|Russia and the CIS News Digest
Putin Visits Caspian Security Meeting
On July 14 Russian TV showed President Vladimir Putin on a surprise visit to a conference on Caspian Sea regional security, held onboard the frigate Tatarstan, flagship of the Russian Navy's Caspian Sea flotilla. The other Caspian littoral states were represented at the level of military attaché or consul. Putin had been in Astrakhan, at the mouth of the Volga River, the day before, for talks on regional economic development and upgrading of Caspian Sea transport facilities in the setting of the Eurasian North-South Transportation Corridor from India to Iran to Russia.
On his own earlier visit to Astrakhan on July 5, Russian Defense Minister Sergei Ivanov had urged the Caspian littoral nationsIran, Azerbaijan, Kazakstan, Turkmenistan, and his Russiato establish a security regime for the Caspian region, without military involvement of powers from outside the region. This is coherent with the demand issued from the recent summit of the Shanghai Cooperation Organization (SCO), for "members of the anti-terror coalition" to set a timetable for withdrawing from bases in SCO member countries (e.g., the United States from Uzbekistan and Kyrgyzstan).
Dagestan Under Fire
A major destabilization of Dagestan, in Russia's North Caucasus area, has been under way for the past ten days, with incidents stretching back several months. It is a focus of attention for Russian ruling circles, as reflected during President Putin's Caspian Sea visit July 13, during which state television showed him vehemently pledging to one of the Navy officers to "solve the problems" in Dagestan.
Dagestan is the easternmost and largest of the North Caucasus republics, and the one targetted by Chechen separatists and some of their London backers, to become the keystone of a "North Caucasus Caliphate," which would break away from Russia. In 1999, it was raids into Dagestan by units under Chechen warlord Shamil Basayev that precipitated the Second Chechen War. Apparently, Basayev is involved again this time.
The recent string of attacks included a July 1 bombing in the Dagestani capital of Makhachkala, which killed 11 Russian special forces troops and wounded 25. On July 6 there was a gun battle in downtown Makhachkala, followed by a bomb explosion that derailed a train north of the capital the next day. According to wire reports, Dagestani police say they have lost 28 officers to insurgent attacks this year, not counting losses by Federal troops. Also on July 6, police stormed a building in the capital and killed two men. One of them turned out to be Rasul Makasharipov, leader of the Basayev-allied Shariat Jamaat group.
Even amidst the London bombing aftermath, British media paid a lot of attention to these events. Reuters on July 8 headlined, "Dagestan a new front in Russia's Caucasus war," while the London Economist of July 9-15 devoted a feature article to a report from Makhachkala titled, "Terrorism in Dagestan: The language of bombsIslamic rebels and corruption threaten another piece of the Russian jigsaw."
Bakiyev Wins in Kyrgyzstan
Kyrgyzstan's interim leader, Kurmanbek Bakiyev, won a landslide victory on July 10 to become the second President of Kyrgyzstan. Bakiyev, a resident of Osh in the south, led the charge to remove Askar Akayev last May. While there are indications that Bakiyev is a favorite of Washington (as Akayev once was), he had to address the issue of U.S. bases in Kyrgyzstan and in neighboring Uzbekistan. He said: "Afghanistan has had Presidential and parliamentary elections. The situation there has stabilized. So now we may begin discussing the necessity of U.S. military forces' presence." (Bakiyev is not quite rightAfghanistan is planning to have parliamentary elections.) Thus Bakiyev echoed the recent call by the Shanghai Cooperation Organization (SCO) for the United States to set a date for withdrawal from the region.
Iranian Delegation Visits Moscow
An Iranian Parliamentary delegation, under the rubric of the Iran-Russia Parliamentary Friendship Group, visited Russia in mid-July. The group was led by Kazem Jalali, head of the Iranian Parliament's Foreign Affairs Committee, and included Mohammad Khoshchehreh, an aide to President Mahmoud Ahmedinajed.
Reports indicate Jalali and Khoshchehreh met with Alexander Rumyantsev, head of the Russian Federal Atomic Energy Agency (Rosatom), and told him that Iran still intends to produce its own nuclear fuel. Khoshchehreh has also commented on extending nuclear ties with Russia.
But some in Moscow believe that Putin is dragging his feet over the issue. Rajab Safarov, head of the Modern Iranian Studies Center in Moscow, has said recently that "if Russia does not launch Bushehr in 2006, Western companies could push Russia out of the Iranian power industry market." Iran had earlier said that Russia would be involved in 20 nuclear power plants in Iran. But, Russia has made no comment on that.
Gazprom Moves To Acquire Sibneft Oil
Reports about a pending deal between the Russian natural gas monopoly Gazprom and Roman Abramovich's Sibneft oil company surfaced at the beginning of July, though the subject quite obviously had been discussed when Abramovich met President Vladimir Putin on May 27. (On July 8, Presidential Representative for the Far East Federal District Konstantin Pulikovsky said that Putin may soon reappoint Abramovich as Governor of Chukotka.) The July 11 Vedomosti reports that consultants to Gazprom from Deutsche Bank advised the Russian gas monopoly to purchase Sibneft. Sources told Vedomosti that Gazprom would acquire a 72% stake in the company. Asked about the matter during the G-8 summit, Putin said it was a private deal, but added, "I am not going to make a secret of the fact that I have discussed this proposal with Sibneft's representatives."
Nezavisimaya Gazeta of July 11 headlined its coverage "The Great Oil Nationalization," writing that the Sibneft acquisition will put about 30% of the Russian oil production under state control. Unlike the natural gas industry, the former Soviet oil sector was broken up in the early 1990s into several firms. Among the large oil companies, Rosneft remains state-owned. Since the state's share in Gazprom has just risen from 40% to over 50%, with the sale of some of its shares to Rosneft, Gazprom's acquisition of Sibneft would return the latter to state control.
There is a great deal of turmoil around these transactionswhich involve some of Russia's core petroleum resources in western Siberiaand the role of Kremlin staff in them. Dmitri Medvedev, chief of the Presidential Administration (PA), is chairman of the board of Gazprom, while deputy chief of the PA Igor Sechin is in charge of Rosneft. Vedomosti reported that as recently as two weeks ago, Rosneft CEO Sergei Bogdanovich was set to sell the company to Rosneft, not Gazprom. At the same time, the state-owned Gazprom is complaining that the state-owned Rosneft has not yet paid the $7.1 billion due for its acquisition of 10.1% of Gazprom. And on July 6, Bogdanovich announced that a Moscow court has frozen a number of Yukos Oil's assetsincluding a 20% state Yukos owns in Sibneftagainst a claim for $3.5 billion Rosneft says Yukos owes it in connection with Rosneft's December 2004 takeover of Yuganskneftegaz, the main Yukos production unit.