Russia in Review

An update from U.S.-Russia Initiative to Prevent Nuclear Terrorism for the week of July 16-23, 2010.

U.S. and Russia priorities for the bilateral agenda.

Nuclear security agenda:

• Henry Sokolski, executive director of the Nonproliferation Policy Education Center, said a new phase of U.S.-Russian nuclear arms control negotiations might hinge in part on whether Washington and Moscow can agree on conventional force reductions in Europe. (GSN, 07/21/10).
• 60 % of Russians are against further nuclear disarmament, the Russia Public Opinion Research Center (VTsIOM) said on Thursday. In 1991, almost half of Russians (48 %) were in favor of nuclear disarmament, the pollster said. Now, the figure stands at 19 %. (RIA Novosti, 07/15/10).

Iran nuclear issues:

• Iranian Parliament Speaker Ali Larijani said the US and Russia know that Iran does not have any nuclear weapons. (Iranian Students News Agency, 07/21/10).
• Aleksandr Fomin, first deputy director of the Federal Service for Military-Technical Cooperation said Russia will not to supply Iran with arms banned by the UNSC resolution. He added that Russia would consider separately each type of weapon not featured in the UNSC resolution when deciding whether to supply. (Interfax via BBC, 07/20/10).

NATO-Russia cooperation, including transit to Afghanistan:

• A NATO delegation, led by the chairman of the NATO Military Committee, Adm. Giampaolo Di Paola, met with chief of General Staff of the Russian Armed Forces Nikolai Makarov in Moscow. Following the meeting Makarov said:
  • Russia is ready to restore military cooperation with NATO which was frozen during the August 2008 war.
  • Russia would continue to provide transit routes for cargo and personnel to Afghanistan."The long-term interests of Russia and the alliance coincide in this region," Makarov said. "We are interested in successful actions by the multinational force." (Reuters, RIA Novosti, 07/23/10).
• Foreign Minister Sergei Lavrov said: "This year, Russia has written off $891mn remaining of Afghanistan's debt, increasing the total to $12bn." (Financial Control Monitor, 07/22/10).

Counter-terrorism cooperation:

• No significant developments.

Missile defense:

• No significant developments.

Ratification of the New START treaty:

• James Miller, the Pentagon's leading authority on nuclear arms, said that even large-scale Russian cheating on the treaty would not hurt U.S. security because U.S. nuclear strengths would more than offset any Russian violations. (AP, 07/20/10).
• Senator Richard Lugar said: "I believe it will provide more transparency than START I, rather than less. The numbering system for warheads and delivery systems is much more transparent than before." (GSN, 07/19/10).
• White House is trying to reach an understanding with Senator Jon Kyl and other Senate Republicans to approve the treaty before the November election. (NYT, 07/22/10).
• While they are unlikely to kill the agreement, Republican conservatives could force Democrats to delay a ratification vote until after the election. Heritage Foundation has taken the lead in opposing the treaty. Heritage's influence may explain why so many Republicans have been reticent about taking a stand. (AP, 07/22/10).
• In their effort to delay a vote on the treaty, senior Republican senators are now pointing to a House appropriations bill still being formed as the latest reason they can't yet support the treaty. (FP, 07/20/10).
• Former Sen. Gary Hart, former Sen. Chuck Hagel, William Owens, former vice chairman of the Joint Chiefs of Staff; and Arlen "Dick" Jameson, former vice commander of strategic command, have expressed their support for the treaty. (WT, 07/20/10).

Energy exports from CIS:

• No significant developments.

Access to major markets for exports and imports:

• Victoria Espinel, the U.S. intellectual property enforcement coordinator said Russia must improve efforts to stop piracy and counterfeiting of U.S. music, movies and other goods to achieve its long-term goal of joining WTO. (Reuters, 07/21/10).

Other bilateral issues:

• Federal Security Service has uncovered a criminal group of people originating from the North Caucasus, who were engaged in arms smuggling from the U.S. and were selling them to criminal groups in Russia. (Interfax via BBC, 07/23/10).
• U.S. has apologized to Russia for failing to give it prompt notice that Russian pilot Konstantin Yaroshenko - who is suspected of smuggling cocaine - was transferred upon his arrest in Liberia to U.S. custody. The U.S. notification went to Romania instead of Russia. (Reuters, 07/22/10).
• Igor Sutyagin, Russian citizen released from a prison term by Moscow as part of a spy exchange with the U.S., said that he wanted to return to Russia. (NYT, 07/22/10).

II. Russia news.

Politics, Economy, and Energy:

• Russia's international currency and gold reserves climbed $2 billion in the week ending July 16 to $469.3 billion. That's the highest level since November 2008. (Bloomberg, 07/22/10).
• Russia's budget may earn more than $32.8 billion from 2011 through 2013 by raising taxes relating to oil, gas, and metals and through other measures, said Finance Ministry official Ilya Trunin. (Bloomberg, 07/21/10).
• Russia's government declared a state of emergency in 23 crop-producing regions due to the worst drought in at least a decade. (Bloomberg, 07/20/10).
• Russian airline Aeroflot bought 11 A330-300 aircraft from Airbus. (Bloomberg, 07/21/10).
• SuperJet International, the joint venture of Finmeccanica SpA's Alenia Aeronautica SpA and Russia's Sukhoi Holding, signed an agreement with Pearl Aircraft Corporation to supply 30 Sukhoi Superjet 100 airplanes for up to $900 million. (Bloomberg, 07/20/10).
• The Russian Finance Ministry said Wednesday it would boost taxes on natural-gas extraction by 61% as it works toward balancing the budget, a blow to the powerful Kremlin-connected industry and Gazprom. (WSJ, 07/21/10).
• The Federation Council on Monday approved a draft law on the creation of a national research centre on the basis of the Kurchatov Institute in Moscow. The federal program of creating the "Kurchatov Institute" research centre specifies several priorities: development of fundamental science and applied research in such fields as energy and energy saving, nanosystems, and modern materials. (Itar-Tass, 07/19/10).
• The 1^st reactor of the Kalininskaya nuclear power plant was shut down on Friday because of fire at one of the control facilities. The fire, which posed no significant danger either to the plant or personnel, was put out. (Rosatom, 07/23/10).
• In a hypothetical presidential election 31% of Russians would vote for Prime Minister Vladimir Putin, according to an opinion poll conducted by the SuperJob.ru opinion research portal in all regions of the Russian Federation.14% of respondents said they would back the current president, Dmitry Medvedev. (Interfax, 07/20/10).

Defense policy:

• First Deputy Defense Minister Vladimir Popovkin has confirmed that the RS-24 ICBM has been deployed. He said the first unit of these ICBM's has been put on combat duty. (RIA Novosti, 07/19/10).
• Popovkin said the ministry of defense is "working with the Finance Ministry" to increase the budget of the defense agency's ambitious 2011-2020 armament program by $230 billion (7 trillion rubles) from $426 billion (13 trillion rubles) to $656 bln (20 trillion rubles). (RIA Novosti, 07/19/10).
• Test launches of the Bulava ballistic missile will resume in August or September. (RIA Novosti, 07/23/10).

Security policy:

• Attack on the Baksanskaya hydropower station in Kabardino-Balkaria:
  • Two carloads of assailants shot their way into the Baksanskaya hydropower station early Wednesday, killing two guards and setting off bombs that disabled the station.
  • President Dmitry Medvedev threatened on Thursday to sack top security officials if they fail to prevent more attacks on strategic assets.
  • "I'm afraid this may have been a rehearsal for something much larger," said a member of the FSB's National Anti-Terror Committee, Alexander Torshin.
  • It will cost 1.5 billion rubles to repair the station.
  • Balkar warlord Asker Djappuyev (nom de guerre Amir Abdullakh) has been identified as the mastermind behind the overnight attack.
  • A year ago Islamist rebels vowed "economic war" on Russia's strategic assets such as pipelines and power stations as part of their plan to create a separate pan-Caucasus Islamic state.

(Reuters, WSJ, 07/22/10, RFE/RL, 07/21/10).

• Russian President Dmitry Medvedev has signed legislation aimed at reforming the country's police force. Under the new legislation, former convicts will no longer be able to work in the police force. It will also be possible to prosecute policemen for defying their superiors' orders. (RFE/RL, 07/22/10).
• Russian President Dmitry Medvedev submitted two bills to the parliament on Saturday to update the law that outlines responsibilities of his Security Council and to toughen punishment for terrorists and accomplices, according to Kremlin.ru (Belfer Center, 07/19/10).
• The Federation Council on Monday passed a bill granting powers to Federal Security Service to issue warnings to people suspected of preparing to commit crimes against Russia's security. (AP, 07/19/10).

Foreign policy:

• The Russian government has launched an English language web portal, ModernRussia.com, to help funnel business and advertise their foray into the information age. (FP, 07/22/10).
• President Dmitry Medvedev won support from Finland's president for visa-free travel for Russians during his visit Finland. (MT, 07/23/10).

Russia's neighbors:

• Russia has frozen financial aid for Moldova's breakaway Transdniestria, saying the main bank of the pro-Moscow region had used the funds in money laundering schemes. The financial aid, provided by Moscow since 2008, stopped flowing last spring when Russia transferred $13.63 million for the first half of 2010. (Reuters, 07/23/10).
• Ukrainian armed forces will be cut by 15-20% by 2015. (Interfax, 07/23/10).
• A visa-free regime will be launched between Georgia and Iran in September. (Day.az, 07/20/10).