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Security Watch: May 1, 2002


1 May 2002, Volume 3, Number 15
FOREIGN POLICY
U.S. ARMS-REDUCTION TALKS HAVE BEEN INTERRUPTED... After holding talks with Russian Deputy Foreign Minister Georgii Mamedov on 23 April in the fourth round of U.S.-Russian arms-reduction negotiations, U.S. Undersecretary of State John Bolton left Moscow early on 24 April, Russian and international news agencies reported. Bolton was expected to hold additional talks on 24 April with senior Russian officials, but the U.S. embassy gave no explanation for his early departure. Both sides hope to reach an agreement that can be signed by U.S. President George W. Bush and Russian President Vladimir Putin when they meet in Russia on 23-26 May. Prior to the 23 April talks, Bolton said, "The relationship between the United States and Russia has fundamentally changed.... We are working as hard as we can to show as much of that progress in the agreement form as we can."

...AS RUSSIAN EXPERT WARNS AGAINST COMPROMISE WITH U.S. ON STRATEGIC-ARMS CUTS. Sergei Kortunov, the vice president of the Russian Foreign Policy Association, said Russia does not need to sign a treaty with the United States on radically reducing the two countries' strategic weapons "at any price," "Vremya novostei" and RIA-Novosti reported on 23 April. Kortunov said Russia should only sign a "good treaty" that should address all issues of concern and differences that Moscow has with Washington on the matter. He also said there is not enough time to overcome the differences before presidents Bush and Putin meet in May; thus, Russia should refrain from signing a strategic accord at the summit, but keep the "negotiation process going."

ZHIRINOVSKY WELCOMES LE PEN'S SUCCESS IN FRANCE... Vladimir Zhirinovsky, the leader of the Liberal Democratic Party of Russia and deputy speaker of the State Duma, has sent nationalist French politician Jean-Marie Le Pen a congratulatory note for his "brilliant victory" following the National Front candidate's success in France's first-round presidential elections, RIA-Novosti reported on 22 April. Zhirinovsky also wrote that Le Pen has "shaken France, awakened it from the dream cast over it by the mystics of globalism and the tales of communism." He hinted that he might travel to Paris for the second round of elections to support his friend.

...AS OTHER REACTIONS ARE MIXED. Duma International Relations Committee Chairman Dmitrii Rogozin, who was attending a session of the Council of Europe in Strasbourg, said he views Le Pen's strong performance as a reaction to France's liberal immigration policy, RIA-Novosti reported on 22 April. According to Rogozin, who is known for his rightist sentiments, the "enormous flow of immigrants" sparked a protest from the electorate. But Konstantin Kosachev, the deputy head of the Duma's Fatherland-All Russia faction, said that the results of the first-round election are a threat to democracy in France, RosBalt reported on 22 April. Kosachev added that it indicates that a victory of rightist forces is possible in France's elections for the National Assembly in June, and of the weakening of the institution of the presidency in that country.

RUSSIA TO SEND HUMANITARIAN AID TO PALESTINIAN AUTHORITY. The Emergency Situations Ministry will send humanitarian aid to the administration of the Palestinian Authority, ITAR-TASS and Interfax reported on 24 April. A cargo plane with food, medication, and other basic necessities was to fly to Jordan on 24 April, and after Russian experts on that might assess the situation on the ground in Palestine another shipment will be prepared. Meanwhile, Foreign Minister Igor Ivanov said on 23 April that Russia is taking this step because "We cannot stand by while innocent civilians are suffering, who do not have enough water, food, and medicine. Many of them have nowhere to live and are in despair." And Interfax quoted Foreign Ministry spokesman Aleksandr Yakovenko as saying the same day that an ad hoc committee for providing humanitarian aid to Palestinians, which is meeting in Oslo from 24-25 April, is receiving "a lot of attention worldwide in light of the tragic situation in the Palestinian territories occupied by Israel, and the scale of destruction and human suffering, particularly in the area of the Jenin camp in the West Bank."

DUMA ADOPTS RESOLUTION CONDEMNING ISRAELI ACTIONS... The Duma adopted with 227 votes in favor a nonbinding resolution on 24 April that harshly condemns the actions of Israeli troops in Palestine, ITAR-TASS and ORT reported on 24 April. According to the resolution, the Israeli action is "leading to mass deaths among the civilian population." The resolution also demands that Israel withdraw its troops from "occupied territories" and allow freedom of movement to Palestine Authority leader Yasser Arafat. The document also states that if Israel refuses to comply with the demands of the global community, it will be necessary to "take measures to restore peace and security in the region, including imposing economic and other sanctions against Israel."

...AND APPROVES INQUIRY ABOUT RFE/RL'S STATUS IN RUSSIA. The Duma on 24 April approved by a vote of 347 to one a parliamentary inquiry to Prime Minister Mikhail Kasyanov on RFE/RL's status in Russia, Russian and international media reported. The inquiry was initiated by Sergei Shishkarev of the People's Deputy group and submitted by the Duma's Foreign Affairs Committee in response to RFE/RL's North Caucasus Languages Service's broadcasts in the Avar, Chechen, and Circassian languages that began on 3 April. The inquiry asks Kasyanov to provide information on how RFE/RL acquired its registration to broadcast in Russia and whether there are any bilateral agreements in place that would allow Russia to set up English- and Spanish-language radio broadcasts to the United States. According to the statement, RFE/RL's North Caucasus Languages Service's broadcasts are a "gross interference in Russia's internal affairs" that can "further destabilize the situation in the region." Russia's Interior Ministry recently announced that it is forming a new "counterpropaganda" agency to broadcast into Chechnya so residents of the republic can "receive firsthand reliable information instead of listening to reports of Radio Liberty and speeches of rebel ringleaders on foreign channels," ITAR-TASS reported Interior Minister Boris Gryzlov as saying on 12 April.

FSB CLAIMS TO HAVE KILLED CHECHEN FIELD COMMANDER... The spokesman for Russia's Federal Security Service (FSB) Aleksandr Zdanovich issued a statement on 25 April claiming that Jordanian-born Chechen field commander Khattab was killed during a "special operation" carried out by the FSB and other services Russian media reported. Speaking to journalists in Voronezh on 26 April, the Defense Minister Sergei Ivanov said that "biological creature Khattab is destroyed." Finally, on 27 the state-run RTR channel screened footage of showing the dead man who looks like Khattab and the FSB put the same video on its site fsb.ru

...BUT CHECHEN LEADER, OPPOSITION SKEPTICAL. Chechen administration head Akhmed-hadji Kadyrov reacted with skepticism to the reports of Khattab's death, which he said he will believe only when he has seen the body, Interfax reported on 25 April. He pointed out that frequent reports of the death of field commander Shamil Basaev have all proved to be premature. Kadyrov had earlier expressed similar doubts over reports that Khattab had been wounded (see "RFE/RL Newsline," 14 December 2001). Meanwhile, chechenpress.com on 25 April quoted Chechen President Aslan Maskhadov's representative Akhmed Zakaev as dismissing the reports as "routine disinformation." On 19 April, "Rossiiskaya gazeta" claimed that Khattab had been killed 3 1/2 months earlier and buried near the village of Niki-Khata. But on 18 April, ITAR-TASS quoted an unidentified "well-informed source" within the Russian army's General Staff as saying that Khattab was still alive, although he had twice been wounded in fighting during the winter.

ENERGY
YUSUFOV HOPES FOR RUSSIAN OIL EXPORTS TO U.S. Energy Minister Igor Yusufov said to journalists on 26 April after his meeting with visiting U.S. Undersecretary for Energy Robert Card that currently all the conditions exist for Russia to became a permanent supplier of energy to the American market, polit .ru reported. Moreover, Yusufov added that Russia also wants the U.S. to "give a signal to the West that Russia is reliable place for energy investments." Yusufov also said to "Izvestiya" on the same day that he and Cord share the opinion that "close cooperation in energy supplies are profitable for both national economies and should not be dependent on political factors."

...WHILE FINE-TUNING ITS OIL POLICY WITH VENEZUELA. Yusufov also met in Moscow on 27 April with the secretary-general of the Organization of Petroleum Exporting Countries (OPEC), Ali Rodriguez, who is expected to step down soon as the head of Venezuela's national oil company at the request of President Hugo Chavez, RIA-Novosti reported on 28 April. Yusufov and Rodriguez discussed the coordination of Venezuelan oil policy with Russian interests on the world energy market. Adnan Shihab-Eldin, Rodriguez's deputy and the head of OPEC's Scientific Research Department, also briefed Yusufov and his staff on OPEC's vision of the future of the global oil market.

MILITARY
CHINA AND INDIA COULD INVEST IN DEVELOPMENT OF NEW RUSSIAN FIGHTER... Ilya Klebanov, minister of industry, science and technology, announced on 27 April in Moscow after a meeting of the state military-industrial commission that the body had selected the Sukhoi aviation design bureau as the main contractor for the country's new fifth-generation fighter, nns.ru reported. According to Yurii Cheryakov, Sukhoi's public-relations director, his company is the first in the history of Russia's military-industrial complex to be granted the right to attract foreign investment for the development and production of a Russian military airplane, "Izvestiya" reported. Chernyakov indicated that the most likely foreign participants in the $1.5 billion project would be major purchasers of Sukhoi fighters, including China, India, Vietnam, and Ethiopia.

...AS INDIA AND RUSSIA TEST JOINT TACTICAL MISSILE. India and Russia successfully tested on 28 April the Brahmos cruise missile, which was jointly developed by the two countries, Western and Russian news agencies reported. The missile was launched from a test site in the eastern Indian state of Orissa, according to the reports. The Brahmos has a range of 300 kilometers and is a product of India's Defense Research and Development Organization and Russia's Mashinostroiyenie, both state-run companies. The missile can be based on ships, submarines, and aircraft and should be deployed by the Indian army in 2004, Press Trust of India reported the same day.

RUSSIA READY TO MODERNIZE SUDAN'S MILITARY. Defense Minister Sergei Ivanov told journalists on 22 April after meeting with visiting Sudanese presidential adviser on defense issues, Bakri Hassan Salih, in Moscow that both sides are prepared to sign a military cooperation agreement that would allow Russia to help Sudan in the overall modernization of its military, RIA-Novosti and ORT reported on 22 April. Ivanov stressed that the Russian side is ready to provide to Sudan "a cheap and all-round upgrading of Sudan's Soviet- and Russian-made hardware." Regarding Russia's attitude to the currently strained Sudan-U.S. relations, Ivanov said that American policy toward Sudan is based on "double standards." However, he said, "No sanctions were imposed on this country, which means we are free to develop all-round cooperation." Ivanov and Salih are also to discuss a secret deal for supplying 12 Russian MiG-29 fighters at cost of $120 million, "Vedomosti" and nns.ru reported on 22 April. This would be the MiG Corporation's biggest contract in the African market, where it has already begun to squeeze out its Chinese competitors, the newspaper commented.

RUSSIAN PRESIDENT ORDERS MILITARY EXERCISES ON CASPIAN SEA. During a press conference in Astrakhan, President Vladimir Putin announced that he has ordered the Russian navy's commander in chief, Vladimir Kuroedov, to conduct military exercises on the Caspian Sea with the participation of units of the North Caucasus Military District, Caspian Naval Flotilla, air force, and Federal Border Guards stationed in the region, nns.ru and strana.ru reported on 25 April. According to Putin, the exercises are intended to protect Russia's economic and political interests, and to "prevent the activities of terrorists and drug dealers."

RUSSIA, EU DISCUSS JOINT DECLARATION ON MILITARY COOPERATION. Russian Prime Minister Mikhail Kasyanov, who is in Brussels on a three-day visit for talks with EU and Belgian leaders, said after talks on 24 April with his Belgian counterpart Guy Verhofstadt that the two sides agreed to develop a joint declaration on Russia-EU defense cooperation, RIA-Novosti and ITAR-TASS reported. The declaration would stress Russia's involvement in the creation of European military forces known as the "all-European defensive initiative." Kasyanov also announced that he and Verhofstadt agreed to work out a bilateral treaty on military-technical cooperation, as well as on cooperation in combating money laundering. Finally, Moscow and Brussels agreed to expand trade relations and to allow the participation of a Belgian astronaut on a Russian space mission.

JEWISH ORGANIZATION DEMONSTRATES AGAINST TERROR AND ANTI-SEMITISM IN RUSSIA. The Russian Jewish Congress (REK) held demonstrations and actions of solidarity with Israel in Moscow and 14 other Russian cities on 25 April, ORT and RTR reported. Speaking at a meeting near a Moscow synagogue, the head of the Committee in Support of Israel, actor Gennadii Khasanov, said the events of 11 September in the United States showed that terror can come to any land. And in Yekaterinburg, the leader of the local Jewish community, Mikhail Oshtrakh, said Jews in Ural regions experience latent anti-Semitism from local authorities and intolerance from the local Russian Orthodox Church, regions.ru reported on 25 April.

INSPECTION UNIT SAYS RUSSIA'S DECOMMISSIONED SUBS ARE A THREAT. According to a recent analytical memorandum of the State Atomic Inspection agency, 190 nuclear submarines that were decommissioned from the Russian navy because of their miserable safety conditions pose a serious threat to the population and environment, "Trud" reported on 25 April. More than 30 percent of these submarines are waiting to be scrapped. Moreover, more than half of these submarines still have nuclear fuel on board, and the navy stores 14,000 cubic meters of liquid and 26,000 cubic meters of solid nuclear waste on the Russian coastline, according to the memorandum, as cited by the newspaper. The total radioactivity of this waste is 500 million curies, or double the amount of radioactivity released into the atmosphere after the Chornobyl nuclear-power-plant catastrophe in 1986. The problem is exacerbated by the fact that the navy considers the decommissioned submarines military objects and bans the State Atomic Inspection agency from inspecting them. Meanwhile, a group of ecologists and scientists has written a letter to President Putin asking him to intervene in order to allow the State Atomic Inspection agency access to nuclear military objects, according to "Trud." Prior to 1996, the agency had access to such objects.

SECRET SERVICES
FSB INDICTS FORMER OFFICER WHO AUTHORED BOOK ON APARTMENT-BUILDING BOMBINGS... The Investigative Department of the FSB finished its investigation of the agency's former lieutenant colonel, Aleksandr Litvinenko, and handed his case over to the Military Prosecutor's Office, Russian news agencies reported on 23 April. Litvinenko's lawyer, Vadim Svistunov, said he will file an appeal against the FSB's motion as the Litvinenko defense was not informed about the completion of the investigation and had no access to its indictment materials. Litvinenko, who is accused of abuse of office and theft of explosive materials, publicly stated in a press conference in Moscow in 1998 that the FSB's leadership asked him to kill media magnate Boris Berezovsky. Following his revelations, Litvinenko was dismissed from the FSB, arrested, and became the subject of a criminal investigation. However, in 1999, the Moscow Garrison Military Court found him not guilty and he was released from custody. In 2000, Litvinenko left Russia and received political asylum in Britain, where he co-authored a book on the role of the FSB in the apartment-building explosions in Moscow and Volgodonsk in August-September 1999.

...AS LEFT FACTIONS SUPPORTS IDEA OF INVESTIGATION OF 1999 EXPLOSIONS. Meanwhile, speaking in the Duma on 22 April, Viktor Alksnis, a deputy from Regions of Russia and known for his hard-line Communist and nationalist orientation, proposed creating a commission to investigate the explosions in 1999, the Agency of Russian Information reported at http://www.ari.ru on 23 April. Alksnis's proposal got 172 votes with the Communist, Agrarian, and part of the Union of Rightist Forces faction voting for it. Some 226 votes are needed to pass the bill. It is surprising that the motion to investigate the possible role of the FSB in the explosion is coming from leftist parties, which until recently had blocked such an initiative.

FSB OFFICIAL COMPLAINS ABOUT U.S. INTELLIGENCE SHARING. Colonel General Viktor Komogorov, the deputy director of the Federal Security Service (FSB), said on 23 April that the Russian intelligence services are not satisfied with the "quality and quantity" of information they are receiving from their U.S. counterparts, Interfax reported. "In February, we provided the U.S. Central Intelligence Agency with 100 reports and got from them only 50," Komogorov said. He also complained that while the Russian side has provided the U.S. with analytical information and forecasts, the U.S. has provided only factual data and has not addressed specific questions. "This is not the kind of cooperation in the fight against terrorism that we were counting on," Komogorov said.

MORE FOREIGN SPIES FOUND LURKING IN FAR EAST... Anatolii Marenkov, head of the Federal Security Service's (FSB) directorate in Khabarovsk Krai, told reporters on 27 April that the intelligence services of foreign countries have been increasing their activities in Russia, including the Far East region, ITAR-TASS reported. According to Marenkov, 20 career officers of foreign secret services were exposed last year among members of visiting foreign delegations. Twelve foreign citizens were banned from Russia and several people were simply expelled.

...AS ANOTHER RUSSIAN CITIZEN IS SENTENCED FOR ESPIONAGE. Meanwhile, the deputy chief of the Khabarovsk regional FSB investigative department, Aleksandr Karatsuba, said that former Russian army Captain Aleksei Vetrov has been sentenced to a four-year prison term for espionage "for a neighboring country," izvestiya.ru reported on 28 April. According to Karatsuba, Vetrov had access during his army service to the Komsomolsk-na-Amure aircraft-building plant, which produces Sukhoi fighter aircraft. Karatsuba alleged that Vetrov was recruited by an organization called the Company for the Development of Economy and Technology, which is used as a front by a foreign intelligence service. Vetrov was assigned the codename "Typhoon" and was asked to deliver documentation on Sukhoi's ejection seat before being detained by the FSB. Karatsuba refused to name the country for which Vetrov allegedly spied directly, although he used several euphemisms that seemed to indicate that he had China in mind.

LOCAL COURT REFUSES TO FREE SUTYAGIN PENDING INVESTIGATION'S OUTCOME. A raion-level court in Kaluga Oblast refused on 22 April to free from custody Russian political scientist Igor Sutyagin, who has been accused of espionage, RIA-Novosti reported. Sutyagin was arrested in October 1999, and a local court sent his case back for additional investigation in December 2001 (see "RFE/RL Newsline," 28 December 2001). Sutyagin, a scholar at the Russian Academy of Sciences' Institute of the U.S.A. and Canada, was arrested in October 1999 on charges of passing secret information on Russia's combat readiness to the United States. He maintains that all his reports were based on publicly available information. The Kaluga court said that it could not release Sutyagin because he might hide, RFE/RL's Russian Service reported.

CRIME AND PUNISHMENT
DEFENSE MINISTRY PROVIDES AIRCRAFT FOR CRIMINAL CHIEFTAINS. A probe of the Russian air forces made by the Military Prosecutor's Office has discovered the misuse of Il-62M executive jets designed to transport high-level Defense Ministry officers and equipped with top-secret communication equipment linking it with the country's leadership, ntv.ru, Interfax, and regions.ru reported on 22 April. In particular, the probe established that the jets have been used by the leaders of the so-called Izmailovo-Golyanovskaya organized crime group, and other shadowy business figures, who "have chartered the aircraft through fake companies." The Izmailovo-Golyanovskaya group was formed in 1992 by the Shenkovii brothers, Maksim and Igor.

PRESIDENTIAL ADMINISTRATION TARGETED BY SWINDLERS. Presidential Property Office head Vladimir Kozhin told RTR television on 21 April that his agency has been targeted by different fraudulent entities that have used his organization's name while conducting illegal activities. In one such case a company sent a bogus letter in Kozhin's name to the Moldovan president asking for economic preferences in supplying hydrocarbons to Moldova. In the other case, a firm using the logo of the presidential office requested a license for buying explosive materials. Such cases not only compromised the name of the Presidential Property Office, but have also caused real economic damage, according to Kozhin.

FORMER MILITARY FINANCIAL CONTROLLER SENTENCED. The military court of the Moscow garrison sentenced the former head of the Defense Ministry's Main Directorate of Military Budget and Finances, Colonel-General Georgii Oleinik, to three years in prison for abuse of office, ntv.ru and RTR reported on 29 April. Oleinik was found guilty of the illegal transaction in 1996-1997 of some $450 million that was transferred by him to Ukrainian companies in the framework of a multistage barter deal in which the Ukrainian side was to pay its debts for supplies of Russian gas by sending materiel for the Russian army. But the deal failed to materialize though the money was transferred, although it was never returned and the military materiel was never sent to the Russian army. In court, Oleinik said the deal was authorized by former Finance Minister Andrei Vavilov and the other senior officials (see "RFE/RL Security Watch," 14 December 2001).

POLITICAL ECONOMY
RUSSIAN PREMIER REFUTES KUDRIN'S STATEMENT ON OIL EXPORTS. Mikhail Kasyanov said in Copenhagen on 23 April that Russia has made no decision to end restrictions on oil exports, nor has the issue even been discussed, nns.ru reported on 23 April. In a clear retreat from Deputy Prime Minister and Finance Minister Aleksei Kudrin's statement in Washington on 22 April at the U.S.-Russia Business Council that Russia has no plans to continue export cuts in the second quarter (see "RFE/RL Newsline," 23 April 2002), Kasyanov said the decision will be made in the "usual manner" following consultations with the heads of oil companies. Kasyanov added, "If the market is stable, it will be one decision; if not, another."

EES PLANS TO DOUBLE ELECTRICITY TARIFF. Unified Energy Systems (EES) head Anatolii Chubais said on 24 April to the Federation Council that EES plans to double electricity rates over the next two years, nns.ru and "Rossiiskaya gazeta" reported on 24 April. He added that price on gas also will be raised. "The country cannot develop itself when, domestically, the cost of [1000 cubic meters of gas] is $19, and outside the country $160." According to Chubais, the average Russian family pays 60 rubles ($2) a month for electricity, which he said is equal to the cost of a cheap bottle of vodka. "Nobody will invest a single ruble or dollar [in this sector]," until they are assured that the utility rates are enough to cover capital investments, the daily added.

RUSSIA, CHINA CONDUCT ENERGY TALKS... Deputy Prime Minister Viktor Khristenko, who ended his visit to Beijing on 22 April at the head of a delegation of Russian officials and oil executives, said after his discussions with his counterpart Wen Jiabao and the other Chinese leaders the same day that the central issue of his negotiations was a projected 2,400-kilometer Russia-China oil pipeline, ITAR-TASS and RIA-Novosti reported. The pipeline, which is estimated to cost some $2 billion, will be laid down by the Yukos and Transneft oil giants from the Russian city of Angarsk in the Irkutsk Oblast to Daqing in northeastern China. According to Khristenko, the pipeline, which should be commissioned by 2005, is designed to supply 20-30 million tons of oil a year. Khristenko also said he discussed the role of Gazprom in another major Chinese project, the East-West gas pipeline stretching from the Xinjiang Uighur autonomous region in western China to the Shanghai area. Finally, Khristenko noted that Russia is successfully cooperating with China in the nuclear energy sphere by assisting in the construction of the Tian Wan nuclear power plant in China, and said Russia is prepared to supply additional nuclear reactors for that project.

...AS MOSCOW AND BEIJING SET UP COMMISSION ON TRADE DISPUTES. Khristenko also revealed that China is carrying out investigations into Russian commodities imports to determine if they are being dumped, particularly steel and fertilizers, and that the two sides have agreed to set up a working group of experts to address the problem, ITAR-TASS reported on 22 April. He also added that the group will be in charge of "preventive work" to avoid "any complexities and difficulties" that may arise in trade between the two countries.

DUMA AMENDS TAX CODE TO GET MORE MONEY FROM RUSSIAN BLUE CHIP COMPANIES. The Duma quietly approved on 19 April an amendment to the Tax Code that could cost large Russian corporations billions of rubles that they tried to hide from the state, "Vedomosti" reported on 23 April. At the beginning of the year, Russian "blue-chip" companies revised the value of their primary assets in order to raise amortization expenditures and decrease reported profits, thus minimizing their taxes. As a result of this operation, the value of primary assets held by Unified Energy Systems was increased by 270 percent, Gazprom's by 200 percent, and Surgutneftegaz by 300 percent, while the Russian budget lost some 100 billion rubles ($3.2 billion) in taxes according to First Deputy Finance Minister Sergei Shatalov. However, according to the approved amendment, the large corporations should pay the state a 24 percent tax on the profits they made from the revised value of their primary assets.

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