, Reuters reported (see "RFE/RL Newsline," August 7, 2006). He said that "this looks like unfair [business] competition. It was an unfriendly act towards Russia and was not done in a spirit of cooperation. If we are to speak about possible consequences of this act for bilateral relations, of course it has not contributed to a further strengthening of the partnership. Among other things, we cannot rule out further negative consequences for this relationship." On August 7, Defense Minister Sergei Ivanov dismissed the charges, while the Foreign Ministry called the sanctions "unacceptable." Sergei Chemezov, who heads Rosoboroneksport, said that "the sanctions will in no way affect [his company] because we have no contracts with the United States on arms supplies or purchases of any weapons by them." He added that "the sanctions are a purely political action." Vyacheslav Bresht, who is co-owner of VSMPO-Avisma, which Rosoboroneksport is seeking to acquire, said that his company's sales of titanium to Boeing will not be effected because Boeing is a private firm, while the sanctions apply only to U.S. government agencies. The light metal is in demand by aircraft manufacturers, who seek to build lighter planes that will consume less fuel. PM

...AS SOME SEE VENGEFULNESS...
The Moscow daily "Izvestia" argued on August 7 that the U.S. sanctions against the two Russian firms amount to "almost an economic declaration of war against Russia." Commentator Pavel Felgengauer wrote in "Novaya gazeta" of August 7-9 that the sanctions are in retribution for recent tough talk against U.S. interests by two of President Vladimir Putin's "partners." Felgengauer referred to comments by Iranian President Mahmud Ahmadinejad about destroying Israel and by Venezuela's Hugo Chavez about using Sukhois to sink U.S. aircraft carriers in the Caribbean. The commentator noted that the two Russian companies do little direct business with the United States. He added, however, that they nonetheless stand to lose "billions" because they will not be able to use U.S. banking services or their New York bank accounts to process deals funded in dollars. The two companies will now have to use indirect alternative channels, which are more expensive. Felgengauer noted that Rosoboroneksport is run by Putin's former colleagues in the KGB and that the Kremlin will accordingly regard the sanctions as an insult to Putin, who appointed them. PM

...AND OTHERS SAY WASHINGTON IS SHORT-SIGHTED
RIA Novosti's Viktor Litovkin suggested on August 7 that the U.S. sanctions against two Russian firms are in retaliation for Russia's recent $3 billion arms deal with Venezuela. Litovkin added that Sukhoi stands to lose because it has been working with Boeing to develop a 100-seat regional aircraft, and Rosoboroneksport will most likely lose an expected $200 million contract for Kalashnikovs for the Iraqi military and police. He suggested that the U.S. State Department and some unnamed "conservative politicians in the White House and the U.S. Congress" are behind the "undeclared trade war on Russia." Litovkin added that the dispute "will not allow American firms to make the short list of Gazprom's partners in the Shtokman project" to develop gas fields in the Barents Sea and thereby ease U.S. dependence on Venezuelan hydrocarbons. PM

LITHUANIA SAYS RUSSIA IS DELAYING PIPELINE REPAIRS
Lithuanian officials said on August 7 that Russia is holding back on repairs to a section of the Druzhba Pipeline that provides crude to the Mazeikiu oil refinery, which is the only refinery in the Baltic states and which a Polish firm is about to acquire at the expense of Russian interests, mosnews.com reported (see "RFE/RL Newsline," May 30, July 12, and August 1 and 3, 2006). Arunas Jievaltas, a senior Lithuanian diplomat in Warsaw, noted that "the timing of this accident [on the pipeline] is very strange," coming just as a Polish firm was concluding negotiations for the purchase. He added that "some would say that Russia is trying to show Poland the price it must pay for obtaining [the refinery]. It seems that every step that is taken by a Russian energy company is motivated by politics." In related news, Modest Kolerov, who is the Kremlin official in charge of relations with CIS countries and other former Soviet states, told "Novaya gazeta" of August 7-9 that his project in 2003 to stop oil deliveries to the Latvian port of Ventspils was not a power play. He argued that "Russia is not abusing its leverage. It is protecting its national interests. If special transit relations provide...subsidies for Russophobes, Russia is bound to question the need for these relations." PM

PUTIN CONGRATULATES UKRAINIAN LEADERS
President Putin telephoned his Ukrainian counterpart Viktor Yushchenko on August 7 to congratulate him for ending the political stalemate in Ukraine by naming Viktor Yanukovych, leader of the pro-Moscow Party of Regions, to head the cabinet, Interfax reported. Putin subsequently phoned Yanukovych to congratulate him on his election. Both Putin and Yanukovych said that they want to start "detailed discussions on Russian-Ukrainian issues" soon (see "RFE/RL Newsline," August 7, 2006). PM

NGO CALLS SENTENCING OF SCIENTIST 'OUTRAGEOUS'
Moscow Helsinki Group head Lyudmila Alekseyeva told Interfax on August 8 that a Nizhny Novgorod court's decision to give physicist Oskar Kaibyshev a six-year suspended sentence for allegedly spying for South Korea was a disappointment in that he was convicted but also a relief in that he will not go to jail. She added that "nevertheless, this decision ranks among other outrageous verdicts allegedly linked to espionage. I don't know why [the authorities] stage such trials. Is it an attempt to defend their reputation? These are trials that [serve to] ruin science, not only the fates of individual people." The Federal Security Service (FSB) initiated the case in 2005 after detaining a South Korean delegation that allegedly carried classified documents supplied by Kaibyshev. The FSB insisted that the trial be held behind closed doors lest "secrets" be divulged to the public. PM

ARMENIAN OPPOSITION FIGURE DEFECTS TO JOIN PRO-GOVERNMENT PARTY
Victor Dallakian, a prominent member of the Armenian opposition Artarutiun (Justice) bloc, defected to join a pro-government party, RFE/RL's Armenian Service reported on August 7. In a letter sent to opposition bloc leader Stepan Demirchian over the weekend, Dallakian announced his intention to join the Prosperous Armenia party founded in January by millionaire businessman Gagik Tsarukian, a close associate of President Robert Kocharian. The party has grown quickly and has an estimated 200,000 members and 300 offices throughout Armenia. Although rumors of the defection were rampant over the past few months, the move stands in contrast to Dallakian's long record of open and heated criticism of the Kocharian government, which he has denounced as a "junta" and a "clan." Dallakian also helped to lead the Armenian opposition's unsuccessful campaign of street protests against the government in spring 2004. RG

NEW REPORT REVEALS RARITY OF ARMENIAN COURT ACQUITTALS
A report released on August 7 by Armenia's highest criminal court revealed that defendants involved in criminal cases were acquitted in under 1 percent of court rulings, according to RFE/RL's Armenian Service. The report, released by Court of Cassation Chairman Hovannes Manukian, detailed that, of some 1,500 criminal rulings in the first half of this year, courts issued a mere four rulings acquitting defendants of criminal charges. In a statement, Manukian admitted that the reported low rate of acquittals questions the independence and fairness of the judicial system. That admission was echoed in an April 2005 report of the Office of the State Human Rights Defender, which found that court bias in favor of state prosecutors was "constantly evident." RG

ARMENIAN STATE REGULATORY BODY ANNOUNCES INVESTIGATION OF 'SUSPICIOUS' CAR IMPORTS
Armenian State Commission on Protection of Economic Competition spokeswoman Armine Udumian announced on August 7 that the launch of an investigation of "suspicious" discrepancy between car-imports statistics released by customs officials and private car dealerships in Armenia, according to RFE/RL's Armenian Service. Udumian explained that the probe was triggered by a glaring difference between the number of car imports declared by the 43 officially registered car dealerships and statistics compiled by the State Customs Committee. But she also noted that the reported discrepancy may not necessarily indicate large-scale tax evasion on the part of the dealerships, adding that a large number of the cars imported into Armenia may be registered in the name of private individuals, indicating that "dealers might thus be avoiding additional paperwork." RG

ARMENIA REGAINS LIMITED INTERNET SERVICE
After a crucial fiber-optic cable was disrupted causing a widespread Internet outage, Armenia regained on August 7 limited Internet service via satellite, Regnum reported. A spokesman for the country's ArmenTel telecommunications provider, Hasmik Chutilyan, reported that although Internet service has been partially restored, connections remain slow due to limited bandwidth available from the satellite link. She added that repairs to the damaged undersea fiber-optic cable in the Black Sea are expected to be completed within 10 days. Internet connectivity in Armenian is vulnerable to any external disruptions to its fiber-optic network, which is linked to the Georgian and Iranian networks to the north and south, respectively (see "RFE/RL Newsline," August 7, 2006). RG

AZERBAIJANI ISLAMIC PARTY ACTIVISTS ARRESTED IN ANTI-ISRAELI DEMONSTRATION
Several activists of the Islamic Democratic Party of Azerbaijan were arrested on August 7 by police during a demonstration held in front of the Israeli Embassy in Baku, Turan reported. Police detained Islamic Democratic Party leader Tahir Abbas and three party activists for staging an "unsanctioned public gathering." The demonstration is the latest in a series of rallies protesting Israeli actions in Lebanon and follows similar pickets in front of the UN office and the embassies of both Israel and the United States in Baku (see "RFE/RL Newsline," July 28, August 2, and 4, 2006). The small Islamic Democratic Party has also been involved in protests over U.S. policy in Iraq (see "RFE/RL Newsline," June 11, 2004). RG

MIGRATION ORGANIZATION OFFICIAL WARNS OF HUMAN TRAFFICKING IN AZERBAIJAN
The head of the Baku office of the International Organization for Migration (IOM), Ahmad Sirinov, warned on August 6 of Azerbaijan's growing role as a destination for international human-trafficking networks, ANS-TV reported. The IOM official added that "hundreds of people are trafficked into Azerbaijan each year" and called on Azerbaijani authorities to devote greater resources to combating the problem. Sirinov noted that a majority of the victims of human trafficking come from Central Asia, but also include some Russian and Georgian women. RG

GEORGIA TO DISPATCH REINFORCEMENTS AFTER POLICE UNIT ATTACKED IN SOUTH OSSETIA
Georgian Interior Minister Vano Merabishvili announced on August 7 that reinforcements will be dispatched to South Ossetia after an attack wounded three Georgian policemen, Rustavi-2 TV reported. Merabishvili stated that the attack, targeting a small police unit stationed in the village of Avnevi in a Georgian-controlled area of South Ossetia, was conducted by a uniformed Ossetian force. The interior minister stated that the attack was carried out on "a direct order from Moscow" and added that the police unit will be reinforced with the deployment of a special-purpose detachment. Georgian State Minister for Conflict Resolution Merab Antadze termed the attack a "provocation" aimed at escalating tension in the area, Caucasus Press reported. RG

GEORGIAN JUSTICE MINISTRY TO EXTEND PRESENCE IN KODORI GORGE...
Georgian Justice Minister Gia Kavtaradze announced on August 7 plans to establish four Justice Ministry agencies in the Kodori Gorge, according to Caucasus Press and Imedi television. The offices, to be fully operational by September, are being established to support the legal authority of the Abkhaz government in exile, which was recently transferred from Tbilisi to the Kodori Gorge (see "RFE/RL Newsline," July 28, 2006). RG

...AS GEORGIAN DEFENSE MINISTER ANNOUNCES PLANS TO FORM NEW ARMED UNIT IN KODORI GORGE
After spending three days in the Kodori Gorge, Irakli Okruashvili said on August 7 that a new armed unit comprised of local volunteers is to be formed for service in the gorge, Georgian Public Television reported. Okruashvili and his deputy Mamuka Kudava added that qualified "young people living in the gorge are being offered an opportunity to serve in the armed forces after completing a period of training." RG

KAZAKH FOREIGN MINISTRY DENIES REPORT OF ARMS SHIPMENT TO SOMALIA...
Foreign Ministry spokesman Ilyas Omarov told a news conference in Astana on August 7 that Kazakhstan has never supplied weapons to Somalia, Interfax-Kazakhstan reported. "In connection with media reports of an illegal transportation of military cargo to Mogadishu airport by an IL-76 aircraft, allegedly bearing the emblem of Kazakhstan, the Foreign Ministry states that Kazakhstan has no connection to this, and that it has never supplied weapons to that country." DK

...AND SUGGESTS KILLING OF FRENCH JOURNALIST UNRELATED TO WORK
Spokesman Omarov said the killing of French journalist Gregoire Debourgues in Almaty last week (see "RFE/RL Newsline," August 4, 2006) had nothing to do with Debourgues's work as a journalist, Interfax-Kazakhstan reported. "The Foreign Ministry believes that this tragic incident was in no way connected with [Debourgues'] professional activities," Omarov said. He added that Kazakh authorities are keeping the French Embassy informed of the murder investigation as it proceeds. DK

KYRGYZ, UZBEK SECURITY SERVICES KILL THREE SUSPECTED EXTREMISTS IN OSH...
Security forces from National Security Services (SNB) of Kyrgyzstan and Uzbekistan killed three suspected members of the Islamic Movement of Uzbekistan (IMU) in the southern Kyrgyz city of Osh on August 6, Kabar reported the next day. "On August 6, 2006, in the city of Osh, as a result of a special counterterror operation by the National Security Service of Kyrgyzstan, a group of three fighters from the Islamic Movement of Uzbekistan has been destroyed," Kyrgyz SNB spokesman Nurbek Tokbaev told RFE/RL's Kyrgyz Service. Kabar reported that security forces from the two countries together carried out a special operation to detain a group of suspected IMU members with ties to a May border incursion (see "RFE/RL Newsline," May 15, 2006) and the murder of eight police officers in Tajikistan. The report said that security forces confiscated a Kalashnikov rifle, ammunition, several grenades, and extremist literature from the car in which the three had been riding. DK

...INCLUDING PROMINENT IMAM IN KYRGYZSTAN...
Muhammadrafiq Kamalov (also known as Rafiq Qori Kamoluddin), the imam of Kara-Suu's Al-Sarahsiy Mosque, was one of the three men killed in the operation, akipress.org reported, citing confirmation from the imam's brother, Sodiq Kamolov. An RFE/RL correspondent who saw the body said that it bore at least four bullet wounds. Kamoluddin had allowed members of the banned movement Hizb ut-Tahrir to pray at his mosque, although he disavowed involvement with the group. Nevertheless, he stressed that he did not consider its members terrorists. Kyrgyzstan's SNB briefly detained Kamoluddin for questioning in May (see "RFE/RL Newsline," May 30, 2006). RFE/RL reported that hundreds of mourners gathered outside Kamoluddin's home on August 7 to pay their final respects. DK

...AS HIZB UT-TAHRIR CONDEMNS KILLING
Hizb ut-Tahrir Britain condemned the killing of Kamoluddin in a statement issued in London on August 7, calling it "the latest chapter in Kyrgyzstan and Uzbekistan's brutal campaign against Muslims who dare to speak out against the tyranny and oppression of the Central Asian regimes." The statement quoted Hizb ut-Tahrir Britain media representative Imran Waheed, who commented, "We condemn the extrajudicial assassination of Imam Rafiq Qori Kamoluddin by the Kyrgyz and Uzbek security apparatus. The killing of imams and Islamic activists has been the practice of the Uzbek regime for the last decade and it now seems that Kyrgyzstan is following the example of the Karimov regime." DK

TAJIK NEWS AGENCY RECEIVES E-MAILED HIZB UT-TAHRIR LEAFLETS
Avesta reported on August 7 that it has received two e-mailed pamphlets from the banned Islamist organization Hizb ut-Tahrir. The first, dated July 20, condemns the transfer of the Nurek space surveillance center to Russia, arguing that the center should remain in Muslim hands. The second, dated July 25, charges that China and Russia are using the Shanghai Cooperation Organization (SCO: China, Kazakhstan, Kyrgyzstan, Russia, Tajikistan, Uzbekistan) to thwart a Muslim revival in Central Asia and China. The news agency noted that this appears to be the first time Hizb ut-Tahrir in Central Asia has used e-mail to spread its message directly to media organizations in Tajikistan. DK

TAJIKISTAN, INDIA INK COOPERATION AGREEMENTS
Tajik President Imomali Rakhmonov met with Indian Prime Minister Manmohan Singh in New Delhi on August 7, Tajik television and IANS reported. The two leaders discussed bilateral relations and oversaw the signing of agreements on energy security, science and technology, cultural exchange, and foreign office consultations, IANS reported. On energy security, the two countries will explore greater cooperation in Tajikistan's hydropower sector, with possible Indian assistance in the reconstruction of the Varzob 1 hydropower station. DK

TURKMEN LEADER READIES MERCEDES, JEEPS FOR OFFICIALS
President Saparmurat Niyazov told a cabinet meeting on August 4 that ministers who "work well during the cotton harvest" will receive a Mercedes as a gift from the president, Turkmen television reported. Regional and district governors who meet cotton production targets will receive jeeps. DK

UZBEKISTAN FILES CRIMINAL CHARGES AGAINST U.S.-BASED NGO
Prosecutors in Tashkent have filed criminal charges against the Uzbekistan offices of U.S-based NGO Winrock International for unauthorized publishing activities, Interfax reported on August 7. The charges focus on a book on women and Islam that was published under the NGO's auspices. An Uzbek court recently ruled to shut down the NGO's Uzbekistan offices (see "RFE/RL Newsline," July 27, 2006). DK

LATVIA CONTINUES TO DEMAND 'PROPER ANSWERS' FROM BELARUS OVER DIPLOMATIC ROW
The Latvian Foreign Ministry is waiting for more explanations from Minsk over a search of the apartment of Latvian diplomat Reimo Smits in Minsk last month (see "RFE/RL Newsline," July 26, 2006), Belapan reported on August 7. Latvian Foreign Ministry spokeswoman Inga Saleniece told journalists that the reply Riga received from the Belarusian Foreign Ministry last week was unsatisfactory. Saleniece added that the Latvian minister will not receive the new Belarusian ambassador to Latvia, Alyaksandr Herasimenka, until Minsk gives "proper answers" regarding the incident involving Smits. During the search, the Belarusian police allegedly found videocassettes and CDs containing pornographic material. Belarusian Interior Minister Uladzimir Navumau said that Smits faces a pornography-related charge in Belarus. The Latvian Foreign Ministry accused Minsk of violating the 1961 Vienna Convention On Diplomatic Relations and sent a note of protest demanding an explanation. Last week, Latvia expelled Dzmitry Krayushkin, the first secretary at the Belarusian Embassy in Riga, for "performing actions that are incompatible with the status of a diplomat," and recalled its ambassador to Belarus, Maira Mora, for consultations. JM

UKRAINIAN PRESIDENT DECREES THREE MULTINATIONAL MILITARY EXERCISES
President Viktor Yushchenko has signed a decree that will allow three military exercises involving the participation of foreign troops to be held in Ukraine in 2006, Interfax-Ukraine reported. The decree follows the Verkhovna Rada's authorization on August 4 of the South 2006 maneuvers, which are to include the participation of Moldovan troops in August in Mykolayiv Oblast; the Cossack Steppe exercise involving British and Polish troops in Zhytomyr Oblast in September; and an exercise involving Slovak soldiers in Lviv Oblast in September. Originally, Kyiv was planning to hold six multinational military exercises in Ukraine, including the Sea Breeze 2006 maneuvers with a sizable NATO contingent. However, the Verkhovna Rada failed to authorize these exercises in February. Moreover, the visit of a U.S. naval ship in the Crimean port of Feodosiya in May sparked a series of anti-NATO protests in Ukraine, with several Ukrainian regions declaring themselves to be "NATO-free territories." JM

BUSH, PUTIN CONGRATULATE UKRAINIAN PRESIDENT ON NEW GOVERNMENT
U.S. President George W. Bush has congratulated Ukrainian President Yushchenko on the formation of Prime Minister Viktor Yanukovych's government, Interfax-Ukraine reported on August 7, quoting the Ukrainian presidential press service. Bush reportedly pledged in his message that the United States will continue to help Ukraine strengthen its sovereignty, democracy, and prosperity. Russian President Vladimir Putin telephoned Yushchenko on August 7 to congratulate him on the settlement of the political crisis in Ukraine with the formation of Prime Minister Yanukovych's cabinet. JM

SERBIA CLAIMS VIDEOTAPE PROVES CROATIAN WAR CRIMES DURING OPERATION STORM...
Serbian officials claim they are in possession of a videotape showing Croatian military units committing war crimes against Serbian civilians, B92 reported in August 7. The abuses in the video allegedly took place during Operation Storm in August 1995, during which Croatian forces completed their conquest of the Serbian-held Krajina region. Serbian officials said that deputy prosecutor Dragoljub Stankovic plans to turn a copy of the videotape over to Carla Del Ponte, chief prosecutor of the International Criminal Tribunal for former Yugoslavia. Serbian Interior Minister Dragan Jocic, meanwhile, called his counterparts in Croatia and Bosnia-Herzegovina and asked them to arrest the perpetrators. Jocic compared the videotape to one that surfaced last year showing Serbian paramilitaries killing Muslim men near Srebrenica in July 1995 (see "RFE/RL Newsline," June 3 and 6, 2005). BW

...AS SERBIAN PRESIDENT DEMANDS ACTION FROM CROATIA
Boris Tadic said on August 7 that he expects Croatian officials to condemn the war crimes allegedly documented on the Operation Storm videotape, B92 reported the same day. "I am demanding from all the political structures in Serbia and the regional structures to condemn the war crimes, because this is a prerequisite for implementing normal and good-neighborly relations" Tadic said. Croatian Interior Minister Zlatko Mehun said that the footage has been forwarded to the state prosecutor's office. "If this proves to be evidence of a punishable act, it will be processed, just as it has been done up until now, regardless of ethnicity." Mehun said. But Croatian government spokesman Ratko Macek said the footage appears to have been shot in Bosnia-Herzegovina and does not show Croatian soldiers committing atrocities. BW

RUSSIA SEEKING TO INCREASE INVESTMENTS IN SERBIA
During a visit to Belgrade on August 7, Russian Emergency Situations Minister Sergei Shoigu said Moscow is prepared to step up its investments in Serbia and stressed the importance of bilateral relations, B92 and Beta reported the same day. Accompanying Shoigu were representatives from Russian companies, including the oil giant LUKoil, who are interested in investing in Serbia. During a meeting with President Tadic, Shoigu said relations between the two countries have been developing "more dynamically" in recent years. "The Russian side is showing absolute openness and this is very good news. A fast and effective reaction regarding this is now needed from our government." Tadic said. BW

RIGHTS GROUP WARNS OF RISK OF ETHNIC CLEANSING IN KOSOVA
The London-based Minority Rights Group International said in a report issued on August 7 that unless greater steps are taken to assure minority rights, Kosova could again be the site of "ethnic cleansing," Reuters reported the same day. The report said that after seven years under international governance, Kosova's ethnic communities have become deeply segregated, leading to a situation that is "little short of disastrous." It also criticizes the United Nations for failing to take adequate measures protect the rights of Kosova's mainly Serbian minority. "The danger is that the patterns of segregation that are accepted in Kosovo, and that lead to the terror of ethnic cleansing, will be enshrined in the constitution and will be played out again over the next decade," the report says. BW

MOLDOVAN SPARKLING WINE PRODUCTION DOWN BY MORE THAN HALF DUE TO RUSSIAN BAN
Moldova has reduced its production of sparkling wine by 53 percent in the first half of 2006 compared to the same period last year due to a Russian ban on wine imports from the country, Basa reported on August 5. In a move widely seen as political retaliation for Chisinau and Tbilisi's pro-Western foreign-policy orientation, Russia imposed a ban on wine imports from Moldova and Georgia in March (see "RFE/RL Newsline," March 28, 2006). Russia accounted for 80 percent of Moldovan wine exports, ITAR-TASS reported. Prime Minister Vasile Tarlev said Chisinau has lost $21 million due to the ban and Moldova's National Statistics Bureau announced on July 31 that industrial output shrank in the first half of 2006 (see "RFE/RL Newsline," July 31 and August 3, 2006). Moldova's natural grape wine production also fell by 45 percent and cognac production fell by 25 percent in the first half of 2006. BW

IRANIAN GOVERNMENT BALKS AT GASOLINE RATIONING
Balancing economic and fiscal responsibility with campaign promises can be a problem for any elected official. For Iran's populist president, Mahmud Ahmadinejad, this has proven especially difficult. Ahmadinejad frequently tours the provinces and lends a sympathetic ear to locals. But when it comes to the public consumption of artificially cheap gasoline, his government has found further funding more palatable than taking unpopular steps like rationing or ending subsidies.

Earlier this year, Iran's central government began considering gasoline rationing and other measures that affect gasoline use. The development was largely motivated by fiscal concerns. Consumers currently pay $0.09 per liter because the government subsidizes gasoline. But Minister of Economy and Finance Davud Danesh-Jafari has estimated that a liter costs more than six times that amount, or 5,000 rials (about $0.57), "Farhang-i Ashti" reported on July 11.

Drivers used 67 million liters a day in the last Iranian year, and the government expects they will use 73 million liters daily in the current year. This is not high in comparative terms. According to the U.S. Energy Information Administration, gasoline consumption is well below that in the United States, Japan, or China, to name a few.

But while Iran is a major oil exporter, its refineries cannot meet domestic demand. They can only refine 60 percent of the gasoline Iranians use, and must import the rest. The situation is further complicated by the smuggling of cheap gasoline from Iran to neighboring states, where it can be sold at a profit.

At the end of June, speaker of parliament Gholam Ali Haddad-Adel announced that Iran's legislature had approved gasoline rationing -- as called for in the executive branch's annual budget. Haddad-Adel also made it clear that he and his colleagues recognize how unpopular rationing would be. He said cooperation was continuing with the government "to find the best way to economize" within an appropriate time frame, Islamic Republic of Iran New Network television reported on June 29.

It soon became clear that the possibility of a public backlash had stayed the government's hand. During President Ahmadinejad's discussion of economic affairs with cabinet members and provincial governors-general on July 9, he dismissed rumors that there were imminent plans to increase gasoline prices through rationing, Islamic Republic News Agency (IRNA) reported. He also reassured them that "if the government decides to ration gasoline," its decision will be "transparent and announced to the nation with the aim of controlling [its] excessive use."

The same day, Deputy Interior Minister for Development Affairs Seyyed Mehdi Hashemi called energy management a major aspect of the meeting, according to Mehr News Agency. He said fuel subsidies cost the government $13 billion annually. Hashemi added that a committee consisting of a presidential envoy, the cabinet secretary, and the head of the Management and Planning Organization will soon address the subject of gasoline. He pledged that legislation will be introduced to the parliament for approval in the coming year.

The legislature's Budget and Planning Committee also met the same day in early July to discuss the possibility of gas rationing, Fars News Agency reported. The committee announced that lawmakers have determined that gasoline requirements for the latter half of the year will be met through imports -- obviating the need for rationing.

But a little more than a week later, government spokesman Gholam-Hussein Elham said the government has not yet reached a decision on gasoline rationing. The spokesman added that the government intends to promote the use of cars that burn natural gas and facilitate the use of public transport, Mehr News Agency reported on July 18. Elham said the government also wanted to get old, inefficient cars off the road.

Eventually, the government decided not to take the unpopular step of rationing gasoline. Kamal Daneshyar, head of the parliamentary Energy Committee, said the government will ask to withdraw $4 billion from Iran's foreign-currency reserves to spend on fuel imports, "Aftab-i Yazd" reported on July 23.

Hussein Nejabat, another member of the Energy Committee, said the government has also decided to change the current gasoline-distribution system, "Aftab-i Yazd" reported on July 23. He described the government's overall objective as reducing gasoline consumption below that of the previous year. "But," he added, "the methods and means of achieving that goal [are] still being debated." He noted that the purchase of buses that run on natural gas has already been approved.

At the end of July, government spokesman Elham stressed that "reducing consumption is one of the government's definite policies," according to IRNA on July 24. He went on to add that the government had yet to develop any strategy that called for rationing or curbing imports.

Petroleum Minister Kazem Vaziri-Hamaneh confirmed on July 30 that there will be no rationing, according to Reuters on July 31. Imports, the minister said, will continue as before.

FINAL FIVE AFGHAN CABINET APPOINTMENTS APPROVED
The Afghan National Assembly's Wolesi Jirga (People's Council) approved President Hamid Karzai's nominations for five ministerial posts whose nominees were previously rejected, the official Bakhtar News Agency reported (see "RFE/RL Afghanistan Report," April 28, 2006). The new ministers are: Ne'amatullah Ehsan Jawed (Transport and Aviation), Mohammad Jalil Shams (Economy and Labor), Abdul Karim Khurram (Culture and Youth), Hasan Banu Ghazanfar (Women's Affairs), and Mir Mohammad Amin Farhang (Commerce and Industry). The Wolesi Jirga in April rejected Farhang as a nominee to head the Economy and Labor Ministry. AT

TALIBAN ISSUE 'FINAL WARNING' REGARDING CAPTURED LEBANESE ENGINEER
A warning posted on a website proclaiming to represent the "Islamic Emirate of Afghanistan" -- the name for the country used under the Taliban regime -- on August 7 calls on "Kabul authorities" to release a number of people who are incarcerated on charges of being members of the Taliban. The warning, which is signed by the "Military Executive Committee," warns that the Islamic Emirate will kill a Lebanese engineer it captured in Zabul Province in southern Afghanistan on July 29 if the prisoners are not released by August 7. The engineer is identified as Khalil and he is said to be working for a U.S.-based construction company; the prisoners in question are not identified. AT

CAPTURED INSURGENT IN NORTHERN AFGHANISTAN CLAIMS HE RECEIVED INSTRUCTIONS IN PAKISTAN
Sayyed Abdul Wahid, claiming to be the leader of a group of 10 insurgents operating in Sar-e Pol Province, has said he received instructions and equipment for his operations in Quetta, Pakistan, Sheberghan-based Aina Television reported on August 5. Abdul Wahid told Aina that under the Taliban he was operating in Sar-e Pol and, after that regime collapsed in late 2001, he went to Quetta and received instructions from Mawlawi Gol Mohammad to attack schools in northern Afghanistan. In his interview with Aina, Abdul Wahid recalled his activities and named schools that he has attacked. On his second trip to Quetta, Abdul Wahid said, he received remote-controlled "devices" from Gol Mohammad to target government vehicles. Gol Mohammad's affiliation is not clarified by Abdul Wahid. AT

FRANCE DEPORTS SUSPECT LINKED TO KILLING OF AHMAD SHAH MAS'UD
French authorities have deported Adel Tebourski, a Tunisian sentenced in Paris in 2005 in connection with the murder of Afghanistan's celebrated mujahedin commander, Ahmad Shah Mas'ud, AFP reported on August 7. A group of Arab terrorists with alleged links to Al-Qaeda assassinated Mas'ud, the military leader of the United Front (aka the Northern Alliance) on September 9, 2001. Mas'ud has become a folk hero among some segments of the Afghan society. It was not immediately clear whether Afghanistan is planning to request the extradition of Tebourski, who departed France for Tunisia. AT

CAPTURED HIZBALLAH FIGHTER REPORTEDLY TELLS OF TRAINING IN IRAN
A purported Hizballah fighter captured by Israeli forces acknowledged during interrogation that he received military training in Iran, Reuters reported on August 7, quoting Israeli military sources. The man, who identified himself as Mahmud Ali Suleiman, said he was accompanied by 40-50 other men when he went to Iran via Damascus airport to receive training on the use of antitank weapons. Hojatoleslam Ali-Akbar Mohtashami-Pur, head of the Support for the Palestinian Intifada conference series and a leader in the creation of Lebanese Hizballah when he was Tehran's ambassador to Damascus in the 1980s, said in the August 3 issue of "Sharq" that many Hizballah personnel fought for Iran during the 1980-88 Iran-Iraq War. Mohtashami-Pur said that "many of the experienced Hizballah forces are those who were on our fronts in our eight-year war, and they carried out operations directly or under our cover." "It is true that at the beginning the Hizballah forces were trained in Iran and Lebanon by the Guard Corps," he added. BS

DIPLOMATIC SOURCES CLAIM IRAN TO SUPPLY HIZBALLAH WITH SURFACE-TO-AIR MISSILES
Iran intends to supply Lebanese Hizballah with several types of handheld surface-to-air missiles, "Janes' Defense Weekly" reported on August 7, quoting anonymous "Western diplomatic sources." The weapons involved include Strela-2/2 (SA-7 Grail), Strela-3 (SA-14 Gremlin), and Igla-1E (SA-16 Gimlet) systems. "Jane's" added that Iran intends to provide Hizballah with its Mithaq-1 low- to very-low-altitude surface-to-air missile system, which is an Iranian model of the Chinese QW-1 system. Hojatoleslam Mohtashami-Pur said in the August 3 issue of "Sharq" that Hizballah has Iranian-manufactured Zelzal-2 missiles. Referring to the Iranian role in the current crisis in Lebanon, U.S. President George W. Bush said on August 7 in Crawford, Texas, that "Syria and Iran sponsor and promote Hizballah activities, all aimed at creating chaos, all aimed at using terror to stop the advance of democracies," Radio Farda reported. BS

UN REPORTS IRAN'S QUEST FOR AFRICAN URANIUM
A shipment of uranium-238 mined in Congo and destined for Bandar Abbas was intercepted by customs officials in Tanzania in October, "The Sunday Times" reported on August 6, citing a July 18 United Nations report. U-238 has nuclear-weapon applications. The uranium was hidden in a shipment of coltan, which is used to make mobile-telephone chips. High radiation levels were found in a routine Geiger-counter scan of the shipment. "The container was put in a secure part of the port and it was later taken away, by the Americans, I think, or at least with their help," a Tanzanian customs official was quoted as saying. "The Sunday Times" added that the report has been submitted to UN sanctions committee Chairman Oswaldo de Rivero and the Security Council will soon take it under consideration. Iranian Supreme National Security Council Secretary Ali Larijani said on August 6 that this report is "untrue" and is an example of U.S. "psychological war," state television reported. "We do not need uranium, we have uranium mines and the facilities to convert the uranium to yellowcake; therefore, under such circumstances, it is not logical for us to ship such cargos." BS

IRANIAN OFFICIAL'S BROTHER REPORTEDLY ARRESTED FOR NARCOTICS SMUGGLING
The brother of Iranian state inspectorate chief Hojatoleslam Mohammad Niazi has been arrested for drug smuggling, the reformist advarnews.com reported on August 5. Niazi, whose first name was not provided, reportedly had 95 kilograms of opium and 45 kilograms of heroin in his possession when he was detained on the road from Kahnuj to Rudan in Kerman Province. BS

IRAN EXECUTES BAM-KERMAN ROBBER
Kerman Province Deputy Governor-General for Political and Security Affairs Abolqasem Nasrollahi announced on August 7 that one of the robbers responsible for an attack along the Bam-Kerman road would be executed later that night, Fars News Agency reported. Twelve people were killed during the May incident in the southeastern Kerman Province, and Interior Minister Mustafa Pur-Mohammadi was widely criticized over the security situation in the southeastern part of the country (see "RFE/RL Iran Report," 26 May 2006). Nasrollahi said the government is closing in on the responsible parties, adding, "The agents responsible for this crime, who are more than 20, are under siege and we anticipate their arrest soon." Nasrollahi said the Islamic Revolution Guards Corps, the regular army's air wing, the Basij, and the national police are participating in the operation against the gang. BS

IRAQI PREMIER CRITICIZES SECURITY OPERATION
Prime Minister Nuri al-Maliki criticized a joint U.S.-Iraqi operation carried out in Baghdad on August 7 in comments to state-run Al-Iraqiyah television, Reuters reported on August 8. "This operation is rejected and it was conducted without the agreement of the government and it does not match the current national-reconciliation environment in the country," he said, referring to the operation that targeted "death squads" operating in the Al-Sadr City district of the capital (see "RFE/RL Newsline," August 7, 2006). Al-Maliki has faced strong criticism from members of his ruling Shi'ite alliance, including supporters of cleric Muqtada al-Sadr, in recent days (see "RFE/RL Iraq Report," August 4, 2006). KR

IRAQI PRESIDENT UPBEAT ON SECURITY SITUATION...
President Jalal Talabani told reporters in Baghdad on August 7 that he is confident the security situation in the country is improving, RFE/RL's Radio Free Iraq reported the same day. Asked if he agreed with comments by U.K. Ambassador to Iraq William Patey last week that the country is slipping toward civil war, Talabani said: "I do not agree with this opinion. I believe that the situation is improving. With this improvement, the economic situation may improve. I do not think a civil war will erupt in Iraq." Asked to comment on the state of relations between the United States and supporters of Shi'ite cleric Muqtada al-Sadr, the president said: "I try to calm things down between the Al-Sadr movement and coalition forces.... A collision between the Al-Sadr movement and the coalition forces or between the Iraqi forces and brothers in the Al-Sadr movement is not in Iraq's interest, the Al-Sadr Movement's [interest], or the American [interest]." KR

...AS U.S. GENERAL SAYS SECURITY TO IMPROVE BY RAMADAN
U.S. General George Casey, the commander of U.S.-led forces in Iraq, told reporters at the same August 7 press briefing that the Baghdad security plan intends to make significant strides in security by Ramadan, which will begin around September 24. "There is a comprehensive plan, as I said, to change the situation significantly prior to Ramadan and then to continue to build on that security with economic projects and development projects so that Baghdad experiences not only security but also prosperity," Casey told reporters. Saying he did not want to elaborate, Casey added: "I think what you will see are Iraqi security forces, supported by the coalition, clearing out areas where there are terrorists and death squads and then establishing security presence to protect the people of that area from terrorist attacks. All of the operations are designed to protect the population of that area and if the people of Baghdad cooperate with their security forces, this can happen very quickly." KR

MUSLIM SCHOLARS ASSOCIATION BLAMES U.S., IRAQI GOVERNMENT FOR ASSASSINATION
The Muslim Scholars Association announced in an August 7 press release posted to its website that it is holding multinational forces and the Iraqi government responsible for the death of a Sunni Arab imam. Gunmen assassinated Sheikh Ali Husayn Shanshal, imam of the Al-Anbiya Mosque in Al-Fallujah, on August 6 while he was en route to perform the noon prayer service. He died on the way to the hospital, the statement said. Calling the assassination a terrorist crime, the Sunni association said it "holds the occupation forces and the newly formed government accountable for this and other crimes and violations against innocent Iraqis who are experiencing never-ending deteriorating conditions under the tyranny of the occupation." KR

SECURITY REPORTEDLY DETERIORATING IN IRAQI CITY
Half of the city of Mosul is now under the control of insurgents, "Al-Zaman" reported on August 7. "Half of Mosul has been in rebel hands for three days and there is no sign that the government has the ability to restore its authority," an unidentified governorate official told the daily. Local residents said that the insurgents have taken control over areas on the left bank of the Tigris River, which runs through the city, cutting of major roads to the Kurdish region in the north. Mosul police chief Wathiq al-Hamdani told reporters on August 6 that police killed some 20 insurgents in the previous three days. Al-Hamdani told RFE/RL's Radio Free Iraq on August 7 that the security situation began to deteriorate on August 4, but that the situation is now under control and calm has been restored. KR

IFJ CALLS FOR UN INTERVENTION TO PROTECT JOURNALISTS IN IRAQ
In an August 7 press release, the International Federation of Journalists (IFJ) called for international intervention to ensure the protection of journalists working in Iraq after another Iraqi journalist was gunned down the same day. Three Iraqi journalists were killed in apparent targeted assassinations last week. According to IFJ, 135 journalists and media workers have been killed in Iraq since March 2003. "The crisis of targeting journalists in Iraq has reached such proportions that the international community needs to react up to the level of the United Nations to put pressure on Iraq and the military authorities to provide more protection for journalists under attack," IFJ Secretary-General Aidan White said. KR

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