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Security Watch: December 24, 2002

24 December 2002, Volume 3, Number 45

The next issue of "RFE/RL Security and Terrorism Watch" will appear on 7 January 2003.
FOREIGN MINISTER SUMS UP FOREIGN-POLICY ACHIEVEMENTS OF 2002... In an appearance on an ORT talk show on 22 December, Foreign Minister Igor Ivanov said that in 2002 Russia "seriously advanced" its relations with the United States, the European Union, and the countries of the Asia-Pacific region. Ivanov named the creation of the Russia-NATO Council in May as "the most important event of the year," saying that it gives Russia the opportunity to influence decision making within the alliance. Ivanov rejected assertions that Russia has made too many concessions to the United States and has adopted the role of Washington's junior partner. He said that such steps as closing down Russian military basis at Lourdes, Cuba, and Cam Ranh Bay, Vietnam; Russia's consent to a U.S. military presence in Central Asia; and the Kremlin's softening attitude toward NATO expansion were all in line with Russia's national interests. "Sometimes, Russia's national interests not only do not contradict, but even coincide with, America's foreign-policy objectives," Ivanov said. He added that Russia has "objective interests" in close relations with China and India, as well as with North and South Korea, Malaysia, and Japan. However, he said that neither China nor India is seeking a military alliance with Russia.

...AND ITS FAILURES... In the same appearance, Foreign Minister Igor Ivanov conceded that the Kremlin has had less success in its dealings with the countries of the former Soviet Union. "The development of political dialogue within the CIS in 2002 has not been satisfactory from Russia's side," he said.

...AND EXPERTS OFFER THEIR OWN VIEWS. Appearing on the same ORT program on 22 December, Federation Council Foreign Affairs Committee Chairman Mikhail Margelov said that for the first time in many decades Russia has enhanced its national security without sacrificing the lives of its soldiers. "I am absolutely certain that if the United States had not come into Afghanistan, then we would have had to do so ourselves in order to defend our security from the Taliban," Margelov said. "This is like judo or the other Oriental martial arts, in which you use the energy of your adversary to achieve your own goals. [President Vladimir] Putin is a great master of this art." Political analyst Andranik Migranyan said Russia halted its campaign against NATO expansion because its position was too weak to make any reprisal threats credible. First Deputy Chief of the General Staff Colonel General Yurii Baluevskii said a military threat to Russia from NATO expansion "does exist," but Moscow hopes to minimize it by asking the Baltic States to join the Treaty on Conventional Forces in Europe. Baluevskii also warned that Russia should not alter its policies regarding China or antagonize that country. Otherwise, Russia could face a serious threat from that direction. "The best policy toward China is to have it as a friend, neighbor, and partner, but never as an enemy," he said.

PUTIN SEEKS TO CEMENT YEMEN'S TIES TO ANTITERRORISM COALITION. President Putin met in the Kremlin on 17 December with Yemeni President Ali Abdullah Saleh, Russian news agencies reported. After the meeting, Putin told reporters that military cooperation between the two countries is developing well and that in recent years Russia has supplied Yemen with arms and military equipment worth more than $8 billion, ITAR-TASS reported. Putin stressed that the two countries have a number of common interests in the Red Sea region and that Yemen is playing an important role in combating international terrorism. ORT and RTR both commented on 15 December that Putin wants to use Russia's considerable influence to cement Yemen's ties to the global antiterrorism coalition. Moscow has had considerable influence in Yemen since the Soviet era, when South Yemen was a loyal ally. Most members of the Yemeni political and military elites were educated in the Soviet Union, ORT noted. reported on 17 December that Putin and Saleh discussed the Israeli-Palestinian conflict and the Iraq situation. Saleh stressed that his country opposes the use of military force against Iraqi President Saddam Hussein.

RUSSIA, HUNGARY SEEK IMPROVED ECONOMIC RELATIONS. Hungarian Prime Minister Peter Medgyessy met in the Kremlin with President Putin on 20 December for wide-ranging talks on bilateral relations, Russian news agencies reported. Speaking to journalists after the meeting, Putin said "the main thing in bilateral relations is economic and trade ties," RTR reported. Putin added that there have been alarming developments, including a slump in bilateral trade at an annual rate of about 6 percent over the last two years. He added, however, that both sides are determined to overcome any obstacles. Medgyessy, the first Hungarian prime minister to visit Moscow since 1996, said, "We neglected one another in recent years and now need to turn a new page in our relations." He added that Hungary is ready to sign a number of economic agreements with Russia and to discuss the issue of Russia's $497 million debt to Hungary.

GOVERNMENT RELEASES CHECHNYA CASUALTY FIGURES. From the beginning of the current military campaign in Chechnya on 1 October 1999 to 15 December 2002, 4,705 Russian servicemen were killed, 13,040 wounded, and 28 are missing, Russian news agencies reported on 16 December, citing the Joint Group of Federal Forces in the North Caucasus. Of that number, 2,738 killed Defense Ministry troops were killed and 6,439 wounded, with the rest of the casualties belonging to the Interior Ministry and the Federal Security Service. According to official statistics, 14,113 Chechen fighters were killed during this period.

PUTIN AGAIN RULES OUT CHECHEN PEACE TALKS... Responding to questions about the conflict in Chechnya during his live television appearance, President Putin reiterated his position that it is impossible to negotiate with representatives of Chechen separatists, RFE/RL's Russian Service reported. He described the Chechen fighters as "international terrorists and bandits" and argued that the peace negotiations held in 1996 simply "led to the escalation of aggression." He reaffirmed his plan to hold a referendum on a new constitution in the republic in the spring, to be followed by elections. He added that he does not believe a state of emergency should be declared in Chechnya.

...AS CHECHEN HEAD PRAISES OUSTED GENERAL. The head of Chechnya's pro-Kremlin administration, Akhmed-hadji Kadyrov, has said he views positively the possible participation of former North Caucasus Military District commander Colonel General Gennadii Troshev in the upcoming presidential election in Chechnya, RIA-Novosti reported on 20 December. Troshev was dismissed from his post last week following public comments he made concerning his possible transfer to command the Siberian Military District. Kadyrov said he has good personal relations with Troshev and added that the general would make "a good candidate." He added, however, that he still plans to participate in the election himself.

COURT RULES THAT ACCUSED ARMY COLONEL IS INSANE... The trial of Colonel Yurii Budanov, who is accused of murdering a Chechen girl, Elza Kungaeva, in March 2000, resumed on 16 December in Rostov-na-Donu after a six-month break, Russian news agencies reported. Budanov has consistently pleaded temporary insanity and claimed that he believed Kungaeva was a Chechen sniper. In June 2002, the prosecutor proposed that Budanov be acquitted on grounds of diminished responsibility, after which the case was referred for a second time to the Serbskii Institute of Psychiatry in Moscow (see "RFE/RL Newsline," 4 and 19 June 2002). Kungaeva's father cast doubt on the court's ruling, saying he will seek an independent examination of Budanov, Reuters reported.

...AS CHECHEN OFFICIALS FEAR BACKLASH AGAINST RULING. Chechen administration officials expressed concern on 16 December that the Rostov court ruling that Colonel Budanov is insane will cause widespread anger in Chechnya, Russian news agencies reported. Russian presidential envoy for human rights in Chechnya Abdul-Khakim Sultygov told ITAR-TASS that "people in Chechnya are convinced Budanov is a criminal, a murderer. Such a mild verdict -- de facto acquittal -- will disturb Chechen society." Deputy administration head Tauz Dzhabrailov pointed out that "it will be difficult for the republic's leadership to explain to the population why Budanov, if he is really [mentally] ill, was appointed a regiment commander," according to Interfax on 16 December. Security Council Secretary Rudnik Dudaev condemned the court ruling as a classic Soviet-style cover-up. He suggested that Russian "national patriots" supported Budanov's efforts to escape criminal responsibility for Kungaeva's murder.

DUMA ADOPTS 'LIBERAL' RESOLUTION ON CHECHNYA By a vote of 252-0, the Duma on 18 December approved a resolution calling on President Putin to publicize a plan for a political settlement of the conflict in Chechnya, to declare a state of emergency in the republic, to create a unified civil-military administration there, to create a government ministry responsible for Chechnya, and to appoint a deputy prime minister to represent the republic's interests in the government, and other Russian news agencies reported on 18 December. The resolution was sponsored by Valentin Nikitin (Communist), the head of the Duma's commission on human rights in Chechnya. Nikitin noted that the declaration of a state of emergency would strengthen civilian control over the military and protect the civilian population. The resolution also urges Putin to continue withdrawing federal forces from the republic.

WEBSITE SAYS WARLORD'S DEATH WAS POLITICALLY MOTIVATED. The sudden death in prison from "internal bleeding" of Chechen field commander Salman Raduev on 14 December (see "RFE/RL Security and Terrorism Watch," 17 December 2002) was politically motivated, asserted on 17 December. The website connected Raduev's death with the equally unexpected and mysterious death in prison of former Chechen Deputy Prime Minister and National Security Minister Turpal-Ali Atgeriev on 18 August (see "RFE/RL Newsline," 23 August 2002) from "internal bleeding" that was attributed to leukemia. Both Raduev and Atgeriev were involved in the same criminal case concerning the 1996 raid on the town of Kyzlyar. Moreover, Atgeriev twice told journalists that he had warned then-FSB Director Putin in 1999 of an imminent incursion by Chechen fighters into Daghestan. speculated that both men might have possessed information that influential people in Russia and Chechnya would like to conceal. As for "internal bleeding," it is often caused by severe beatings, the website added.

GENERAL TURNS DOWN DEFENSE MINISTER'S OFFER... Colonel General Gennadii Troshev, commander of the North Caucasus Military District and formerly Russia's top military commander in Chechnya, said that he rejected an offer by Defense Minister Sergei Ivanov of transfer to the Siberian Military District, reported on 18 December. Troshev confirmed that Ivanov had made the proposal (see "RFE/RL Newsline," 11 December 2002) but said that he would wait "until the current counterterrorism operation is finished" before accepting a transfer. "This was the task set for me by the supreme commander [President Putin], and I do not think that now is a good time, especially on the eve of the referendum [on a new constitution] in Chechnya," Troshev said. Analysts have speculated that Ivanov made the offer to Troshev as part of a move to sideline generals who have made their reputations during the war in Chechnya and who are now widely viewed as an obstacle to peace negotiations.

...AND THEN GETS SACKED... President Putin has dismissed Troshev from his post as commander of the North Caucasus Military District, Russian news agencies reported on 19 December. Lieutenant General Vladimir Boldyrev, commander of the Siberian Military District, was named to replace Troshev. Presidential aide Sergei Yastrzhembskii described Troshev's statements about turning down Ivanov's offer as "unacceptable," reported. "Generals should not publicly discuss suggestions and orders from the defense minister," Yastrzhembskii was quoted as saying. reported that the military counterintelligence service has been ordered to monitor senior officers close to Troshev.

...AS SOME SEE THE MOVE AS PLOY. Troshev's unexpected dismissal could signal the start of a bid by him to run for president of Chechnya in the election that was recently announced for next spring, Chechnya's Duma deputy Aslanbek Aslakhanov told on 19 December. Aslakhanov added that Troshev has serious ambitions to become the republic's president and could be a serious candidate in the election. His refusal to accept Defense Minister Ivanov's proposal gives Troshev the appearance of being in opposition to the government, repeating a pattern established by other generals such as Aleksandr Lebed and Lev Rokhlin, "Izvestiya" noted. A former commander of federal forces in Chechnya, Vladimir Shamanov, was elected governor of Ulyanovsk Oblast in 2002, and Federal Security Service (FSB) General Murat Zyazikov was elected president of Ingushetia in 2001.

CHURCH SEEKS RESTORATION OF MILITARY CLERGY. Speaking to journalists following the end of the World Russian People's Congress, Dmitrii Smirnov, head of the Russian Orthodox Church's military liaison office, said the church views the reinstitution of the military priesthood as a top priority, reported on 18 December. He said that there are currently 450 priests serving in the Russian armed forces, operating 150 military churches. But he added that both these figures should be dramatically increased. Speaking at the same press conference, Archbishop of Smolensk and Kaliningrad Kirill said the church plans to increase the number of chapels in public places, especially in supermarkets, to protect citizens from "the nightmare of a consumer economy."

INTELLIGENCE COMMUNITY CELEBRATES ITS SOVIET ORIGINS... Russia's security and intelligence services on 20 December marked the 85th anniversary of their creation by the founder of the Soviet state, Vladimir Lenin, Russian news agencies reported. On 20 December 1917, Lenin signed a decree establishing the notorious Soviet secret police, the VChK-KGB. Agents of the VChK came to be called "chekists." Until 1995, the intelligence services marked 20 December as Chekist Day, but that year President Boris Yeltsin renamed the day Security Services Day. At present, the key Russian intelligence agencies are the Foreign-Intelligence Service (SVR), the Main Intelligence Directorate of the General Staff (GRU), the Federal Security Service, the Federal Agency of Governmental Communications and Information (FAPSI), the Federal Protection Service (FSO), and the Main Directorate of Special Programs of the Russian President. All of them except the GRU were formerly elements of the Soviet KGB and have preserved the KGB "sword-and-shield" emblem as their symbols, although they have added the two-headed Russian eagle to them.

...AS FOREIGN-INTELLIGENCE DIRECTOR OUTLINES PRIORITIES... SVR Director Sergei Lebedev told "Rossiiskaya gazeta" on 20 December that the fact that President Putin is a former intelligence officer helps him and his service. Lebedev said his agency is efficient and works in coordination with other elements of the country's intelligence community, " though they were split up [after the dismantling of the KGB]." He said the SVR "takes adequate measures to identify threats connected with NATO's approach to Russia's borders." He also said Russia is concerned by NATO's "declared interest in Central Asia and the Caucasus." He added that his agency has "helpers" abroad who cooperated with it on an ideological or political basis. "There are people abroad who sympathize with Russia and support its striving to form a multipolar world and to secure global and regional balances of power," he said. The SVR has no special units to conduct diversions abroad because the SVR has never been asked to carry out such operations, Lebedev said. He also said that, although he personally condemns defectors, the SVR has no "cleaners" who seek out defectors abroad and punish them as the Soviet KGB had.

...FSB GOES AFTER SPIES IN THE REGIONS... FSB Director Nikolai Patrushev has said that he is satisfied with the work of his agency in 2002 and noted that the FSB has managed to prevent serious harm to Russia's national interests, reported on 20 December. He noted the FSB's role in denying visas to more than two dozen U.S. Peace Corps volunteers, including the former head of that organization in Primorskii Krai. The head of the FSB's Nizhnii Novgorod directorate, Lieutenant General Vladimir Bulavin, said his officers uncovered 19 foreign intelligence officers looking into defense objects in the region, RIA-Novosti reported on 19 December. He said the prime targets of interest are the Federal Nuclear Center in Sarov and local defense enterprises working on the development of advanced weaponry.

...AND PRESIDENTIAL ENVOY ACCUSES RED CROSS OF SPYING. Speaking at a meeting of members of executive branches in the Southern Federal District on 18 December in Rostov-na-Donu, presidential envoy to the Southern Federal District General Viktor Kazantsev said it is necessary to take the activities of all "humanitarians" in the North Caucasus under strict control and "redirect foreign charity" from Ingushetia to Chechnya, changing the scheme for distributing humanitarian cargoes, "Kommersant-Daily" reported on 19 December. "You know very well who works for the Red Cross -- spies," he said. Kazantsev was formerly the commander of the federal forces in Chechnya before being appointed presidential envoy (see "RFE/RL Russian Federation Report," 24 May 2000). Kazantsev also reported that while the number of displaced persons from Chechnya in Ingushetia has fallen from 148,600 last year to 68,700 this year and the situation has stabilized, the problem of displaced persons is far from resolved. He argued that the basic obstacle hindering their return is that they remain afraid for their lives, and this fear is reinforced by anti-Russian provocations carried out in Chechnya and Ingushetia.

MOSCOW RESUMES OLD ESPIONAGE CASE. The Moscow City Court on 16 December resumed hearing the case of Professor Anatolii Babkin, who stands accused of "state treason in the form of espionage" for the United States, ORT reported. Babkin, 72, was arrested in August 2000 together with U.S. engineer Edmund Pope and indicted for allegedly transferring to Pope classified information about the Russian Shkval high-speed, liquid-fueled, rocket-propelled torpedo. In 2001, Pope was convicted of espionage and sentenced to 20 years in prison. However, President Putin pardoned him in December 2001. Babkin was convicted of revealing state secrets but was released for "humanitarian reasons." Now, however, prosecutors have revived the case by arguing that Babkin was guilty not just of revealing secrets but of "high treason." Babkin's lawyers argue that he is not guilty of either crime, since he left his job in 1966 and the materials that he showed to Pope were only classified in 1973.

SECRET COURT SENTENCES FSB 'TRAITOR' WHO SOLD SECRETS TO OLIGARCH. The chief of the FSB's Internal Security Department, Sergei Shishin, has said that an unidentified FSB officer pled guilty to charges of selling classified information to Media-MOST over a period of several years and was sentenced by a secret court over the summer to "several years" in prison, reported on 17 December. At the time, Media-MOST was the flagship company of tycoon Vladimir Gusinskii and its security department was largely staffed by former KGB and FSB officers who were involved in "the total surveillance of Gusinskii's opponents."

DUMA DEPUTY LAMENTS KGB-IZATION OF THE GOVERNMENT. State Duma Security Committee Deputy Chairman Yurii Shchekochikhin (Yabloko) told journalists in Samara on 17 December he has the impression that Russia has "returned again to the period at the end of the 1970s and early 1980s," reported. "Now in Russia a like-mindedness is observable absolutely everywhere...a constant fear and the strengthening of the position of the first committee for state security," he continued. "For any society, the KGB-ization of the government is an abnormal occurrence," Shchekochikhin added. In terms of the media, he noted that Russia ranks second after Algeria in terms of the number of journalists killed and that any official can now go to court against a newspaper and receive "a completely abnormal sum in compensation" that can close a publication down. He also noted that websites containing false information keep popping up for one day and then disappear. But somehow "all publications manage to comment on this information," he noted.

CONTROVERSIAL SLAVNEFT AUCTION NETS JUST $1.86 BILLION... A 74.95 percent state-owned stake in oil major Slavneft was sold in a closed auction on 18 December to Sibneft, which is controlled by oligarch and Chukotka Autonomous Okrug Governor Roman Abramovich, for $1.86 billion, Russian news agencies reported. The auction lasted just five minutes and a total of seven bidders participated. The government set the minimum starting bid at $1.7 billion. Chinese state oil company CPNC withdrew from the auction following a call by the State Duma to ban it from participating (see "RFE/RL Newsline," 16 December 2002). The Slavneft purchase makes Sibneft one of Russia's four largest oil companies, together with Yukos, LUKoil, and Surgutneftegaz. Sibneft announced late on 18 December that the company had made the purchase in a joint bid with TNK, which is owned by the Alfa financial-industrial group. Sibneft shares jumped sharply upon news of the purchase, Reuters reported.

...AS CRITICS DENOUNCE AUCTION AS A 'LOTTERY.' Despite previous government pledges that the Slavneft auction would be "unprecedentedly transparent," the process was characterized by a large number of scandals and intrigues,,, and other Russian news agencies noted on 18 December. The results of the auction "attest that...this was not a competition but a lottery," Duma Speaker Gennadii Seleznev was quoted by ITAR-TASS as saying. He expressed disbelief that the stake was sold for less than $2 billion. The media noted that the list of bidders was changed at the very last minute and that the wealthiest potential purchaser, China's CNPC, was practically forced out of the competition. reported that the state-owned oil company Rosneft was also sidelined. Furthermore, LUKoil and Surgutneftegaz both "voluntarily" declined to bid at the last minute. The complete list of the seven entities that did participate was not released to the public, and journalists were not allowed to observe the auction. Audit Chamber official Sergei Ryabukhin told RIA-Novosti on 18 December that his agency estimated the value of the Slavneft stake at at least $3 billion.

RUSSIA SIGNS PIPELINE-INTEGRATION ACCORD. A government delegation visiting Zagreb on 16 December signed an accord with Hungary, Slovakia, Croatia, Ukraine, and Belarus about the integration of Russia's Druzhba pipeline with the Adria pipeline, "Izvestiya" and other Russian news agencies reported on 17 December. The Druzhba pipeline goes from Russia through Belarus, Ukraine, and Slovakia, while the Adria transits Hungary and Croatia. Under the accord, the two pipelines will be controlled by a joint entity and will guarantee the annual provision of 15 million tons (90 million barrels) of Russian oil to global markets via the Croatian port of Omisalj. Russia oil majors Yukos, Sibneft, LUKoil, and TNK, which hope the new infrastructure will substantially reduce oil-transport costs, instigated the project. noted on 17 December that the system could make it more feasible to ship Russian oil to the United States via oil tankers.

DUMA APPROVES RESTRICTIONS ON CHANGING ENERGY TARIFFS. The Duma on 19 December passed amendments to the law on energy tariffs that would make it more difficult to change prices for electricity and heating fuel, RTR and other Russian news agencies reported. The revised amendments were worked out by a conciliation commission after the Federation Council rejected amendments passed by the Duma this summer. Under the latest amendments, only the government would have the authority to change energy rates. Furthermore, each year the government would set maximum energy rates for industrial and residential customers, and it would be illegal to change tariffs during a given fiscal year. The bill stipulates that energy prices be set once a year, immediately prior to the Duma's first reading of the federal budget.

DUMA PUTS OFF EES REFORMS... Duma Deputy Gennadii Raikov (People's Deputy) announced on 19 December that the Duma will not consider a package of reforms for the electrical-energy sector until next year, reported. Unified Energy Systems (EES) head Anatolii Chubais said that delays in approving the reforms have already cost the country $200 million, RTR reported on 18 December. He added that market speculators who want to see a reduction in the price of EES shares are behind the Duma's decision to postpone consideration of the reforms.

...AS CHUBAIS AND ILLARIONOV CLASH AGAIN. Speaking at the International Energy Forum in Moscow on 18 December, EES head Chubais said that a group of unnamed influential businesspeople are buying up EES shares, reported. Chubais said that he has no exact information but that "analysts" believe the speculators have used their political influence to reduce the price of EES shares. He said the speculators have purchased about 10 percent of the company for about $600 million. Presidential economics adviser Andrei Illarionov said the depreciation of EES shares is not the result of intrigues but a natural market reaction to the company's poor management and the bad restructuring policies implemented by Chubais, reported.

RUSSIAN CONGRESS MULLS NATIONALITY ISSUES. Speaking at the opening of the seventh annual World Russian Peoples' Congress in Moscow on 17 December, Russian Orthodox Church Patriarch Aleksii II called for a revival of business and work ethics, RIA-Novosti and other Russian news agencies reported. The patriarch added that periods of reform are often accompanied by moral decay. Archbishop of Smolensk and Kaliningrad Kirill called on the state to redistribute the national wealth to benefit "the have-nots and those who cannot work." Deputy Duma Speaker and Liberal Democratic Party of Russia leader Vladimir Zhirinovskii said that the congress should clearly declare that "Russians are a state-forming nationality and that empire is the Russian system of government." He added that by the term "Russian" he means all those who acknowledge Russian culture. Communist Party leader Gennadii Zyuganov called for the transformation of the nonprofit, arts-oriented Kultura television channel into a "Russian television channel."