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Security Watch: May 20, 2003


20 May 2003, Volume 4, Number 20
FOREIGN POLICY
LONGTIME POLITICAL PLAYER CALLS FOR SHIFT AWAY FROM EUROPE... Fedor Burlatskii, a former political adviser to Soviet-era leaders from Nikita Khrushchev to Mikhail Gorbachev and currently the head of the political science council of the Russian Academy of Sciences, wrote in "Izvestiya" on 18 May that the United States, not Europe, should be Russia's primary international partner. He argued that it is understandable that Russia would actively seek integration into the European Union in the belief that EU's organizational infrastructure, together with Russia's nuclear arsenal and natural-resources potential, could somehow counterbalance the "irresistible power" of the United States. However, this belief is illusory, Burlatskii warned. Russia, by flirting with Europe, has already lost its entire economic position in postwar Iraq and will get no compensation from the EU except for "warm handshakes" from French and German leaders, Burlatskii wrote.

...AND TOWARD WASHINGTON. In the same "Izvestiya" article, Burlatskii noted that China is not actively seeking a closer alliance with Russia. Therefore, the United States must be Russia's main international partner. Because of their nuclear arsenals, the two countries bear primary responsibility for global security and their economies are sufficiently complimentary, Burlatskii wrote. The United States is interested in Russian natural resources, and Russia seeks greater access to U.S. high technologies. He argued that the Group of Eight leading industrialized countries (G-8), not the United Nations, should take on the leading, coordinating role in global affairs. He proposed that Moscow, within the G-8 format, put forward an initiative to convene an international congress on restructuring the UN to bring it into line with changes in geopolitical realities that have occurred since that organization was created after World War II.

DUMA RATIFIES MOSCOW TREATY... During a closed-door session on 14 May, State Duma deputies voted by 294 to 194 to ratify the Strategic Offensive Reductions Treaty, which was signed by U.S. President George W. Bush and President Vladimir Putin last May and approved by the U.S. Senate in March, Russian media reported. Under the treaty, the two countries will reduce their nuclear arsenals to 1,700-2,200 warheads by the end of 2012. The countries retain the right to maintain the existing structure of their nuclear forces. Speaking with journalists after the vote, Duma Foreign Relations Committee Chairman Dmitrii Rogozin (People's Deputy) said the treaty paves the way for an additional agreement with the United States and noted that the Strategic Offensive Reductions Treaty is more important for Russia that it is for the United States, nns.ru reported. He said that even if Russia had failed to ratify the treaty, it would nonetheless have a nuclear force of about 2,000 warheads by 2012, while the United States would likely have a much larger arsenal. TV-Tsentr commented on 14 May that Russia cannot afford simultaneously to maintain nuclear parity with the United States, build a volunteer military, and continue feeding its 17 oligarch-billionaires. Ratification of the treaty was timed to coincide with a visit to Moscow by U.S. Secretary of State Colin Powell.

...AS PUTIN, POWELL TRY TO MEND U.S.-RUSSIAN RELATIONS... Speaking to journalists after talks in the Kremlin with Secretary Powell on 14 May, President Putin said the two countries have "spoken and argued a lot in the recent past about the issue of Iraq, but have still managed to preserve the fundamentals of their bilateral relations," RTR and other Russian media reported. Putin told Powell that his 1 June meeting with U.S. President Bush in St. Petersburg will give a new impetus to all aspects of bilateral relations. Powell told Putin that the Duma's ratification of the Strategic Offensive Reductions Treaty is proof that the two countries can work together to resolve the most pressing international problems.

...ALTHOUGH THEY FAILED TO REACH COMPROMISE ON IRAQ SANCTIONS... President Putin and Secretary Powell failed to bridge differences between Washington and Moscow on the issues of lifting international sanctions against Iraq, the possible return to that country of UN weapons inspectors, and a new UN Security Council resolution on postconflict Iraq, Russian and Western media reported on 14 May. The United States has urged the lifting of sanctions in order to allow a new administration in Iraq to use oil-export revenues to finance the reconstruction of the country. Moscow has argued that UN weapons inspectors must first certify that Iraq is free of weapons of mass destruction. Analysts believe, however, that the Kremlin fears that lifting sanctions now would give U.S. oil companies too strong a position in Iraq's petrochemical sector. Powell told Reuters on 14 May that the two countries have significant disagreements over Iraq, but continue to work to resolve them. Foreign Minister Igor Ivanov said the two countries have decided not to concentrate on areas of disagreement, but to focus on drafting a mutually acceptable UN Security Council resolution on Iraq.

...AS RUSSIAN DIPLOMAT INSISTS ON LEADING UN ROLE IN IRAQ. Andrei Granovskii, who heads the Foreign Ministry's department for relations with international organizations, said Moscow believes the United Nations should play either a leading role in Iraq or none at all, strana.ru reported on 15 May. In a reference to the U.S.-led coalition's postwar plans for Iraq, Granovskii rejected any compromises under which the UN would play a subordinate role to occupying forces. He left the door open to backing for a variant similar to that employed in Afghanistan, in which occupying forces are responsible for the broader situation while special UN bodies work on specific issues, according to strana.ru. He also said occupying forces should be withdrawn as soon as possible and replaced by UN peacekeeping troops, preferably from Islamic states. Granovskii effectively accused the United States of shirking its responsibilities in postwar Iraq, adding, "[Reconstruction] must be done not on American conditions but on the UN principles of noninterference in the internal affairs of other states."

U.S. SAYS IRAQI DEBT TO MOSCOW WILL BE RESPECTED. In a 15 May interview with Ekho Moskvy during a visit to Moscow, U.S. Secretary of State Powell said the new Iraqi government will fully respect its financial obligations toward the Russian Federation. He said Iraq has some $100 billion-$120 billion in foreign debt, $8 billion of which is owed to Russia. He added that repayment will likely be restructured or otherwise delayed, however. Powell said he did not discuss the Iraqi debt during his meeting with President Putin and Russian Foreign Minister Igor Ivanov on 14 May, but was satisfied with progress in other areas.

MINISTER: PARIS CLUB MUST RESOLVE IRAQI DEBT ISSUE. Deputy Prime Minister and Finance Minister Aleksei Kudrin told journalists after a meeting of G-8 finance ministers in France on 17 May that Russia will continue to seek a resolution of Iraq's foreign debts within the context of the Paris Club, strana.ru reported. Kudrin said the ministers discussed the possibility of involving the International Monetary Fund (IMF) in solving the problem.

MILITARY
PUTIN SETS MILITARY MODERNIZATION AS A NATIONAL PRIORITY... During his 16 May address to parliament, President Putin listed the modernization of the armed forces as one of the country's top three priorities, together with doubling gross domestic product and overcoming widespread poverty, Russian and Western news agencies reported. He said that by 2007, Russia's paratroops, marines, and infantry forces will be entirely comprised of volunteers serving on a contract basis. By 2008, the term of conscription will be reduced to one year. Conscripts will be offered the opportunity to sign contracts, which will include benefits such as free higher education. Putin said the military will also accept volunteers from other CIS countries, and such volunteers will be offered Russian citizenship after three years of service.

...AS EXPERTS DIFFER ON WHAT PUTIN MEANT BY 'NEXT GENERATION.' President Putin on 16 May also said the country will continue work to modernize its nuclear arsenal and to create "the next generation of strategic weaponry." Speaking to journalists in Moscow the same day, Deputy Prime Minister Boris Aleshin, who oversees the military-industrial complex, said that Putin was referring to a new "space-air-surface" intelligence system that will provide for the integrated control of all strategic and conventional weaponry, strana.ru reported on 16 May. However, independent military analyst Pavel Felgenhauer said that Putin was referring to a new generation of nuclear warheads, AP reported on 16 May. These new warheads could include so-called mini-warheads, which are less powerful than current warheads, but can be deployed in conventional military operations with less risk of radioactively contaminating the environment, Felgenhauer said.

PUTIN PROPOSES NEW BANNER FOR ARMED FORCES. President Putin has submitted to the Duma a bill to authorize a new banner for the Russian armed forces, "Nezavisimaya gazeta" and RTR reported on 13 May. The new banner would replace the present red banner, which was adopted in 2000 as the result of a compromise between the leftist and centrist factions in the Duma. According to the presidential bill, the new banner will be red -- as military banners have been since the days of old Muscovy -- and will feature a complex decoration of eagles, stars, and other symbols. Analysts expect that the Duma will adopt the bill.

RUSSIA CONDUCTS INDIAN OCEAN EXERCISES. Six Russian strategic bombers on 14 May joined a group of ships from the Pacific and Black Sea fleets for joint exercises with the Indian Navy in the Indian Ocean, RTR and gazeta.ru reported on 14 May. Two Tu-95 (Bear) and four Tu-160 (Blackjack) strategic bombers set off from their base near Engels in Saratov Oblast and reached the exercise site after a seven-hour flight, after which they successfully used air-to-surface missiles to strike targets located in the Arabian Sea off the coast of Yemen. Defense Minister Sergei Ivanov told reporters in Moscow that the exercises are the first of this type since the fall of the Soviet Union.

MALAYSIA TO BUY 18 RUSSIAN FIGHTERS. Defense Minister Ivanov told journalists in Kuala Lumpur on 19 May that Malaysia has agreed to purchase 18 state-of-the-art Su-30 MKM jet fighters for a total of $900 million, Russian media reported. Ivanov said the contract, which includes provisions for the maintenance and future modernization of the fighters, marks a breakthrough in bilateral military-technical cooperation. The deal also opens up prospects with Indonesia, which has close defense cooperation with Malaysia and often purchases the same types of equipment to facilitate coordination, "Vremya novostei" commented on 19 May. India is the only other country to have purchased the Su-30 MKM.

SARS EPIDEMIC
GOVERNMENT VOWS 'TOUGH MEASURES' TO COMBAT SARS. Prime Minister Mikhail Kasyanov announced at the 15 May cabinet session that his government is ready to take "tough measures" to prevent the spread of severe acute respiratory syndrome (SARS) from China to Russia, ORT reported the same day. The government approved the closure of 31 of 52 checkpoints on Russia's border with China and Mongolia, and voted to allocate 52 million rubles ($1.7 million) for federal medical centers to monitor SARS. "The situation is not acute but potentially dangerous, but the government is in control [of the situation and will] provide the necessary protection of the population and territory," Kasyanov said. Speaking at the same government meeting on 15 May, Deputy Health Minister and head of the State Health Inspectorate Gennadii Onishchenko said quarantines will affect not only the border with China but also regular flights between Moscow, St. Petersburg, or Irkutsk and China; the Moscow-to-Beijing express rail line, and dozens of shipping routes between Chinese and Russian ports.

WAR IN CHECHNYA
FSB THINKS CHECHEN ADMINISTRATION HEAD WAS TARGETED... Federal Security Service (FSB) spokesman Colonel Ilya Shabalkin said on 15 May that investigators believe the suicide bombing in the Chechen village of Iliskhan-Yurt on 14 May (see "RFE/RL Newsline," 14 May 2003) was caused by two women posing as television journalists, RTR and other Russian media reported. One of the women was killed by the explosion before being able to detonate the explosives she was carrying. As a result of the explosion 16 people were killed -- although higher figures were reported immediately following the attack -- and 145 were injured, strana.ru reported on 15 May. Among the dead were four bodyguards of Chechen administration head Akhmed-hadji Kadyrov, who was at the scene of the incident and who the FSB believes was the target of the attack, nns.ru reported. Kadyrov was not injured. Deputy Prosecutor-General Sergei Fridinskii, however, said on 15 May that he does not think Kadyrov was the intended target, RTR reported. He said that if Kadyrov had been the target, the attackers would have made greater efforts to get close to him.

...AS OPINIONS DIFFER OVER WHO MASTERMINDED LATEST CHECHEN BOMBING. Chechen administration head Kadyrov on 14 May laid the responsibility for the suicide bombing in Iliskhan-Yurt earlier that day in which four of his bodyguards were killed on Chechen President Aslan Maskhadov, Interfax reported. Kadyrov similarly identified Maskhadov as responsible for bombings in Grozny on 9 May and Znamenskoe on 12 May. But an unidentified FSB spokesman told Interfax on 14 May that Saudi national Abu al-Walid might have recruited and trained the two women who perpetrated the Iliskhan-Yurt bombing, while the Chechen Interior Ministry said it has determined that one of the women belonged to a unit commanded by radical field commander Shamil Basaev. Salambek Maigov, who is Maskhadov's envoy to the Russian Federation, told grani.ru on 14 May that the recent bombings in Chechnya are a response to the Kremlin's failure to implement any of the measures it promised in the wake of the 23 March referendum on a new Chechen constitution, chechenpress.com reported.

COMMITTEE HEAD PREDICTS DUMA WILL BACK CHECHNYA AMNESTY. Pavel Krasheninnikov, head of the Duma's Legislation Committee, said the lower chamber will support an amnesty for Chechen fighters submitted this week by President Putin (see "RFE/RL Newsline," 14 May 2003), RIA-Novosti and RTR reported on 15 May. Krasheninnikov said he hopes the amnesty bill is adopted in May so there is no major gap between its introduction and its passage -- which would foster crime in the interim, according to Krasheninnikov. Krasheninnikov said the amnesty would cover crimes committed by Russian troops in the conflict, in addition to wrongdoing by Chechen fighters. The proposed amnesty would be the fifth involving Chechnya in the last 10 years, TV-Tsentr noted on 15 May, suggesting there has been little to show from the first four.

POLITICAL ECONOMY
PUTIN CALLS ON RUSSIANS TO INVIGORATE ECONOMY, 'GOLDEN RUBLE.' President Putin highlighted serious troubles that Russia has faced during the past year in his annual state-of-the-nation address to a joint session of the Russian parliament on 16 May, Russian and international media reported. He defined the greatest problems as the unsatisfactory economic situation in the country and Russian businesses' pervasive inability to compete on a global level. Russia faces "serious threats" due to the inconsistency of its political and economic system and acute competition within the world economy, he said, according to strana.ru. He said the country has managed to dismantle serious obstacles in recent years, adding that the time has come to take "the next step." In an hour-long speech that Reuters international news agency called "the first shots in his bid for re-election" next March, Putin called on Russians to work together "to double the country's GDP" in the next 10 years and "restore the golden ruble." He said full convertibility of the ruble is desirable not only in domestic transactions, but also in international financial operations. "Our principal task should be the return of Russia to the ranks of rich, developed, strong, and respected countries. But this return will only be possible when Russia becomes strong economically, when it is no longer dependent on crumbs from international financial organizations," he said, according to RFE/RL.

DUMA APPROVES NEW RULES ON PRODUCTION-SHARING AGREEMENTS... The Duma on 14 May approved in their second reading amendments to the Tax Code related to production-sharing agreements (PSAs) for extracting natural resources, gazeta.ru reported. Reaching consensus on the amendments was a lengthy process. They were approved in their first reading last June. In the end, 384 of the 450 deputies voted for the amendments, under which PSAs would be allowed only for natural-resource deposits that no one is planning to exploit under ordinary tax rules. Auctions for the right to develop deposits would be held, and only if those auctions are declared invalid due to a lack of bids would PSAs be permitted. Gazeta.ru argued that the amendments would end the use of PSAs "as a means of evading the national tax regime and receiving excess profits."

...WHICH WOULD HAVE RETROACTIVE FORCE. The Tax Code amendments would affect not only future PSAs, but also some contracts that have already been signed, gazeta.ru reported on 14 May. The legislature has adopted 17 laws in recent years listing deposits that can be developed using PSAs. Most of those laws would lose force if the changes to the Tax Code are adopted. Companies that have contracts for those deposits would have two options: either to go ahead with the project under ordinary tax rules or to give up their licenses, wait until an auction for the use of the deposit is declared invalid, and try to conclude new PSAs. However, the amendments approved on 14 May contain loopholes. The requirement that auctions be held for the right to develop deposits under ordinary tax rules will not apply to deposits on continental shelves, at the bottom of the Caspian Sea, or in special economic zones, or those that will be exploited under international treaties. Gazeta.ru noted that the loophole will allow LUKoil to retain PSAs for two oil fields under the Caspian Sea and will allow Rosneft, ChevronTexaco, and ExxonMobil to retain similar agreements to develop deposits beneath the Sakhalin shelf.

TRENDS
SUPREME COURT REVERSES BAN ON HEADSCARVES IN OFFICIAL PHOTOS... Muslim women in Russia will be allowed to wear headscarves in photographs taken for official documents following a ruling issued by the Supreme Court's appellate chamber on 15 May, Russian media reported. An Interior Ministry directive bans the practice, but 10 Muslim women from Tatarstan charged that the ban violates their constitutional right to freedom of conscience. In March, the Supreme Court rejected their lawsuit on the grounds that Russia is a secular state (see "RFE/RL Newsline," 6 March 2003). But the appellate chamber ruled that "citizens whose religious convictions do not permit them to appear before strangers without head attire may present a passport photograph with head attire." The Interior Ministry had argued that women cannot be identified using photos in which they wear scarves over their heads and necks.

...BUT RULING MIGHT NOT SETTLE DISPUTE. The head of the Interior Ministry's passport and visa department announced on 15 May that the ministry will appeal to the Supreme Court presidium, "Izvestiya" reported on 16 May. But even if that chamber rules against the Interior Ministry, the matter might not be resolved. "Izvestiya" reported that the constitution allows the rights of citizens to be limited, but only in accordance with federal laws. An Interior Ministry directive was at issue in the case, while a presidential decree regulates passport matters generally. "Izvestiya" noted that the State Duma might amend a federal law to require citizens to appear bareheaded in passport photos. Muslim women could challenge the constitutionality of such a prohibition, but they would have to do so in the Constitutional Court. The Supreme Court has jurisdiction in cases charging that actions taken by state officials are unconstitutional, but the Constitutional Court has jurisdiction in cases charging that a federal law violates the constitution.

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