Russia in Review

I. U.S. and Russian priorities for the bilateral agenda.

Nuclear security:

No significant development.

Iran nuclear program and related issues:

Russian President Vladimir Putin said: “We need to be patient and work with our American colleagues to find solutions, the way we have in some areas of our cooperation, such as with the Iranian nuclear issue.” (Kremlin.ru,, 07.27.15).
Russia is modernizing its S-300 missile system to supply to Iran, an adviser to Russian President Vladimir Putin said Thursday. (Reuters, 07.30.15).

NATO-Russia relations:

Russian President Vladimir Putin said when asked if another war possible in Europe today: “I hope not. But I would really like to see Europe demonstrate some real independence and sovereignty and be capable of defending its national interests, the interests of its people and its nations.”(Kremlin.ru, 07.27.15).
“The determining factor in relations with NATO remains the alliance’s unacceptable to Russia plans to advance its military infrastructure to [Russian] borders,” Russia’s maritime doctrine reads. (Sputnik, 07.26.15).
"NATO just cannot deploy its assets close enough to engage our armed forces," Russia's Ambassador to the United Kingdom Alexander Yakovenko said. NATO military analysts proceed from the assumption that "with the systems deployed in the Crimea we control the entire water space of the Black Sea and 40% of its airspace," the diplomat said. "You just extrapolate this on to the whole length of our western border on land and in sea… to see that no direct engagement is possible under these circumstances," Yakovenko said. (Interfax, 07.29.15).
On Friday 24th July as part of NATO's ongoing mission to police Baltic airspace, RAF Typhoons intercepted 10 Russian aircraft during a single Baltic Air Patrol, Quick Reaction Alert mission. (Raf.Mod.Uk, 07.30.15).
There are some 30,000 U.S. troops in Europe today, and just two Army Brigades permanently stationed in Europe. During the Cold War there were some 300,000 troops. (Wall Street Journal, 07.31.15).

Missile defense:

Russian President Vladimir Putin said: “The process of starting a new arms race began from the moment of the United States’ unilateral withdrawal from the ballistic missile defense treaty…. we are developing strike systems capable of overcoming any missile defense system.” (Kremlin.ru, 07.27.15).
Russia inducted a new-generation spy ship into the Northern Fleet. The ship, which is known as the Yury Ivanov, the lead boat of the Project 18280 intelligence ships designed for the Russian navy, will be tasked with monitoring U.S. anti-missile defenses on the high seas. (The Moscow Times, 07.26.15).

Nuclear arms control:

No significant developments.

Counter-terrorism:

Russian President Vladimir Putin said: “When we were only beginning this struggle (against terrorism) and came across problems in the Caucasus, I was amazed to see that even though we had proof that we were dealing with a terrorist threat, that we were fighting Al Qaeda representatives, we had no support….Now I see that the situation has changed. Europe and the United States have come to see the real danger of the extreme manifestations of radicalism and have joined this struggle.” (Kremlin.ru, 07.27.15).
Turkish President Tayyip Erdogan and Russian President Vladimir Putin discussed the situation in the Middle East, and better cooperation in fighting Islamic State, the Kremlin said on Sunday. (Reuters, 07.27.15).
Alexander Bortnikov, head of the FSB security service, said on July 30 that during the Sochi Olympic Games and preparations for them, "we succeeded together with our partners from many governments, primarily France, Germany, Austria, the USA, and Georgia, in preventing an array of attacks against Olympic facilities that were being prepared." Bortnikov said collaboration between the security services of Russian and Western countries also helped prevent incidents at the recent European Games held in Azerbaijan. He said he hopes to draw on the same arrangements to ensure security at the 2018 World Cup events to be held in Russia. (RFE/RL, 07.31.15).
Deputy Foreign Minister of Russia Oleg Syromolotov said that Russia was as much interested in resuming Russian-Western counter-terrorism cooperation as Western countries. He also said that U.S.-Russian counter-terrorism cooperation “is continuing to a certain extent even under the current conditions,” singling out cooperation in countering the Islamic State terrorist organization. (Kommersant, 07.26.15).
Citizens of over 100 countries are fighting for the Islamic State, an international terrorist organization banned in Russia, Russian Federal Security Service (FSB) Director Alexander Bortnikov told an international conference of chiefs of special, security, and law enforcement agencies from countries that are FSB partners in Yaroslavl on July 29. (Interfax, 07.29.15).
Out of an estimated 20,000 foreign recruits fighting for IS and other extremist groups in Iraq and Syria it is believed that close to 2,000 are Russian nationals and approximately 1,500 come from the Central Asian republics. (ECFR.eu, 07.27.15).
Mukhammad Abu Dujana Gimrinsky, a militant who gained experience fighting in Syria has been appointed as the Emir of the Caucasus Emirate’s Mountainous Sector of Dagestan. (ChecheninSyria.com, 07.26.15).
A fighter from the Caucasus Emirate in Syria, an al Qaeda-affiliated group, released a photo showing ownership of a US-made BGM-71 anti-tank missile. It is unclear when or where the photograph was taken, but it is likely recent and taken in northern Syria. A note card reading “Imarat Kavkaz” or “Caucasus Emirate” in Chechen can be seen in the foreground. (Long War Journal, 07.28.15).
On Aug. 1 a hotline will start working in Russia for those whose friends or family members have joined ISIS. (RBTH, 07.29.15).
Chechen police have detained three female con artists who talked fighters of the terrorist group Islamic State into sending them money for traveling to Syria. The three-girl operation managed to swindle some $3,300 from Islamic State recruiters before being caught. (Russia Today, 07.29.15).
A jury was selected July 30 in the case of a Russian military officer charged with leading a Taliban attack on U.S. forces in Afghanistan. Irek Hamidullin faces 15 counts, including providing material support to terrorism and trying to kill a U.S. military officer. (RFE/RL, 07.31.15).

Cyber security:

Terrorists are actively using new technologies and software products, which enable them to code their traffic and stay anonymous, Russian Federal Security Service Director Alexander Bortnikov told an international conference of chiefs of special, security, and law enforcement agencies in Yaroslavl on July 29. “We should expand the practice of joint operative investigation into terrorist groups, expose and stop the activities of people who form the core of these organizations, discredit their leaders and sow discord among these bandits,” Bortnikov said. (Interfax, 07.29.15).
Russian government-backed hackers who penetrated high-profile U.S. government and defense industry computers this year used a method combining Twitter with data hidden in seemingly benign photographs, according to experts studying the campaign. Researchers at security company FireEye Inc said the group used the unusual tandem as a means of communicating with previously infected computers. (Reuters, 07.29.15).
The White House has dismissed a petition calling on the United States to pardon fugitive government contractor Edward Snowden. (RFE/RL, 07.29.15).

Energy exports from CIS:

If Moscow and Beijing decide to sign an agreement on shipments of Russian natural gas to China via the western route, Russian President Vladimir Putin's visit to China in September would be a good opportunity for signing the document, Kremlin spokesman Dmitry Peskov said. (RBTH, 07.29.15).

Bilateral economic ties:

Aleksander Stadnik, Russian Trade Representative in the U.S., said that in 2014, U.S.-Russia trade volume increased by over 5.6 percent to $29 billion. However, the first five months of 2015 demonstrated a serious decline of about 20.9 percent, according to Stadnik. According to the data of the U.S. Department of Commerce, the outflow of American direct investment from Russia in 2014 was $287 million. U.S. direct investments into Russia in 2014 are estimated at a little over $700 million. In comparison, Russian direct investments in the U.S. grew by about $1.7 billion in 2014. (Russia Direct, 07.24.15).

Other bilateral issues:

U.S. President Barack Obama is expected to unveil a new commitment when he leads a summit on peacekeeping in September during the U.N.'s 70th annual general debate. Washington is appealing to Europe, Australia, Canada and other developed countries to deploy their troops on U.N. missions, and has also sought help from China and Russia. (Wall Street Journal, 07.28.15).
The U.S. Treasury Department's Office of Foreign Assets Control imposed measures against eight entities and people it said were providing support to Gennady Timchenko. It also targeted two entities it said were providing support to Boris Rotenberg. The United States on Thursday also sanctioned four former Ukrainian officials and their close associates linked to Viktor Yanukovych. Five Crimean port operators and one ferry operator were sanctioned for operating in Crimea. The United States also identified several entities it said were subsidiaries of VEB and Rosneft. (Reuters, 07.31.15).
The National Endowment for Democracy is the first organization to be labelled "undesirable" under a new Russian law. Russia's Foreign Ministry warned that "we will never tolerate mentoring and open interference in our affairs by foreign structures”. The US Department of State called the blacklisting "a further example of the Russian government's growing crackdown on independent voices and another intentional step to isolate the Russian people from the world". (BBC, 07.30.15).
Russian citizen Evgeny Buryakov accused by U.S. authorities of posing as a banker in New York in order to spy for his government lost a bid on July 29 to have his charges thrown out. (RFE/RL, 07.30.15).
According to the research held by the Levada Center in mid-July 70 percent of Russians currently have negative sentiments about the United States, which is 11 percent points less than in January. Only 19 percent of responders confessed positive attitude towards the US in July. China and Belarus topped the list of Russians' favorably-viewed countries with 75 and 84 percent of positive answers respectively. Other nations in the list included Iran with 43 percent and Georgia with 45 percent. (Russia Today, 07.29.15).

II. Russia news.

Domestic politics, economy and energy:

The Russian central bank slashed the key rate by 50 basis points to 11%, in line with the market consensus, taking its total cuts so far this year to six percentage points. (Wall Street Journal, 07.31.15).
The Russian ruble has come back to below 60 against the US dollar in early trading on the Moscow Exchange Wednesday. The Central Bank of Russia (CBR) said it stopped buying foreign currency, as the ruble hit 4-month lows. (Russia Today, 07.29.15).
Ruble plunge, Moscow's conflict with Ukraine, and low oil prices are taking their toll on Gazprom, which saw its profits fall 86% last year. Its net income plummeted to 159 billion rubles ($3 billion) in 2014 from 1.1 trillion rubles ($20 billion) in 2013. (CNN, 07.29.15).
Amid a renewed fall in global oil prices, Rosneft has cut its payments to BP by 50 percent. In the second quarter, the Russian oil giant’s British shareholder received a pre-tax profit of $510 million, BP noted in its report. (RBTH, 07.28.15).
Novatek, Russia's No. 2 gas producer, made second-quarter net profit of 41.9 billion rubles ($703 million), up 31 percent year-on-year on stronger sales. (Reuters, 07.29.15).
Russia's most popular search engine Yandex NV said Thursday its second-quarter net profit dropped 82% from a year earlier, driven by a “challenging economic environment.” (Wall Street Journal, 07.30.15).
Russia's gross domestic product contracted by 4.2 percent in June compared with the same period a year earlier, and by 0.1 percent compared to the previous month in seasonally-adjusted terms, the Economy Ministry said on Tuesday. (Reuters, 07.28.15).
A Russian group of nuclear technicians will in November head to Italy for training on a vessel called the Itarus that would be able to lift sunken nuclear reactors and other radioactive litter scuttled by the Soviet Navy in Arctic waters over decades. (Bellona, 07.24.15).
Russia’s first point for long term storage of “special” radioactive waste is to be built at the site of the EI-2 uranium graphite weapons-grade plutonium production reactor in Siberia’s closed nuclear city of Seversk by the end of December. (Bellona, 07.29.15).
Dismantlement works on floating nuclear hazards in Russia’s Far East have begun as promised by a new plan announced in June by Sergei Kirienko. (Bellona, 07.28.15).

Defense and Aerospace:

President Vladimir Putin on Sunday approved amendments to Russia’s maritime doctrine to shift the emphasis of Russian naval operations toward so-called blue water operations with a focus on the Atlantic and Mediterranean .By focusing on the Atlantic, the amended doctrine asserts the Russian navy’s role as a countering force to what military planners in Moscow see as an encroaching NATO military alliance on Russian borders and interests. The new doctrine also aims to reverse the decline of Russia’s Black Sea Fleet. (The Moscow Times, 07.27.15.)
The head of Russia's Black Sea Fleet said his fleet received over 10 new warships last year. This year the navy is expected to commission over 10 new warships, 40 support ships and an unspecified number of naval aircraft and coastal defense forces into its ranks. (The Moscow Times, 07.26.15).
The 2015 Defense News Top 100 list featured seven Russian firms, all of which saw revenues rise in 2014. (The Moscow Times, 07.28.15).

Security, law-enforcement and justice:

Vladimir Lapygin, 75-year-old employee of a research branch of Russia's Space Agency has been placed under house arrest on suspicion of passing classified data to a foreign state. (RFE/RL, 07.28.15).
An unknown number of Londoners might have been put at risk by the 2006 poisoning of ex-KGB agent Alexander Litvinenko with a radioactive isotope, which amounted to "a nuclear attack on the streets" of the British capital, an inquiry heard on Thursday. British police have accused two Russians -- Dmitry Kovtun and Andrei Lugovoi -- of carrying out the killing, sponsored by elements in the Kremlin. Both deny involvement and Moscow refuses to extradite them. ( AP, 07.30.15, RFE/RL, 07.31.15).
A lawmaker from the centrist-conservative ruling party United Russia has told reporters that he was preparing a bill that would make undertaking military service in certain foreign forces ‘high treason’. (Russia Today, 07.27.15).
The Russian Supreme Court Plenum submitted to the State Duma a bill amending the Russian criminal legislation aimed at decriminalizing some offences and reducing the number of criminal cases in Russia by 300,000. (RBTH, 07.31.15).
Russian authorities solved 93 percent of all open murder cases in the country during the first six months of 2015, head of the Investigative Committee of Russia Alexander Bastrykin said on Friday. (The Moscow Times, 07.24.15).
The amount of the average bribe in Russia has nearly doubled this year, reaching 208,000 rubles ($3,485 at today's rate), according to Interior Ministry estimates. (The Moscow Times, 07.31.15).
Russia's Prosecutor General said Monday that 7.5 billion rubles ($126 million) had been stolen during construction of a new spaceport in Russia’s Far East. (The Moscow Times, 07.27.15).
A district governor in Dagestan has been arrested on suspicion of financing a criminal group. Moscow's Basmanny district court ruled on July 29 that Andrei Vinogradov must stay in pretrial detention until at least September 28. (RFE/RL, 07.29.15).

Foreign affairs and trade:

Russian President Vladimir Putin will attend this year's United Nations General Assembly in September. Putin plans to address the gathering of the world's heads of states and governments on its opening day, Sept. 28. (The Moscow Times, 07.28.15).
Russia vetoed a United Nations Security Council draft resolution on Wednesday that would have set up an international tribunal to prosecute those suspected of downing a Malaysia Airlines passenger airliner last year in eastern Ukraine. (Reuters, 07.29.15).
Syrian opposition leaders say they have detected a shift in Moscow's long-standing support for President Bashar al-Assad. Hadi al-Bahra, a senior member of the Turkey-based opposition umbrella group the Syrian National Coalition, said his alliance discussed Mr. Assad's political fate with Russian officials for the first time in a meeting last month led by Russia's Deputy Foreign Minister Mikhail Bogdanov. (Wall Street Journal, 07.28.15).
China and Russia will hold joint naval and air defense drills in the Sea of Japan. The exercises, which will take place from Aug. 20-28, will take place in the Gulf of Peter the Great. (Reuters, 07.30.15).
Russia has reached a compensation deal with France for the non-delivery of two Mistral warships, a Kremlin aide has said, but Paris on Friday refused to confirm a final agreement. (France24, 07.31.15).
Russian President Vladimir Putin has signed a decree ordering the "destruction" of any food or agricultural good shipments brought into the country against Russia's bans on Western food imports amid the crisis in Ukraine. (The Moscow Times, 07.30.15).
The Kremlin has not ruled out taking response measures with regard to Montenegro, Albania, Iceland, Lichtenstein, Norway and Ukraine, which have joined the sanctions imposed on Russia, Kremlin spokesman Dmitry Peskov told reporters. (Interfax, 07.30.15).
Dutch exports to Russia have fallen nearly 40 percent since last year. (Reuters, 07.24.15).

Russia's neighbors:

Ukraine is facing a "hidden emergency" because of the government's failure to plan for nearly 1.4 million people uprooted by the war in the east, which has left many struggling to find shelter, charities say. The United Nations says 5 million Ukrainians — almost one in nine — need humanitarian assistance. (Reuters, 07.27.15).
Ukraine's Constitutional Court has ruled that draft constitutional amendments that would decentralize power do not violate the country's constitution. The Deputy Chairman of the Constitutional Court, Vasyl Bryntsev, also said "the peculiarities of the local self-government in some areas of the Donetsk and Luhansk regions will be defined by a separate law." The separatists insist that special status of the districts they control should be mentioned in the constitution. (RFE/RL, 07.31.15).
The battle readiness of Ukraine's military and the rebels it's fighting in the country's east is at its highest level since a February truce, monitors warned, a situation that risks tipping the conflict back into war. (Bloomberg, 07.28.15).
Ukraine's state security service identified a Russian army major who was detained with a cargo of military explosives in eastern Ukraine July 26 and said he has been charged with terrorism. Russian President Vladimir Putin's spokesman July 29 repeated Moscow's denial of involvement in the conflict, and refused to comment on Ukraine's latest claim. (RFE/RL, 07.30.15).
Russian Prime Minister Dmitry Medvedev has warned that Ukraine could disappear from the map of Europe as Yugoslavia did. (Newsweek, 07.24.15).
This fall, the U.S. will begin training Ukrainian Ministry of Defense troops. "This small unit training will be conducted by personnel from U.S. Army Europe to help develop the internal defense capabilities and institutional training capacity of Ukraine's Armed Forces, and is similar to our ongoing training of the National Guard," said Laura Seal, a Pentagon spokeswoman. The new training would bring the total security assistance provided to Ukraine to $244 million. (Washington Post, 07.25.15).
Negotiations between Ukraine and investors who own its debt finally are starting to thaw. After months of relative stalemate, a group of the conflict-torn country's creditors has indicated it is willing to take a small reduction in the face value of Ukrainian bonds to speed up a debt-restructuring process. (Wall Street Journal, 07.31.15).
The head of the International Monetary Fund on Wednesday signaled the emergency lender will likely approve a bailout payment for Ukraine despite the failure of Kiev to secure a debt restructuring deal with creditors. (Wall Street Journal, 07.29.15).
The Ukrainian Finance Ministry said on Wednesday it anticipated international assistance worth more than $3.2 billion up to the end of 2015, including $1 billion of U.S. guarantees in November. It also expects to receive two credit payments of $500 million a piece from the World Bank in August and September and 600 million euros from the European Commission. (Reuters, 07.29.15).
According to a recent poll by the Kyiv International Institute of Sociology, in a hypothetical presidential election held in July with expected turnout at 54%, support for Petro Poroshenko has fallen to a record low of 26.9% since his 54.7% first-round election win in May 2014. Yulia Tymoshenko is already hot on his heels with 25.6%. (BNE, 07.30.15).
The 'western' and 'eastern' halves of the arch of the New Safe Confinement at the Chernobyl nuclear power plant in Ukraine have been joined. (World Nuclear News, 07.28.15).
The WTO General Council has approved oil-rich Kazakhstan's membership, finalizing almost 20 years of negotiations. (RFE/RL, 07.27.15).
Kyrgyzstan’s President Almazbek Atambaev has signed a decree that sets October 4 as the date for his country to conduct elections for a new parliament. (RFE/RL, 07.25.15).
Kyrgyz President Almazbek Atambaev has defended his government's decision to terminate a long-standing cooperation agreement with the United States and accused Washington of "provocation" aimed at disrupting interethnic harmony in Kyrgyzstan. (RFE/RL, 07.27.15).
Russian economist Vladimir Inozemtsev estimates China has invested 10.7 times more into Uzbekistan, Kazakhstan and Turkmenistan than Russia did. (Gazeta.ru, 07.29.15).
Belarus on Tuesday received $760 million from Russia under a 10 year loan agreement. (The Moscow Times, 07.28.15).
Moldovan President Nicolae Timofti has signed a decree nominating Valeriu Strelet of the Liberal-Democratic Party as the country's next prime minister. (RFE/RL, 07.27.15).

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