Expert

Alexander Golts, a military expert in Moscow, says this Manichean view
of the world is what drives Russia to arm Assad. “The root motivation here is ideology, not finances,” Golts says. “It is the ideology of Cold War realpolitik, where you had two sides sitting at the chessboard and moving pieces around. That is how Putin still sees the world.” As for the Syrians, they have lots of reasons to keep buying Russian arms even if they don’t really need them. “They’re desperately trying to keep Russian on board as a partner by channeling more cash to the Russians and building on that relationship,” says Griffiths.

Russia seems eager to play along, as much for the cash as the geopolitical dividends. Throughout the Arab Spring revolts, which many in Moscow saw as a U.S.-led conspiracy to carve up the Middle East, Putin grew increasingly angry over western meddling in the region. In 2010, when Putin opened the first ever arms bazaar at the Zhukovsky airfield, Yemeni President Ali Abdullah Saleh flew in to attend, and Putin personally showed him around. As they passed the display of the T-90 tank with reporters in tow, Putin turned to Saleh and said, “That’s what you’ve got to buy.” He did not do this with the aim of making a profit, Golts suggests, but to cement Russia’s influence in Yemen. A weapons deal is not a simple cash-and-carry arrangement. It requires the buyer and seller to maintain stable relations, so that the weapons can be installed, serviced and repaired. The seller will often provide ammunition and training for years. “This is a serious bond,” Golts says.

TIME

The Syrians seemed impressed, even climbing into the truck to look around before warmly shaking hands with the Russians and moving on to the other exhibits. Apart from Col. As’saadi, the military attache, the Syrian delegates refused to give their names or answer TIME’s questions. The man whom As’saadi identified as the head of the delegation would only say that he had flown in from Damascas specifically to attend the fair. “That shows a serious intention to buy,” says Hugh Griffiths, an arms trafficking expert at the Stockholm International Peace Research Institute (SIPRI), which tracks the global weapons market. It was, however, impossible to tell what if anything the Syrians purchased. Those deals are struck behind closed doors. But if they did end up buying the assault rifles or armored vehicles that they spent hours studying on Thursday, it would cast serious doubt on the official line from the Russian Foreign Ministry, which has said that only defensive weapons, like anti-aircraft missiles, are being sold to Syria, none of which could be used against civilians. The “house-to-house” capabilities that Vishnyakov touted at the Kalashnikov exhibit undermined the Ministry’s claim.

The organizer of the arms expo, which included a “tank ballet” choreographed by the Bolshoi Theater, is the Russian weapons and engineering conglomerate Russian Technologies. The company is headed by Sergei Chemezov, an old friend of Putin’s from the KGB. In the 1980s, both men worked as KGB spies in the East German city of Dresden, and after Putin became President in 2000, he gradually transferred Russia’s largest state-owned machine-building and weapons firms to Chemezov’s corporation. Russian Technologies now controls around 600 companies and thousands of factories, producing everything from cars and planes to military hardware. But the jewel in its crown is Rosoboronexport, the only company in Russia that can legally sell arms abroad. Last year, the company sold more than $11 billion in arms worldwide, making Russia the world’s second largest weapons dealer after the United States. As of 2011, Russia had about $4 billion in outstanding weapons contracts with Syria, including sales of Buk-M2E surface to air missiles, Pansir-S1 rocket complexes and Mig-29 fighter jets.

“This is one of our traditional markets,” says Anatoly Isaykin, the general director of Rosoboronexport, who spoke to TIME at the arms expo. Isaykin, who was also a career KGB officer before becoming Russia’s top arms dealer, says the Syria issue is being blown out of proportion, perhaps as part of a western conspiracy to blacken his company’s name. “Around these hotspots, efforts are made to present our organization, Rosoboronexport, as some kind of evil genius who is trying to pour kerosine on the fire,” Isaykin says. “I think this is part of the political game.” All of the West’s efforts to stop Russia from selling weapons to Syria, he says, amount to nothing more than unfair competition. “Of course I mean competition in the broadest sense,” Isaykin says. “It always existed and it will continue to exist. So if Russia loses a market, its competitors have a chance to gain.”

Reform

Russia’s Putin Orders Reform Of Parliament.

President Vladimir Putin submitted a bill Wednesday that would change how the upper house of the Russian parliament is formed, a move he said would make it more democratic but which critics said wouldn’t change the body’s role as an obedient tool of the Kremlin.
Under the current system, the Federation Council is made up of randomly chosen former officials or rich businessmen with government links, with two representatives for each of Russia’s 87 regions.
Putin’s bill will have candidates for provincial governors publicly name their choice for an upper house member from the region ahead of local elections. The second candidate for each province should be a member of its legislature, Putin said.
The bill requires approval from the lower house of parliament as well as the Federation Council itself. Given both bodies’ genuflection to Putin, it is all but certain to quickly pass.
Putin won a third presidential term in March’s election despite a wave of massive protests in Moscow against his rule.
He has approved a series of political reforms supposedly aimed at making Russia’s tightly controlled political system more democratic. The opposition has dismissed the changes as window dressing that wouldn’t weaken Putin’s steely grip on power.
Alexander Kynev, an independent political expert, was quoted by the online Gazeta.ru as saying that the upper house’s makeup would continue to depend on political manipulations and not the people’s will.
“As before, the house will be formed not by the voters but through some strange procedures,” he said.Мейн кун котята продаются на сайте питомника YanikaCoon.Котята мейн кун имеют отличные породные данные.

CSTO

Uzbekistan quits Russia-led CSTO military bloc.

Following years of refusing to fully participate, Uzbekistan has informed the Collective Security Treaty Organization that it is suspending its membership in the Eurasian military bloc.
The secretariat of the CSTO bloc confirmed it had received a note from Tashkent suspending Uzbekistan’s membership. The CSTO is seen by analysts as the eastern version of NATO.
The organisation’s press secretary Vladimir Zainetdinov says experts will now study the documents and prepare a report that will be presented to the Presidents of all CSTO member states.
The official did not disclose the reasons behind Uzbekistan’s decision.
Over recent years Uzbekistan has repeatedly ignored CSTO events, drawing criticism from Russia and other CSTO members. In 1999 Uzbekistan even quit the bloc by refusing to prolong its membership treaty, but in 2006 it re-joined.
The Collective Security Treaty Organization was formed in 1992 and consists of Russia, Armenia, Belarus, Kazakhstan, Tajikistan and Kyrgyzstan with Uzbekistan now due to depart. In 2004 the UN General Assembly granted the bloc observer status.

United Russia

United Russia borrows Soviet idea, plans opening party schools.

In a throwback to Soviet times, the majority United Russia party is considering opening party schools to train new personnel and activists to meet the challenge of increased political competition across the country.
United Russia opened a discussion with political analysts and education experts this week on the principles of organizing such schools: who should be taught, what, and how.
The majority of those participating in the round table meeting agreed that party schools should be opened not only for United Russia members, but also for its supporters. Ideology should become the cornerstone of any such training course.
“A party school must have a mission of political education – it should not only train a party member, but, first of all, it should raise a civil activist,” senior party member Aleksey Chesnakov said, as cited by Rossiyskaya Gazeta daily.
Experts thus far agree that there is no need for the creation of a new college or university. Rather there should be two levels of training: one for ordinary party activists and, also, a kind of a magistrate for political managers, PR specialists and political technologists, writes Nezavisimaya Gazeta.
The idea of political schools had previously been supported by Prime Minister Dmitry Medvedev – the chairman of United Russia. Speaking at a party meeting earlier in June, he noted that party schools existed in the Soviet Union. However, teaching there was very formal.
“Our party needs training aimed at a normal dialogue with the whole of civil society,” Medvedev said.
Meanwhile, the Communist party (KPRF) as well as the right-wing opposition are also mulling over the idea of political education.
Experts link the new trend to increased electoral competition between parties.

HR

Russian HR watchdog to check ban on ‘gay propaganda’.

Russia’s top Human Rights watchdog, The Public Chamber is planning to check if recently introduced laws banning gay propaganda are constitutional.
Public Chamber member Yelena Lukyanova is a professor of constitutional law, and said in a newspaper interview that some of the chamber members think the laws targeting gay propaganda are limiting freedom of expression. The Public Chamber suggests if the laws are not repealed as being anti-constitutional, a precise formula on what can be considered propaganda should be introduced.
Lukyanova said the Public Chamber will have hearings and pass a resolution on the subject in the near future.
“We should thoroughly check into these laws’ conformity with the Constitution. It says that the rights can only be limited if there is a threat to national security. But is homosexuality a threat to national security? Is not is an artificial limitation, just as it was with the law on rallies?” the activist told the Izvestia newspaper, adding that it was necessary to start a broad public discussion regarding such initiatives.
Another member of the Public Chamber, Yelena Toppoleva-Soldunova, saysin her view it was completely unnecessary to introduce separate laws banning gay propaganda as it was possible to make exactly the same limitation in already existing legal acts.
“We should distinguish between what is admissible and what is not. If someone is announcing his or her sexual orientation, this cannot be banned, but it is completely inadmissible to make children’s television programs that promote homosexuality,” Topoleva-Soldunova said.
One of the leaders of the Russian gay rights movement, Nikolai Alekseyev, has welcomed the Public Chamber’s initiative and that the existing laws should be probed by lawyers, experts and psychologists.“In reality we are about 30 years behind in this process. They introduced anti-gay laws in Britain in the 80s under Margaret Thatcher, but later they cancelled them all in the 2000s. The same will happen in our country,” Alekseyev said.
This year some Russian politicians started an active campaign against so-called gay propaganda – a special law was approved and signed into force in St. Petersburg, prompting legislatures in the cities of Samara, Ryazan, Arkhangelsk, Novosibirsk and Kostroma to introduce administrative fines for propaganda of homosexuality. A group of parliamentarians have suggested approving a similar law on a nationwide scale.

Gazprom

Russia’s Gazprom may extend Nord Stream pipeline to Great Britain.

Russian gas giant Gazprom may extend its Baltic pipeline project to reach Great Britain, the Kremlin-controlled company’s chief executive said Friday.The Nord Stream pipeline is Gazprom’s multi-billion offshore project that ferries Russian gas through the Baltic Sea to Germany. The project’s first line opened last November and will eventually have an annual capacity of 27.5 billion cubic meters, while a second line is under construction.Gazprom chief executive Alexei Miller said in televised remarks that energy company BP “has shown an interest” in extending the pipeline, although no agreements have been reached so far. He said that Gazprom is analyzing a possibility of building two additional lines, one of which will reach Great Britain. He did not specify the costs of the extension.Russia already provides two-fifths of Europe’s gas imports and wants to boost exports further.But Russia’s pricing wars over gas supply to Ukraine, whose pipelines carry Russian gas westward, have prompted energy supply interruptions in recent years, prompting Europeans to look for alternatives to Gazprom. The European Union is backing a rival Europe-bound pipeline project called Nabucco that would hook up Central Asian or Middle Eastern gas with a pipeline in Turkey.Gazprom owns 51 percent in Nord Stream, Germany’s Wintershall and E.On each own 15.5 percent, and Netherland’s Gasunie and France’s GDF Sues each have 9 percent of the shares.Miller also said that Gazprom has scrapped its plans to build a pipeline to Japan and instead will concentrate on becoming a leading exporter of liquefied natural gas, mostly to Asian nations such as Japan, China and South Korea.

Russian demographic trends

Russian and American Birth Rates Have Rapidly Converged

I am in the middle of doing a longer post on recent Russian demographic trends, but in the course of doing research I stumbled upon something that was far too interesting to pass up.

Although Russia is often portrayed as a demographic nightmare, a “dying bear” that is rapidly receding from the world stage and that is doomed to irrelevance, and the United States is often portrayed as enjoying demographics that are uniquely robust among developed nations, I would argue that the reality is quite a bit more complicated. Although America benefits greatly from immigration, its fertility rate has actually consistently been sub-replacement for almost all of the past 20 years. Knowing that, due to the aftereffects of the Great Recession, birth rates in the United States have generally been declining for the past few years and also knowing that birth rates in Russia have been increasing I decided to create a chart showing what’s happened since the late 1990′s. Even I was surprised by the extent and the rapidity of the convergence between Russian and American birth rates*:
Now it is, of course, true that the United States’ demographic outlook remains much more positive than Russia’s, and I am not arguing otherwise. Russia really did experience a grievous demographic crisis during the 1990′s, a crisis that will have serious long-term negative consequences. The United States has, thankfully, not experienced either a  mortality surge or a fertility plunge that are even remotely comparable to those experienced by Russia during its transition from communism.

However, all of that being said, I’m very surprised that more attention hasn’t been paid to the recession’s demographic costs and to the long-term impact this will have on the US economy. Indeed, if trends hold, Russia’s 2012 birth rate will actually exceed the United States’, a truly remarkable and noteworthy turnaround considering where things stood as recently as 2000. At an absolute minimum the fact that Russian and American birthrates are now roughly equal ought to seriously complicate the media narrative of a dying Russia and an all-conquering United States.

Russia claim 800m double

Yuriy Borzakovskiy and Yelena Arzhakova claimed gold in the men’s and women’s 800m races respectively as Russia took three titles on the third day of the European Athletics Championships here.
The 31-year-old Borzakovskiy, the 2004 Olympic champion and four-time world medallist, attacked coming off the final bend to claim gold in 1:48.61 ahead of Denmark’s Andreas Bube and France’s Pierre-Ambroise Bosse.
“I ran a good tactical race today,” said the Muscovite on Friday. “I came here to test my form before the Olympic Games.”
Arzhakova dominated the women’s event with the 22-year-old leading all the way to win in 1:58.51. Britain’s Lynsey Sharp took silver but her 2:00.52 was not enough to seal her Olympic berth with Russia’s Irina Maracheva taking bronze in 2:00.66.
Irina Davydova ensured that Russia stayed top of the medals’ table by winning their third gold of the day in the women’s 400m hurdles with a season’s best 53.77.
Olympic hosts Britain won two gold medals on Friday with Robbie Grabarz taking his first major title by winning the men’s high jump while compatriot Rhys Williams won the 400m hurdles to effectively seal his place in London.
Two athletes retained their titles – Ukraine’s Olha Saladuha in the women’s triple jump and France’s Mahiedine Mahiedine in the 3,000m steeplechase.
The 27-year-old Mahiedine clocked 8:33.23 to take gold ahead of Turkey’s Tarik Langat Akdag (8:35.24) and Spaniard Victor Garcia (8:35.87).
Mekhissi won the Olympic silver medal in 2004 and was a bronze medallist at the 2011 world championships at Daegu, South Korea.
Garcia lost his battle for gold after falling at the final hurdle some 40m from the line and had to settle for bronze.
Czech Pavel Maslak won the men’s 400m title in 45.24 ahead of Hungary’s Marcell Deak-Nagy (45.52) and France’s Yannick Fonsat (45.82).
Germany’s Nadine Kleinert, Olympic runner-up in 2004, won the women’s shot putt with a throw of 19.18m, as Vira Rebryk ensured a second gold for Ukraine by winning the javelin (66.86m), to beat German duo Christina Obergfoell (65.12) and defending champion Linda Stahl (63.69).
Germany’s David Storl, the world shot putt champion, took men’s gold with a season’s best 21.58m, ahead of Dutchman Rutger Smith (20.55) and Serb Asmir Kolasinac (20.36).
But Germany’s Betty Heidler, the world record holder in the hammer, failed to make it out of the qualifying rounds in that discipline.

Soyuz spacecraft

Russia’s Soyuz spacecraft lands safely in Kazakhstan.

A Soyuz spacecraft with a crew of three on board landed safely in southeastern Kazakhstan on Sunday, Russia’s Mission Control Center said.
The Soyuz TMA-03M capsule, bringing home Russian cosmonaut Oleg Kononenko, U.S. astronaut Donald Pettit and Dutch astronaut Andre Kuipers, touched down at 12:15 Moscow time (0815 GMT) on the landing site some 147 km east of Jezkazgan city.
It undocked from the International Space Station (ISS) at 8:48 a.m. Moscow time (0448 GMT) in an automatic mode.
Live broadcast from NASA TV showed that a search and rescue team helped the three astronauts get out of the module and put them on chair for a few minutes to adapt to the Earth’s gravity.
The trio, who had spent 193 days in space, appeared calm and relaxed with smiling faces.
During their mission, the crew vigorously updated their Twitter with photos and videos. They also kept a space diary to note down the memorable experiences in the orbiting station.
In his June 29 diary titled “going home”, Pettit shared his reflections of the mission with the public. “When a frontier feels like home, it is no longer a frontier; it has become ‘civilization.’ Those determined to wander must now pack their bags and move further into the cosmos.”
Before the departure, the crew witnessed the Space X Dragon capsule’s successful docking with the ISS in May, which raised hopes that commercial spacecraft will be able to shuttle humans and cargo to the station in place of the now-retired U.S. space shuttle.
Space X has a 1.6-billion-U.S.-dollar contract with NASA, which entails supplying cargo to the ISS 12 times in the coming years. NASA said it will fix the date for Space X’s first full cargo mission after evaluating the Dragon capsule’s performance.
Russia’s Soyuz TMA-05M rocket is scheduled to send another three-member crew, namely NASA astronaut Sunita Williams, Russian cosmonaut Yury Malenchenko and Japanese astronaut Akihito Hoshide, to the ISS from the Baikonur space center on July 15.
The three newcomers will join the current ISS crew of Russian cosmonauts Gennady Padalka and Sergei Revin and NASA astronaut Joe Acaba, who have been in orbit since mid-May.
The successful landing of the Russian Soyuz spacecraft came two days after the Chinese Shenzhou-9 spacecraft’s successful return as China had fulfilled its first manned space docking.
Local analysts said China’s space program is inching closer toward building a space station, as manned docking procedures are necessary to build and resupply space stations.

World champions Russia

Beach Kings to make up for Russia’s Euro 2012 blunder.

Beach soccer world champions Russia are back on the sand to finalize their preparations for the European qualification, which kicks-off in Moscow on Sunday. The hosts are hot favorites to book one of the four places for the 2013 World Cup in Tahiti.
Established in 2005, the Russian beach soccer team have developed into one of the top sides in the sport.
They won every tournament held in 2011, including the World Cup, and seem intent on continuing the trend after adding the European title earlier this year on home sand.
The Red Beach Machine now enters the qualifying tournament for next year’s World Cup as red hot favorites to make it to the South Pacific.
“We always aim to win all the tournaments,” Mikhail Likhachev, Russia’s beach soccer coach, told RT. “We hold lots of titles but that’s history now. Its sport and we have to prove everything once again.”
24 national teams will take to the sand in Moscow for qualifying, battling for one of the four European, World Cup berths. Russia will face Poland, Germany and Latvia in Group A.
“It’s always hard for us to play in front of a home crowd, we feel the pressure and it’s hard to relax and show our best,” Ilya Leonov, Russia’s captain, said. “But we still haven’t lost a tournament on home turf so hopefully this time around we’ll win again.”
Russia can boast a stable squad with defender Leonov and goalkeeper Andrey Bukhlitskiy regarded as two of the best in the game.
Manager Mikhail Likhachev built the side, who reached the top of the sport, but he’s still hungry for more.
The team, who on paper look certain to make it to the World Cup, are taking nothing for granted. And success or otherwise parallels with the Russian national football team’s performance at Euro 2012 aren’t shared.
“We feel the pressure after Russia’s poor display at the Euros,” Likhachev stressed. “But I think we can use one Russian character trait – we can perform better as things get worse.”
“Russia’s failure really upset us, but we understand its football and anything can happen. If our performance can sweeten the bitterness for all Russian football fans – we’ll do our best,” Leonov added.
There’s still a long way to go for Russia to retain their world crown in Tahiti next year of course.
But the likelihood is expectations will grow even more as the’ Kings of the Sand’ strive to prove they belong once again at the summit in Moscow on July 1.

Russians Join Israel

Russians Join Israel to Start Jewish Prize of $1 Million.

A charity founded by Russian Jewish billionaires is establishing a $1 million annual award for excellence in virtually any field, to honor those people who attribute their success to Jewish values. The prize will be administered in partnership with the Israeli government, highlighting the strong ties between Israel and Russia.
The award, called the Genesis Prize, will be financed by an endowment of about $50 million set up by three of Russia’s so-called oligarchs: Mikhail M. Fridman, Pyotr Aven and German Khan, among others. Its creation was announced on Tuesday by Prime Minister Benjamin Netanyahu of Israel, where President Vladimir V. Putin of Russia was wrapping up a 24-hour visit, though Mr. Putin did not attend the announcement event.
The award is among a widening number of accolades that come with a seven-figure purse, including the Nobel Prizes; the Templeton Prize, for contributions to religion and spiritual life; and the Shaw Prizes, for astronomy, medicine and mathematics.
But the new prize also sends an inevitable political message, which its originators say is unintended.
Despite differences over how to deal with Iran and Syria, Mr. Putin is viewed as a strong friend of Israel, which has a large Russian immigrant population.
“It’s just one of the signs of the good relations between Israel and Russia in general,” said Dmitry Maryasis, a senior research fellow on Israel at the Institute of Oriental Studies in Moscow. “We can say a lot of things about the present-day government, but one thing we can tell for sure is they are not anti-Semites.”
Emphasizing Russia’s good rapport with Israel and Cyprus, which also has a large Russian-speaking diaspora, has become increasingly important to the Kremlin, given its eroding influence elsewhere in the Middle East. That sway is likely to diminish even further should the government of President Bashar al-Assad fall in Syria.
Mr. Fridman, Mr. Aven and Mr. Khan are shareholders in the Alfa Group, a Russian corporate behemoth with interests in banking, oil, gas, insurance, telecommunications, insurance and retail. They are also known for close connections to Mr. Putin and the Russian government.
In 2007, together with two associates, Alexander Knaster and Stan Polovets, they established the Genesis Philanthropy Group, a foundation that promotes Jewish identity among Russian-speaking Jews worldwide.
To underscore that there were no political motives, creators of the Genesis Prize said Mr. Fridman had first raised the idea about three years ago with Natan Sharansky, the former Soviet dissident and later Israeli politician, who is now chairman of the Jewish Agency for Israel.
The agency will play a large role in administering the award, with Mr. Sharansky as the nomination committee chairman. The selection committee will be led by the speaker of the Knesset, Israel’s Parliament, and include two retired Israeli Supreme Court justices. The winner will be announced each year at the residence of the Israeli president.
In a telephone interview, Mr. Sharansky said the award would recognize the role of Jewish identity in encouraging universal achievements.
“All my life I had to prove again and again that there is no contradiction between a desire to contribute to universal values and your desire to be part of your tribe or your identity,” he said. “What gives your life value, what gives you strength to fight for universal values is your identity.”
The Genesis Philanthropy Group’s chief executive, Mr. Polovets, said Mr. Putin’s trip provided a convenient opportunity to schedule the announcement because some of the award’s Russian sponsors were in Israel for the visit.
But, Mr. Polovets said, the prize was developed without political motivations.
“From our perspective, there is no political angle whatsoever,” he said. “All of our activities are strictly focused on educational, cultural issues — as apolitical as you can get.”
Some of Mr. Putin’s own ties to Israel have been personal. His boyhood teacher of German, a language in which Mr. Putin is fluent, is Jewish and left the Soviet Union for Israel, where they were reacquainted in 2005 during Mr. Putin’s first official visit.
Mr. Maryasis, the research fellow in Moscow, said the award would still be seen as underscoring a geopolitical friendship. “It’s an important symbol,” he said, “to say we are O.K. with Israel.”

Russian canoeists

Russian canoeists and kayakers aiming high at London Olympics.

The Olympics are just a month away and 17 more places have been taken on the Russian team following three days of trials in canoeing and kayaking in Moscow.
This year’s Russian Championships were used not only to determine the best athletes domestically, but also to find out who will represent the country at the Olympic Games in London.
The 200 meters men’s individual race in canoeing was one of the most anticipated events. Russia’s only Olympic champion in the sport in Beijing, Maksim Opalev, was battling for his fourth consecutive Summer Games ticket. However he failed to see off the opposition in the final as six-time world champion Ivan Shtil came home first to make it into his first Olympics.
Other medal hopefuls for Russia are canoeists Aleksey Korovashkov and Ilya Pervukhin in the 1,000 meters pairs. Last year’s European Champions edged their nearest opponents by less than half of a second in the final.
In total, Russia will send four canoeists to the Olympics, while 13 athletes will represent their country in kayaking.
The 1,000 meters quartet of Ilya Medvedev, Anton Vasiliev, Oleg Zhestkov and Anton Ryakhov won bronze at the 2011 World Championships, and they will be trying to make the podium once again in London.
Meanwhile Russia’s sprint duo, Yury Postrigay and Aleksander Dyachenko, are among the favorites for the 200 meters gold in London after posting the fastest times in the world this year.
There’s also a strong female contingent in the Russian team. Natalia Lobova will be taking part in two different disciplines. She will compete in the solo sprint as well as the 500 meter pairs race along with Vera Sobetova. At the domestic event this newly-formed couple gave a very solid performance, beating runners-up Anastasia Lavrova and Svetlana Kudinova by more than a second.
So with one of the biggest teams at the upcoming games, Russian canoeists and kayakers believe they will make waves in London.

Stocks

Russia Stocks Jump Most in Four Months on EU Meeting, Oil

Rally.

Russian stocks surged the most in four months as oil rallied after European leaders moved closer to containing the region’s debt crisis, boosting investor appetite for equities in the world’s biggest energy exporter.
The Micex Index (INDEXCF) gained 3.3 percent to 1,387.52 by the close in Moscow, its strongest advance since Feb. 24. The gauge has lost 8.6 percent this quarter, compared with an 8.2 percent increase in the first three months of the year. Power stocks surged, with the MSCI Russia Utility Index (MXRU0UT) rising 5.9 percent, the most since Jan. 3. Banks rallied, with VTB Group and OAO Sberbank, the nation’s biggest lender, adding at least 6.9 percent.
Emerging-market stocks rallied after European Union President Herman Van Rompuy said leaders of the 17 euro countries dropped the requirement that governments get preferred creditor status on crisis loans to Spain’s blighted banks. Crude oil gained 5.8 percent to $82.23 a barrel in New York. Oil and gas contribute about 50 percent to Russia’s state revenue.
“The European decision is not a game changer, but it buys time,” Farhan Kazmi, head of emerging-market equities at Credit Suisse Group AG in Moscow, said by phone. “People will be closely watching how things develop in the fiscal union in Europe.”
MSCI Inc.’s Russia Energy Index (MXRU0EN) rallied 4.5 percent to 936.63, the most since Feb. 24. The RTS dollar-denominated index added 5.4 percent to 1,350.51, the most since May 2010.
OAO MRSK Holding, the country’s largest electricity distribution company, and Federal Grid Co., the high-voltage transmission monopoly, were the worst performers on the Micex this quarter, losing more than 38 percent. MRSK added 5.1 percent to 1.779 rubles today, while Federal Grid gained 3.1 percent to 19.57 kopeks.
Risk Aversion
“The market has been under pressure from escalating risk aversion driving risk premiums higher and valuation lower” this quarter, Alex Kantarovich, head of research at JPMorgan Chase & Co. in Moscow, said by e-mail on June 25. In the third quarter, “volatility may persist given the markets may continue to lack clarity on the Euro crisis development and the risks are on the downside.”
Among 30 stocks traded on the Micex, 26 declined in the third quarter. OAO Uralkali, the largest producer of potash by output, rose 12 percent this quarter. OAO Magnit increased 7.1 percent in the period as four-month net retail revenue jumped 32 percent through April.
Russian stocks trade at 5 times estimated earnings, having lost 1.1 percent this year. That compares with a 2 percent advance for MSCI’s emerging-market gauge which trades at 9.6 times projected earnings.
Asset Sales
Russian equities will maintain the lowest valuations among emerging-market stocks next quarter as the nation delays state asset sales, according to analysts at Alfa Capital Partners Ltd., JPMorgan and Libra Capital.
Prospects for the government sale of a stake in MRSK Holding faded after the company said on May 11 that it would merge with Federal Grid.
In April the government postponed a roadshow for a stock offering for OAO Sberbank, Russia’s biggest lender, as the bank’s shares dropped below a level at which officials were willing to sell. Igor Shuvalov, Putin’s first deputy, said on April 16 that the Sberbank sale may be delayed until 2013 or 2014
“The government sends ambiguous signals on privatization,” Alex Kantarovich, head of research at JPMorgan in Moscow, said by e-mail on June 25. “The external conditions are unsupportive as valuations remain depressed.”
The Market Vectors Russia ETF (RSX), a U.S.-traded fund that holds Russian shares, lost 1.4 percent to $24.80. The RTS Volatility Index, which measures expected swings in the index futures, fell 2.9 percent to 36.86 points in New York.

Officials

“This weapon is perfect for close-quarters combat, house to house,” the Russian arms dealer explains, gently passing a silencer-equipped assault rifle, the AK-104, to the official from Syria, who brings the gun’s sight level with his eye and aims it across pavilion C3 of Russia‘s semi-annual arms bazaar. Serving as their translator is Colonel Isam Ibrahim As’saadi, the military attache at the Syrian embassy in Moscow, who chaperones the three officials in town from Damascus for a bit of military shopping. It is a rare opportunity for them. With their country sinking into a civil war, most of the world’s top arms-dealing nations have banned sales to the Syrian government. So the delegates enjoy themselves in Moscow. They spend more than an hour talking to the Kalashnikov salesman, Andrei Vishnyakov, head of marketing for Izhmash, the company that created the AK-47. Then they stroll over to other displays spread out across the giant Zhukovsky airfield near Moscow. They peruse tanks, touch rocket launchers, study cruise missiles and other heavy artillery, all of which stand gleaming in the summer sun like so many sports cars at a dealership. All of it is for sale.

Welcome to Russia’s premier weapons expo, the deceptively titled Forum of Technologies in Machine Building, a military smorgasbord for the dictators of the world that Russian President Vladimir Putin opened in 2010. Delegations from Iran, Zimbabwe, Bahrain, Pakistan and Uganda, among many others, came to the fair last week, but the Syrian presence was the most controversial. Since the 1950s, when it first became a client state of the Soviet Union, Syria has purchased almost all of its weapons from Russia, making it a cherished customer. Over the past 16 months, Syrian forces loyal to President Bashar Assad have used these weapons to brutally crush a homegrown rebellion, with the death toll now estimated at 14,000, including thousands of women and children. The rest of the Arab world has joined with the West in condemning these massacres, but that has not stopped the flow of Russian arms. Indeed, the Kremlin seems willing to jeopardize its relations with Europe and the U.S. in order to defend Assad and continue to sell him weapons.

In diplomatic terms, there is nothing frustrated Western officials can do to stop them. Russia has a permanent seat on the U.N. Security Council, and it has repeatedly used its veto power to block any discussion of an international arms embargo against Syria. Susan Rice, the U.S. ambassador to the U.N., said in May that the Russian arms sales to Syria are “reprehensible,” but they are not illegal. Diplomatic and moral pressure from the West, like the claim that Russia is aiding the murder of civilians, has not changed many minds in Moscow. “These are the guys we are rooting for,” an official with Russia’s state arms dealer, Rosoboronexport, told TIME on Thursday while showing the Syrian delegates a set of truck-mounted rocket launchers.

Electricity

Russia offers $500m for electricity import project.

Russia has offered an investment of $500 million in establishing a transmission system for the Central Asia South Asia 1,000-megawatt (CASA-1,000) power import project, which will bring electricity from Kyrgyzstan and Tajikistan to Afghanistan and Pakistan.
Russia has offered an investment of $500 million in establishing a transmission system for the Central Asia South Asia 1,000-megawatt (CASA-1,000) power import project, which will bring electricity from Kyrgyzstan and Tajikistan to Afghanistan and Pakistan.
The offer came in a meeting of a six-member Russian delegation, headed by State Secretary and Deputy Energy Minister YP Sentyurin, with Federal Water and Power Minister Ahmad Mukhtar here on Thursday.
The two sides discussed various matters of mutual interest and cooperation in the energy sector. They agreed to sign a memorandum of understanding for energy cooperation and a draft will be prepared in this regard for consideration.
According to a statement issued here, the Russian delegates expressed interest in investing $500 million in the CASA-1,000 project. They were also willing to provide assistance for modernisation and rehabilitation of Muzaffargarh and Guddu thermal power plants and their conversion to enable them to run on cheaper fuel, like coal.
Earlier welcoming the delegation, Ahmad Mukhtar asked them to help Pakistan modernise hydroelectric plants, participate in construction of 500-kilovolt transmission line for import of 1,000 megawatts of electricity from Iran and other projects like Tarbela 4th Extension, coal and renewable energy and transmission lines.
He recalled that Russian companies had already developed many big projects in Pakistan and assured them of continuous and unwavering cooperation.
Separately, a delegation of the Asian Development Bank (ADB), headed by Central and West Asia Department Director General Klaus Gerhaeusser, held a meeting with Water and Power Minister Ahmad Mukhtar.
Mukhtar discussed the possibility of financial and technical assistance for mega water and power projects like Bhasha Dam. The delegation was also informed about the process of land acquisition for the dam and compensation package for displaced people.
Terming Bhasha Dam a very critical project, the ADB delegation assured the minister of support for big water projects including Bhasha Dam.
The bank has already provided $1.5 billion for energy projects and says it will continue financial and technical support for other projects as well.
Moscow seeks IP pipeline feasibility study
Russia has sought a detailed engineering design and feasibility study on the Iran-Pakistan (IP) gas pipeline for evaluation before going ahead with financing the project.
German-based firm ILF is currently engaged in feasibility study of the vital gas import project and the report has not yet been completed. However, the engineering design has been prepared.
According to sources, a 12-member Russian delegation, headed by Deputy Energy Minister YP Sentyurin, made the demand in a meeting with Adviser to Prime Minister on Petroleum and Natural Resources Dr Asim Hussain here on Thursday.
The Russian delegation is visiting Pakistan in connection with the second meeting of the Pakistan-Russia joint working group on energy cooperation.
Hussain assured the delegation that Pakistan would submit the detailed engineering design of the pipeline project.
According to a statement issued here, Hussain highlighted Pakistan’s urgent approach towards meeting its energy needs and said completion of mega gas projects including Turkmenistan-Afghanistan-Pakistan-India (TAPI) and IP pipelines was the country’s top priority. In this connection, he praised the Russian offer of cooperation for the gas import projects.
Petroleum Secretary Ejaz Chaudhry, who was present in the meeting, briefed the delegation on progress on the pipeline projects and stressed the need for expanding the bilateral treaty framework of cooperation in the oil and gas sector.
The delegation was informed about the extensive work done on formulating shale and tight gas policies, which may be of interest to Moscow.
Both sides agreed that details of the two mega gas projects would be shared immediately and financial matters would remain negotiable.

Saleh

The bond between Russia and Yemen was put at risk by the Arab Spring revolts, which erupted in Yemen a year after Putin’s stroll with Saleh through the arms bazaar in 2010. That revolution quickly turned violent, and Saleh ceded power soon after he was wounded in a rebel rocket attack last June, costing Putin one of his allies — albeit a country that played on U.S. ties and anxieties
in the Arab peninsula as well. months later, the Libyan dictator Muammar Gaddafi, another client of Russian arms dealers, was killed by rebels who had support from NATO bombing raids. Putin was outraged, especially after images of Gaddafi’s bloody corpse appeared in the media. “Who gave them the right to do this?” he snapped at a press conference in Denmark, referring to NATO’s role in the Libyan revolution. “Why did they have to get involved in this armed conflict? What, is there a shortage of crooked regimes in the world? Are we going to interfere in every domestic conflict? … You have to let people resolve their own problems.”

After the war in Libya, Russia drew a line. It began blocking all U.N. efforts to force Assad down the same road as Gaddafi and Saleh, and as foreign countries began arming rebels in Syria, Russia continued supplying Assad. “None of these events will influence our relationships with our traditional markets in any way,” says Rosoboronexport’s Isaykin. Judging by the crowd at the arms bazaar — packed with military men from Asia, Africa and the Middle East — Russia still has plenty of loyal customers around the world. As Russia’s tanks performed their ballet in a mock battle field on Thursday, the foreign delegates looked on, happy patrons of the art of war. That evening, after two long days of shopping, the Syrian delegates walked toward the parking lot with bags full of pamphlets and promotional videos for Russian military hardware. No doubt they were imagining how useful it could be back home.

Bashneft

Russia’s Bashneft wins contract to explore for oil in southern

Iraq, official says.

Iraq has awarded Russian oil giant Bashneft rights to explore for oil in the south of the country after nearly one month of negotiations, a senior Baghdad official said on Sunday, bringing the total number of Russian companies with oil deals in Iraq to three.
Bashneft and Vietnam’s PetroVietnam were part of a consortium led by UK’s Premier to bid for Block 12 in Iraq’s fourth energy bidding round in May. The consortium rejected the government’s proposed fee of $5 per barrel of oil equivalent as too low and sought $9.85 for each barrel.
The deputy director of the Oil Ministry’s contracts department, Sabah al-Saidi, said that the ministry reached a separate agreement with Bashneft last week after it accepted the $5 fee.
The 8,000-square-kilometre (3,100-square-mile) block is in the southern provinces of Muthanna and Najaf.
The May auction was Iraq’s fourth since 2009 and was meant to attract foreign investment in the country’s crucial energy sector, particularly natural gas exploration. It drew lukewarm response from foreign companies due to tough contract terms. Out of 12 exploration blocks were on offer only three were awarded.
Only areas with undetermined hydrocarbon resources were on offer, while previously the rights to known large and medium oil and gas fields were being auctioned off. Iraq has offered only service contracts in which companies are paid a flat fee, rather than deals in which they receive a share of the hydrocarbons found.
The three successful bids were made by consortiums led by Kuwait Energy, Russia’s Lukoil and Pakistan Petroleum.
Kuwait Energy with its partners, Turkey’s TPAO and the UAE’s Dragon Oil, will explore for oil in southern Basra province and will be paid $6.24 for each barrel of oil equivalent it finds. Russia’s Lukoil and Japan’s Inpex Corp. will explore for oil in southern Iraq and will be paid $5.99 for each barrel of oil equivalent they find and Pakistan Petroleum will search for natural gas in the east of the country and is to receive $5.38 for each barrel of oil equivalent.
All three deals will be initially signed in mid-July and will be sent to the Cabinet for final approval, al-Saidi said. The fourth deal could be initially signed later this month, he added.
Iraq is trying to build up its energy sector, hit by years of neglect and violence, including the turmoil following the ouster of Saddam Hussein in 2003. Iraq holds the world’s fourth largest oil reserves of 143.1 billion barrels, and oil revenues cover nearly 95 per cent of the country’s local budget.
Since 2008, Iraq has awarded 15 oil and gas deals to international energy companies, the first major investments in the country’s energy industry in more than three decades.
Daily oil production stands at about 3 million barrels. Iraq initially set a target of 12 million barrels a day by 2017, but it is now considering a downward revision to fewer than 10 million barrels, in part because of infrastructure bottlenecks.

Clinton Calls Russia

Clinton Calls Russia Backing Syria Plan Significant Step.

U.S. Secretary of State Hillary Clinton called the decision by Russia and China to endorse a United Nations plan for political transition in Syria “a significant step forward,” pushing back against criticism that the accord was too weak.
“There was every reason to believe that we would never get the Russians and the Chinese on board,” she said in an interview with Bloomberg Radio after the talks in Geneva on June 30. During more than six hours of contentious negotiations, Clinton said she “didn’t know that we were going to be able to get anything.” Russia’s Foreign Minister Sergei Lavrov said the road map doesn’t imply the ouster of Syrian President Bashar al-Assad, and Clinton’s optimism wasn’t shared by analysts such as Andrew Tabler, who also saw the outcome as providing leeway for Assad to remain in power.
“As it reads, it seems Washington has made a major concession in that Assad could stay on,” Tabler, a fellow at the Washington Institute for Near East Policy, said in an e- mailed response to questions on June 30.
Russia and China agreed to back UN Special Envoy Kofi Annan’s plan to mediate an end to the 16-month conflict by calling on the Syrian regime and opposition to establish a transitional government chosen “by mutual consent.” Russia had dug in against a U.S.-backed draft by Annan that said an accord would “exclude from government those whose continued presence and participation would undermine the credibility of the transition and jeopardize stability and reconciliation.”
Bloody Hands
Clinton said in the interview that there was little difference between the earlier draft and the final document’s “strong language” giving both sides an effective veto over anyone seen as an impediment to peace.
“I don’t think you have to be up on current events to know that no member of the opposition is going to have Assad or anyone else with blood on their hands on the transitional body,” Clinton said.
Russia was averse to being seen as endorsing a coalition against Assad, its closest ally in the Middle East, and is concerned about what would follow his ouster, according to Clinton.
Asked if the U.S. would press the UN Security Council to mandate sanctions or allow for military force to oust Assad, Clinton said the first step is “to test whether it is possible to mediate this very bloody, violent conflict.”

Annan

Annan Empowered

She said Annan has been empowered to go to the Syrian capital of Damascus to call for a new governing body with the full backing of the Security Council — the U.S., U.K., France, Russia and China. The Arab League, the European Union and four regional neighbors — Turkey, Qatar, Iraq and Kuwait — also support the plan.
Annan, a former UN secretary-general, “can now go to the Assad regime and say, ‘We have to start talking about a transition,’ and not be met with, ‘Well, we don’t have to do that because Russia and China don’t agree,’” Clinton said.
If Annan reports back to the so-called Syria Action Group that his mission has failed, “then I think we will have to act, and I believe we will be building the case as to why the Security Council should take such action,” she said.
The conflict in Syria began in March 2011, when the regime violently suppressed peaceful protesters inspired by the anti- authoritarian movements that toppled presidents in Egypt, Tunisia and Libya. Since then, an armed opposition has emerged, and the conflict has claimed more than 10,000 lives, according to the UN.
Syria has long served as Russia’s foothold in the Middle East, home to its only military base in the region, the strategically located Tartous naval facility. Russia also has been Syria’s leading arms supplier.
Supplying Weapons
Clinton has criticized Russia for continuing to supply the regime with weapons, while Lavrov has denounced U.S. allies Saudi Arabia and Qatar for funneling arms to the opposition.
Asked whether the international community would support an arms embargo on both sides, Clinton said that’s “one of the issues that we’re going to have to be discussing further as we go forward.” The U.S. “believes that ending the arming of the Assad government is the first order of business.”
Clinton said she was heartened by the eventual agreement in Geneva, which looked doubtful until the very end, because Annan “now has a stronger hand to play than he did yesterday.”

Russian Party in Estonia

Russian Party in Estonia Hits Back at Occupation Denial Claim

The Russian Party in Estonia (RPE) has issued a statement saying that its leaders, Stanislav Tsherepanov and Gennadi Afanasjev, had not denied the fact of the Soviet occupation and had not given an assessment of it.

The statement comes after IRL MP Andres Herkel posted an article on his blog accusing the two men of calling for a moratorium on the discussion of the issue and paraphrasing an opinion purportedly expressed by Afanasjev that the occupation was a question of belief and not a documented fact.

Herkel has called on the Social Democratic Party, which is on the verge of a merger with the Russian Party in Estonia, to clarify its stance on the occupation issue.

In their statement, the Russian Party in Estonia leaders said that any evaluation of Estonia’s past should be undertaken in accordance with Parliament’s 2002 declaration, which states that the crimes of Germany’s Nazi regime had been condemned by international authorities, but that the similar crimes of the Soviet Union had not.

“We believe that the basis for judgment of the communist regime of the USSR could be put into force by a court ruling analogous to that which was carried out in relation to the German National Socialist regime. Evaluation of these crimes should not stem from the interpretations of various politicians, especially if they connect the communist regime to the Russian people. This cannot be a matter of opinion. [Ethnic] Russian people are not and cannot be occupiers or descendants of occupiers,” the statement said.

Tsherepanov, who is to be the Social Democratic Party’s vice chairman, said that his underlying message was that the past shouldn’t be used for political infighting.

“We can talk about tragic historical events, but they should not be used for dividing the society and pitting various nationalities against one another,” he said.

Russian space agency Roscosmos

Russian space agency Roscosmos Aims to Make Sea Launch Profitable

Russian space agency Roscosmos and rocket and space-station hardware builder RSC Energia are working to restore commercial viability to the Sea Launch floating platform project, Roscosmos head Vladimir Popovkin said on Thursday.

“We are preparing a business plan together with RSC Energia to make Sea Launch profitable. We need to guarantee from three to four launches (from the platform) a year to reach that goal. We already have contracts for launches for the next two years,” Popovkin told Echo Moskvy radio.

The most recent launch was in September 2011 from the platform in the Pacific Ocean.

Sea Launch AG was formed in 1995 as a consortium of four companies from Norway, Russia, Ukraine and the United States, and managed by U.S. Boeing. It resumed operations last year after a 30-month hiatus that saw passage through U.S. Chapter 11 bankruptcy, change of ownership from Boeing to Energia and a move from California to Switzerland.

Russia Sberbank

Sberbank re-opens Russia market

Fears that political risk would preclude Russian borrowers from accessing the bond market were dispelled this week when Sberbank priced a heavily oversubscribed dollar trade, thereby opening the door for more supply from the country.

The USD1.5bn five- and 10-year issue was the most eagerly awaited transaction from Central and Eastern Europe. As well as being the first 144a/ Reg S by a Russian borrower this year, it was also the first since development bank VEB pulled its deal in December following the outbreak of protests against parliamentary elections.

With Russia’s presidential election a little more than a month away, market players were interested to see what, if any, political risk still existed for Russian borrowers. If the Sberbank trade is any guide, the answer is zero.

The deal also shed any doubts that Russian borrowers may struggle to access the market after the finance ministry made noises last week about imposing a 20% withholding tax on Eurobonds.

The USD1.5bn, five- and 10-year dual-tranche transaction from the country’s biggest bank, whose senior unsecured debt is rated A3/BBB (Fitch), saw a good reaction from international investors, who were keen to get their hands on Russian paper after a dearth of supply over the past six months. The order book totalled more than USD4.6bn with 420 accounts participating across both tranches.

The new issue premium on a yield basis was estimated to be 8bp for the new USD1bn 4.95% 2017s based on the 4.87% level that Sberbank’s outstanding 2017s were trading at the time of the deal’s announcement. Initial guidance for the five-year was a deliberately vague low 5% area.

For the USD500m 6.25% (plus or minus 12.5bp) 2022s, the concession was about 9bp for the tight end of the range when compared with the issuer’s outstanding 2021s, which were trading at 5.90% and adding 14bp for the one-year curve extension.

Both tranches, which were priced at par, were up in the secondary market with the five-year quoted at 100.06-100.12 and the longer-tranche at 101.10 and 101.20 on Wednesday.

“This was a real test to see if appetite for Russian risk was there as we approach the election,” said William Weaver, head of CEEMEA debt capital markets at Citi, which acted as a bookrunner on the deal together with Barclays Capital, BNP Paribas and Troika Dialog (now part of Sberbank).

“However, after announcing the mandate the US roadshow was packed within a day,” he added.

TRANSFORMATIONAL CHANGE

As Sberbank’s debut 144a transaction it was the first time the bank had roadshowed in the US with a specific issue in mind. “The 144a documentation is a transformational change in the bank’s funding strategy,” said Nick Darrant, head of CEEMEA debt syndicate at BNP Paribas. “It increases the options at their disposal.”

There was disquiet among some investors that Sberbank’s priority was the five-year tranche rather than the 10-year – a tenor that US investors in particular prefer.

“In the meetings we had with them we expressly said we wanted to see a 10-year bond,” said one investor, who was disappointed that the shorter-dated paper was given greater emphasis.

However, he was pleased that the second longer tranche was added later. “It was good that they announced a 10-year bond and they priced it pretty attractively as well. Pricing was a lot better for the 10-year.”

Another investor added: “They tightened the five-year quite a bit but they left more juice on the 10-year, so understandably it is doing better.”

Darrant said there was natural demand from European and Asian investors for five-year debt. “That formed the core of the transaction. Once that was done and dusted Sberbank opportunistically added a longer tranche.”

He added: “Sberbank was very much in the driving seat of this transaction, whether it be the timing, the sharp revision in pricing or the size. We’d shown them a menu of options during the marketing process and gave them investor feedback. But Sberbank has the luxury to choose a la carte.”

Fabianna Del Canto, director at Barclays Capital, said the deal paves the way for other top tier Russian borrowers to access the market. “It has re-opened the market but it doesn’t mean it is open across the credit spectrum,” she said, adding she expects to see potentially more deals from the country in the next few months.

The allocation of the deal is as follows: for the five-year tranche, the regional breakdown is Europe 59%, UK 23%, US 8%, Asia 7% and others 3%. By investor type it’s asset managers 34%, banks 33%, private banks 11%, hedge funds 9%, pension funds and insurers 4% and others 9%.

For the 10-year tranche it was US accounts 47%, UK 26%, Europe 24%, Asia 2% and others 1%. Asset managers took 61%, hedge funds 15%, pension funds and insurers 10%, banks 8%, private banks 4% and others 2%. (Reporting by Sudip Roy; Editing by Helene Durand)

Russian Party in Estonia

Russian Party in Estonia Hits Back at Occupation Denial Claim

The Russian Party in Estonia (RPE) has issued a statement saying that its leaders, Stanislav Tsherepanov and Gennadi Afanasjev, had not denied the fact of the Soviet occupation and had not given an assessment of it.

The statement comes after IRL MP Andres Herkel posted an article on his blog accusing the two men of calling for a moratorium on the discussion of the issue and paraphrasing an opinion purportedly expressed by Afanasjev that the occupation was a question of belief and not a documented fact.

Herkel has called on the Social Democratic Party, which is on the verge of a merger with the Russian Party in Estonia, to clarify its stance on the occupation issue.

In their statement, the Russian Party in Estonia leaders said that any evaluation of Estonia’s past should be undertaken in accordance with Parliament’s 2002 declaration, which states that the crimes of Germany’s Nazi regime had been condemned by international authorities, but that the similar crimes of the Soviet Union had not.

“We believe that the basis for judgment of the communist regime of the USSR could be put into force by a court ruling analogous to that which was carried out in relation to the German National Socialist regime. Evaluation of these crimes should not stem from the interpretations of various politicians, especially if they connect the communist regime to the Russian people. This cannot be a matter of opinion. [Ethnic] Russian people are not and cannot be occupiers or descendants of occupiers,” the statement said.

Tsherepanov, who is to be the Social Democratic Party’s vice chairman, said that his underlying message was that the past shouldn’t be used for political infighting.

“We can talk about tragic historical events, but they should not be used for dividing the society and pitting various nationalities against one another,” he said.

Russia’s modern economy

Russia’s quest for a modern economy

We are living through a period of serious changes in the world economy. Never before has technology advanced so quickly. What we see today would have seemed like science fiction just 15 years ago.

In such circumstances, it is important to ensure stable development, to give our citizens maximum protection from the impact of global crises while renewing all aspects of our economy. For Russia, it would be inadmissible not to have an economy that can guarantee stability, sovereignty and a decent standard of living.

We need an economy with competitive industries and infrastructure, a developed service sector and an effective agricultural system – in short, an economy that harnesses modern technology. Fostering competition is key to securing demand for innovation. Only competition can encourage private business to seek enhanced technologies and innovate their products.

To restore our technological leadership, we must choose our priorities carefully. We should look at sectors such as pharmaceuticals, high-tech chemicals, composites and non-metal materials, the aviation industry, information and communication technologies and nanotechnologies.

The experiences of countries such as South Korea and China that have successfully modernized their economies show that a push from the state is necessary. We are also counting on the active participation of Russian capital in the privatization and further development of high-tech assets. At the same time, it is necessary to find buyers in global investment circles who are ready not only to invest in an individual scientific production facility, but to bring in their connections and experience on the international markets.

What is important is to get market leaders in global technology to move from the initial stage where Russia is perceived as a promising market to the second stage, where they start investing in local production facilities, and the third stage, where new processes and products would be designed in Russia.

To encourage this, we need to expand our domestic market, making it more attractive for direct investment. In recent years, we have moved from declarations of intent to real integration by creating the Customs Union with Belarus and Kazakhstan, the single economic space and the free-trade zone with CIS countries. Russia has been consistently working toward establishing a single market with its neighbours.

We must improve Russia’s business climate and its attractiveness for long-term investment. Both remain dissatisfactory. In the past few years, on the initiative of President Dmitry Medvedev, we launched a series of reforms aimed at improving the business climate. Until now, however, no significant change has occurred.

Speaking plainly, we still have system-wide corruption. The cost of doing business varies depending on your “proximity” to specific individuals within the government machinery. In these conditions, entrepreneurs quite rationally tend to find backers and strike deals with them rather than observing the law. Then, having made their deals, such businesses try to suppress competition.

Clearing the way for businesses prepared to win a competitive battle on a level playing field is our fundamental system-wide goal. And this cannot be attained through economic policy alone. We must transform the state itself, its executive and judiciary branches. We must dismantle the accusation-driven collection of law-enforcement, investigative and judiciary agencies and eliminate from our legislation all vestiges of the Soviet legal system. Economic cases must be transferred from trial courts of general jurisdiction to arbitration courts. Together with the expert community, judges and entrepreneurs, we should publicly discuss and introduce before the end of this year all the necessary initiatives to achieve this.

Economic policy must be adjusted to reduce the level of government regulation, replacing regulations with market-based mechanisms, and administrative control with liability insurance. The global crisis lent more credibility to the proponents of state-led management of the economy. But we understand that, as opposed to many other countries, the share of the state in the Russian economy and the degree of government regulation remains rather high.

We have plans to privatize a number of key assets. I should emphasize that such privatization is structural, rather than fiscal, in nature. In other words, we are selling not only to obtain additional budget revenue but, above all, to boost the competitiveness of our economy and clear the way for private initiatives. We will not ignore the market environment and sell cheap.

We should also reduce the participation of state-owned companies and banks, as well as that of natural monopolies, including Gazprom, in the capital of other economic players, and spin off their non-core businesses, including media holdings.

Maintaining and improving macroeconomic stability is a prerequisite for all these developments. It is probably one of our greatest achievements in recent years. We have come to value macroeconomic stability and use tools for maintaining it even amid extremely adverse conditions.

And we must eschew protectionist measures. We will soon join the World Trade Organization. Excessive protectionism always leads to stagnation, poor quality and high prices.

We have the key drivers for success in place. Russia now has a rapidly growing middle class prepared to invest in better medical services, better housing and higher retirement benefits. The task of the government is to make sure their money doesn’t go up in flames.

The modernized economy should grant everybody the possibility of self-fulfilment – entrepreneurs, public officials, engineers, skilled workers.

India and Russia

The twin-city partnerships between India and Russia are poised for expansion.  “These cities have much in common, and the administrations concerned have already established the twin-city partnership,” says Shtapkina.

Three more Russian cities, she says, are earmarked for partnerships with Indian cities. They are Yessentuki, Stavropol and Pyatigorsk. “The RCSC and the Indian Association of Friendship with Foreign Countries are trying to find out suitable Indian cities for partnership with the Russian cities. Presently, the two sides are trying to establish partnership between Pyatigorsk and Kochi,” says she.

Building upon ongoing efforts to promote cooperation between the Altai region of Russia and Kerala, Days of Pyatigorsk festival will be organised in Thiruvananthapuram, the capital of Kerala, this year. The talks are also going on to connect Stavropol with Jaipur in Rajasthan. Mikhail Grymin, the mayor of Severodvinsk,  has expressed his desire to associate with an Indian city to India’s ambassador to Russia Ajai Malhotra. With this revival of the twin-city relationships, there is a lot of camaraderie waiting in the wings for India and Russia.

St. Petersburg and Mumbai

St. Petersburg and Mumbai

Nightfall weaves magic around the embankments of Neva River during White Nights and to Mumbai’s Marine Drive promenade. While the authorities in St. Petersburg never need to turn the city’s streetlights on, the lights along South Mumbai’s boulevard make it resemble like a pearl necklace. Besides the nightlife the cities have a mélange of creativity, radical ideas, and legacy. St. Petersburg has a network of baroque and neoclassical architectural wonders and Mumbai showcases Art Deco riches and Neo-Gothic masterpiece, the Chhatrapati Shivaji Terminus.

Moscow and New Delhi

Moscow and New Delhi

A view of the Grand Kremlin Palace in Moscow is a powerful symbol of authority in the Russian Federation. In the exhibition, not far away, the monuments of Delhi are displayed to give a glimpse of the Indian national capital and political powerhouse. The Kremlin and the Rashtrapati Bhavan in New Delhi are matched by very few other residential premises of the Heads of the State in the world in terms of their vastness and magnificence. Both the metropolitan cities encompass testaments of the past be it Kitai Gorod or Red Fort, Lenin’s or Humayun’s Tomb, and Annunciation Cathedral or Jama Masjid. A walk down Moscow’s Stary Arbat Street past souvenir stalls, performing artists, and cafés is somewhat akin to wandering the lanes of Chandni Chowk for culinary pleasures or shopping at wholesale prices. Moscow and New Delhi are steeped in history and cultural heritage. The fame of Bolshoi Theatre is in step with New Delhi’s network of performing art centers such as Kamani Auditorium, Sri Ram Centre, and the National School of Drama.

India-Russia

Twin-cities celebrate India-Russia connect

The cities are the soul of a nation. On the face of it, New Delhi and Moscow, Mumbai and St. Petersburg may not appear to have much in common, but go deeper and you will find striking cultural affinities. The twin-city relationships also promise to accelerate people-to-people camaraderie.

New Delhi and Moscow. Mumbai and St. Petersburg. Volgograd and Chennai. Thousands of miles apart, but linked in spirit, these twin-cities of India and Russia radiate a certain cultural affinity and emotional connect that’s hard to match. A photo exhibition held in New Delhi last year artfully illuminated hidden connections between iconic metropolises of the two great countries. Entitled “Views of Indian and Russian Twin-Cities,” the photo exhibition held at the Russian Centre of Science and Culture (RCSC) in New Delhi provided a bird’s eye view, perhaps that of a Siberian avian migrating between India and Russia and capturing cultural affinities between them.

Jointly organised by the RCSC and Forum of Indian Photographers and Artists (FIPA) (October 4-21, 2011), the exhibition was seen as a positive step towards promoting cultural exchange and fostering mutual understanding. “The exhibition is unique in the sense that it promotes people-to-people diplomacy between the two countries. Through the medium of photography the exhibition seeks to demonstrate the necessity of activating the tie-ups between the Indian and Russian twin-cities,” says Yelena S. Shtapkina, deputy director (Culture and Information), RCSC. “It’s a springboard for more such interactive events in the future, says Vimal Mehta, president of FIPA. The exhibition was aimed at “collecting diverse visions of the cities’ lifestyle and landmarks.”

Russia space

Russia’s ambitious space poojects: Phobos-Grunt-2?

Space science in Russia seems to be in the doldrums: after the Phobos-Grunt failure the future of next planetary missions seems vague. A press conference called ‘Ambitious space projects’ was held at RIA Novosti press center on February 1st, just after the official conclusion of the special Commission for investigation of the Phobos-Grunt disaster was presented to head of Roscosmos Vladimir Popovkin.

The main cause of the disaster was computer failure due to heavy particle bombardment. Another probable reason stated by Popovkin was the use of integral parts that were not designed to be used in space.

However, answering the question of whether the scientific community believed that Phobos-Grunt was ready for launching, Professor Lev Zelenyi, director of the Space Research Institute, principal organization for scientific payload, said ‘No’. But the next astronomical window in 2013 would be inconvenient for interplanetary missions, and 2015 is too far away and a lot of the technology would need replacement.

The finale is well too known. Still, plans to conquer Phobos are by no means abandoned. Space projects are known to be repeated after failures. Such was the case with ESA’s Cluster 4-satellite mission in 2000, which initially (in 1996) perished due to failure of the new Ariane-5 booster, and NASA’s Phoenix Mars Lander which was a reincarnation of the 1999 Mars Polar Lander. Still, the question is whether the same scenario is viable for Phobos-Grunt and to what extent the project could be duplicated.

Phobos-Grunt-2

Currently, it seems like the idea of a second Phobos mission would not become outdated at least in a decade. Martian plans of Europe and the US encompass several missions that aim at Mars itself, and although exploration of Phobos is still considered, Phobos-Grunt-2 could still be the first to fulfill the task even if it’s launched in 2018. But what would be the price?

Commenting on that, Lev Zelenyi gave an estimate of 3 billion rubles, pointing out that this figure is based on current prices. ‘It would be more than 1 billion but less than 5, as many technologies are already developed’ he said.

It might be also sensible to shrink the program of the project, leaving out some of the satellite experiments and therefore reducing the weight of the spacecraft.

Whether Phobos-Grunt-2 will be built, depends largely on lunar projects and Russian participation in European ExoMars, which is in the process of being discussed by agencies’ representatives.

In the next five years Russian planetary science will be focused on lunar exploration, with two missions, Luna-Resurs (joint mission with Indian Space Research Organization) and Luna-Glob. Both will study the polar regions of the Moon that turned out to have more surprises for scientists after the discovery of probable deposits of ice or chemically bound water in the shallow layer of lunar surface.

Current dates of launches are 2013-2014 and 2014-2015 respectively. These dates were one of the reasons why Phobos-Grunt-2 was suggested to be launched in 2018 rather than 2015 — as most likely all spacecraft would be built by the Lavochkin Association and it might be implausible to run both projects at the same time.

ExoMars

The story of ExoMars is more complex and still far from decided. The project includes a lander and an orbiter for studying the Martian atmosphere and geology. Having been for a long time a joint ESA-NASA project, now that the US has withdrawn from the project this mission is being revised with probable participation of Russia. An obvious advantage of participating in ExoMars is an opportunity to send scientific devices to the planet, while the main disadvantage is that this project requires money, as will Phobos-Grunt-2. ExoMars was planned for 2016–2018.

Meanwhile, the Venera-D project of a long-living lander to Venus is mostly likely to be postponed until after 2020. Truly ambitious (previous Soviet landers lasted about two hours while Venera-D was intended to exceed this limit by several times), this project is for that reason highly unlikely to be run along with Martian plans.

The Phobos-Grunt disaster was on the top of the news agenda of the Russian media for several days, after every major event of this unfortunately too short of a story. The effect could hardly have been stronger, if the spacecraft left the near-Earth orbit and began its journey to Mars. Overrated attention to failures is also among the problems of Russian space. Still, not only the media are to blame.

space

Public and media relations in space science, as well as educational outreach, have never been among the priorities in space policy, which led to space exploration misrepresented as a victorious quest or total failure. Brilliantly exemplifying the approach, Roscosmos erased the Phobos-Grunt section on its web site a day after its fall.

However, Russian solar and geophysical research in near-Earth space in the 1990’s and in the 21st century was mostly successful, not to mention the RadioAstron space radio observatory, that has just begun its scientific program. Still, the outcome of the missions (with some exceptions) was poorly covered online and never widely used in science popularization.

‘Educational/Public Outreach’, or E/PO, is one of the mandatory parts of a project’s budget in the US, making up around 5–7 per cent of the total price. In Russia these activities are mostly volunteer-based, although the idea of publicity is gradually spreading among chief space organizations.

If Phobos-Grunt-2 is accepted for realization, internal coverage of the project would probably be even more important after the current failure. Hopefully, though, there would be no failures of the kind in the future.

Goldman Sachs

Goldman Sachs Chief Russia Trader Quits to Build New York Sauna

Goldman Sachs Group Inc.’s chief equity trader in Moscow, Peter Kizenko, said he quit to return to New Jersey and finish building a commercial Russian sauna.

Kizenko, who was born in New York, said he decided to return after 18 years in Moscow because of the growth of electronic trading and declining compensation in the industry.

“The fun element has been taken out of it,” the 45-year- old said in a telephone interview today. “The golf course just got harder, and Moscow is no longer like Chicago in the 1920s where anything goes. Russia is becoming more refined.”

He’s leaving the industry at a time when regulators are forcing banks to cut back their proprietary trading activities and lenders themselves are cutting pay. Goldman Sachs, which set a record for securities-firm pay in 2007, reduced compensation for the third year in a row after earnings skidded and protesters denounced Wall Street bonuses.

Kizenko joined Goldman Sachs in 2006 from UBS AG, where he was the Swiss bank’s lead trader in Moscow. Kizenko, whose parents emigrated from the former Soviet Union, said he is leaving the company today before returning to the U.S. and the banya’s opening next month.

“I am no longer the oldest trader on the Russian market,” Kizenko, said. “Now I can finish building up a Russian banya in New Jersey.” He didn’t rule out a return to the financial industry at a later date.

Banya Tradition

The banya tradition dates to the 11th century in Russia. A wooden log shed is heated by an electric or wood-burning stove to more than 80 degrees Celsius. Copious amounts of water are poured on the heat source to bring the humidity to about the same level. A visit to a banya begins with several rotations in and out of the steam room to allow the body to warm up. Naked bathers typically beat one another with birch or pine branches before plunging into cold water or rolling in snow to cool down.

There are about five to seven banyas already in the New York, area according to Kizenko, who considered opening one in London until he saw how expensive the rents are.

“There are a few in Brooklyn and Manhattan, but the aesthetics are not up to scratch,” Kizenko said by phone today. “We are going for a mixture of the contemporary and the classical of Sanduny in Moscow.” Kizenko had his banya, called Bear and Birch, made in Russia and shipped to the U.S., he said.

Built in the 19th century for nobles, the Sanduny baths near the Kremlin are Moscow’s fanciest. The poet Alexander Pushkin and the writer Leo Tolstoy are said to have bathed there. More recent visitors include the actors John Travolta, Dolph Lundgren and the billionaire Roman Abramovich.

Goldman Sachs reduced its compensation and benefits expense 21 percent to $12.2 billion in 2011 as revenue slid 26 percent. The expense for salary, bonuses and benefits, the company’s biggest cost, was enough to provide $367,057 to each of its 33,300 employees, down from $430,700 for each of its 35,700 workers at the end of 2010.

Separately, the firm said today Paolo Zannoni, chairman of Italian investment banking, will take over as chief of Russian operations from co-heads Chris Barter and Jean Raby in the third leadership change in as many years. Barter is leaving Goldman after 19 years to start his own investment firm while Raby will remain and work with investment-banking clients.

Russian Jan oil output

TABLE-Russian Jan oil output at a new post-Soviet high

Oil output in Russia, the world's top crude producer, rose
to a new post-Soviet high of 10.36 million barrels per day (bpd) in January and was up by 0.4
percent from 10.32 million bpd reached in December, Energy Ministry data showed.    	
    Exports via pipeline monopoly Transneft fell by 0.6 percent to    	
4.24 million bpd from 4.26 million bpd in December.  	
    The following oil production and export data were supplied by Russia's Energy Ministry. 	
Volumes are in millions of tonnes and show the monthly and year-to-date totals.    	
    Percentage change figures are based on daily volumes.	

                   OIL AND CONDENSATE PRODUCTION         TRANSNEFT EXPORTS
                           Pct change vs                   Pct change vs   
                  Jan 12  Dec 11  Jan 11     YTD   Jan 12  Dec 11  Jan 11     YTD
 Rosneft           9.826     0.6     1.6   9.826    4.625    -8.8    -6.9   4.625
 LUKOIL            7.155     0.2    -3.3   7.155    2.147     6.0     0.1   2.147
 TNK-BP            6.196    -0.2     1.8   6.196    2.632   -10.4    12.6   2.632
 Surgutneftegaz    5.162    -0.1     0.7   5.162    2.134   -10.6    -5.2   2.134
 Gazprom Neft      2.582    -1.1     2.1   2.582    1.270    10.4     2.6   1.270
 Slavneft*         1.529    -0.8    -0.9   1.529      0.0     n/a     n/a   0.000
 Tatneft           2.226     0.0     0.1   2.226    1.214    -2.3    -2.7   1.214
 Gazprom           1.447    10.7    14.5   1.447    0.062   -12.6     n/a   0.062
 Bashneft          1.320     1.9     4.6   1.320    0.300     0.0     0.0   0.300
 Russneft          1.177    -0.1     5.9   1.177    0.402    -6.1   -12.8   0.402
 Novatek           0.368    -0.1     4.9   0.368      0.0     n/a     n/a     0.0
 Small producers   3.627    -0.4    11.3   3.627    1.012    47.1    70.5   1.012
 PSA operators     1.206     0.7   -11.6   1.206    0.125    -3.1    25.0   0.125
 TOTAL OUTPUT     43.820     0.4     1.5  43.820                                 
 Total Russian exports through Transneft           15.927    -3.1    -0.6  15.927
  including Caspian pipeline                        0.004     n/a   -99.0   0.004
 Transit through Russia:                                                         
  from Azerbaijan                                   0.080   -48.9   -52.7   0.080
  from Kazakhstan                                   1.765    41.2    -3.9   1.765
  Belarus production                                0.139    -0.8     n/a   0.139
 TOTAL TRANSNEFT THROUGHPUT                        17.924    -0.6    -0.5  17.924
 Routes other than Transneft**                      1.853     3.8   -12.3   1.853

    NOTES:    	
    * Slavneft is half owned by TNK-BP Holding and Gazprom Neft  	

    ** Some companies export crude by sea tankers, filling them at ports close    	
to offshore oilfields, or by rail, therefore  bypassing Transneft, the Russian    	
crude oil pipeline monopoly.

Russian diplomat

Russia intends to help Khartoum & Juba settle disputes, envoy says

A senior Russian diplomat visiting Khartoum has offered his country’s support to enable Sudan and South Sudan to overcome their disputes.

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Russia’s Deputy Minister of Foreign Affairs Mikhail Bogdanov has led a delegation to the Sudanese capital and held a series of meetings with top Sudanese officials.

Following a meeting with Sudan’s President Omer Al-Bashir on Wednesday, Bogdanov told reporters that Moscow intends to support Sudan in order to find durable solutions to all issues of contention with South Sudan.

Sudan and South Sudan have been unable to overcome an array of disputes arising from failure to fully implement the 2005 Comprehensive Peace Agreement (CPA) which ended more than two decades of civil wars between the two sides and paved the way for the south’s secession in July last year.

The most notable of these disputes are to the status of the hotly contested region of Abyei and sharing of oil revenues.

The Russian diplomat, however, pointed out that his country’s offer is limited to making contacts between the two sides without going into too many details or interfering with the ongoing efforts of the African Union High Level Panel, the main facilitator of talks between the two countries.

AUHIP-moderated talks between Sudan and South Sudan on the oil dispute have been unsuccessful so far as the crisis escalated in recent weeks after the south shut down oil production in response to Khartoum’s unilateral decision to confiscate its oil.

Bogdanov said he had received briefing from Al-Bashir on the situation between Sudan and South Sudan as well as the outcome of Sudan’s participation at the 18th AU summit held in Addis Ababa.

Al-Bashir held a meeting with Kiir on the margins of the AU summit in a bid to resolve the dispute but the talks collapsed after Kiir refused to sign a proposed agreement on oil.

Separately, the Russian official held meetings with Sudan’s Foreign Minister Ali Karti as well as the presidential assistant Nafie Ali Nafie.

The Russian delegation is visiting Khartoum to participate in the meetings of the joint ministerial committee between the two countries which was formed during Karti’s visit to Moscow in December 2010.

The committee aims to advance bilateral cooperation in the fields of economy, commerce and trade.

Bogdanov said his delegation comprises representatives of more than 10 Russian companies specialized in different fields.

He explained that the committee’s meeting, which is scheduled to kick off today, will aim to link Russian entrepreneurs with their Sudanese counterparts.

Russian Crude Oil

Russian Crude Oil Output Climbs to Post-Soviet Record in January

Russian oil production rose 0.4 percent in January from the previous month, setting a post- Soviet record.

Output from the world’s largest oil producer climbed to 10.36 million barrels a day last month from 10.32 million barrels a day in December, according to preliminary data from the Energy Ministry’s CDU-TEK unit. That was a 1.4 percent increase from 10.21 million barrels a day in January 2011.

Prime Minister Vladimir Putin, who will seek re-election as president in March, has called for Russia to pump more than 10 million barrels a day for at least the next decade, and lowered the tax rate on crude exports to encourage output. Oil taxes are the biggest contributor to the national budget.

Average production passed Putin’s target level in 2009 for the first time since the Soviet Union collapsed in 1991, reaching 10.35 million barrels a day in October last year. Soviet-era output peaked at 11.48 million barrels a day in 1987, according to BP Plc (BP/) data.

Exports rose to 5.29 million barrels a day in January, an increase of 1.2 percent from the previous month and 2.3 percent from January 2011.

Russia veto

Russia says will veto “unacceptable” Syria resolution

Russia said on Wednesday it would veto any U.N. resolution on Syria that it finds unacceptable, after demanding any measure rule out military intervention to halt the bloodshed touched off by protests against President Bashar al-Assad’s rule.

The political violence in Syria has killed at least 5,000 people in the past 10 months and activists say Assad’s forces have stepped up operations this week on opposition strongholds, from Damascus suburbs to the cities of Hama, Homs and the border provinces of Deraa and Idlib.

Arab and Western states urged the U.N. Security Council on Tuesday to act swiftly on a resolution backing an Arab League plan calling for Assad to hand powers to his deputy and defuse the 11-month-old uprising against his family’s dynastic rule.

“If the text will be unacceptable for us we will vote against it, of course,” Russian U.N. envoy Vitaly Churkin told reporters in Moscow via a videolink from New York.

“If it is a text that we consider erroneous, that will lead to a worsening of the crisis, we will not allow it to be passed. That is unequivocal,” he said.

His remarks came hours after Russia’s envoy to the European Union, Vladimir Chizhov, said there was no chance the Western-Arab draft text could be accepted unless it expressly rejected armed intervention.

Russia and China, both veto-wielding Security Council members, have resisted a Western push for a resolution condemning the Syrian government’s crackdown on unrest.

U.N. Security Council ambassadors met in New York on Wednesday to discuss ways to overcome their disagreements on the wording of the draft resolution Morocco submitted to council members on Friday.

Western envoys said they did not expect the closed-door meeting would immediately result in a deal with Russia and predicted further negotiating sessions in the coming days.

Despite the Russian comments, French Foreign Minister Alain Juppe said a “window of hope” had opened. “We will work furiously in the next few days to try and get a resolution that will allow the Arab League to forge ahead in finding a solution,” he told parliament in Paris.

Russia says the West exploited fuzzy wording in a March 2011 U.N. Security Council resolution on Libya to turn a mandate to protect civilians in the North African country’s uprising into a push to remove the government, backed by NATO air strikes, that led to the overthrow of Muammar Gaddafi.

Russia has also expressed concern that the draft’s threat of further measures against Syria could lead to sanctions, which it opposes.

“WHOSE SIDE?”

Western envoys in New York said the main sticking point was likely to be not military intervention, on which they said a diplomatic fix was possible, but the resolution’s support for the Arab League plan demanding that Assad give up power. That is seen by Moscow as tantamount to regime change.

The envoys said their biggest challenge would be to reword the draft so that it still endorses the plan but in a way that is weaker than the current version.

In Washington, U.S. Secretary of State Hillary Clinton told reporters, “Every member of the council has to make a decision: Whose side are you on? Are you on the side of the Syrian people? … Or are you on the side of a brutal, dictatorial regime?”

An activist group said Syrian troops killed eight people in the central city of Homs and that 15 government soldiers were killed in a clash with a defector unit. Syria’s state news agency SANA said a general, Rajeh Mahmoud, was killed along with three soldiers on the outskirts of Damascus on Wednesday.

Syrian insurgents said Assad’s forces extended a military sweep overnight to counter a rebel threat that had reached the gates of the capital, sending armor into eastern and northern suburbs that Assad’s forces took over this week. An activist group said at least 25 people had been killed in that sweep.

In Wadi Barada on the edge of the capital, four people were killed in a tank bombardment on Wednesday to flush out rebel Free Syrian Army (FSA) units operating near the capital, activists said. A rebel spokesman put the death toll at 15.

SANA said troops killed 11 members of an “armed terrorist group” outside the southern city of Deraa, and that government forces discovered bomb factories and field hospitals in a raid on armed cells in Irbin and Sabqa, Damascus suburbs where insurgents had appeared recently.

It was not possible to verify the reports as Syria restricts access for independent media.

Russian Foreign Minister Sergei Lavrov said the policy of isolation and trying to remove the government risked igniting a “much bigger drama” in the Middle East.

“The people who are obsessed with removing regimes in the region, they should be really thinking about the broader picture,” he told the Australian Broadcasting Corporation.

“And I’m afraid that if this vigor to change regimes persists, we are going to witness a very bad situation much, much, much broader than just Syria, Libya, Egypt or any other single country.”

Russian official says Moscow

Russian official says Moscow will not stop arms sales to Syria

Russia will not stop selling arms to Syria, a top defense official said Thursday, as Moscow stands by its longtime ally despite mounting international condemnation over the Syrian regime’s bloody crackdown on a 10-month-old uprising.

Russia’s Deputy Defense Minister Anatoly Antonov said his country is not violating any international obligations by selling weapons to Damascus.

“As of today there are no restrictions on our delivery of weapons,” he told journalists in Russia, according to the country’s state news agencies. “We must fulfill our obligations and this is what we are doing.”

Moscow has been one of Syria’s most powerful allies — along with Iran — as Syria tries to crush the revolt against President Bashar Assad. The U.N. estimates that more than 5,400 people have been killed in the government crackdown.

Moscow’s stance is motivated in part by its strategic and defense ties, including weapons sales, with Syria. But Russia also rejects what it sees as a a world order dominated by the U.S. Last month, Russia reportedly signed a $550-million deal to sell combat jets to Syria.

U.N. ambassadors this week are trying to overcome Russia’s opposition to a draft resolution at the Security Council calling for Assad to surrender power. Moscow says it would veto the draft because it believes it opens the way for eventual international military action.

Wiam Wahhab, a pro-Syrian Lebanese politician, met Tuesday with Assad in Damascus.

“I found him relaxed and sure. He is confident in the Russian position,” Wahhab told the Lebanese newspaper Al-Akhbar in an interview published Thursday.

Wahhab said Assad told him he will end the uprising, because “the cost of chaos is much worse than the cost of decisiveness.”

As the diplomatic push continues, however, Syrian activists Thursday marked the 30-year anniversary of the Hama massacre. The three-week assault on the rebellious city of Hama leveled entire neighborhoods and killed thousands of people in one of the most notorious massacres in the modern Middle East.

The attack was carried out in 1982 when Assad’s father, Hafez, was president — and it has become a rallying cry for some Syrian protesters who want to topple the family dynasty now, once and for all.

On Thursday, many of the city’s residents were observing a general strike to mark the anniversary, said Ahmed Jimejmi, a resident. Protests were planned, he said, but security forces flooded the streets in anticipation.

Hundreds of troops and security forces were in the city, including Al-Assi square, and troops set up flying checkpoints, asking for people’s IDs.

“There is a checkpoint every 100 meters,” he said.

Activists painted two streets in Hama red to symbolize blood, and threw red dye in the waters of Hama’s famous and ancient water wheels.

Graffiti on the walls read: “Hafez died, and Hama didn’t. Bashar will die, and Hama won’t.”