Russia in Review

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

Nuclear security agenda:

$1.9 billion out of $12.6 billion that the Obama administration has requested for NNSA as part of its Fiscal Year 2016 Department of Energy budget will go towards Defense Nuclear Non-Proliferation programs. While the $1.9 billion request represents a $299 million increase from the previous year, that number is still down significantly from just a few years ago. The increase is also misleading, as it counts programs previously located elsewhere in the budget. (Nukes of Hazard, 02.23.15).

Iran nuclear issues:

No significant developments.

NATO-Russia relations, including transit to and from Afghanistan:

NATO's Gen. Philip Breedlove said Russian President Vladimir Putin's main goal is to divide the West, expand his control in Ukraine, and possibly position himself to increase Moscow's influence even among NATO member nations. (Wall Street Journal, 02.25.15).
The Russian Foreign Ministry sees a statement by NATO Supreme Allied Commander Europe Gen. Philip Breedlove alleging Russia's political pressure on post-Soviet space as part of anti-Russian propaganda. (Interfax, 02.27.15).
General Adrian Bradshaw, NATO's Deputy Supreme Allied Commander Europe said: ‘Russia might believe the large-scale conventional forces … might be used …potentially to seize NATO territory. The threat from Russia… represents an obvious existential threat to our whole being.” (The Nation, 02.22.15).
U.S. military combat vehicles paraded Wednesday through an Estonian city that juts into Russia, a symbolic act that highlighted the stakes for both sides amid the worst tensions between the West and Russia since the Cold War. (Washington Post, 02.25.15).

Missile defense:

No significant developments.

Nuclear arms control:

If Russia continues to violate the Intermediate-Range Nuclear Forces Treaty, the U.S. could respond in kind, according to the next U.S. Secretary of Defense Ashton Carter. “The range of options we should look at from the Defense Department could include active defenses to counter intermediate-range ground-launched cruise missiles; counter-force capabilities to prevent intermediate-range ground-launched cruise missile attacks; and countervailing strike capabilities to enhance U.S. or allied forces," Carter said. (Politico, 02.23.15).

Counter-terrorism agenda:

No significant developments.

Cyber security:

U.S. Director of National Intelligence James Clapper said: "The Russian cyber threat is more severe than we have previously assessed.” “Russian cyber actors are developing means to access industrial control systems remotely,” according to the Worldwide Threat Assessment of U.S. Intelligence Community. (AP, DNI.gov, 02.26.15).
The U.S. State Department said it is offering a $3 million reward for information leading to the arrest and/or conviction of Russian Yevgeny Bogachev, who is accused by the FBI of cybercrimes. (RFE/RL, 02.24.15).
U.S. fugitive Edward Snowden has denied allegations that his life in Russia is controlled by the security services, saying he "wouldn't play ball" when he first came to Russia and continues to remain unscathed only because of his public profile. (Moscow Times, 02.24.15).

Energy exports from CIS:

The advance made by the Ukrainian side for deliveries of Russian natural gas will be sufficient for three to four days after which Gazprom, in compliance with the contract will suspend deliveries which can pose a threat to the transit of Russian gas to Europe, President Vladimir Putin has said. (Interfax, 02.25.15).
Gazprom CEO Alexei Miller said Russia may is cut off supplies to Ukraine entirely as early as February 26. ( RFE/RL, 02.24.15).
Russian Energy Minister Aleksandr Novak has said Russia would likely suspend supplies of gas to Ukraine before a March 2 meeting in Brussels that aims to resolve this latest energy dispute between the two countries. (RFE/RL, 02.27.15).
The EU shrugged off threats by Russian officials that cutting off Kiev could cause gas supply problems for European customers further downstream. Nothing of the sort happened during the six-month shut-down last year. Nowadays, Kiev pays for any Russian gas it receives with cash up front. If Russia does halt gas to Ukraine in coming days as Putin threatened, it won't be because Moscow has decided to cut Kiev off; it will be because Kiev hasn't ordered any. (Reuters, 02.27.13).
The European Union could make a ruling in the probe on Russian energy company Gazprom OAO “in a matter of weeks," the EU's energy chief said on Wednesday. (Wall Street Journal, 02.25.15).
EU policymakers on Wednesday unveiled plans to ensure the free flow of gas and power to every corner of the 28-member bloc, hailing it as the biggest energy shake-up for more than half a century. The European Commission is also calling on member states and companies to consult it when negotiating with big suppliers, such as Russia. (Reuters, 02.25.15).

Bilateral economic ties:

Russia has signed a new contract to export titanium components to Boeing, Rostec Corporation's general director, Sergei Chemezov, said. (Interfax, 02.23.15).

Other bilateral issues:

Moscow and the West will be able to restore their productive relations only if there is respect for Russian national interests, Russian presidential press secretary Dmitry Peskov said. (Interfax, 02.26.15).
Russia's state media watchdog has approved U.S. news giant CNN's application for a broadcast license, bringing the cable broadcaster back to Russia less than two months after it left the market following the introduction of a tough new media advertising law. (Moscow Times, 02.26.15).
“Washington D.C. residents are doomed to a grim future of drug addiction,” the Russian Health Ministry's top drugs specialist warned Thursday in a scathing commentary on the district's recent legalization of marijuana. (Moscow Times, 02.26.15).

II. Russia news.

Domestic politics, economy and energy:

The ruble strengthened for a second day on Thursday, extending its biggest monthly gain on record. The currency dipped below 60 per dollar for the first time in seven weeks. The ruble is on course for a 13 percent appreciation in February, bolstered by the biggest monthly jump in Brent crude in six years. (Bloomberg, 02.26.15).
Russia's stock market has proven to be the world's best performer in early 2015.The country's benchmark stock index has surged almost 27 percent in the year-to-date.
(CNBC, 02.24.15).
Russia wants to draw at least $50 billion from its reserve fund this year, spending up to 54% of the money set aside to support the budget at a difficult time when falling oil prices and western sanctions force deeper austerity measures, officials said Friday. (Wall Street Journal, 02.27.15).
Russia's banking system may see its bad loans rise to 17-23 percent of its loan portfolio in 2015 from around 8 percent last year, Standard & Poor's said on Thursday, underlining the impact of an economic crisis on the sector. (Reuters, 02.26.15).
Moody's downgraded Russia's sovereign rating to Ba1 from Baa3, citing the impact from the Ukraine crisis as well as the steep fall in oil prices and the ruble exchange rate. Russian Finance Minister Anton Siluanov said Moody's downgrade was based on "factors of a political character." Barclays will remove Russian foreign currency debt from its global bond indexes, putting it off-limits for many international investors, after Moody's decision (RFE/RL, 02.21.15, Reuters, 02.24.15).
Although President Vladimir Putin has maintained the approval of 86 percent of Russians, one-third of their countrymen believe Russia is headed in the wrong direction, independent Moscow-based pollster the Levada Center revealed Thursday. Between November 2014 and January 2015 the approval rating stood at 85 percent, by the Levada Center's count. (Moscow Times, 02.26.15).
The share of Russians acknowledging the ongoing economic crisis has grown to 71 percent, from 62 percent in January, the Public Opinion Foundation said. And an public opinion poll conducted by the Institute of Priority Regional Projects in February 4, 2015 showed that three-fourths of Russians see the situation in the country as a crisis (Interfax, 02.24.15, Interfax, 02.27.15).
Nine out of ten Russians (including 84 percent of heavy Internet users) trust the news on the central television channels, according to a recent survey by state pollster VTsIOM. (Moscow Times, 02.23.15).
In Moscow and other Russian cities on Saturday, thousands of government supporters yelling anti-American and anti-Ukrainian slogans marched through the streets. ‘‘There will be no Maidan in Russia!’’ the crowd chanted, referring to months of protests last year on the Maidan, Kiev’s main square, that led to the departure of President Viktor F. Yanukovych. (New York Times, 02.23.15).
A Pro-Kremlin political party has issued a formal reprimand to its maverick lawmakers after they argued that Moscow's ban on Western food imports has hurt Russians, proposing legislation to lift the restrictions and limit President Vladimir Putin's power to impose new sanctions. (Moscow Times, 02.27.15).
In its freshly released annual report, Amnesty International blasted Russia for a broad range of policy issues, from the heavy-handed use of its United Nations veto power, to controversial legislation serving to stifle civil society. (Reuters, 02.25.15).

Defense and aerospace:

Russia's new rail-mobile missile system will be called "Barguzin." Missiles for the Barguzin complex will be built on the basis of the Yars ICBM. (Pravda.ru, 02.24.15).
Russian fighter jets will take part in exercises on thwarting a potential missile attack in the Barents Sea. (Reuters, 02.26.15).
Russia's military budget may shrink by about 10 percent in 2015, the chief executive of state-owned defense conglomerate Rostec said Monday." Sanctions imposed on Russia have had an impact on its defense industry, with the country planning to substitute all its current imports with home-made options by 2017, he said. (Reuters, 02.23.15).
The independent Levada Center pollster said Saturday that 68 percent of Russians believe a foreign power threatens Russia's national security, a 24 percentage point increase over the decade. (Moscow Times, 02.23.15).
Russia has indicated it will continue to use the International Space Station though 2024. (RFE/RL, 02.25.15).
Russian President Vladimir Putin has signed a decree naming February 27 the Day of Special Operations Forces. (RFE/RL, 02.27.15).

Security, law-enforcement and justice:

A leading Russian opposition politician, former deputy Prime Minister Boris Nemtsov, has been shot dead in Moscow, Russian officials say. An unidentified attacker shot Mr Nemtsov four times in central Moscow, a source in the law enforcement bodies told Russia's Interfax news agency. (BBC, 02.27.15).

Some of the Al-Qaeda documents obtained after the 2011 raid of Osama bin Laden's Pakistan compound make reference to plots in Europe, Britain, and Russia. One references plans to bomb a pipeline or the U.S. embassy in Russia. The documents included a 2009 a report, which was prepared by Saleh al-Somali, allegedly al-Qaeda's head of external operations, and which describes sending "brothers" to Britain, Russia and Europe. (Telegraph, 02.24.15,RFE/RL, 02.26.15).
A native of Tajikistan has been detained in Moscow on suspicion of creating a website promoting the militant group Islamic State. (RFE/RL, 02.25.15).
Six suspected militants have been killed in a security operation in the North Caucasus region of Dagestan. Dagestan Interior Ministry officials said that they believe three suspects were killed on February 25 and three more early on February 26 near the villages of Nechayevka and Sultan-Yangyurt in central Kizilyurt district. RFE/RL, 02.26.15).
The number of extremism cases launched in Russia surged by 28 percent in 2014 to 591, the head of the Investigative Committee said Thursday. (Reuters, 02.26.15).
Nearly three years after anti-Kremlin protests erupted into bloody clashes between police and protesters in the center of Moscow, police have detained their 33rd suspect in the ongoing Bolotnoye case. (Moscow Times, 02.26.15).
Russia has handed over to France the results of a preliminary investigation into the cause of a jet crash that killed a French oil executive in October, and the findings indicate that two of the key suspects may have been intoxicated at the time. (Reuters, 02.27.15).
The average cost of a bribe in Moscow rose 37 percent last year to hit 327,000 rubles ($5,250), according to Moscow police chief Anatoly Yakunin. The typical cost of a bribe in Russia's regions, which are far poorer than Moscow, stood at 139,000 rubles ($2,230) said Yakunin, citing a recent study completed by Moscow's police. Corruption overall cost Russia's budget about 47 billion rubles ($762 million) last year, he added. (Moscow Times, 02.25.15).

Foreign affairs and trade:

Russia has offered to sell a powerful air-defense system to Iran, a top executive said, five years after the Kremlin canceled the sale of an earlier version under U.S. and Israeli pressure. Sergei Chemezov, chief executive of the Russian defense conglomerate Rostec, said Tehran was considering its offer to sell Antey-2500 anti-ballistic missile systems. A 2007 contract to supply the less-advanced S-300 system was canceled in 2010.(Wall Street Journal, 02.23.15).
Russia may consider allowing Chinese investors more than 50 percent stakes in its strategic oil and gas fields, Deputy Prime Minister Arkady Dvorkovich said on Friday. (Reuters, 02.27.15).
Chinese President Xi Jinping would be at a May 9 parade in Moscow celebrating the war’s end in Europe and Russian President Vladimir V. Putin would be a prized guest in Beijing in September. (New York Times, 02.26.15).
Western powers should take into consideration Russia's legitimate security concerns over Ukraine, Qu Xing, China's ambassador to Belgium, has said. He said the "nature and root cause" of the crisis was the "game" between Russia and Western powers, including the United States and the European Union. "The West should abandon the zero-sum mentality, and take the real security concerns of Russia into consideration," Qu said. (Reuters, 02.27.15).
Russian Foreign Minister Sergei Lavrov on Monday accused Western powers of trying to dominate and impose their ideology on the rest of world, while the United States and European delegations slammed Moscow for supporting rebels in eastern Ukraine. Without accusing specific countries, Lavrov complained about what he said was rampant violation of key principles of the U.N. Charter, specifically the "independence and sovereign equality of states, the non-interference in their internal affairs." He cited Western interventions in Syria, Libya and Iraq. (Reuters, 02.23.15).
The speaker of Russia's State Duma says the Kremlin wants India to become a full-fledged member of the Shanghai Cooperation Organization this year. (RFE/RL, 02.27.15).
European Central Bank policymaker Ewald Nowotny has warned against kicking Russian banks out of the SWIFT payments transfer system as part of tighter sanctions on Moscow. (Reuters, 02.27.15).
Russian presidential press secretary Dmitry Peskov has regretted British Defense Secretary Michael Fallon's recent statement alleging that President Vladimir Putin is as much a threat to Europe as Islamic State, posing "a real and present danger" to Latvia, Lithuania and Estonia. (Interfax, 02.26.15).
Russian President Vladimir Putin says he thinks he "understands" and "generally trusts" German Chancellor Angela Merkel and French President Francois Hollande, the two brokers of a recent Minsk cease-fire agreement. (RFE/RL, 02.23.15).
Lithuania plans to restart military conscription, which it ended in 2008, to address growing concerns about Russian assertiveness in the Baltic region, President Dalia Grybauskaite has said. (Reuters, 02.25.15).

Russia's neighbors:

Nearly 5,800 people have died in the fighting in Ukraine, according to U.N. estimates, and more than 1 million people have been displaced from their homes. (Washington Post, 02.26.15).
Kiev's military reported on Friday the deaths of three servicemen in the past 24 hours, following two days with none in east Ukraine. (Reuters, 02.27.15).
With mutual distrust both Ukrainian troops and Russian-backed forces claimed they started withdrawal of heavy weapons from the front line, an essential demand of the Minsk ceasefire deal that came to an effect on Feb 15. (Kyiv Post, 02.27.15).
In a swap on Saturday, the separatists released 139 Ukrainian soldiers in exchange for 52 prisoners released by the central government (New York Times, 02.21.15).
Kiev said Sunday it arrested four people who had been armed and trained in Russia after the blast, which killed a policeman and a demonstrator at the rally in Kharkiv. (Reuters, 02.23.15).
Russian President Vladimir Putin says a war with Ukraine is "unlikely" and he hopes "it will never happen.” “Putin called such a war "an apocalyptic scenario."(RFE/RL, 02.23.15).
Russian President Vladimir Putin said Kyiv’s suspension of gas supplies to separatist parts of eastern Ukraine "smells of genocide.” Gazprom said on Thursday it would exempt gas supplies to rebel-held regions from its main contract with Ukrainian Naftogaz. (Reuters, 02.26.15, RFE/RL, 02.26.15).
The foreign ministers of France, Germany, Russia and Ukraine have decided to extend the mandate of the Organization for Security and Co-operation in Europe (OSCE) in Ukraine for another year. They also agreed to monitor compliance by the Contact Group of the February 12 Minsk agreements, and send "political impulses" to avoid any protraction. (Interfax, 02.24.15).
The United States and Russia traded accusations, mainly over the conflict in Ukraine, at the UN Security Council on February 23. Russian Foreign Minister Sergei Lavrov said the Security Council had become a tool to "rubber stamp" decisions made by Western countries. U.S. Ambassador to the United Nations Samantha Power suggested Moscow's call for greater respect for nations' sovereignty and territorial integrity was hypocritical. (RFE/RL, 02.23.15).
U.S. Secretary of State John Kerry says President Barack Obama will evaluate his options on dealing with events in eastern Ukraine “in the next few days” after consulting with German Chancellor Angela Merkel. Kerry will meet with his Russian counterpart Sergei Lavrov in Switzerland on March 2. Kerry also said Russia has repeatedly lied about the presence of Russian troops and weapons in Ukraine. (Reuters, 02.26.15, RFE/RL, 02.24.15-02.27.15, Wall Street Journal, 02.24.15).
Russian Deputy Foreign Minister Sergei Ryabkov said on Feb. 27 that accusations from U.S. Secretary of State John Kerry that Russia was lying over its involvement in eastern Ukraine went "beyond diplomatic ethics.” (Reuters, 02.27.15).
Moscow would face more EU sanctions if pro-Russia separatists attacked Ukraine's government-held port of Mariupol, French Foreign Minister Laurent Fabius said. (Reuters, 02.25.15).
A bipartisan group of U.S. senators has urged Secretary of State John Kerry to tighten sanctions against Russia and provide defensive military aid to Ukraine. The senators told Kerry in a letter that "it is time to provide defensive weapons to Ukraine and to consider imposing additional sanctions and penalties that will increase the cost of Putin’s actions, including the potential removal of Russia from the SWIFT financial system." Among those signing the letter were top Democrat Dick Durbin and Armed Services Committee Republican Chairman John McCain. (RFE/RL, 02.20.15).
U.S. Director of National Intelligence James Clapper believes Russian-backed separatists in eastern Ukraine will likely wait until the spring to attack the port of Mariupol and possibly try to establish “a land bridge to Crimea.” Clapper also said he supports arming Ukrainian forces. (Dow Jones, AFP, 02.25.15, Washington Post, 02.25.15).
On Thursday, Lt. Gen. Vincent Stewart, who heads the Defense Intelligence Agency told U.S. lawmakers that U.S. weapons would not reach Ukrainian troops quickly enough and wouldn't change the battlefield balance.( Washington Post, 02.25.15).
U.S. assistance that has been provided to Ukraine so far isn't “changing the results" in the ground conflict there, the North Atlantic Treaty Organization's top military commander said Wednesday. General Philip Breedlove declined to say whether he favored supplying defensive weapons to Kiev. (Reuters, 02.26.15, Wall Street Journal, 02.25.15).
Britain says it will send up to 75 military personnel next month to help train Ukraine's army. (DW, 02.24.15)
NATO Secretary-General Jens Stoltenberg says Russia should withdraw some 1,000 items of military equipment that it has in eastern Ukraine. (RFE/RL, 02.26.15).
The sending by some countries, in particular, the UK and Poland, of military instructors to Ukraine will not promote the implementation of the Minsk agreements and will aggravate the situation, Russian envoy to NATO Alexander Grushko said. (Interfax, 02.27.15).
U.S. public support for arming Ukraine has grown from 30 percent to 41 percent over the past 10 months, though the majority of Americans still oppose sending lethal military aid to Kiev, a poll has shown. (Moscow Times, 02.24.15).
The delivery of U.S. weapons to Ukraine may start a new world war, 42 percent of respondents told the Russian Public Opinion Study Center. Another 18 percent believe that such deliveries will fuel the Ukraine conflict. (Interfax, 02.25.15).
Ukrainian President Petro Poroshenko has come back from the UAE to tell reporters that "over the course of the exhibition, Ukraine has signed about 20 contracts for the supply of arms." He also said a “practical dialogue" remained under way with the U.S. to provide defensive weapons, including communications gear and the ability to counter artillery fire. (Wall Street Journal, Sputnik, 02.24.15).
A U.S. State Department official says former Georgian President Mikheil Saakashvili met with Assistant Secretary of State Victoria Nuland in Washington this week to discuss the Ukraine crisis. (RFE/RL, 02.27.15).
The OSCE Representative on Freedom of the Media Dunja Mijatovic has said the “continued intimidation” of the media nongovernmental organizations in Russia “further endangers” the media freedom situation. (RFE/RL, 02.24.15).
Spain has arrested eight Spanish citizens for fighting along pro-Russian separatists in Ukraine's eastern regions. (RFE/RL, 02.27.15).
A member of the Kremlin's human rights council has said that jailed Ukrainian pilot Nadia Savchenko "could die within days.” Yelena Masyuk said on February 27 the captive pilot's health had seriously deteriorated. Savchenko has been on a hunger strike for nearly 80 days protesting what she calls her illegal detention and false charges brought against her. The European Union and the United States have issued fresh calls on Russia to release hunger-striking Ukrainian pilot Nadia Savchenko (RFE/RL, 02.26.15, 02.27.15).
Ukraine's Ministry of Information Policy has called on its citizens to enlist in the country's "information forces" to battle against online propaganda. (Moscow Times, 02.25.15).
Ukraine's central bank abruptly reversed a broad ban on foreign-currency purchases Thursday, a day after imposing the measures in an attempt to halt the hryvnia's free fall. Ukraine's currency has dropped 46 percent in February alone, and is down 71 percent in the year. (Washington Post, 02.23.15, Wall Street Journal, 02.27.15).
The International Monetary Fund said Wednesday that its expanded bailout of embattled Ukraine will include “heavily front-loaded" cash payments once the board approves the program. (Wall Street Journal, 02.25.15).
A Russian newspaper has published what it says is a strategy document calling for Russia to annex Crimea and absorb other parts of Ukraine that was presented to Kremlin leaders in early February 2014, shortly before Ukraine's pro-Russian president Viktor Yanukovych was forced from power. (Voice of America, 02.24.15).
Ukrainian President Petro Poroshenko said Friday that police evidence showed that a top Russian presidential aide, Vladislav Surkov, had directed "foreign sniper groups" who shot and killed protesters in Kiev a year ago. A Russian foreign ministry spokesman dismissed the claims as "nonsense.”(Reuters, 02.20.15).
Kazakh President Nursultan Nazarbaev has announced that an early presidential election will be held on April 26. (RFE/RL, 02.25.15).
Rakhat Aliev, a former son-in-law of Nursultan Nazarbaev who became an opponent of the long-ruling Kazakh president, has been found dead in a Vienna jail in what Austrian officials said was a suicide. (RFE/RL, 02.24.15).
The Worldwide Threat Assessment of U.S. Intelligence Community said: “Armenia and Azerbaijan saw in 2014 a record number of casualties along the Line of Contact. The increased violence highlights how the close proximity of opposing military forces continues to pose a risk of miscalculation and unintended escalation. Prospects for a peaceful resolution in the foreseeable future are dim.” (DNI.gov, 02.26.15).
The Central Bank of Azerbaijan set official rate for the manat was set on February 21 at 1.05 to the dollar and 1.19 to the euro. It means the manat lost 33.5 percent and 30 percent of its value against the U.S. and European currencies, respectively. (RFE/RL, 02.21.15).
Relatives of a seven-member family that was massacred in Gyumri on January 12 are demanding that the Russian soldier charged with the killings be handed over to Armenian authorities. (RFE/RL, 02.23.15).

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