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Russia: Chechnya, Economy Cast Shadows Over Yeltsin's Inauguration

Prague, August 8 (RFE/RL) - Political and economic analysts are debating whether tomorrow's presidential inauguration at the Kremlin will signal the beginning of a positive chapter for Russia, or the continuation of its recent painful past. Whatever proves to be the case, shadows already are being cast over the ceremony by fresh fighting in Chechnya and by concerns about Russia's economy and the health of re-elected President Boris Yeltsin.

Yeltsin yesterday canceled plans to conduct the inauguration outdoors beneath three onion-domed cathedrals on Kremlin Square. A presidential spokesman, Sergei Medvedev, also announced that Yeltsin is likely to go on holiday following the ceremony.

But Yeltsin's press service is hotly denying speculation that these actions come because of the 65-year-old President's health. The press service said that conducting the ceremony inside the Soviet-era Kremlin Palace would save about $1.7 million in expenses. Yeltsin compared both plans and decided that there is no superfluous money in the state coffers even for such ceremonious events.

But correspondents note that workmen earlier this week already had built an outdoor inauguration stand at the foot of the grand Red Staircase of the Granovitaya Palace. Yeltsin would have had to descend 50 stone steps to reach that platform. The president has been hospitalized twice during the past year due to a heart condition which restricts his blood flow. Reports that he recently suffered a recurrence of heart pains remain unconfirmed.

Speculation about Yeltsin's health has been fueled by the fact that he has hardly been seen in public since his July 3 election victory. On Tuesday, the president returned to the Kremlin from Moscow's suburban Barvikha sanatorium where his aides say he has been "resting" after a tough election campaign.

Immediately upon his return, however, Yeltsin was faced with news of a major challenge in Chechnya. Separatists on Tuesday launched their biggest wave of attacks against Russian troops in five months.

The separatists seized key buildings in central Grozny, including the capital city's telephone exchange, and claim to have captured the town of Gudermes. Reports say a fierce battle continues today in Grozny with each side sending in fresh reinforcements. Heavy fighting also is reported at the town of Argun, about 15 kilometers east of the capital.

The Chechen offensive appears to have ended any hopes for a resumption of peace talks between Russian negotiators in Grozny and separatist representatives. Yeltsin and separatist leaders had reached a cease-fire deal during the election campaign.

Correspondents say the Kremlin sees this week's offensive as an attempt by the separatists to humiliate Yeltsin as he prepares to be sworn in for his second term of office.

Economic concerns also cast shadows of doubt over tomorrow's ceremony. This week, the finance ministry revealed that the federal government has collected only 63 percent of the taxes needed for to fulfill budget requirements for the first half of the year.

The budget crisis reportedly has led Prime Minister Viktor Chernomyrdin's government to postpone some campaign promises made by Yeltsin for more social spending and support for domestic industry. Russian newspapers report that implementation of four federal laws, 24 presidential decrees and 14 government decrees would cost the federal budget about $7.9 million.

Russian coal miners, some of whom haven't received pay in more than five months, already are striking in Russia's far eastern regions. And miners now are threatening a national strike. Miners have been among Yeltsin's most loyal supporters. Meanwhile, Russia's proliferation of under-capitalized banks are pleading for an expensive government bail out.

The International Monetary Fund (IMF) indicated its concern about the budget crisis by delaying last month's tranche of a $10.2 million loan.

In a news analysis today, the "Financial Times of London" suggests that economic recovery could be in sight. The newspaper's Moscow correspondent, John Thornhill, says that so long as a firm monetary grip is maintained, Russia could soon enter a circle of falling interest rates, increased investment and the first real economic growth this decade. Thornhill says an expanding economy would considerably ease the social strains that are still racking Russia.

But Thornhill says that in order to address the country's problems, Yeltsin must demonstrate considerable vigor... (using) all his legendary cunning to keep his ambitious subordinates, and potential successors, under control.

That, Thornhill concludes is "tall order for a tired man."