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Russia Report: June 3, 2005

3 June 2005, Volume 5, Number 22
By Claire Bigg

A Moscow court on 31 May sentenced oil tycoon Mikhail Khodorkovskii to nine years in prison after finding him guilty of fraud and tax evasion, bringing the most controversial trial in post-Soviet Russia to a close. Co-defendant Platon Lebedev received the same sentence. The case is widely perceived as a Kremlin-led campaign to clip the wings of the politically ambitious Khodorkovskii and to punish him for supporting opposition parties. Abroad, the verdict is likely to further shake investor confidence and tarnish President Vladimir Putin's image, both badly hurt by the 11-month trial.

The sentence means Khodorkovskii must serve another 7 1/2 years, having already been in prison for 1 1/2 years since his October 2003 arrest. A third defendant in the case, former Volna General Director Andrei Krainov, received a five- year suspended sentence.

The judges pronounced the sentence on the 12th day of a drawn-out verdict-reading process, whose delays were viewed by many as an attempt to deflect attention from the trial.

One of Khodorkovskii's lawyers, Robert Amsterdam, said the defendants had been punished for showing entrepreneurship, innovation, and transparency in Russia's business world. "Khodorkovskii and Lebedev were found guilty of entrepreneurship, of innovation, and of transparency, and transparency is the one thing this government fears," Amsterdam told RFE/RL. "Transparency is the one thing the power cannot stand."

Yukos spokesman Aleksandr Shadrin expressed dismay at the sentence, slamming it as a "monstrous distortion of justice."

"All those who work at Yukos were shocked by the court's decision today," Shadrin said. "Of course, we see today's verdict as an absolutely monstrous distortion of justice by Russia's judicial system. We consider that the verdict is a typical example of the authorities' use of law enforcement and judicial systems for political ends."

The Prosecutor-General's Office, however, was swift to fend off allegations of a political bias against the defendants. Natalya Vishnyakova, the official spokeswoman for the Prosecutor-General's Office, denied the sentence was politically motivated. "We consider this sentence to be fair and commensurate with the circumstances and the gravity of the crimes committed by Khodorkovskii, Lebedev, and Krainov," Vishnyakova said. "We categorically reject any political motive in this case. Concrete, grave crimes were committed and have been proven."

A number of observers have also voiced concern over Khodorkovskii's heavy sentence, which came just short of the maximum 10-year prison term sought by the prosecution. Mark Urnov, the head of the Moscow-based Ekspertiza think tank, says the sentence highlights Russia's poor standards when it comes to justice and democracy.

"What happened testifies to the fact that there is no normal, independent and objective court in Russia," Urnov told RFE/RL. "With such a tough sentence, almost the maximum, we have simply been told: 'You have no democracy now. Get it?'"

Yukos, which once had a market value of $40 billion and was considered Russia's most transparent company by foreign investors, is now worth only around $2 billion.

In December, the state-owned oil company Rosneft dealt a severe blow to Yukos by acquiring its core production unit Yuganskneftegaz in a state-organized auction to help pay off Yukos's tax debt. Khodorkovskii denounced the auction as illegal.

Foreign investors -- already jittery over the Yukos saga -- are likely to be further scared off by the guilty verdict. It could also badly shake the West's confidence in the rule of law in Putin's Russia.

The first signs of this came as early as 31 May, when U.S. Congressman Tom Lantos (Democrat, California) told reporters outside Moscow's Meshchanskii Raion Court, where the trial was held, that he no longer considered Russia a democratic country. "We hope to have very good relations with Russia, but we are concerned that the trend of centralization of power makes it impossible for us to continue viewing this country as a democratic country," Lantos said. Lantos added that he and three other congressmen had proposed a resolution to expel Russia from the G-8 group of leading industrialized countries.

Once Russia's richest man with an estimated worth of $15 billion, a somber Khodorkovskii listened to the verdict from behind bars of a metal cage, where defendants traditionally sit in Russian courtrooms.

Nobody expected an acquittal in the politically charged trial, but doubts remained until the last minute whether the court would give Khodorkovskii the maximum 10-year prison term. Khodorkovskii's lawyers had asked for their client to be cleared of all charges and said they would appeal any conviction.

Khodorkovskii's trial is widely regarded both in Russia and abroad as the Kremlin's revenge for the Yukos founder's political ambitions and his financing of liberal opposition parties ahead of the 2003 parliamentary elections.

Rumors have also circulated that Khodorkovskii was planning to run in the presidential election in 2008. His sentence means he will be in prison well after the 2008 vote.

The 41-year-old Khodorkovskii was arrested in October 2003 when his jet stopped at a Siberian airport to refuel. He has been held in prison ever since.

Russian tax authorities then claimed that Yukos owed some $27.4 billion in back taxes. They also accused Khodorkovskii and Lebedev of illegally siphoning off huge sums to tax havens, rigging a privatization deal in 1994, and evading millions in personal income taxes.

Prosecutors vowed earlier in May to bring fresh charges against Khodorkovskii and Lebedev for alleged money laundering. The threat of additional charges was seen by many observers as a move to ensure that the magnate remain behind bars in the event that he were to receive a suspended sentence.

Khodorkovskii accumulated enormous amounts of Russia's natural-resources assets for low prices in shady privatization deals in the 1990s, taking advantage of the chaos that followed the collapse of the Soviet Union and of loopholes in the law.

But analysts say dozen of other firms used the same methods as Yukos in the 1990s and nonetheless avoided prosecution.

By Claire Bigg

The nine-year sentence that wrapped up the trial of Yukos founder Mikhail Khodorkovskii on 31 May has trained the international spotlight on Russia. Observers have widely slammed the verdict as a move by the Kremlin to crush the oil tycoon's perceived political ambitions and punish him for funding opposition parties. To what extent will Khodorkovskii's heavy sentence now act as a deterrent for politically-involved Russian businessmen?

Political analysts largely agree that Khodorkovskii had riled the Kremlin by funding opposition political parties and using his wealth to try to install deputies in parliament ahead of the 2003 State Duma elections.

Khodorkovskii was also rumored to plan to run as a candidate for the 2008 presidential elections.

The fact that his arrest on financial charges so closely followed upon his increased political activity has helped fuel widely heard charges both in Russia and abroad that his trial was politically motivated. It also has raised questions about President Vladimir Putin's commitment to democracy and justice.

Some Russian analysts say that the prosecution of Khodorkovskii -- and now the stiff sentences -- sends a strong message to Russia's business community: Stay out of politics.

"Of course [the sentence] is revenge, but maybe even more so a signal to other oligarchs and rich people not to engage in a political fight with the current regime," Yevgenii Volk, the director of the Moscow office of the Heritage Foundation, told RFE/RL. "This is a very serious step in the fight against any type of political opposition."

Masha Lipman, an analyst at Moscow's Carnegie Center, says the Kremlin has fully succeeded in reining in prominent businesspeople. "The definite result is that businessmen are frightened," Lipman told RFE/RL. "They are horrified by all that has happened, they are shaking, at least as far as big businesses are concerned. Today, big businesses cannot finance anything political unless they obtain 10 times the Kremlin's total consent."

She notes that businesspeople had begun distancing themselves from politics as soon as Khodorkovskii was arrested at gunpoint in October 2003. The guilty verdict against the jailed billionaire, she says, will simply reinforce this trend.

Lipman, however, contends that Khodorkovskii's funding of political parties, or even his possible personal political ambitions, were not the sole reasons that landed in prison.

The oil tycoon funded not only political parties but also an array of projects aimed at building civil society in Russia. The Kremlin, Lipman says, therefore felt threatened by Khodorkovskii not merely as a political opponent but as an increasingly prominent and influential public figure.

"The question here is not about the concrete financing of political parties," Lipman said. "Khodorkovskii sought to have decisions that he needed approved in the Duma, but the nature of these decisions were for the most part economic rather than political. This was another sign of his huge influence as a person owning an enormous oil company. The persecution of Khodorkovskii is an attempt to get rid of a very serious rival."

At any rate, Khodorkovskii's trial and his subsequent nine-year sentence bode ill for opposition parties in Russia.

Volk of the Heritage Foundation predicts that the Khodorkovskii sentence will sever most of the opposition parties' financing channels and thereby strip them of their real power of opposition.

"[The opposition parties] won't die, but they will exist in a half-comatose state, on the verge of survival," Volk said. "They will formally exist in this state of vegetation, they will make statements, but the Kremlin has no desire to give them any kind of real political power."

By Jeremy Bransten

Russia's main rightist political party, the Union of Rightist Forces (SPS), was once led by some of Russia's most prominent politicians, who helped craft the transition to a market economy in the 1990s. Many became critics of President Vladimir Putin and were welcomed abroad as representatives of pro-Western reformist ideals. But at its 28 May congress in Moscow, the SPS elected new leaders, who say they no longer want the party to be in "opposition" to the Kremlin. Is it a sign of the times?

Until the congress, the SPS had been leaderless for more than a year. The party's top officials had resigned from their posts, taking responsibility for the SPS's electoral debacle in December 2003, when the party failed to make it into parliament. That was a humiliating blow for some of the best-known names in Russian politics: Anatolii Chubais, Boris Nemtsov, Irina Khakamada, and Yegor Gaidar.

So the congress's election of 29-year-old Perm Oblast Deputy Governor Nikita Belykh as the new party chairman signals a long-awaited fresh start for the party.

On the plus side, Belykh is young, well-educated, and untainted by the privatization scandals of the 1990s. He is also not a Muscovite, which could add to his appeal for many voters.

But the SPS faces a major obstacle that seemingly no leadership change can overcome. It is what former Yukos chief Mikhail Khodorkovskii, in his now-famous missive from prison last year, called a "crisis of liberalism in Russia" (see "RFE/RL Russian Political Weekly," 2 April 2004).

On paper, the SPS says it espouses traditional liberal goals and values: personal freedom and responsibility, market economics, freedom of speech, separation of powers, and decentralization.

Putin has largely co-opted the economic part of the liberals' program, while rejecting the political and social components. He has mostly favored market reforms while at the same time leading a drive to re-centralize power and limit the influence of independent media.

That leaves the SPS with a dilemma -- should it support Putin or oppose him? Stephan de Spiegeleire, a Russia analyst at the Clingendael Center for Strategic Studies in The Hague, explains that the party has tried to do both.

"In the current situation, where you still have an economic policy of the government that contains a lot of liberal elements, it would be silly for a party like SPS to disavow this entire part of government policy," de Spiegeleire told RFE/RL. "So you can be critical of a lot of the political elements which have been emerging for quite a while now, but still try to support certain aspects of policy that concur with your own views. And like I said, in the economics realm, there are certainly a number of issues that are still very much liberal."

Where the crisis comes in is with SPS's liberal political and social agenda. Because of the upheaval associated with the 1990s, most Russians seem only too happy to see Putin reimpose order and discipline. The liberal ideals of decentralization, individual responsibility, and freedom of the press appear to have been largely discredited.

That means that running in opposition to the Kremlin on these issues would probably not garner many votes, as de Spiegeleire notes.

"The problem of liberalism in Russia is not just a problem of identity or of individuals. It's a very structural problem. It's really a crisis of liberalism -- as Khodorkovskii put it about a year ago -- at a couple of different levels," he said. "It's a crisis at the level of the population -- and we've seen it in the elections of 2003. There really is a backlash of the people against this entire liberal construct. Many young people who were traditionally the backbone of liberalism in Russia are now also increasingly turning to the government parties. So it's almost electoral suicide today to try to position yourself exclusively as an opposition party against that kind of a background."

Leonid Gozman, the new deputy chairman of the party who is a member of the board of Unified Energy Systems (EES) and a close ally of EES head Chubais, seems to have gotten the message. He said at the congress on 28 May that he did not want to the SPS to be seen as an opposition party.

But if a de facto opposition party says it is not really in the opposition, does it offer voters any reason to vote for it?

Yabloko, Russia's other main liberal grouping -- which also failed to make it into parliament in 2003 -- says no. It has stuck to its liberal principles on social policy and remains estranged from the SPS.

Andrei Ryabov, of the Carnegie Center in Moscow, says as long as these two parties fail to shelve their disagreements, their programs become almost irrelevant, as they have little chance of making it back into the Duma in the next elections in 2007.

"Without a doubt, any kind of coalition that excludes either of those two most influential political players cannot have a chance to strengthen the position of the democratic camp before the next parliamentary elections," said Ryabov.

De Spiegeleire concurs. He notes that changes to the way deputies are elected -- including the elimination of single-mandate constituencies, the elimination of electoral blocs, and the raising of the minimum threshold needed for parties to gain Duma representation from 5 to 7 percent -- mean the odds against the SPS are higher than ever.

By Liz Fuller

More than two months after Russian forces hunted down and killed Chechen President and resistance leader Aslan Maskhadov, the resistance forces now under the overall command of radical field commander Shamil Basaev still have not mounted any major retaliatory action. But it is unclear whether the resistance is too weak to hit back, or is lying low and preparing a new terrorist attack.

Stratfor suggested the former in a 17 May analysis based largely on claims by Major General Ilya Shabalkin, the Russian military spokesman for the Group of Forces in the North Caucasus. Shabalkin said that Russian forces have succeeded in killing numerous Chechen field commanders, including at least six in the preceding few days, thereby seriously impairing resistance capabilities. But Shabalkin's claims of continuous military successes should be treated with caution, if not skepticism, especially as the website of the militant resistance and the more moderate generally confirmed the death of senior field commanders (such as Ruslan Gelaev and Abu-Walid), stressing their military achievements, courage, and self-sacrifice. In recent days, however, there have been no such confirmations.

Second, at least some resistance groups are reportedly engaged in heavy fighting with federal forces in southern and eastern Chechnya (Vedeno, Nozhai-Yurt, and Shelkokovskii Raion).

Third, Basaev might be biding his time and planning a major blow against Russia at what he considers psychologically the most advantageous moment. Specifically, he could hope to thwart the signing -- which according to pro-Moscow Chechen administration head Alu Alkhanov is currently set for the second half of June -- of a long-awaited treaty outlining the division of powers between the Chechen Republic and Moscow.

Work on that treaty first began more than two years ago, immediately after the controversial referendum on the new Chechen constitution. But its signing has been repeatedly delayed, first because the Chechen side's economic demands on Moscow were deemed exorbitant; then due to the assassination in May 2004 of pro-Moscow Chechen leader Akhmed-hadji Kadyrov; then again due to Russia's reluctance to agree to all the Chechen leadership's demands.

The initial draft of the treaty, which Kadyrov claimed to have authored, stipulated that until 2010 Chechnya should retain all taxes from the sale of oil extracted on its territory, and that the republic's leadership should control the sale of not only oil but other natural resources such as timber. But Finance Minister Aleksei Kudrin argued in October 2003 that no exceptions should be made to Russia's unified tax system.

Kadyrov predicted in December 2003 that the treaty would be signed before the Russian presidential election in March 2004; but that prediction proved wrong. Following Kadyrov's death on 9 May in a terrorist bombing, Musa Umarov, Chechnya's representative in the Federation Council, told Interfax on 13 July that although the draft treaty had been revised several times, its precise content would depend on who was elected Kadyrov's successor in the ballot scheduled for late August.

On 24 July, ITAR-TASS quoted Chechen State Council Chairman Taus Djabrailov as saying that the treaty would be signed by the end of 2004. According to Djabrailov, three separate drafts existed: Kadyrov's, one prepared by the Chechen State Council, and a third prepared by a Russian working group chaired by presidential-administration head Dmitrii Medvedev. As Kadyrov had done, Djabrailov argued that the Chechen leadership should have complete control over the oil and gas sector and the revenues it generates, together with a special tax regime.

Following his inauguration in early October as Kadyrov's successor, Alu Alkhanov said the treaty would be signed in spring 2005 and that it would give Chechnya the status of a free economic zone (even though, at that time, the Russian State Duma had not yet begun debating a draft bill on such zones). In January, Djabrailov announced that work on the draft treaty was complete, Interfax reported on 18 January. He said that from 2005-15 Chechnya would have the status of "a region of intensive economic development," meaning that its land, subsoil resources (oil), and plant and animal life will be the exclusive and indivisible property of the people of Chechnya -- a formulation that suggests that Moscow has given in to the maximalist Chechen demands for exclusive control over the republic's resources. In addition, the federal center would grant Chechnya annual subsidies of 3 billion rubles ($100 million).

A Chechen National Bank would be established as a subsidiary of the Russian Central Bank, and it would be empowered to register new enterprises, including joint ventures with the participation of foreign capital. The treaty further provided for a one-time compensation payment equal to 720,000 rubles for all surviving victims of Soviet dictator Josef Stalin's repression.

But over and above those exorbitant economic concessions, the Chechen leadership also insisted on including in the seven-page draft two crucial political demands, according to "Vremya novostei" on 24 January. First, Russian security structures, including the Federal Security Service (FSB), would be forbidden to interfere in Chechnya's internal affairs -- meaning they would no longer be empowered to act as a restraining influence on First Deputy Prime Minister Ramzan Kadyrov and his so-called presidential security service. And second, the Chechen leadership demanded a revision of the de facto border between Chechnya and Ingushetia agreed upon when the Checheno-Ingush Autonomous Soviet Socialist Republic split in the summer of 1992, to transfer to Chechen jurisdiction parts of Sunzha and Malgobek raions that are currently part of Ingushetia.

The "Frankfurter Allgemeine Zeitung," however, on 28 January quoted an unnamed Kremlin official as having told "Moskovskii komsomolets" that Djabrailov's list of anticipated concessions was grossly exaggerated, and that the Kremlin was prepared to grant Chechnya only the status of a special economic zone and certain tax privileges. Chechen Prime Minister Sergei Abramov indirectly confirmed that Djabrailov was exaggerating: Abramov told ITAR-TASS on 26 January that the treaty would not designate Chechnya "a region of intensive economic development." But he said the treaty would nonetheless take into account Chechnya's unique situation, giving it the opportunity "to carry out economic transformations much more effectively and with smaller losses" based on an assessment of both the positive and negative experience accumulated by other federation subjects. A commentary in "Profil," No. 2, suggesting that Djabrailov's list of privileges should simply be regarded as Grozny's initial, maximalist negotiating position, might have been close to the mark.

The Chechen-Russian working group tasked with drafting the treaty met in late February for what was intended to be its penultimate discussion, ITAR-TASS reported on 27 February, after which Abramov announced that the wording of the treaty has been finalized. But on the eve of that discussion, Djabrailov again implied that Moscow had agreed to major concessions. He told Interfax on 25 February that the finished text will be presented to the Russian State Duma and that "all [Russian] laws that contradict this document will have to be brought into conformity with it." Djabrailov predicted that the treaty might finally be signed before the end of June, a time frame that Alkhanov repeated on 25 April and then again on 14 May and 19 May. But Alkhanov also insisted that the text of the treaty conforms to the basic tenets of the Russian Federation Constitution.

Regardless of the precise content of the treaty, Basaev might feel it worthwhile to try to prevent its signing by staging a terrorist atrocity of such magnitude that the Kremlin would be constrained to abandon any thought of special privileges for Chechnya. In that context, it is worth recalling that Maskhadov's envoy, Akhmed Zakaev, warned in the immediate aftermath of the Moscow theater hostage taking in October 2002 that "we cannot exclude that the next [Chechen terrorist] group could seize a nuclear facility," Reuters reported on 27 October 2002.

In an interview on 24 May with RFE/RL's North Caucasus Service, journalist Anna Politkovskaya listed a number of cautionary measures taken recently by the authorities in North Ossetia, including the suspension of school classes and restrictions on the traditional celebrations to mark the end of the school year, which, she said, incline her to fear that a new terrorist attack might be imminent.

By Liz Fuller

The ongoing process of revising and formalizing the internal territorial-administrative composition of Russia's North Caucasus republics, which triggered protests in Ingushetia in March, has now served as the catalyst for the reemergence of demands by the Balkar minority for the division of the Kabardino-Balkaria Republic (KBR) into two units to give that group an autonomous republic of its own.

The republic's leadership responded in 1996 to analogous demands with mass arrests and reprisals and the closure of political parties and organizations that had campaigned for the Balkar cause.

On 28 May, some 1,000 Balkars congregated in Nalchik, the republican capital, to protest the new law on the internal administrative-territorial structure of the republic, which redesignates as suburbs of Nalchik two Balkar-populated villages that previously had the status of separate municipalities. The Balkars argued that the territorial downgrading of the two villages constitutes one of numerous examples of discrimination by the Kabardian majority against the Balkars. Unemployment among Balkars, especially in the republic's mountainous regions, is as high as 80-90 percent in some areas.

The Balkars -- a Turkic-speaking people whose ethnogenesis remains unclear -- currently constitute approximately 10 percent of the total 786,200 population of the KBR; the Kabardians account for 50 percent and the Russians some 32 percent. The Balkars are closely related to the Karachais, who also speak a Turkic language, and may be descended from the Kipchak group of tribes. The Karachais constitute some 33.7 percent of the population of the neighboring Karachaevo-Cherkessia Republic, which has a total population of 433,700.

By contrast, the Cherkess, who are related to the Kabardians, constitute just 11 percent. The present-day territorial-administrative division of the North Caucasus to include two composite republics, Kabardino-Balkaria and Karachaevo-Cherkessia, each of which brings together a Turkic and a Circassian ethnic group, dates back to a policy embraced in the 1920s by Soviet leader Josef Stalin. That policy was intended to split up ethnic groups between artificially created multiethnic polities, rather than try to create territorial units for those groups within which they would constitute a majority and thus might develop a powerful sense of national identity.

Like the Chechens and Ingush, the Karachais and Balkars were both deported en masse to Central Asia in 1943 and 1944 on suspicion of having collaborated with the Nazi German forces that occupied the Karachai Autonomous Oblast in August 1942 and Nalchik in October of that year. Following that deportation, the Karachai Autonomous Oblast was literally wiped off the map: Its territory was divided between Stavropol and Krasnodar krais, the Georgian Soviet Socialist Republic, and the Cherkess Autonomous Oblast.

The Kabardino-Balkar Autonomous Soviet Socialist Republic (ASSR) was renamed simply the Kabardian ASSR. The Balkars had enjoyed the status of an autonomous okrug (district) for only a very brief period from 1918 to 1922 prior to the formation in January 1922 of the Kabardino-Balkar Autonomous Oblast, which was upgraded to an ASSR in 1936.

Again, like the Chechens and Ingush, the Karachais and Balkars were exonerated in 1956 by Soviet leader Nikita Khrushchev of the charge of collaborating with Nazi Germany and allowed to return to the North Caucasus the following year. In January 1957, the Kabardian ASSR reverted to its previous title of Kabardino-Balkar ASSR. The outer boundaries of that republic remained the same, but the inner border was altered in such a way that four Balkar villages fell under Kabardian jurisdiction. The former Karachai Autonomous Oblast was not reconstituted; its territory was incorporated into a new, expanded Karachaevo-Cherkess ASSR.

In April 1991, the Russian Soviet Federal Socialist Republic's (RSFSR) Supreme Soviet adopted a law on the rehabilitation of oppressed peoples, which many representatives of those ethnic groups construed as heralding the righting of decades-old wrongs. The Karachais launched a campaign for autonomy, and in February 1992 President Boris Yeltsin presented a draft bill to the Russian Supreme Soviet that would have resurrected a Karachai Autonomous Republic within the Russian Federation. But the overwhelmingly Cherkess leadership of the Karachaevo-Cherkess Republic sabotaged that legislative initiative by scheduling a referendum in March 1992 in which a majority of the republic's voters endorsed the status quo.

Similarly, in November 1991 an unofficial Balkar National Congress formed in March of that year appealed to the republic's Communist leadership to support its demands for a Balkar autonomous region within the Russian Federation. That appeal was ignored, after which most Balkar voters boycotted the 22 December 1991 election of the republic's first president. The Balkars did, however, vote overwhelmingly one week later in an unofficial referendum in favor of "national sovereignty" within the Russian Federation, but newly elected President (and former republican Communist Party First Secretary) Valerii Kokov dismissed that plebiscite as unconstitutional.

In 1996, the Balkar National Congress, by then headed by a retired General Supyan Beppaev, former commander of the Transcaucasus Military District, resumed its activities. The congress met in November 1996 to consider two separate sets of demands. The first was for the return to Balkar control of the four districts transferred to Kabardia in 1957, and for the creation of the post of republican vice president, which was to go to a Balkar; the second was for the creation of a separate Balkar republic. Delegates opted for the second demand and on 17 November unilaterally declared a Balkar Republic within the Russian Federation, selected a republican government, and appealed to President Yeltsin to support what they termed their legitimate demands.

The republic's authorities responded, however, with mass arrests and reprisals; Beppaev resigned from the Balkar National Congress and, on 28 November, appealed to other delegates to rescind the demand for a Balkar republic, which the majority refused to do. The Balkar national party Tere was banned and some of its leaders brought to trial; others were bought off with the offer of influential government posts. Many other Balkar national organizations were also forced to close. Kokov was reelected president in January 1997 and again in 2002.

In 2001, hard-line Tere members again accused the republic's Kabardian leadership of discrimination and demanded a meeting with President Vladimir Putin to discuss their grievances, according to an Institute for War and Peace Reporting (IWPR) report dated 16 March 2001, but that demand was ignored.

As noted above, the catalyst for the 28 May protest in Nalchik was the entry into force in March of republican legislation that subsumed four small municipalities, including the Balkar-populated villages of Khasanya and Belaya Rechka, into Nalchik. Khasanya Mayor Artur Zokaev filed suit with the republic's Supreme Court, arguing that the law violates the constitutions of both the KBR and the Russian Federation. Zokaev was killed in the yard of his house during the night of 14-15 May; 10 days later the Supreme Court dismissed his objections as unsubstantiated. On 23 May, the Nalchik City Court satisfied a request by the republic's prosecutor-general to ban as illegal a planned referendum in which the residents of Khasanya would have been asked whether or not they approved of the village's incorporation into Nalchik.

Participants in the 28 May meeting in Nalchik initially focused on a four-stage plan that called for the creation of an initiative group centered in Khasanya; the return to Balkar jurisdiction of the four villages transferred to Kabardian control in 1957; the convening of a new Balkar National Congress; and the creation of a Balkar republic. The resolution adopted at the end of the meeting did not include the latter demand, although it did call for the suspension of the new legislation on municipalities. In addition, participants voted to rename a street and school in Khasanya after Zokaev. They also voted no confidence in Beppaev, whom they accused of serving the interests of the republic's Kabardian leadership, and in the ethnic Balkar deputies to the republic's parliament.

The resolution adopted at the 28 May meeting will be sent to Putin, the Federation Council, and the Council of Europe. The Khasanya local council members who apparently form the nucleus of the renewed campaign for a Balkar republic plan to launch an indefinite hunger strike if their demands are not met.

(Readers interested in RFE/RL's analysis of issues related to the North Caucasus should see "RFE/RL's Caucasus Report" at

30-31 May: Foreign Minister Sergei Lavrov to visit Japan

2 June: A meeting of the foreign ministers of Russia, India, and China to be held in Vladivostok

3 June: Meeting of CIS prime ministers in Tbilisi

3 June: Prime Minister Mikhail Fradkov to meet with Ukrainian Prime Minister Yuliya Tymoshenko in Tbilisi

Late June: Chinese President Hu Jintao to visit Moscow

16 June: Moscow Arbitration Court to open hearings on Yukos's suit against the government seeking $11.5 billion in compensation for the seizure of Yuganskneftegaz

19 June: Referendum in Samara on dismissing Mayor Georgii Limanskii

20-22 June: Meeting of the Collective Security Council (Armenia, Belarus, Kazakhstan, Kyrgyzstan, Russia, and Tajikistan) in Moscow

23 June: Yukos shareholders meeting

24 June: Gazprom shareholders meeting

25 June: Meeting of the CIS Defense Ministers' Council in Moscow

July: Shanghai Cooperation Organization summit in Astana, Kazakhstan

4 July: 750th anniversary of the founding of Kaliningrad

6-8 July: G-8 summit in Scotland

9 July: End of the Duma's spring session

August: CIS summit to be held in Kazan

September: First-ever Sino-Russian military exercises to be held on the Shandong Peninsula

1 September: Date by which President Putin has ordered the government to submit its plans for the elimination of the estate tax, the simplification of individual tax declarations, and the simplification of the requirements for real-estate purchases

5 September: Fall plenary session of the State Duma opens

1 October: Date by which President Putin has ordered the government to submit its economic-development plans for the Far East, the North Caucasus, and Kaliningrad Oblast

23 October: Referendums to be held in Kamchatka Oblast and the Koryak Autonomous Okrug about the merger of the two federation subjects

1 November: Public Chamber expected to hold first session

1 November: Date by which President Putin has ordered the government to submit its proposals for limiting foreign-capital participation in the defense sector and strategic-resource development

1 November: Date by which President Putin has ordered the government to submit its proposals for judicial reform and combating crime, especially terrorism

Second half of November: Chechnya to hold legislative elections, according to pro-Kremlin Chechen President Alu Alkhanov

1 December: Date by which President Putin has ordered the government to submit its plans for reducing traffic accidents, alcoholism, and drug addiction, as well as its proposals for improving health care

1 December: Date by which President Putin has ordered the government to submit its plan to increase state-sector wages by 50 percent within three years

2006: Russia to host a G-8 summit in St. Petersburg

1 January 2006: Date by which all political parties must conform to law on political parties, which requires at least 50,000 members and branches in one-half of all federation subjects, or either reregister as public organizations or be dissolved

4-7 June 2006: World Newspaper Congress and World Editors Forum to be held in Moscow, hosted by the Guild of Publishers of the Periodical Press.