Russia 110513

Basic Political Developments Dmitry Medvedev will meet with President of Austria Heinz Fischer on May 19,

2011 - Federal President of the Republic of Austria Dr Heinz Fischer will pay an official visit to Russia on May 18–21, 2011 at President of Russia's invitation.

Putin to talk joint projects in Slovakia - Russian and Slovakian leaders will focus on economic, energy, transport and scientific cooperation and will consider launching a number of joint projects.

Kazakh, Russian PMs talked over phone - As the press service of the Russian Government's Chairman informs, they discussed the issues of bilateral economic cooperation, the course of integration processes, including in the context of the upcoming session of the CIS Council of heads of government in Minsk.

Russian FM warns against foreign intervention in Syria o Russia warns against foreign intervention in Syria - Speaking on a visit to

the central Asian nation of Kazakhstan, he warned against a repeat of the "Libya scenario", where a Western coalition is carrying out air strikes against regime targets in a campaign that is increasingly troubling Moscow.

International Libya Contact group illegitimate, Russia will not join – FMo Lavrov said the contact group on Libya illegitimateo INTERNATIONAL COALITION IN LIBYA COMMITTING TOO MANY

VIOLATIONS OF UN SECURITY COUNCIL RESOLUTION, WHICH IS UNACCEPTABLE - RUSSIAN FOREIGN MINISTER LAVROV

o Libya marks beginning of a dangerous new trend – Russian foreign minister

LAVROV HOPES PROGRESS WILL BE MADE IN DIFFICULT TALKS ON MISSILE DEFENSE WITH U.S. BEFORE MEDVEDEV-OBAMA MEETING IN DEAUVILLE

o RUSSIA AND U.S. AGREE TO GIVE POLITICAL IMPETUS TO EXPERTS' WORK ON MISSILE DEFENSE ISSUES, CLINTON PROMISES TO TAKE MEASURES – LAVROV

o Russian-US negotiations on anti-missile systems going “tight” RUSSIA URGES TEHRAN NOT TO DODGE SERIOUS DISCUSSION OF IRAN'S

NUCLEAR PROBLEM – LAVROVo In Russia's view, Iran should report to the IAEA - "We stand for that in a

dialogue with Iran and consider the perspective of full participation of Iran in resolving various regional problems, but not at the expense of serious discussion on the Iranian nuclear program" - Lavrov said.

Session of Arctic Council wraps up worko Arctic countries sign “ground-breaking” SAR agreemento Russia’s Lavrov calls Arctic instance of good will, cooperation - “The

signing of an agreement on cooperation in the air and maritime search

and rescue in the Arctic – the first legally binding pan-Arctic document – will become a milestone in the Arctic Council’s work,” Lavrov said.

Interview of Russian Foreign Minister Sergey Lavrov, Published in the Newspaper Moskovskiye Novosti on May 12, 2011

Russia does not recognize Kosovo independence - Churkin o Russia backs UN probe into Kosovo crimes

Vice-Prime Minister Ivanov will visit the Kuril Islands on Sunday Vice Prime Minister of the Dominican Republic met with the leadership of

Abkhazia Islamabad seeks investment, Moscow wants to tackle terror - Russia and

Pakistan on Thursday pledged to boost economic ties and coordinate efforts to fight terror as the Kremlin welcomed President Asif Ali Zardari for a key visit after the killing of Osama bin Laden.

o Pak, Russia for intensifying ties in diverse fieldso Massive Russian investment in Pakistan –

Russia’s energy giant Gazprom will be developing gas deposits in Pakistan.

Russian state-owned mining and metallurgical facility construction company Tyazhpromexport will be modernizing the Pakistan Steel Mills near Karachi.

Russia’s largest power trader Inter RAO UES will be building power plants in Pakistan.

Russia will be joining the CASA-1000 project, which will bring electricity from Tajikistan to Afghanistan and Pakistan

Moscow also supports the Turkmenistan-Afghanistan-Pakistan-India (TAPI) gas pipeline project to transport natural gas from Central Asian states to Pakistan and India.

Chief of General Staff of Armed Forces of Russian Federation Nikolay Makarov pays visit to Minsk. - Yesterday First Deputy Minister of Defense of Russia delivered a lecture at a military academy and told about results of the reforms of the Russian Army.

Peru to receive 1st batch of Russian Mi-171copters after May 20 Russia sends destroyer to protect shipping off Somali coast - A Russian task force

led by Northern Fleet's destroyer Severomorsk will start patrolling pirate-infested waters in the Gulf of Aden in June, the Russian Defense Ministry said.

Russia has good chance in Turkish tender for anti-aircraft missile system – Rosoboronexport

Russia to deploy 2nd S-400 air defense regiment near Moscow Popular Front doesn't come under law on equal access to media – CEC Russia reforms fail to halt rights abuses – Amnesty FSB officer killed in armed clash in Dagestan Terrorist attack prevented in Kizlyar district of Dagestan Small blast hits Moscow cafe, no casualties Forest fire area increases by one third in Siberia in 24 hours

o Twelve more forest fire outbreaks reported in Siberia past day Launch of Russian observatory to study universe could be postponed Reuters PRESS DIGEST - Russia - May 13 RIA Russian Press at a Glance, Friday, May 13, 2011 A Victory Day for mothers - The Russian government will soon begin to pay out

maternity benefits directly from Russia’s Social Insurance Fund (SIF), ending the cumbersome present system by which employers are responsible for these and other types of welfare payments.

The Central Asian peacekeeping issue - The regional states actively cooperate with NATO’s programs, similar to those which Russia is initiating within the framework of the Collective Security Treaty Organization (CSTO). By Vladimir Mukhin

The 1,000-day countdown - Facilities for the upcoming Games are appearing like mushrooms in the resort town: a new airport has been built, tunnels and highways are being constructed at an accelerated pace.

Is Russia Interested in Regime Change in Belarus? – by Balázs Jarábik An umbrella to shield from space threats - Defence Russia's anti-ballistic missile

defence system can cover Eastern Europe and the Black, Baltic and North Seas, Russia: Shades of difference - Not much love, according to most Kremlin

watchers, is lost between Russian President Dmitry Medvedev and Igor Sechin, deputy prime minister. By Charles Clover and Neil Buckley

National Economic Trends CBR reports April interventions at only $3.7bn Inflation returns to 0.1% per week CIS Wheat Competition - Russia, Ukraine and Kazakhstan will increase wheat

supplies and boost exports starting July 1, increasing competition for European and U.S. growers, the U.S. Department of Agriculture said.

Business, Energy or Environmental regulations or discussions Fesco, Mechel, Norilsk Nickel, Novatek: Russian Equity Preview Sberbank May Buy BNP Paribas Russia Retail Unit, Kommersant Says

o Sberbank eyes BNP Paribas Russia retail arm –paper Troika Dialog Was Unprofitable in First Half, Vedomosti Reports Winsway Coking buy first Russian coal deposit Morgan Stanley could buy Moscow shopping mall for $1bn Russian seaports handle 0.7% less cargo in Jan-Apr – ASOP

Activity in the Oil and Gas sector (including regulatory) Gas Agreement With China Likely by Start of Forum Rosneft Still Weighing Arctic, Swap Deal Before May 16 Deadline on BP Deal -

“The company will make a decision that best meets its shareholders’ interests,” Rustam Kazharov, a spokesman for the Moscow-based Rosneft, said by phone

today. “The company wants to take a very balanced approach to making a decision.”

Russia TNK-BP minority shareholder sues BP –papers TNK-BP minorities seek $10bn in damages from BP TNK-BP shareholders prepare $5-10 bn BP suit Russia's Surgut proposes flat dividends on 2010

Gazprom Gazprom Neft in big profits hike - Russia’s Gazprom Neft lifted its first-quarter

net profit by 91% year-on-year to $1.437 billion, beating analysts' expectations thanks to better refining data.

Pakistan Seeks Cooperation With Gazprom on Gas Pipleines Gazprom faces $8 bln hit from taxes, price curbs Gazprom discloses pipeline construction costs

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Full Text Articles

Basic Political Developments

Dmitry Medvedev will meet with President of Austria Heinz Fischer on May 19, 2011http://eng.kremlin.ru/news/2202

May 12, 2011, 12:00

Tags: foreign policy, Austria

Federal President of the Republic of Austria Dr Heinz Fischer will pay an official visit to Russia on May 18–21, 2011 at President of Russia's invitation.

Putin to talk joint projects in Slovakiahttp://english.ruvr.ru/2011/05/13/50224545.html

May 13, 2011 09:11 Moscow Time

Prime Minister Vladimir Putin is leaving for Slovakia for talks with the country’s prime minister and president.

   Russian and Slovakian leaders will focus on economic, energy, transport and scientific cooperation and will consider launching a number of joint projects.

   Putin will also attend the Congress of the International Hockey Federation which is expected to name the host country of the 2016 world championships.

    Russia is among countries competing for hosting the event.

Kazakh, Russian PMs talked over phonehttp://engnews.gazeta.kz/art.asp?aid=341015

10:48 13.05.2011 text: Kazinform

Kazakh Prime Minister Karim Massimov has held a telephone conversation with Russian colleague Vladimir Putin.

The Kazakh Premier posted it on his Twitter page.

As the press service of the Russian Government's Chairman informs, they discussed the issues of bilateral economic cooperation, the course of integration processes, including in the context of the upcoming session of the CIS Council of heads of government in Minsk.

Russian FM warns against foreign intervention in Syria http://www.jpost.com/Headlines/Article.aspx?id=220400

By JPOST.COM STAFF  05/13/2011 10:37

  Russian Foreign Minister Sergei Lavrov on Friday warned against foreign intervention in Syria, calling on its opposition not to look for a repeat of the "Libya scenario," AFP reported.

On Thursday, the International Commission of Jurists (ICJ) said Syrian authorities have killed more than 700 people and rounded up thousands while shelling cities indiscriminately in their military crackdown on protesters.

Russia warns against foreign intervention in Syriahttp://www.google.com/hostednews/afp/article/ALeqM5jCu-z6I5PvcZpq30N7Wby0AvivvQ?docId=CNG.362c73b7828630d611a2c7b4ef2e55f1.571

(AFP) – 28 minutes ago

ALMATY — Russian Foreign Minister Sergei Lavrov warned Friday against foreign intervention in Syria, calling on the Syrian opposition not to seek a repeat of the "Libya scenario".

"We are very worried that the process of reconciliation, the process of the start of dialogue ... is being slowed down by a desire of some participants to attract foreign forces to support their actions," Russian news agencies quoted Lavrov as saying.

Speaking on a visit to the central Asian nation of Kazakhstan, he warned against a repeat of the "Libya scenario", where a Western coalition is carrying out air strikes against regime targets in a campaign that is increasingly troubling Moscow.

In March, Russia chose to abstain from the UN Security Council resolution on Libya that essentially authorised military action to protect civilians in Libya.

But the Kremlin has lately accused the West of exceeding the UN mandate and getting entangled in a full-blown military operation in north Africa.

As the situation in Syria escalates, Moscow has clashed with the West at the United Nations over Damascus's deadly crackdown on opposition protests, blocking a proposed Security Council statement condemning the violence.

Speaking in an interview with Moskovskie Novosti newspaper published this week, Lavrov complained that the West abused Russia's willingness to cooperate on Libya.

He said that from now on Moscow would look at any attempts by the UN to authorise the use of force through a "huge magnifying glass."

Analysts also explain Russia's firm stance on Syria by a desire to preserve economic and political ties with a Soviet-era ally.

Observers say that while Libya is located on the periphery of the Arab world, Syria is right at the heart of the region and any escalating unrest is likely to send shockwaves across the entire Middle East.

Lavrov also said all the countries should be held accountable for their policies at the UN Security Council.

"In our opinion, in the opinion of countries such as Brazil, India, China and South Africa the answers given by the coalition to the questions asked cannot fully satisfy us so far," Lavrov was quoted as saying.

RT News line, May 13

International Libya Contact group illegitimate, Russia will not join – FMhttp://rt.com/news/line/

10:55

Russian Foreign Minister Sergey Lavrov has once again declared the Russian view on the Western powers’ campaign in Libya, stating on Friday that the Contact group keeps violating the UN resolution which makes it beyond the law. The tactics the coalition propagates are unacceptable, Lavrov insists, and Russia will not join the group. Russian officials have persistently called on the international community to put paid to NATO strikes in Libya and turn to talks instead. Lavrov also urged the parties of the North African conflict to start political dialogue without preconditions as soon as possible.

GOOGLE TRANSLATION

Lavrov said the contact group on Libya illegitimate

http://www.bbc.co.uk/russian/rolling_news/2011/05/110513_rn_libya_lavrov.shtml

Last Updated: Friday, May 13, 2011, 07:40 GMT 11:40 MCKRussian Foreign Minister Sergey Lavrov said that some of the international coalition in Libya's decision violated UN Security Council.Lavrov said that international forces are applied to attacks on civilian targets, hospitals and diplomatic missions.The minister also said that Russia does not intend to join the contact group on Libya because, according to Lavrov, this group has "no legitimacy from the standpoint of international law. "

10:40

INTERNATIONAL COALITION IN LIBYA COMMITTING TOO MANY VIOLATIONS OF UN SECURITY COUNCIL RESOLUTION, WHICH IS UNACCEPTABLE - RUSSIAN FOREIGN MINISTER LAVROVhttp://www.interfax.com/news.asp

 

  Libya marks beginning of a dangerous new trend – Russian foreign minister http://rt.com/news/libya-opposition-government-conflict/

Published: 13 May, 2011, 02:03Edited: 13 May, 2011, 02:24

Russian Foreign Minister Sergey Lavrov told RT that the Libya situation has given rise to the possibility of a dangerous new trend.

He warned that opposition groups across the region may believe the West will get involved and take sides in domestic conflicts, which should instead be resolved by national governments

“The Libya case has created a temptation for many opposition groups in the region to spark similar situations, in the expectation that the West won't stay out and will intervene in a conflict, taking one side,” Lavrov warned. “It's a very alarming prospect, and I hope this won't happen. It's crucial that governments should solve their problems independently.”

 10:38LAVROV HOPES PROGRESS WILL BE MADE IN DIFFICULT TALKS ON MISSILE DEFENSE WITH U.S. BEFORE MEDVEDEV-OBAMA MEETING IN DEAUVILLEhttp://www.interfax.com/news.asp

10:40RUSSIA AND U.S. AGREE TO GIVE POLITICAL IMPETUS TO EXPERTS' WORK ON MISSILE DEFENSE ISSUES, CLINTON PROMISES TO TAKE MEASURES – LAVROVhttp://www.interfax.com/news.asp

Russian-US negotiations on anti-missile systems going “tight”

http://vestnikkavkaza.net/news/politics/13801.htmlRussian Minister of Foreign Affairs Sergey Lavrov said in Alma-Ata that the talks between USA and Russia on the anti-missile systems “are going tight”, RIA Novosti reports.

He added that US Secretary of State Hillary Clinton assured him that measures will be taken.

Lavrov noted that he met Clinton at the Arctic Council and discussed the issue. They agreed to boost the work of experts to reach results for the G8 summit in Douville.

10:37MOSCOW CALLS ON CONFLICTING PARTIES IN LIBYA TO START POLITICAL DIALOGUE WITHOUT PRECONDITIONS AS SOON AS POSSIBLE – LAVROVhttp://www.interfax.com/news.asp

 10:37RUSSIA URGES TEHRAN NOT TO DODGE SERIOUS DISCUSSION OF IRAN'S NUCLEAR PROBLEM – LAVROVhttp://www.interfax.com/news.asp

Lavrov called on Tehran to accounthttp://samara.kp.ru/online/news/891183

In Russia's view, Iran should report to the IAEAYegor Arefiev - 13/05/2011 12:12Russian Foreign Minister Sergei Lavrov called on Tehran not shy away from talks on the Iranian nuclear issue.

"We stand for that in a dialogue with Iran and consider the perspective of full participation of Iran in resolving various regional problems, but not at the expense of serious discussion on the Iranian nuclear program" - Lavrov said.

Russian Foreign Minister stressed that the international community must obtain the

necessary confirmation of the peaceful nature of Iran's nuclear program.

"We all want to be 100% sure that it has no military dimension, and that requires Iran to answer IAEA questions," - said the minister.

"So we will encourage our Iranian neighbors to ensure that they still comply with the decisions that are taken in the IAEA and supported the UN Security Council" - added the Russian minister.

He was commenting on the message of the Iranian side to the European Union, in which Tehran agreed to hold talks, but primarily on the number of international problems, "Interfax".

Session of Arctic Council wraps up workhttp://english.ruvr.ru/2011/05/13/50220923.html

May 13, 2011 02:41 Moscow Time

A session of the Arctic Council has ended work in the capital of Greenland, Nuuk. It was attended by Foreign ministers of eight countries in the region. An agreement was signed on cooperation in search and rescue operations in the Arctic.

Russia was represented at the session by Foreign Minister Sergei Lavrov. The declaration emphasizes the importance of strengthening the Arctic Council in order to respond successfully to new circumstances and challenges, particularly climate change.

02:31 13/05/2011Top News

Arctic countries sign “ground-breaking” SAR agreementhttp://www.itar-tass.com/en/c32/141340.html

NUUK (Greenland), May 13 (Itar-Tass) — Foreign ministers and leaders of the indigenous peoples of the Arctic Council met to set out future policy on Thursday and signed the Nuuk declaration and an agreement to cooperate in Search and Rescue efforts in the Arctic.

The Arctic Council said on its website the Search and Rescue (SAR) agreement is “ground-breaking in the annals of the Arctic Council, as it is the first legally-binding agreement negotiated under the auspices of the Council.”

It “will strengthen cooperation between the Arctic states and improve the way Arctic countries respond to emergency calls in the region,” it added.

Sweden's Minister of Foreign Affairs, Carl Bildt, incoming chair of the Arctic Council, said that Arctic countries need enhanced cooperation on many future challenges, not the least being prevention, preparedness and response to oils spills. He said that during their chairmanship, Sweden will press forward with this on the agenda.

The ministers also decided to strengthen the Arctic Council by establishing a secretariat to increase the ability of the Council to address future challenges in the region. The secretariat will be located in Troms·, Norway.

The Arctic Council unites Denmark, Iceland, Canada, Norway, Russia, the United States, Finland, Sweden, and six associations of indigenous peoples of the North.

01:02 13/05/2011Top News

Russia’s Lavrov calls Arctic instance of good will, cooperation http://www.itar-tass.com/en/c32/141325.html

NUUK, Greenland, May 13 (Itar-Tass) — Arctic region may serve as an instance of a positive yield resulting from good will, readiness for cooperation, and consideration of one another’s interests, Russian Foreign Minister Sergei Lavrov said here Thursday as he addressed the 7th session of the Arctic Council.

“A vivid instance of this is provided by the Russian-Norwegian Treaty on delimitation of maritime spaces and cooperation in the Barents Sea and the Arctic Ocean, which both countries ratified recently,” Lavrov said.

“This document has significance on the bilateral and region plane likewise,” he said. “It shows the result that was reached in the spirit of partnership, and this refuted the still circulating assertions that the clash of the Arctic littoral countries’ interests is inevitable, and craving for resources will eventually give rise to conflicts.”

“I’m confident the new Russian-U.S. START treaty will have an immediate impact on consolidation of security, trust and predictability in the region,” Lavrov said.

He underlined the important results that have been reached by way of strengthening the Arctic Council, saying that “they have the nature of hallmarks.”

“We’re adopting a package decision ion setting up the permanent secretariat of the Council, on its budget, on imparting a more legally binding character to the decisions

taken by our organization, and the clarification of the role played by and criteria for observers,” Lavrov said.

“Thus we’ve made an important step towards building up the multilateral character of Arctic cooperation,” he said. “Additional prerequisites are being set up for raising the efficiency of our Council’s operations and maintaining its regional identity along with its openness for everyone who would like to contribute to the solution of problems of the Arctic region.”

“The signing of an agreement on cooperation in the air and maritime search and rescue in the Arctic – the first legally binding pan-Arctic document – will become a milestone in the Arctic Council’s work,” Lavrov said.

He indicated that the new agreement will enhance the promptness of aid to the people who have found themselves at bay and will broaden opportunities for further exploration of the Extreme North.

Lavrov voiced gratitude to all the member-states of the Council for fruitful participation in the talks.

He also pointed out the highly professional work of two co-chairmen David Bolton of the U.S. and Anton Vassilyev of Russia.

Interview of Russian Foreign Minister Sergey Lavrov, Published in the Newspaper Moskovskiye Novosti on May 12, 2011http://www.ln.mid.ru/bdomp/brp_4.nsf/e78a48070f128a7b43256999005bcbb3/b16f5e51d8e02230c325788f001c7496!OpenDocument

687-12-05-2011

Question: The Russian Foreign Ministry has stated that it “shares the sentiments of Americans” about bin Laden’s elimination. But it was accomplished within the territory of another country and without Security Council authorization. How justified is it in terms of international law?

Sergey Lavrov: Our position is very simple. After 9/11 the Security Council adopted a resolution clearly recognizing the United States’ right of self-defense under Article 51 of the UN Charter, because it was an attack against a UN

member country. The right of self-defense envisages no restrictions. Those who perpetrated, planned or conceived the attack are the subject and the object of exercise of this right. There is room for questions here, and journalists (including American reporters) are asking these questions. But again, those who carried out the operation, had a sound legal basis beneath them in the form of the right of self-defense under the UN Charter, confirmed moreover in the resolution of the Security Council.

I wouldn’t take a legalist position here. Nobody in the world doubts that Bin Laden was the man behind the terrible acts of terrorism of 11 September and behind a number of other terror attacks. Al-Qaida, which he created and nurtured, is involved in numerous terrorist acts in other countries, including Russia. Certainly, the fight against terror should be carried out within the framework of international law, including rules for such cases – for armed combatants who the terrorists are. But these are details; they have yet to be sorted out. I understand that the American side is ready for explanations, we will wait for them. But the fundamental thing is what I said in the beginning.

Question: That is, Article 51 of the UN Charter allows countries to pursue terrorists?

Sergey Lavrov: It allows a country against which an attack was made to take all necessary measures to prevent any future such attacks and punish those responsible.

Question: But will this Article be used to prosecute not only terrorists, but also politicians who commit crimes in their country now?

Sergey Lavrov: Article 51 does not imply a carte blanche to kill politicians. It applies only to cases where a person not only gave the orders, but when he actually directed the specific operation. Politicians who give criminal orders are subject to trial. For this purpose the International Criminal Court (ICC) has been created, it is functioning.

Question: Russia abstained in the vote on the Libya Security Council resolution authorizing member states to “take all necessary measures to protect civilians and civilian populated areas.” Did Moscow not assume that “all necessary measures” might subsequently be interpreted as broadly as is currently the case?

Sergey Lavrov: No, we didn’t assume it for one simple reason that the previous paragraph 3 contains the purpose of this resolution, namely the

protection of civilians by declaring a no-fly zone over Libya. We certainly shared this goal, since the Libyan air force had been used to strike at areas where there were civilians, and this practice had to be immediately stopped. However, we strongly advocated that paragraph 4 be clearly tied solely to the goal of enforcing a no-fly zone. When the formulation you refer to, was suggested by the cosponsors, we asked them what it meant. Is it about specifically designating the states that are ready to fulfill the goal of enforcing a no-fly zone? By what means will this objective be achieved and what are the limits of the use of force? Because what you quoted is a dimensionless formulation that allows one to legalistically interpret it whatever way one desires.

The fact that the cosponsors refused to specify it, reduce it to clear, absolutely verifiable actions certainly gave us cause for serious concern and we were forced to abstain. We abstained because we shared the objective of the resolution, but were unhappy that the methods of its implementation were not formulated clearly. Unfortunately, our misgivings were justified. What is now being done with respect to Libya goes far beyond the scope of the Security Council-mandated task.

Question: But what can be done? Russia calls on the coalition to stop the bombing. But then Gaddafi’s army will surely assume the offensive and there will again be casualties among the rebels and the civilian population...

Sergey Lavrov: It cannot start again because it never ended. A civil war is going on. And civilians do not care in the least about whose hands they are dying at – from the blows of Gaddafi, from the blows of the rebels or from the airstrikes the coalition inflicts, now by and large indiscriminately. The coalition, in fact, openly declares that its mission is a change of regime. That Gaddafi and his relatives – with all the equivocations that this phrase is hedged about – are a legitimate target. That's just too much.

The coalition by the way at the same time performs the tasks of the previous resolution 1970, namely to enforce an arms embargo, which implies a ban on the supply of any weapons and of any military services to anybody in Libya. Double standards are clearly beginning to be applied here. For example, coalition forces are stopping merchant ships that carry civilian goods and foodstuffs. They stopped the vessel that was on its way to Libya carrying equipment for the destruction of remaining stocks of chemical weapons there. Now the Libyans – in my opinion, rightly so – contacted the Organization for the Prohibition of Chemical Weapons asking to clarify how they are to fulfill their obligations to eliminate those stocks.

On the other hand, more and more steps are being taken to support the rebels with finances and to the questions about whether the funds may be used to purchase weapons, which is prohibited by the Security Council, answers are following not very clear.

A third point. No economic sanctions have been imposed against Libya as a country. Only the accounts of Gaddafi and his inner circle have been frozen. Nevertheless, coalition members are talking openly about the need to impose a direct economic blockade on Libya – including a blockade on all operations with energy resources and other vital goods for the functioning of the state. Calls are being made out loud to impose an information blockade; that is, put a stop to Libyan mainstream media broadcasting abroad. No one was negotiating about that. Even with the richest imagination it is hard to imagine such a very, very broad interpretation of the paragraph you have quoted.

A real civil war is under way in Libya. The coalition is sliding down – if it has not already slid down – towards support of one party in this conflict. There’s only one way out: an immediate cease-fire, which Russia has already proposed in the Security Council. Then – the search for a way out through mediation efforts, especially of the African Union and UN. Five African presidents on behalf of the African Union visited Libya and talked with both Tripoli and Benghazi. I believe that this should form the basis for negotiations.

Question: People in Benghazi said that they will not negotiate with Gaddafi.

Sergey Lavrov: Frankly speaking, this can be understood. Qaddafi has made blunders and committed crimes. He gave orders to the armed forces to kill their own people, and we strongly condemned that by supporting resolution 1970 and letting resolution 1973 pass. But when they are talking about refusing to negotiate with any representatives of Qaddafi... It's either a misunderstanding of reality, because Libya has a tribal system, and a large tribal stratum, while not exactly supporting the methods of Gaddafi, represents the interests of a part of the state's population. Or – I can’t otherwise describe it – a conscious choice of a military solution to the problems, a war to a victorious end. This will have catastrophic consequences. In Arab capitals, those with whom we are consulting are all very concerned that Libya could break down into two or even more entities.

Negotiations should begin immediately, regardless of any circumstances. And then it is possible to put forward conditions and voice different proposals. They say that some reasonable conditions for Gaddafi’s departure could be arranged. All this must be discussed. But the Libyans themselves have to decide. External

forces should not incite anyone and create the impression that if you show principledness, then we will continue to bomb a part of Libya ceaselessly, until the enemy one day shouts out: “I surrender!” Maybe this will meet somebody’s interests. But the number of lives that will be sacrificed in the process, we absolutely cannot accept this.

Bad peace is better than a good war, the ancients said so, and since then nothing has changed.

Question: The ICC has found Gaddafi responsible for killing civilians and issued a warrant for his arrest. Could this be the basis for a tougher Security Council resolution on Libya?

Sergey Lavrov: This is not a matter for the Security Council. It is a matter for the ICC. This is about judicial procedures which have their own logic and momentum and are going to develop exactly according to it.

Question: Although Russia did not hinder the adoption of the resolution on Libya, it did not support the draft UN Security Council Presidential Statement on Syria condemning the excessive use of force against demonstrators. What is the difference between these situations?

Sergey Lavrov: We, like more than half the members of the Security Council, were convinced of the full counter-productivity of such a move. The situation in Syria is not tantamount to Libya’s. In Syria, there are many concrete facts showing that opponents of the regime have from the very beginning used violent methods. Incoming information attests that during the clashes there have been victims among both protesters and police. This means that opponents of the regime are quite well armed. And another thing – the obvious attempt by opponents of the regime to use the Libyan scheme. Namely: we will demand the resignation of President Assad, NATO will take a decision, and the UN Security Council will be convinced that it must somehow condemn the regime. But they must all be condemned there, because the use of brute military force against civilians from whatever quarter is unacceptable.

And we shouldn’t multiply the Libyan model anymore. We showed constructiveness on Libya. This constructiveness is now being abused. We will be examining any new proposals for the Security Council to authorize intervention in an internal conflict through a huge magnifying glass, based on the sad experience of Libya.

Question: How are negotiations with the EU on a visa-free regime progressing?

Sergey Lavrov: They are progressing normally. We have arranged to elaborate a common list of extremely specific questions relating to aspects of border crossings. The questions relate to introducing biometric passports with the appropriate security features; to migration procedures at the border, readmission, facilitation of any rules of registration on a reciprocal basis, etc. The list is now at the final stage of negotiation. I hope that the upcoming June Russia- EU summit will be able to decide on this issue, and then the work will enter into a practical stage. We presume that the list will be exhaustive and that upon the closure of all the issues included in it we will immediately begin negotiations on a Russia-EU agreement on abolishing visas for short-term trips of citizens.

This is an ideal scheme. I will not hide the fact that some EU members are guided by political considerations as well. Someone based on old phobias wants to punish us. Someone wants to extract concessions from Russia on issues not related to the visa regime.

We have to treat it philosophically. Old habits die hard. We parted with them faster than some members of the EU and NATO. We have reason to believe that our natural movement towards each other will slowly but surely be cleansed of artificial accretions.

Question: How are negotiations with the US on a visa-free regime proceeding?

Sergey Lavrov: We have only proposed them so far. We are convinced that having a visa-free regime with more than 100 countries, including US allies such as Israel, having a very advanced negotiation process with the EU, there is no reason not to raise this question in our dialogue with the United States. This is a serious proposal, which reflects the new thinking, toward which we, in fact, were encouraged always. Ever since the Helsinki Final Act of the OSCE our Western partners insisted that the Soviet Union agree to freedom of movement. We then agreed.

Since then we have fully traversed our part of the road. Emigration is guaranteed by the Constitution of our country, even though the Jackson-Vanik amendment, introduced by the US in retaliation for a ban on Jewish emigration, continues to operate. And now we and our CIS partners raise in the OSCE and other formats the need to move to a visa-free regime. Our Western partners are already agreeing, but somehow bashfully and slightly glancing back.

I understand that now the problem of migrants in Europe is quite acute. This involves rethinking by European countries of many aspects of their open door policy. Now this topic is getting exacerbated due to the influx of immigrants from North Africa. But this does not mean that we will be responsive, if our European partners say: “Enough is enough. We can no longer talk with you about it.”

With the US we have increasingly more and more areas of cooperation. We have created the Presidential Commission, which covers all areas of interaction. To communicate in them a comfortable regime is important, so that our proposals are absolutely justified. Meantime, we’re concluding the negotiation of a document which will greatly facilitate mutual visits as exemplified by the agreement that we signed with the EU a few years ago as a forerunner of a visa-free regime.

Question: What is the general policy of Russia towards a visa regime? We would like visas for Russian citizens to disappear altogether?

Sergey Lavrov: Of course we are for all countries to switch to a visa-free regime. Certainly, one can’t ignore the security aspects. With all partners with whom we agree on a visa-free regime, we also conclude agreements to curb illegal migration and on readmission. Then, if a person gets into our country illegally from a state with which we have a visa-free agreement, that country will accept that offender back. So in principle, yes, a visa-free regime is our aim in relations with any country subject to the necessary safety and security precautions.

Question: However, experts call the transparency of our southern borders one of the reasons that Russia gets a large inflow of drugs.

Sergey Lavrov: The main flow of drugs into Russia comes from a country with which we have not, and in the foreseeable future, will not have a visa-free regime, I mean Afghanistan. We have a visa-free regime with our neighbors in Central Asia, through which a big flow of drugs reaches us. But you must nip the problem in the bud. It is necessary to destroy the crops and laboratories that produce heroin in Afghanistan, and we insist on this. Of course, there will always be abuses of the visa-free regime. However, they need to be dealt with not by building new walls, but via suppressing the illicit flows of drugs, weapons or anything else. And also through the elimination of the problems, in this case in Afghanistan, which we are actively engaged in.

To fence oneself off from any adversity is impossible. Violators will always find a loophole through bribery and the counterfeiting of documents. But only good citizens are bound to suffer from restrictions.

Question: Does Moscow really intend to put the question of WTO membership on the general ballot, bypassing Georgia?

Sergey Lavrov: We are engaged in consultations with the Georgian side with Swiss mediation so far. In essence, the problem posed by Georgia is the only political one. All other questions refer to the WTO regime and will be amenable to solution at the expert level. I can confirm what I said. WTO rules permit admission of countries on the basis of a vote in the absence of consensus. The Georgian colleagues have called my comments on this subject a whim. But perhaps it was done by those who are not familiar with the documents of the WTO and with the fact that there is even a precedent on this score. The WTO rules permit entry into the organization by means of voting.

06:41 13/05/2011Russia

Russia does not recognize Kosovo independence - Churkin http://www.itar-tass.com/en/c34/141401.html

UNITED NATIONS, May 13 (Itar-Tass) —— Russia supports territorial integrity and sovereignty of Serbia and does not recognize unilaterally-proclaimed independence of Kosovo, Russian Ambassador to the United Nations Vitaly Churkin told the Security Council on Thursday adding Kosovo problem can be resolved only through negotiations.

“We proceed from the fact that the 1244 UN Security Council Resolution remains in full force and is obligatory for the whole international legal base of Kosovo settlement, as well as for ensuring security in the province,” he said and stressed the Security Council “should continue to play the leading role in the resolution of the Kosovo problem.”

The ambassador welcomed resumed dialogue between Belgrade and Pristina and said representatives of the UN Mission in Kosovo (UNMIK) should be officially present at the talks.

“This is due to the requirement to keep the Security Council adequately informed about the progress and contents of the negotiations and to the very agenda of the talks” as it is directly related to UNMIK activities, Churkin said.

“We believe the European Union which mediates the talks shall provide a proper place for the United Nations at them specifically now when the EU received a possibility for more active work in the framework of the global organization,” he said.

The UNMIK “shall continue to render maximum assistance to the settlement of Kosovo problem and fulfill its commitments to ensure Kosovo representation in regional and international organizations and mechanisms.”

The ambassador warned against potential explosive situation in the north of Kosovo.

“Attempts to ‘Albanize’ local units of Kosovo police, to spread to the north the activities of Kosovo customs, and to resettle there Albanian population in an uncontrolled way and without agreement with all interested parties will definitely escalate tensions,” he said.

Russia backs UN probe into Kosovo crimeshttp://english.ruvr.ru/2011/05/13/50225675.html

May 13, 2011 09:49 Moscow Time

Russia backs the involvement of the UN in reaching a settlement in Kosovo and leading a probe into human organ trafficking there, Russia’s UN ambassador Vitaly Churkin said Thursday.

The Parliamentary Assembly of the Council of Europe (PACE) on the 25th of January adopted a resolution on a report published by the Council of Europe Rapporteur Dick Marty in late 2010, where members of Kosovo’s ruling party are identified as being involved in serious crimes, including kidnappings and the murders of Serb and other civilians for their organs.

CORRECTED GOOGLE TRANSLATION

http://www.interfax.ru/politics/news.asp?id=189744

Vice-Prime Minister Ivanov will visit the Kuril Islands on Sunday

May 13, 2011 10:52Moscow. May 13. INTERFAX.RU - Deputy Prime Minister Sergei Ivanov, who oversees the Russian government, among others transport issues, in the near future plans to visit the Far East, in particular Vladivostok, as well as two Kuril Islands - Iturup and Kunashir."The visit to the islands of Iturup and Kunashir is scheduled for May 15", an informed source told Interfax on Friday.

According to him, the Deputy Prime Minister during his visit plans to hold a meeting on the development of infrastructure related to air transport.

GOOGLE TRANSLATION

Vice Prime Minister of the Dominican Republic met with the leadership of Abkhazia

http://www.interfax.ru/politics/news.asp?id=189715

May 13 2011 1:48Sukhumi. May 13. Interfax - Deputy Prime Minister of the Dominican Republic, Jose Miguel Mejia Abreu and his wife on Thursday evening arrived in Abkhazia, told journalists at the press service of the government.According to the press service, on Friday held official meetings of the Deputy Prime Minister of the Dominican Republic with the Vice-President of Abkhazia, Alexander Ankvab, prime minister Sergei Shamba, foreign minister Maxime Gvindzhia.In addition, the Embassy of South Ossetia, Abkhazia to meet Deputy Prime Minister of the Dominican Republic, Minister of Foreign Affairs of the Republic of South Ossetia, Murat Dzhioeva.On Saturday, May 14, Jose Miguel Mejia Abreu will visit the famous Lake Riza, Gagra and Pitsunda.As reported, located in Moscow, President Sergei Bagapsh said on Thursday that the independence of Abkhazia can recognize another state. "In the near future, one of Latin America could recognize the independence of Abkhazia", - said Sergei Bagapsh, told Interfax.Earlier, a member of parliament of Abkhazia Adgur Kharazia in an interview with "New Day" has declared that "the State of San Marino can replenish the number of countries recognize the independence of the republic."In addition, the Foreign Minister of the Republic M. Gvindzhia during the visit of Russian Foreign Minister Sergei Lavrov in Sukhumi on 26 April, told reporters that the independence of Abkhazia in the current year, recognize the three countries. "" These states are not African ", - said M. Gvinjia, without specifying what kind of country

Islamabad seeks investment, Moscow wants to tackle terror http://tribune.com.pk/story/167770/islamabad-seeks-investment-moscow-wants-to-tackle-terror/

By AFP

Published: May 13, 2011MOSCOW: 

Russia and Pakistan on Thursday pledged to boost economic ties and coordinate efforts to fight terror as the Kremlin welcomed President Asif Ali Zardari for a key visit after the killing of Osama bin Laden.

This is the first official visit by a Pakistani leader since the fall of the Soviet Union, former prime minister Zulfikar Ali Bhutto being the last leader to visit Moscow during Soviet times.

“We are interested in coordinating our efforts on the international arena.  It is obvious that our countries are facing absolutely the same threat, I mean international terrorism,” Russian President Dmitry Medvedev told President Zardari at the Kremlin.

“We have to do everything so that we could jointly counter this main evil of the 21st century,” Medvedev said in comments released by the Kremlin.

Russia has for years been struggling to root out an insurgency in the North Caucasus following two wars with separatists in Chechnya after the fall of the Soviet Union. The Kremlin says Caucasus militants receive support from abroad.

Zardari, who kicked off his three-day trip to Russia on Wednesday, expressed hope his historic visit would help deepen ties between the two countries which share a complicated history.

Moscow is not usually seen as an ally of Islamabad, not least because of its historically close ties to Pakistan’s traditional foe India.

“Our countries are very close neighbours. We are located in the same region … the time has come to acknowledge the importance of our countries for each other and the importance of regional cooperation,” Zardari said.

The two leaders oversaw the signing of several framework agreements on cooperation including in energy and agriculture and adopted a joint declaration highlighting the importance of tighter economic cooperation.

“Projects of regional development can secure prosperity for all the peoples in the region,” said the declaration, adding it supported Russian companies willing to pursue economic, infrastructure and banking projects in Pakistan.

Those projects would include plans by gas giant Gazprom to develop gas fields in Pakistan, the declaration said, while Tyazhpromexport, part of state conglomerate Russian Technologies, would help modernise a metals plant in Karachi.

Vedomosti business daily, citing a source close to the management of Russian Technologies, said on Wednesday that the two countries were expected to agree on a $540 million deal for Pakistan to upgrade the Soviet-built Karachi-based Pakistan Steel mills and increase its production capacity to seven million tonnes a year.

The two countries also signed an agreement on promoting air travel while the president emphasized currency swap agreements and the opening of bank branches in each other’s countries.

Published in The Express Tribune, May 13th, 2011.

Pak, Russia for intensifying ties in diverse fieldshttp://pakobserver.net/detailnews.asp?id=91892

Moscow—President Asif Ali Zardari and his Russian counterpart Dmitry Medvedev on Thursday called for intensifying bilateral relations in diverse fields and enhance further cooperation between the two countries in economic and political spheres.

Terming his Moscow visit historical, President Zardari said that it is the beginning of a new chapter in Pak-Russia relations. At the delegation level talks between the two leaders in Kremlin, President Zardari said,”it is time that we recognize the importance of each other and intensify our ties in diverse fields.”

He said that the government, the parliament and the people of Pakistan were keen to promote relations with Russia and start a new era of diplomatic and political relationship.

The President said it is high time to re-define relationship between Pakistan and Russia in the regional perspective.

“We recognize our importance in the regional context. We understand that the nations become prosperous by increasing their relations with their neighbours,’ the President said. “We are very close neighbours. Although, our borders don’t meet but our hearts too. There is great room for improving our relationship,” he said.

President Zardari emphasized the need to increase people to people contacts so that both nations could understand each others’ culture to further promote their relations. He said “we are here together for our coming generations to give them a bright future and the history will remember it”.

He said that his father-in-law Shaheed Zulfikar Ali Bhutto officially visited the then Soviet Union in 1974 which heralded a new era of political and economic cooperation between the two countries.

President Zardari thanked his Russian counterpart for extending him invitation for

official visit and said this would bring the two countries closer.

The Russian President Medvedev said, “we have been meeting on regular basis and this visit has provided the opportunity to both leaders to discuss various issues between Russia and Pakistan.President Medvedev recognized the role played by Pakistan in the relentless efforts against terror. He said terrorism is a global issue and both the countries are facing the menace of international terrorism. He said the threat must be fought collectively.—NNI

Massive Russian investment in Pakistanhttp://www.pakistanpatriot.com/?p=34620

Posted on 13 May 2011

Russia has come out in a big way and will be investing billions of Dollars. As the Russian relations with Bharat fray, the situation arising in South Asia is the opposite of what existed during the Cold War. Pakistan was a US ally and Bharat a Soviet client state. Today US Pakistani relations are at a nadir, and they are not improving. Russia and Pakistan have both decided to build their own links. A reset of relations will be paying dividends to both countries.

Russia’s energy giant Gazprom will be developing gas deposits in Pakistan. Russian state-owned mining and metallurgical facility construction company

Tyazhpromexport will be modernizing the Pakistan Steel Mills near Karachi. Russia’s largest power trader Inter RAO UES will be building power plants in

Pakistan. Russia will be joining the CASA-1000 project, which will bring electricity from

Tajikistan to Afghanistan and Pakistan Moscow also supports the Turkmenistan-Afghanistan-Pakistan-India (TAPI) gas

pipeline project to transport natural gas from Central Asian states to Pakistan and India.

Moscow also supported Pakistan’s quest to join the Shanghai Cooperation Organization (SCO). The SCO set up a mechanism to allow new members to join the organization. Iran was turned down, and Bharat cannot join becuase of the Chinese veto. The Pakistani Prime Minister and President recently visited the Central Asian Republics (CARs). All supported Pakistan’s desire to join the SCO and make the ECO more potent. There has been discussion of building road and rail links from Fergana, and Dushambe to Gwader and Karachi. President Zardari offered Moscow access to the “Southern Seas”.

13.05.2011 8:42

Chief of General Staff of Armed Forces of Russian Federation Nikolay Makarov pays visit to Minsk.

http://www.tvr.by/eng/society.asp?id=48053

Yesterday First Deputy Minister of Defense of Russia delivered a lecture at a military academy and told about results of the reforms of the Russian Army. Within the limits of the meeting with the management of Armed Forces of Belarus a number of issues of cooperation of the military departments of the two countries were discussed.

12:08 13/05/2011Russia

Peru to receive 1st batch of Russian Mi-171copters after May 20 http://www.itar-tass.com/en/c34/141561.html

LIMA, May 13 (Itar-Tass) — The first batch of three Mi-171Sh helicopters bought by Peru will be supplied to that Latin American country after May 20, the head of Russia’s Rostekhnologii mission in the country, Viktor Polyakov, said on Friday.

“We are satisfied with the implementation of that contract,” Polyakov said. “Moreover, the client is pleased with its implementation,” he said in reply to an Itar-Tass query at the Sitdef Peru 2011 international defence technology exhibition.

“The customer accepted the first three helicopters at a plant in Ulan-Ude at the end of April,” he said. Under the schedule, they will be loaded on a transport plane on May 20. “The second batch of three helicopters will be presented to the customer at the end of July,” Polyakov added.

He also said that two Mi-35P helicopters were delivered in Peru in April within the framework of the contract.

Russia sends destroyer to protect shipping off Somali coasthttp://en.rian.ru/mlitary_news/20110513/163999082.html02:39 13/05/2011

A Russian task force led by Northern Fleet's destroyer Severomorsk will start patrolling pirate-infested waters in the Gulf of Aden in June, the Russian Defense Ministry said.

The Udaloy class destroyer left its home base in northern Russia on May 8, and will be joined on route to the Gulf of Aden by the Yelnya tanker from the Baltic Fleet and a tug boat from the Black Sea Fleet.

"A task force led by Northern Fleet's Severomorsk destroyer will start escorting commercial ships in the Gulf of Aden and off the Horn of Africa in the first half of June," the ministry said.

The Russian Navy has maintained a presence off the Somali coast since October 2008, with warships operating on a rotation basis.

The latest Russian anti-piracy mission in the Gulf of Aden was carried out by a Pacific Fleet's task force led by the Admiral Vinogradov destroyer.

During its four-month-long patrol duty, which ended on April 17, the task force successfully escorted 14 convoys of commercial vessels.

According to the UN, the number of pirate attacks on merchant ships reached 400 in 2010. A total of 790 sailors and crew members were captured by pirates last year.

MOSCOW, May 13 (RIA Novosti)

Russia has good chance in Turkish tender for anti-aircraft missile system – Rosoboronexporthttp://www.militaryaerospace.com/index/display/avi-wire-news-display/1416474362.html

Russia & CIS Military NewswireMay 12, 2011

Russia is a worthy bidder in Turkey's international tender for air defense systems. Results of the tender will be announced soon, Chief Advisor to the Rosoboronexport General Director Anatoly Aksyonov, who leads the Rosoboronexport delegation to IDEF 2011, told reporters on Thursday.

"We are entering into the decisive phase of the tender, and we are a worthy bidder," he said.

The tender organizers thanked Russian specialists for their colossal work, which solved problems related to critical technologies, industrial participation and offset programs. The prospective clients were able to see the serial production of an anti-aircraft missile system and peculiarities of its use in the Armed Forces, he said.

"Our Turkish colleagues saw everything with their own eyes. They told us they were sure that the anti-aircraft missile system offered to them really existed, was produced serially and used in the Russian Armed Forces," Aksyonov said.

Turkey described the offset program offered by Russia as "adequate, balanced and feasible," he said.

The United States is Russia's main rival in the tender. France and China are the other bidders. "Our main rival is the Americans with their well-known product. This is a serious rival," he said.

Earlier reports said that Russia offered the S-300 long-range anti-aircraft missile system at the Turkish tender.

Copyright 2011 Interfax News AgencyAll Rights ReservedRussia & CIS Military Newswire

Russia to deploy 2nd S-400 air defense regiment near Moscowhttp://en.rian.ru/mlitary_news/20110513/163998509.html01:33 13/05/2011

A second regiment equipped with advanced S-400 Triumf air defense systems will be put on combat duty near the Russian capital on May 15, the Defense Ministry said.

The first S-400 regiment has been deployed in Electrostal, also near Moscow, as part of the air and missile defense network around the Russian capital.

The S-400 (SA-21 Growler) air defense system is expected to form the cornerstone of Russia's theater air and missile defenses by 2020.

The S-400 system can engage targets at a maximum range of up to 400 km at an altitude of 40,000-50,000 meters. The system uses a range of missiles, optimized for engaging ballistic and cruise missiles.

An S-400 air defense regiment consists of two or three battalions equipped with four systems each. Russia is planning to arm 56 battalions with S-400 systems by 2020.

MOSCOW, May 13 (RIA Novosti)

May 13, 2011 10:48

Popular Front doesn't come under law on equal access to media – CEChttp://www.interfax.com/newsinf.asp?id=243268

MOSCOW. May 13 (Interfax) - The All-Russia Popular Front will have the right to engage in party campaigning, formally remaining outside the field of the election campaign, Central Election Commission member Yelena Dubrovina told the commission on Thursday, according to Rossiiskaya Gazeta.

"If it does not become a political party it will not come under the law on political parties' equal access to the media and will remain in 'free floatation,'" Dubrovina said.

The Congress of Russian Communities has every chance to become a political party within a month, if it is joined by the required number of members and sets up the required number of regional braches, she also said.

"It will not be difficult technically. They will need to hold a congress and become reorganized into a party," Dubrovina was quoted as sayi9ng.

Sd

Russia reforms fail to halt rights abuses – Amnestyhttp://in.reuters.com/article/2011/05/13/idINIndia-56984420110513

7:55am IST

By Alissa de Carbonnel

MOSCOW (Reuters) - President Dmitry Medvedev's reforms to rid Russia of police violence, legal impunity and unfair detention have been "piecemeal" and done little to curb frequent rights abuses, Amnesty International said on Friday.

Three years after Medvedev succeeded Vladimir Putin and promised to fight Russia's tradition of graft and widespread flouting of the law, allegations of police torture and corruption in the judicial system are widespread, the rights group said in its annual report.

"In spite of a stated desire for police reform, corruption and collusion between the police, investigators and prosecutors were widely perceived ... There were frequent reports of torture and other ill-treatment by law-enforcement officers," it said.

"Judicial reform continued to be presented as a government priority. However, reforms remained piecemeal and had only a limited impact."

Outrage over the 2009 prison death of lawyer Sergei Magnitsky, who colleagues say was denied access to adequate medical care in pretrial detention, spurred Medvedev to propose legal reforms and order a special rights inquiry into the case.

Leaked details of the inquiry by a commission of rights lawyers last month found the case against Magnitsky was fabricated, but no one has been prosecuted over his death.

"It's of course positive that Medvedev has repeatedly expressed respect for human rights organisations and independent media, called for greater independence of the courts, but so far this has not realised itself into real action," Amnesty's Russia expert Frederica Behr told Reuters.

The watchdog group cited the December sentencing of ex-oil tycoon Mikhail Khodorkovsky, who is to remain in jail until 2017 following his conviction in a second trial, as an example of political pressure on the justice system.

"MIXED MESSAGES"

Amnesty also accused Moscow of sending mixed messages on freedoms, saying that while the official rhetoric has changed and activism is growing, police crackdowns on protesters and attacks on journalists continued in a climate of impunity.

There have been 19 unsolved murders of journalists in Russia since 2000, including the 2006 killing of Kremlin critic Anna Politkovskaya, according to the New York-based Committee to Protect Journalists.

"In the last three years people have less fear to go out into the streets. ... We have seen a growing activism among the population," said Behr. "But at the same time we have seen harsher methods by the authorities to clamp down on dissent."

Less than a year before a new election, a perceived lack of results has disappointed rights activists, liberals and critics of Putin who hoped Medvedev's presidency would bring more tangible reforms.

Putin, president from 2000-2008 and now prime minister, has hinted he will seek to return to the Kremlin in the March 2012 vote or endorse Medvedev for a second term.

"WORRYING TREND" IN UKRAINE

In the neighbouring ex-Soviet republic of Ukraine, Amnesty said the human rights situation had deteriorated since President Viktor Yanukovich took office in February 2010 and quickly consolidated political powers.

"In a worrying new trend, the picture darkened in Ukraine for human rights defenders," it said. "They were physically attacked, and faced harassment from law enforcement officers, in connection with their legitimate human rights work."

Amnesty cited the case of Andrei Fedosov, the chairman of a mental disability rights group, who was assaulted by unidentified men last year and then briefly detained on charges of committing a crime 10 years ago, which were later dropped.

In another case, a court ordered trade union activist Andrei Bondarenko to undergo a forced psychiatric examination after prosecutors said he had displayed "excessive awareness of his and others' rights and his uncontrollable readiness to defend these rights in unrealistic ways".

(Additional reporting by Richard Balmforth in Kiev; editing by David Stamp)

10:43 13/05/2011Russia

FSB officer killed in armed clash in Dagestan http://www.itar-tass.com/en/c34/141496.html

MAKHACHKALA, May 13 (Itar-Tass) —— Major of the Border Department of the Russian Federal Security Service for the republic died in an armed clash in Dagestan’s Tsumadinsky region.

As ITAR-TASS learnt at the Interior Ministry for Dagestan, “at about 19.00 Moscow time on Thursday, unidentified people fired from automatic arms at law enforcers during the holding of a counterterrorist operation in a forest of the region, as a result an officer of the Border Department died.”

Criminal proceedings were instituted.

At dawn, the operation to spot and liquidate the attackers was resumed. The number of the attackers is not reported.

GOOGLE TRANSLATION

Terrorist attack prevented in Kizlyar district of Dagestan

http://www.interfax.ru/news.asp?id=189746

May 13, 2011 11:16Makhachkala. May 13. INTERFAX.RU - Explosive device was found on the outskirts of the Dagestani village Pervokizlyarsky, it was defused by sappers of the Federal Security Service, told Interfax on Friday, the press service of the Russian FSB in Dagestan.According to the interlocutor of agency, found the night before the bomb was destroyed by erosion of superimposed charge.

Improvised vzryvustroystvo is a 12-liter bucket filled with a mixture of ammonium nitrate and aluminum powder, and balls of bearings as submunitions. Next to the bomb was a bag, it was container with flammable liquid. Radio-controlled bomb."Power devices is estimated at 10 kg of TNT, "- said the agency interlocutor.

Small blast hits Moscow cafe, no casualtieshttp://en.rian.ru/russia/20110513/164001462.html

08:43 13/05/2011

Visitors to a Moscow cafe escaped injury in the early hours of Friday when a small improvised explosive device detonated, a police source told RIA Novosti.

The blast - equivalent to 200 grams of TNT - hit the summer terrace of a café in the north-west of the Russian capital, he said. The cafe was slightly damaged.

Police are carrying out an investigation. No group has claimed responsibility.

Violence is often used to settle business disputes in Russia, while both Islamist terrorists and nationalist groups have used explosives in past attacks.

MOSCOW, May 13 (RIA Novosti)

May 13, 2011 10:27

Forest fire area increases by one third in Siberia in 24 hourshttp://www.interfax.com/newsinf.asp?id=243250

NOVOSIBIRSK. May 13 (Interfax) - Thirty-two forest fires were raging in the Siberian Federal District as of Friday morning over an area of 204.6 hectares, of which 14 have been localized on an area of 92.4 hectares.

The number of fires has increased by 12 over the past 24 hours and the territory enveloped in flames has grown by 30% or 47.54 hectares, the Siberian regional emergency situations center has reported.

"No major fires are burning. Most of the fires are man-made," it said.

Overall, 1,137 personnel and 296 pieces of equipment have been involved in tackling fires over the past 24 hours. Two hundred and fifty-three fire inspections of forests have

been carried out and 53 protocols of administrative offences have been drawn up, the center said.

As many as 1,318 posts, including 208 mobile, have been deployed to limit access to forests and to monitor the situation.

Fire hazard is ranked at five points in two regions and three districts of Russia for the coming 24 hours, and 4 points in 12 regions and 72 districts.

Sd

(Our editorial staff can be reached at eng.editors@interfax.ru)

08:00 13/05/2011Russia

Twelve more forest fire outbreaks reported in Siberia past day http://www.itar-tass.com/en/c34/141410.html

KRASNOYARSK, May 13 (Itar-Tass) —— Twelve new forest fire outbreaks were reported in Siberia over the past day.

There were 32 fires on 204.6 hectares by Friday morning. The burning area has enlarged by 47.54 hectares. Firefighters localised 14 outbreaks on 92.4 hectares.

According to the Emergencies Ministry's regional centre, no large conflagrations have been reported. A total of 1,137 people fought the blaze. They used 296 vehicles in the work.

Air Forest Guard planes and helicopters carried out 11 flights to patrol the taiga. On the ground, forestry inspectors conducted 253 raids during the day to detect violations of the fire prevention regulations. A total of 1,318 mobile and stationary posts have been placed to bar access to forests and monitor the situation.

Launch of Russian observatory to study universe could be postponedToday at 09:13 | Interfax-Ukraine Moscow, May 13 (Interfax-AVN) - The placement of Russia's Spektr-R astrophysical observatory into orbit, initially set for July, could be postponed because its Zenit rocket is needed to launch the U.S. Intelsat 18 telecommunications satellite.

"Roscosmos [the Russian Federal Space Agency] is currently debating how to use the Zenit launch vehicle available to it - either for the launch of the Spektr-R observatory or for the launch of the Intelsat 18 satellite," a space rocket source told Interfax-AVN on Friday.

Recently a shortage of Zenit launch vehicles has created "a real competition" for them, the source said.

Zenit rockets serve to launch satellites as part of Russia's federal space exploration program, from a platform in the Pacific Ocean as part of the Sea Launch program, as well as from the Baikonur Cosmodrome, which Russia leases from Kazakhstan, as part of the Land Launch program.

The source, however, said that a date for launching the observatory was not crucial.

"Its launch can take place either in July, September or October," he said.

But the launch of the Intelsat 18 telecommunications satellite within the timeframe set by the contract is vital for the Intelsat international satellite operator, he said.

"If the Zenit launch vehicle is transferred to the Intelsat 18 program, the satellite could be launched in August or September," the source said.

The satellite's timely launch is also important for the Sea Launch consortium, which is 95% controlled by the Energia Overseas Limited company, which is a subsidiary of Russia's Energia corporation, he said.

Intelsat is a strategic customer of the consortium, which conducts satellite launches for the company from a platform in the Pacific Ocean, the source said.

"As far as I know, the Sea Launch consortium announced willingness to carry out the launch of the Intelsat 18 and asked for permission to use a Baikonur launch pad,' he said.

"The thing is that the Intelsat company is kind of blackmailing Sea Launch, saying that if the question over the launch of the Intelsat 18 satellite from Baikonur is not resolved, the company will decide against launching the Intelsat 19 and subsequent satellites from the platform in the Pacific Ocean," the source said.

Read more: http://www.kyivpost.com/news/russia/detail/104298/#ixzz1MDGcIIPb

PRESS DIGEST - Russia - May 13http://in.reuters.com/article/2011/05/13/press-digest-russia-may-idINLDE74C02J20110513

12:41pm IST

MOSCOW, May 13 (Reuters) - The following are some of the leading stories in Russia's newspapers on Friday. Reuters has not verified these stories and does not vouch for their accuracy.

KOMMERSANT

www.kommersant.ru

- A shareholder of BP's (BP.L: Quote, Profile, Research) Russian joint venture TNK-BP (TNBP.MM: Quote, Profile, Research) Andrei Prokhorov is planning to file a lawsuit seeking up to $10 billion in damages from the British oil company over its plans to set up a strategic alliance with state-run Rosneft.

- Russia's government will be able to freeze railway tariffs if a new contract is signed regulating relations between the monopoly Russian Railways and the state, the daily says.

- Russia's Sberbank (SBER03.MM: Quote, Profile, Research) is in talks with French BNP Paribas on buying the retail network of the European banking group in Russia, the daily reports citing its sources.

VEDOMOSTI

www.vedomosti.ru

- Gazprom (GAZP.MM: Quote, Profile, Research) is expecting to spend up to 1 trillion roubles ($35.74 billion) on launching a gas pipeline from Yamal Peninsula fields, making it one of the most expensive projects of the state monopoly, the daily says.

- Sberbank Chief Executive German Gref has increased his stake in the lender by 1.5 times to a holding of 0.0014 percent.

Gref's total stake in the Russia's leading lender could be worth 29.1 million roubles, the daily says.

ROSSIISKAYA GAZETA

www.rg.ru

- Russia will monitor the condition of its oil and gas fields in the Far East over the next three to four months to check for effects from the March earthquake in Japan.

- The head of Russia's chief narcotics watch-dog agency Viktor Ivanov is urging the government to toughen legislation on fighting drugs traffic and consumption.

- Nearly half of 57,000 human rights complaints registered with the presidential human rights representative Vladimir Lukin were caused by violations of rights and freedoms, according to Lukin's official annual report published by the daily.

IZVESTIA

www.izvestia.ru

- Russia's military has chosen a rocket manufacturing centre in Chelaybinsk region to design and produce by 2018 a fifth- generation heavy ballistic missile to replace an existing Voevoda missile system (Satan under NATO qualification), according to Russia's nuclear missile chief Viktor Yesin.

- Sergei Mavrodi, once convicted by Russia for carrying out a financial pyramid scheme which destroyed the savings of nearly five million investors, is offering to save Belarus' ailing econo

Russian Press at a Glance, Friday, May 13, 2011http://en.rian.ru/papers/20110513/164001646.html

08:59 13/05/2011

POLITICS

In an unexpected twist indicative of a possible rift with Prime Minister Vladimir Putin, Russian President Dmitry Medvedev suggested that the ruling United Russia party's victory in the upcoming parliamentary election was not a foregone conclusion.

(Kommersant)

Russian Prime Minister Vladimir Putin quickly moves ahead with his All-Russia People's Front initiative. He presided on Thursday over a meeting of the coordination council which approved the manifesto of the movement.

(Kommersant, Moscow News, Rossiiskaya Gazeta, Izvestia) 

Russian Central Election Committee said that foreign observers would monitor upcoming elections in Russia in accordance with existing rules and regulations.

(Kommersant)

Russia’s notorious Congress of Russian Communities nationalist group has won a five-year battle for registration with the Justice Ministry, in line with what analysts say is a Kremlin plan to create a controllable right-wing movement.

(Moscow Times)

Territorial dispute over four Kuril Islands between Russia and Japan may soon reignite with a new intensity in view of the upcoming visit to the islands of the Russian Deputy Prime Minister Sergei Ivanov.

(Kommersant)

WORLD

Ukraine-born Ivan (John) Demjanjuk, who was found guilty of helping to kill at least 27,900 Jews at a Nazi extermination camp and convicted to five years in prison, will be released from custody because of his declining years, a German court ruled Thursday. (Kommersant)

Denmark plans to reintroduce customs and passport controls on the border with Germany and Sweden to regulate the inflow of migrants. (Rossiiskaya Gazeta)

ECONOMY & BUSINESS

Russia, the world's largest oil producer, may extend to June a gasoline export duty, which was raised by 44 percent from May to $408.3 per ton to fight local shortages, Economic Development Minister Elvira Nabiullina said.

(Vedomosti)

Russia and China are likely to sign an agreement on natural gas supplies during the St. Petersburg International Economic Forum in June. (Moscow Times)

Russia’s Sberbank is planning to buy the French BNP Paribas retail business in Russia.

(Kommersant)

Inflation in Russia this year will most likely hit 8.9 percent, experts believe.

(Rossiiskaya Gazeta)

Russian bourses continue to experience sharp downward correction. Their indexes have dropped by 12-13 percent since April.

(Moscow News)

Russian Helicopters desperately wants to penetrate the Indian market. The company offered Delhi a sweet deal which includes construction of an assembly plant in India and sales of jointly produced helicopters to third countries.

(Moscow News)

Russia may seek extradition of Hermitage Capital head William Browder from Britain and prosecute him in absentia if London refuses. (Kommersant)

Ford company has stopped producing economy models of its Focus line in Russia - Limited Edition and three-door hatchback.

(Vedomosti)

BMW automaker may build an assembly plant in Russia.

(Vedomosti)

DEFENSE

The Russian Defense Ministry has picked the developer of a new heavy ballistic missile to replace outdated SS-18 Satan. Interview with former head of the General Staff of the Missile Forces Viktor Yesin.

(Izvestia)

SOCIETY

Russia’s overcrowded prisons could release 15,000 inmates if the State Duma approves a "business amnesty" proposed by the parliamentary opposition.

(Vedomosti, Izvestia)

The pension age could be raised for men and women in Russia in 20 years, experts working on Russia’s Strategy-2020 say.

(Izvestia)

The mastermind of the infamous MMM financial pyramid in Russia Sergei Mavrodi offered Belarus help in bringing the country out of the current financial crisis.

(Izvestia)

CRIME

DNA analysis confirmed that a teenage girl found dead in April near a luxurious cottage village in the Moscow region was the daughter of a LUKoil top executive.

(Rossiiskaya Gazeta)

IT

Google challenges Windows with its innovative operating system Google Chrome for notebooks. Most of its applications will be stored on remote servers.

(Vedomosti)

Russia is not planning to introduce stringent control over Internet content, Communications Minister said in an interview.

(Rossiiskaya Gazeta)

The Russian segment of the Internet may become largest in Europe, says Communications Minister Igor Shchegolev.

(Izvestia)

A Victory Day for mothershttp://themoscownews.com/society/20110512/188662136.html

by Svetlana Kononova at 12/05/2011 19:14

The Russian government will soon begin to pay out maternity benefits directly from Russia’s Social Insurance Fund (SIF), ending the cumbersome present system by which employers are responsible for these and other types of welfare payments. The new procedure will go into effect July 1 in two of Russia’s regions – Nizhny Novgorod and Karachayevo- Cherkessia – and if successful there will be implemented nationwide.

At present, the SIF collaborates with employers using the so-called “credit principle”: employers deduct social fees from all employees’ salaries and transfer the funds to SIF; if a worker is eligible to receive social benefits, the employer applies to SIF, receives the compensation and transfers it to the worker – a lengthy process, and one that allows some employers to dodge the law.

Under the new system benefit payments will go directly to workers’ bank accounts or debit cards, or will be made as mail payment remittances. In the future, all Russians will get “social cards” to receive such benefits.

This issue first surfaced in 2009, when thousands of women were fired during the financial crisis and lost their incomes, including social payments. Some employers simply stopped paying maternity benefits, while other companies disappeared altogether.

According to Rima Sharifullina, president of Peterburgskaya Egida, a St. Petersburg-based employmentrights NGO, appealing to the courts to punish dishonest or elusive employers often proved ineffective: “Many judicial decisions [in our favour] were not executed because there was no one to implement them.” In effect, “pregnant women became ‘hostages’ to their employers.”

Anastasia Yermakova, who organised a December 2010 protest by pregnant women and young mothers in Moscow, added that while majorcentre companies that valued their reputations continued paying social welfare, there were “many cases when the rights of pregnant women were violated in the regions. Employers [simply] denied them maternity benefits under different pretenses.” Yermakova estimates that every fifth woman in the regions met with resistant employers.

“Only a few women whose rights are violated go to court. The majority can’t afford it,” Sharifullina said. “We realised that the law should be changed to protect pregnant women and young mothers from dishonest employers. We decided that it would be better if maternity benefits were paid directly from SIF…[so] we developed our proposal and put it forward to the Committee on Social Policy.”

The activists of Peterburgskaya Egida then delivered speeches to the Public Chamber and the State Duma, appealed to high-ranking officials – including St. Petersburg Governor Valentina Matviyenko – and organised street protests. On the eve of March 8, as Russia celebrated International Women’s Day, 100 women who had suffered from dishonest employers, had been fired because of pregnancy or were refused maternity benefits held a street protest in St. Petersburg, chanting “Don’t give us flowers! Give us a new law!”

These tactics eventually had the desired effect. Meanwhile, Russia stands 37th in the Mothers’ Index 2011, a ranking of 164 countries compiled by the independent organisation Save the Children. The rankings are based on criteria such as female health and life expectancy; women’s status in education, economics and politics; maternity benefits; the ratio of male to female income; and children’s mortality, health and education. The Baltic States and most East European countries placed ahead of Russia.

The Central Asian peacekeeping issuehttp://rt.com/politics/press/nezavisimaya/nato-peacekeeping-russia-asia/en/

Published: 13 May, 2011, 07:13Edited: 13 May, 2011, 07:13

Vladimir Mukhin

The North Atlantic Treaty Organization continues to strengthen its positions in Central Asia. The regional states actively cooperate with NATO’s programs, similar to those which Russia is initiating within the framework of the Collective Security Treaty Organization (CSTO). As stated by the Special Representative of the Secretary General of NATO for relations with the countries of the Caucasus and Central Asia, James Appathurai, Kyrgyzstan is once again involved in NATO’s Planning and Review Process (PARP), which will allow its troops to participate in peacekeeping operations.  

The announcement about Kyrgyzstan and other member states’ of the CSTO involvement in peacekeeping operations was made two weeks ago by the organization’s Secretary General, Nikolay Bordyuzha. He had even declared readiness of the CSTO’s troops for military deployment. This sounds sensational, because in the almost 20-year history of the CSTO’s existence, the organization has not used its troops anywhere, other than in joint training exercises. The CSTO units were left on the sidelines even in 2005 and 2010, when Kyrgyzstan was going through an illegitimate regime change. The CSTO troops did not intervene in the ethnic conflict, which took place in the summer of 2010 in the country’s Osh Province, though help from Russia and the leadership of this organization was sought by Kyrgyzstan’s new leader, Roza Otunbayeva. Apparently, for this reason, having felt the familiar spuriousness of Bordyuzha’s organization, NATO refused, despite Moscow’s active attempts, and continues to refuse to get actively involved in the CSTO. Meanwhile, the alliance with great enthusiasm interacts with practically all of the CSTO member states. For instance, the NATO’s Planning and Review Process, in addition to Kyrgyzstan, involves Uzbekistan and Kazakhstan.

The piquancy of the situation is associated with the fact that the official Tashkent, while highlighting its peacekeeping intentions in NATO’s programs, flatly refuses to participate in similar ones within the CSTO. As it is known, when the statement of readiness of the CSTO member states’ collective peacekeeping forces to carry out tasks within the CSTO responsibility zone, as well as outside of the zone under the UN Security Council mandate, was adopted in Moscow in December of 2010, President of Uzbekistan, Islam Karimov, had objected to his country’s participation in such action. According to the Kyrgyz media reports, today, Uzbekistan has qualitatively and quantitatively increased military presence on the border with Kyrgyzstan. The border troops commander of the National Security Service of Kyrgyzstan, Zakir Tilenov, claims that more than 80 conflicts had taken place in 2009-2011 on the border between his country and Uzbekistan.           

Of course, it’s unlikely that Uzbekistan will play the role of an aggressor and occupy Kyrgyzstan’s land to the south, populated with ethnic Uzbeks. James Appathurai, while speaking about the involvement of Uzbekistan, and other Central Asian states, in the PARP program, stressed that they are “obliged to observe the international law, the UN Charter, all arms control agreements, preserve the existing borders and handle disputes diplomatically, rather than militarily”. Tashkent, having basically stopped active military cooperation with Moscow within the framework of the CSTO, will hardly quarrel with NATO.   

Uncontrolled inter-ethnic clashes, similar to those that took place in the summer of 2010 in the south of Kyrgyzstan, as well as the export of instability from Afghanistan to the countries of the CIS, are highly possible. And here, NATO, as well as its key member – the United States – has clearly-defined goals and tasks. At a recent meeting between Roza Otunbayeva and James Appathurai in Bishkek, agreements were reached on provision of assistance to Kyrgyzstan in strengthening its border security and the capabilities of the republic’s border guards. Meanwhile, James Appathurai had expressed NATO’s readiness to participate in major repairs of the storage facilities for missiles and artillery of Kyrgyzstan’s Ministry of Defense, making an emphasis on the country’s southern region. Roza Otunbayeva, who had traveled to Washington in March of this year, had agreed to Pentagon’s proposal to open a US military training center in the Tajikistan-and-Uzbekistan-bordering Kyzyl-Kiya and the Batken provinces. Russia is currently slow to make a decision about opening a similar training center or a new military base in Kyrgyzstan. Funds for these developments have not been provisioned in the Russian budget for the next three years.        

Uzbekistan objects to the construction of Russian military bases in the south of Kyrgyzstan; however, Tashkent has not issued any statements in regard to the US and NATO’s desire to establish similar military facilities in Kyrgyzstan. In Central Asia, clashes are possible in Kyrgyzstan as well as in Tajikistan. And it’s very likely that Uzbekistan will be linked to these conflicts. Whether or not the CSTO leadership will make a decision to stop such conflicts if Uzbekistan objects – is a big question.

“NATO’s positions in Central Asia are becoming stronger. Russia, and especially the CSTO leadership, does not have a clearly-defined policy in this case, or any concise economic and military goals. And the NATO alliance, meanwhile, does. Its ambitions to participate in the resolution of conflicts in Central Asia and other regions of the CIS could results in what we are currently witnessing in Libya – a forced invasion, bombings, etc. The Russian leadership is currently discussing and outlining a system of measures on how to rescue our citizens in these types of situations. Though, one would think, Moscow could use its geopolitical weight here, then the issue regarding the protection of our citizens would disappear on its own. It would be more appropriate to organize and clearly advocate a system of national goals and geopolitical objectives in form of military assistance, military-technical cooperation, creation of new military bases, implementation of long-term economic, humanitarian, or other joint programs in the given region,” President of the Academy for Geopolitical Studies, Doctor of Military Sciences, Konstantin Sivkov, told Nezavisimaya Gazeta. For a long time, he served as the head of the Center for Military-Strategic Studies of Russia’s General Staff and developed real measures to strengthen Russia’s positions in various countries of the world. In his opinion, if we cut the profits of the oil monopolies by 10-15%, then we will have plenty of funds to militarily, politically, and economically strengthen Russia’s positions in the vitally-important zones of the CIS and the world.

© Autonomous Nonprofit Organization “TV-Novosti”, 2005 - 2011. All rights reserved.

The 1,000-day countdownhttp://rt.com/politics/press/rossijskaya-gazeta/sochi-olympic-games-installation/en/

Published: 13 May, 2011, 04:21Edited: 13 May, 2011, 04:21

Pavel Zarudny, Anna Kozina

On February 7, 2014, Sochi will light the Olympic Flame. All that remains is to wait 1,000 days. That’s not so much. And just look at everything that has already been done!

Facilities for the upcoming Games are appearing like mushrooms in the resort town: a new airport has been built, tunnels and highways are being constructed at an accelerated pace. The cute mascots of the 2014 Olympics, which for the first time ever were chosen by a popular vote, are impatiently biting their paws in anticipation.  

But, that’s not all. Starting tomorrow, the waiting for the home Olympic Games will take place to the steady beat of a precise Swiss mechanism. A unique countdown clock, “1,000 days to the 2014 Olympic Games” will be set up in the park in front of the Sea Port of Sochi.    

The clock’s dimensions are fully consistent with the scale of the event. The official time-keeper of the International Olympic Committee from Switzerland has created for the Russian people a clock more than four meters high, more than two meters wide, and weighing three and half tons.  

Installation of the innovative Olympic “chime” will be handled on location by Swiss specialists. However, Russian organizers are not lagging behind their punctual colleagues in terms of innovation and have offered a number of surprises.  

“The Games will start on February 7, 2014; but already today we want for every resident of our country to feel connected to the Olympic movement. And on this memorable day, when we overcome the symbolic achievement, everyone will have this opportunity,” noted Dmitry Chernyshenko, president of the 2014 Sochi Organizing Committee.   

In Russia, the project “1,000 days before the Games” will be very unique in nature. Throughout the entire country, 26 volunteer centers will host events with social, cultural, environmental or an athletic emphasis, called “1,000 good deeds”.  

Symbolic numbers, large-scale involvement, the presence of Olympic champions – are all part of the mandatory conditions. In Moscow, Krasnodar, Khanty-Mansiysk, and Novocherkassk, starts the campaign called “1,000 Olympic lessons”. Master classes will be taught to students of physical culture schools by Svetlana Zhurova, Aleksey Nemov,

Svetlana Masterkova, Denis Pankratov, Nikolay Kryukov, Maria Kiseleva, Nikolay Gulyaev, Karina Aznauryan, and other gold medalists.  

Large-scale flash-mobs, called “Olympic workout”, will be organized by volunteers for amateur athletes and supporters of a healthy lifestyle at the central squares of a number of cities. In Pyatigorsk, meanwhile, it was decided to add social stress to the physical. Participants in the “Conquer 1,000 meters” event will not only hike up the 1,000-meter Mashuk Mt., but also collect garbage on its slopes.  

“1,000 children’s drawings on asphalt” will appear on May 14, as well as “1,000 smiles” and “1,000 chocolate medals”. Moreover, residents of Moscow, Kazan, and Tomsk, will be able to hear the original version of the Sochi-2014 hymn, which will be performed by 1,000 people from three combined orchestras. These cities will have their own clocks, albeit not Swiss. Volunteers will create an art installation from 1,000 alarm clocks, which will be gathered in one place. A simultaneously sounding alarm will be the symbolic start or the countdown to the Olympic Games in Sochi.    

Incidentally, creators of the original clock have things over which to be concerned. Whereas the countdown “1,000 days to Beijing-2008” and “365 days to Vancouver-2010” began from the first attempt, the clock “500 days to London-2012” had been launched twice. After the solemn ceremony, the precision instrument stopped. Now, the timer works without fail.   

The final celebrations within the framework of the “1,000 days to the 2014 Olympic Games” will be gala concerts in Moscow and Sochi.

© Autonomous Nonprofit Organization “TV-Novosti”, 2005 - 2011. All rights reserved.

Is Russia Interested in Regime Change in Belarus?http://belarusdigest.com/2011/05/12/is-russia-interested-in-regime-change-in-belarus/

This week Russia’s Finance Minister Kudrin made it clear that Moscow was not interested in bailing out the Belarusian economy with no conditions attached. That stimulated discussions that Russia finally decided to get rid of Alyaksandr Lukashenka. However, these discussions are based the premise that Russia`s intention is regime change.

Certainly Russia has no interest to support further Lukashenka’s geopolitical juggling between the East and the West. Despite the noisy anti-Lukashenka campaign and speculations over possible support to opposition candidates, Russia`s intention has not been changing Lukashenka. For Moscow any other president would mean a new large opening to the West. The Russian efforts more intends to guarantee the loyalty of Belarusian leader and to get the most important economic assets of Belarus – energy transit, oil refineries, potash and some other – under control. Russia certainly does not

want to weaken Belarus too much and therefore could support Lukashenka’s regime financially (as it has happened before), should it be absolutely necessary. But not now. Moreover, Belarus makes ideology is based on, may no longer remain as the only option.

In this context, the Western press is eagerly discussing the lack of the right EU policy toward Belarus. But Brussels has tried everything from isolation to engagement by now. With the renewal of sanctions based approach, the EU policy has returned to the same point after a full circle. Moreover the visa-ban itself is a great show case how much the West knows Belarus: dozens are left the positions, another dozen are not responsible for the actual court decisions, there are two heads of presidential administration and even a dead person on that list. Perhaps now it would be worth learning what is really happening in Minsk first of all in order to make the Western policy and assistance a better fit.

It is time for the West to think out of the box – consider that nothing can make the EU more attractive in the eyes of Minsk than ignorance. This is exactly what happened with the US before the elections. The American ignorance two years ago after the row over the US Embassy in Minsk when Minsk forced the US to reduce its diplomatic corps from 34 to a mere 5 prompted Minsk to give up its enriched uranium before the elections. Although the delivery is in question, the path toward a new policy is there.

Thus, a new viable mid-term strategy for the West at this moment is not to isolate but to ignore Alexander Lukashenka, meanwhile focusing on broader society as a whole. It is not an easy task considering the strong intention of the West to be (at last) principled with Belarus. Having no oil or gas, Lukashenka has developed another commodity – his own image of a dictatorship. Until the West will reduce the importance of this commodity, it will keep continue to play its part from the Lukashenka’s script. As Lukashenka is in the corner he is sending different messages every day: insulting European Commission President Barosso while offering dialogue with the EU. Hold your breath.

The Western press and policymakers, rightly so, have pushed for a tougher response. In the meantime a new policy must finally acknowledge that Belarus provides a more complex challenge than it seems. It is not only about Lukashenka but about a society that approves and supports order and stability and does not mind a lack of freedom in return. To make Belarus embrace European values – such as normal leadership change through free and fair elections – the West needs to engage with all layers of society. Unless the West is able to expand its contacts and influence amongst the bureaucrats it will have a little chance to support a systemic reform and build public support for it.

Balázs Jarábik

Mr Jarábik is Associate Fellow at FRIDE in Madrid, Spain. The full version of this paper is available at FRIDE web site.

An umbrella to shield from space threats http://indrus.in/articles/2011/05/11/an_umbrella_to_shield_from_space_threats_12504.html

May 11, 2011Victor LitovkinDefence Russia's anti-ballistic missile defence system can cover Eastern Europe and the Black, Baltic and North Seas,

Russian President Dmitry Medvedev has issued a decree to create Aerospace Defence Forces in the country before December 1 this year. The aerospace forces will work under a single command-and-control system to effectively ward off potential missile threats. It will be equipped with means to fight supersonic unmanned planes and non-nuclear missiles, says Russian Aerospace Forces Commander, Lieutenant General Oleg Ostapenko. The forces will be capable of destroying enemy targets in near space and could be used in the future for defence from stray asteroids, says Ostapenko.

“Russia, for much too long, placed its bets on the enemy not starting a war against us because people here thought our nuclear-missile shield would guarantee that no one would think of doing anything of the sort,” says Konstantin Sivkov, Vice-President of the Academy for Geopolitical Issues. “We can see, however, that this didn’t stop Georgia, which perfectly understood that we would not use our nuclear-missile shield in conventional warfare. Nuclear-deterrence forces need to have reliable protection against air and space strikes. Therefore, creating aerospace defence forces is extremely necessary,” he says. 

Under this programme, all the systems in Russia that monitor near and outer space, the country’s and its allies’ airspace, as well as their borders, will be integrated. This includes a missile warning system, radar stations in northern Russia, the Murmansk and Leningrad regions and the Komi Republic. This will also include a radar station currently under construction in the Kaliningrad region, operating radar stations in Hantsavichy (Belarus), Armavir in the Krasnodar region, Gabal (Azerbaijan), Balkhash (Kazakhstan) and near Irkutsk. It also includes space missile warning system satellites in high-elliptical and geosynchronous orbit, a space surveillance system with radar and optical-electronic complexes in many different areas of the country and abroad such as the ones outside Nurek, in Tajikistan. 

In addition, the aerospace defence will include DON-2N, a unique radar station complex outside Moscow, which will be able to detect objects ranging from five centimeters at hundreds of kilometers in the air. The station provides security for Moscow and the entire surrounding region, and also wields anti-missile/anti-air S-300 and S-400 air-defence systems. A S-500 air-defence system will also be created and armed with missiles capable of intercepting ballistic targets in near space. What’s important is that the western, southern, central and eastern military districts’ anti-aircraft defence complexes, as well as their aviation fleet of interceptor aircraft, will be given to the aerospace defence forces for operational control. 

The aerospace forces command must be subordinate to the general staff. Some experts say that the strategic missile forces should become a part of the aerospace defence forces. This means that should something happen and a signal from the missile warning system about an attack on Russia by enemy strategic missiles is received, a counter strike can be made without delay.

Experts have also been discussing and exploring how Russia’s aerospace defence system can be integrated with Europe’s anti-ballistic missile system.

The space forces’ chief said in April that Russia’s anti-ballistic missile defence system could cover Eastern Europe and the waters of the Black, Baltic and North Seas. “Our anti-ballistic missile system’s contribution would be in destroying ballistic missiles launched at targets in Russia, border regions between Russia and its neighboring countries and European states,” he said. He clarified that destroying missiles targeted toward Europe would be possible thanks to a joint military control centre that is being discussed as part of the European anti-ballistic missile system.

Russia: Shades of differencehttp://www.ft.com/cms/s/0/c6ca794e-7cc5-11e0-994d-00144feabdc0.html#axzz1MDAlrAQX

By Charles Clover and Neil Buckley

Published: May 12 2011 19:46 | Last updated: May 12 2011 19:46

Not much love, according to most Kremlin watchers, is lost between Russian President Dmitry Medvedev and Igor Sechin, deputy prime minister. On their few appearances together on television the disdain has been obvious, right down to bulging neck veins. Higher-ups at Rosneft, the state oil company of which Mr Sechin was chairman, have been known to refer to the president’s circle derisively as “the boy scouts” behind their backs.

So it may have been especially satisfying for Mr Medvedev to force Mr Sechin out of his eyrie at Rosneft. On March 31 he issued a decree that cabinet ministers had to vacate board seats they occupied at state companies, eliminating untold privileges and conflicts of interest. A few weeks later, Mr Sechin duly stepped down.

It was a rare victory for Mr Medvedev. As the junior associate in the ruling “tandem” with Vladimir Putin – his more powerful, and more conservative, predecessor and mentor, who is currently prime minister – making good on his reform pledges has not always been easy.

Without liberalisation and a scything of bureaucracy, state ownership and corruption, many economists hold little hope that the world’s 10th largest economy will realise its potential as one of the prime growth markets of the future. That would leave it to languish in its current state as a marginal supplier of raw materials for the developed world.

Where possible, Mr Medvedev has been combining the struggle to reform an economy he accepts is inefficient and opaque with the fight to broaden his own political power. Over the past few months this has had some noteworthy successes, which both weaken rivals such as Mr Sechin and tackle some of the more blatant problems with economic management.

In some ways the Medvedev strategy is reminiscent of the approach taken by Mikhail Gorbachev. The Soviet leader, faced with an entrenched Communist old guard in the 1980s, identified himself with inevitable economic and political reforms and used these as a tool to empower himself against the Politburo establishment. “Medvedev is using the slogan of modernisation as a way to grab political decision-making over the economy away from the government,” says a former Kremlin official.

Like Mr Gorbachev, Mr Medvedev is the relative liberal in a field of grey-suited apparatchiks who owe their jobs and their perks to Mr Putin. The two Putin terms as president were an all but unmitigated economic success: he reasserted the role of the state in an economy left in turmoil by the fast-and-loose privatisations of the 1990s, while Russia’s gross domestic product doubled during his eight years in office.

But the economic collapse of 2009, when GDP fell 8 per cent, has brought home to many that the Putin economic model, dubbed “Kremlin Inc”, is nearing exhaustion.

Mr Medvedev is now struggling to make his mark as the next presidential election approaches in 2012. Although the president would clearly like a second term, it was only to fulfil a constitutional requirement that Mr Putin stepped down a rung three years ago. He will once more be free to stand, seems to have right of first refusal and has not yet made his choice clear. But for Mr Medvedev, positioning himself for re-election means having a stable of accomplishments to his name.

Their relationship is delicate – the two are old friends from St Petersburg, where Mr Medvedev was Mr Putin’s lawyer, and they appear to get along in public. But Mr Medvedev’s staff chafe at having their memos ignored by cabinet officials and at being shut out of the higher echelons of power.

Although the constitution gives the president a nearly omnipotent executive decision-making ability, since 2008 the punching weight of the Kremlin, where Mr Medvedev sits, has fallen sharply vis-à-vis the White House, across the Moscow ring road. Now, all instructions from the Kremlin go via Mr Putin’s office and the stern ex-KGB colonel has made it clear that he has a veto over important decisions.

Mr Medvedev has had to tread a fine line between carving himself a separate identity as a politician and not alienating the kingmaker who stands between him and a second presidential term. His criticism of Mr Putin has been carefully structured and oblique – notably calling the economy he inherited (without naming names) “primitive” for its reliance on raw materials exports.

Indeed, Russia’s economy looks more like that of a Middle Eastern oil autocracy than a modern European state: oil sales fund roughly half the federal budget, while 70 per cent of federal expenditure goes on social spending and pensions. With its economy limping along since the 2009 collapse, economists reckon Russia’s 4 per cent growth rate is far below what it could achieve if reforms were made that cut social spending and increased both state and private investment.

Mr Medvedev has sought by stealth to gain leverage over economic policy. An otherwise unremarkable commission on modernisation, created in 2009 and consisting of 23 people including five cabinet ministers, has been transformed into a “sort of parallel government” where Mr Medvedev can directly issue instructions and quiz members on their fulfilment, according to Sergei Guriev, rector of the New Economic School in Moscow.

“Unlike other commissions, this one meets every month, and on time,” says Prof Guriev. “It provides Medvedev direct access to ministers which he wouldn’t get otherwise.”

Many of Mr Medvedev’s instructions to the government have fallen on deaf ears: the finance ministry under Alexei Kudrin, a close Putin ally, is legendary for its unresponsiveness, say a number of insiders and former officials. Mr Kudrin is himself a respected reformer and economic manager, but clearly his loyalties lie with Mr Putin rather than Mr Medvedev, as do those of most of the cabinet. “The deputy ministers don’t see Medvedev as their boss, they see it as Putin,” says one economist.

Mr Medvedev’s 2009 order to establish a unified national payment system, to expand the use of consumer credit and debit cards, took 17 months before the finance ministry made it into legislation. The ministry maintains that the delay was due to problems in co-ordination with other ministries, not to lack of will or interest.

Persistently, Mr Medvedev uses the commission to prod ministers into doing his bidding. At its last meeting on April 25, he took Andrei Fursenko, education minister, to task for poor co-ordination between academia and the private sector. “The ministry should work – not sleep but work seriously,” he said, apparently noting that Mr Fursenko had been nodding off during the four-hour long session. “Maybe you should do some ‘doping’,” joked the boyish-looking president – slang for a brisk shot of espresso or vodka to get the blood flowing.

He also admonished Mr Kudrin, the finance minister, urging him to “work together with the administration, so the results are useful to all” – a swipe at Mr Kudrin’s evident lack of co-operation with the Kremlin.

Targeting the cosy relationships between cabinet ministers and state companies was the most noteworthy of 10 points on a reform agenda that also promises to strengthen corporate governance and weed out corruption by empowering whistleblowers. Outlined by Mr Medvedev on March 31 at a meeting of the modernisation commission in the industrial city of Magnitogorsk, it led not only to Mr Sechin’s departure from Rosneft but the resignation of Mr Kudrin from the board of VTB, the state-controlled bank, though those close to him say the finance minister agreed with the president’s action.

“Medvedev’s decision clearly had a political aspect to it,” says Alexei Makarkin of the Centre for Political Technologies in Moscow. “Most of the cabinet ministers covered by the decree were appointed by Putin, loyal to Putin, and Medvedev was interested in a way to weaken their influence.” He says it was clear the man Mr Medvedev was really going for was Mr Sechin, leader of the group in Mr Putin’s circle known as the siloviki, literally “strong guys”, with security backgrounds whom Mr Putin brought with him into the Kremlin in 2000. Mr Sechin’s ousting was widely seen as a blow to siloviki power.

Yet while the episode allowed Mr Medvedev to flex his muscles, it also demonstrated graphically the limits of his powers – namely that he is clearly not allowed to fire ministers, only to whittle away at their perks. And although Mr Putin reportedly supported the new rules on state company boards, it is unclear where he will stand on replacing the ministers, some of whom have tried to nominate their replacements.

The frontrunner for Mr Sechin’s Rosneft seat is Sergei Shishin, a vice-president at VTB and a former general in the Federal Security Service who is rumoured to be close to both Mr Sechin and Mr Putin. “Medvedev’s great idea has turned into a saddening fiasco. What difference does it make who sits on the board if he votes on orders anyway?” asks Alexei Navalny, an opposition blogger and activist shareholder.

Mr Putin supports Mr Medvedev’s efforts at modernising the economy but his backing appears tempered by a desire to keep hold of all levers of control. “The government understands that state companies are very important to political power,” says Prof Guriev. “Putin has no ideological preference for state capitalism but the government knows that private companies are harder to boss around.”

The reform drive has been somewhat blunted by the high price of oil, which has flooded the state’s coffers and made measures such as the sale of stakes in banks seem unnecessary. Oil at $120 a barrel has bought the government time to delay hard questions such as pension reform – Russia’s pension system is already running at a loss and on its present course is expected to go broke in 2018.

Mr Putin remains lukewarm on liberalisation, tending to err on the side of political stability. He told the state Duma, or lower house of parliament, last month that the country would have “no radical economic experiments”, which resonates with most Russians’ negative view of the “shock therapy” reforms of the 1990s under Boris Yeltsin. One economist close to the prime minister says bluntly: “I think Putin wants to know how long he can afford to do nothing.”

Led by Arkady Dvorkovich, Kremlin adviser, the Medvedev team thinks that hard choices cannot continue to be put off. “There is a risk that if we do not bring spending under control, we will have to raise taxes,” says Mr Dvorkovich. A payroll tax imposed to pay for a 10 per cent rise in pensions this year has embroiled the cabinet and the Kremlin in another row. Mr Dvorkovich and others close to Mr Medvedev believe it places too much of a burden on small and medium-sized enterprises. But so far, Mr Putin has successfully defended his tax increases.

The question of the 2012 election remains paramount, however, and it is unclear whether Mr Medvedev has begun to assert himself too late in his term to do any good. Igor Yurgens, a key member of the Medvedev economic camp, says there was an opportunity about two years ago for Mr Medvedev to start building his own political support base; the two men might then have competed for the presidency. Since that was not done, the president’s only route to the nomination is through Mr Putin rather than an independent bid.

“Anyway, it’s a little too late now for that,” Mr Yurgens adds. “But I think that he is rehearsing and maturing himself and positioning himself for the election. I think it’s pretty obvious.”

Warnings about the need to wean a nation hooked on hydrocarbons

Alexei Kudrin, Russia’s finance minister, startled economy-watchers last month with a sobering prediction: a further increase in oil prices might “have a depressive effect”, Charles Clover reports. The rising price, he said, “used to act as an economic stimulus. Now, however, this model is exhausted.”

As prices wobbled and dipped as much as $15 a barrel in a matter of days this month, many of his compatriots have joined him in taking a more critical look at oil’s dominance.

The economy has long been linked to oil and gas. The Kremlin floated for most of the previous decade on a cushion of steadily rising oil revenue; it has earned about $1,500bn from oil and gas exports since 2000. They are today the source of roughly 50 per cent of federal budget revenues and made up 25 per cent of gross domestic product in 2010.

But rising oil prices “played a cruel joke on us”, according to Mr Kudrin, who says it fuelled inflation and created bubbles in economic sectors such as trade, finance and property, while more fundamental areas failed to develop.

“We paid for growth with inflation,” he said, adding that some years the money supply rose 50 per cent per year, compared with GDP growth of about 8 per cent annually. To fight price rises, the central bank was forced to strengthen the rouble, which hurt trade in all sectors but oil and gas. This in turn further concentrated dependence on energy, he said.

Despite Mr Kudrin’s sometimes adversarial relationship with President Dmitry Medvedev, the two are agreed when it comes to reforms. Mr Medvedev has frequently called for an end to dependence on energy exports. He called this economic model “primitive” in a 2009 article, seeming to contradict Vladimir Putin, the former president and now prime minister who praised Russia in 2007 as “an energy superpower”.

Still, weaning the country off oil and gas will not be easy. It will require pervasive economic reforms, principally tackling endemic corruption and mismanagement, and liberalising the state-run economy – a feat many in the government say they are already struggling to pull off.

Copyright The Financial Times Limited 2011. You may share using our article tools. Please don't cut articles from FT.com and redistribute by email or post to the web.

National Economic Trends

CBR reports April interventions at only $3.7bn http://www.bne.eu/dispatch_text15164

Alfa BankMay 13, 2011

According to information recently released by the CBR, of the $21.5bn nominal CBR reserve increase, only $3.7bn reflects interventions on the exchange rate market in April.

At first glance, this implies that capital outflow was as high as $13bn vs. our assumption of a balanced-to-positive capital account, which explains the April liquidity squeeze. However, under this assumption, the reserve revaluation effect in April should be $18bn, which is unrealistically high given that EUR/USD movements justify only a $5bn revaluation. We therefore view the published CBR reserves data as confusing and require further clarification.

Many market-watchers have taken the released $3.7bn intervention figure as negative news: given our April current account expectation of $16bn, such a modest purchase of foreign currency would imply a huge $13bn capital outflow. While this scenario would explain the liquidity squeeze we saw in April on the interbank market, the CBR reserves statistics do not look conclusive. The newly released CBR intervention data imply that the currency revaluation effect in April should be as high as $18bn, while movements on the global currency market can only justify a revaluation of $5bn. The latter was the reason why after last weeks' announcement of an April nominal reserve increase of $21.5bn, we estimated the CBR actually purchased $16.5bn, which would mean a $0.5bn capital inflow, i.e. a zero or slightly positive capital account (see our note "Interbank Liquidity: Squeezed by the Tight Budget" issued on May 5). We thus deem the recently released intervention data as confusing and expect clarification to follow from the CBR, but the publication certainly gives rise to more concern with regards to the capital account in May-June, especially given the instability of oil prices.

Inflation returns to 0.1% per week http://www.bne.eu/dispatch_text15164

VTB CapitalMay 13, 2011

News: CPI inflation was reported at 0.1% WoW during the week of 4-11 May, with the YTD figure reaching 4.4%. The main drivers were food staples, most notably eggs (down 4% WoW), sugar (down 0.5% WoW) and vegetables (down 0.5% WoW). At the same time, fuel prices increased by around 1% WoW.

Our View: Inflation has returned to its trend of running a 0.1% price increase per week, from spiking to 0.2% last week. It seems that the government administrative measures continue to bring results (that said, fuel prices continued to rise, so the government can still do better here). However, we have also witnessed a severe tightening of liquidity as a result of the budget running a sizeable surplus (and thus withdrawing cash from the system). RUB appreciation likely also played a role. However, all these factors are transitory, as the government efforts never hold for long: due to the creativity of objects of control, the RUB appreciation is likely over and the Ministry of Finance will probably seasonally start releasing cash (rather than withdrawing it in the autumn). We therefore believe that the YTD inflation, now at 4.4%, makes our 9% YoY forecast continue to look appropriate.

Speaking of policy consequences, the CBR paid remarkably little attention to the running inflation in its latest statement, focusing instead on capital flows, real growth and credit market developments. Thus, we think that this CPI figure, which is right on the trend, is monetary policy-neutral.

Alexey Moiseev

CIS Wheat Competition http://www.themoscowtimes.com/business/article/cis-wheat-competition/436751.html

13 May 2011

Russia, Ukraine and Kazakhstan will increase wheat supplies and boost exports starting July 1, increasing competition for European and U.S. growers, the U.S. Department of Agriculture said.

Their wheat exports will be 26 million metric tons, more than double the 12.5 million tons a year earlier, the USDA said Wednesday. Russia's wheat exports will be 10 million tons, up from 4 million last year, from production of 53 million tons, up from 41.51 tons, the USDA said.

(Bloomberg)

Business, Energy or Environmental regulations or discussions

Fesco, Mechel, Norilsk Nickel, Novatek: Russian Equity Previewhttp://www.bloomberg.com/news/2011-05-12/fesco-mechel-norilsk-nickel-novatek-russian-equity-preview.html

By Ilya Khrennikov - May 12, 2011 10:00 PM GMT+0200

The following companies may be active in Russian trading. Stock symbols are in parentheses and share prices are from the previous close.

The 30-stock Micex Index fell 1.5 percent to 1,630.78 in Moscow, the weakest level since Dec. 1. The dollar-denominated RTS declined 2.3 percent to 1,864.95.

Fesco Transportation Group (FESH RX): Russia’s largest shipper of container cargoes will report its 2010 financial results. Fesco added 1.4 percent to 15.685 rubles.

OAO Mechel (MTLR) : The Russian coal and steel producer asked shareholders to allow the company to guarantee an acquisition by its Mechel Steel unit for as much as $537 million. Mechel fell 2.4 percent to 718.90 rubles.

OAO GMK Norilsk Nickel (GMKN RX): The world’s largest producer of nickel and palladium recommended a 2010 dividend of 180 rubles a share, or $1.23 billion in total. Norilsk rose 2 percent to 7,301 rubles.

OAO Novatek (NOTK RX): The Russian natural-gas producer controlled by billionaires Leonid Mikhelson and Gennady Timchenko is scheduled to report first-quarter earnings. Novatek fell 1.8 percent to 346.76 rubles.

To contact the reporter on this story: Ilya Khrennikov in Moscow at ikhrennikov@bloomberg.net

To contact the editor responsible for this story: Amanda Jordan in London at ajordan11@bloomberg.net

Sberbank May Buy BNP Paribas Russia Retail Unit, Kommersant Sayshttp://www.bloomberg.com/news/2011-05-13/sberbank-may-buy-bnp-paribas-russia-retail-unit-kommersant-says.html

By Marina Sysoyeva - May 13, 2011 6:24 AM GMT+0200

Sberbank is holding talks to acquire BNP Paribas (BNP)’s consumer credit unit in Russia, Kommersant reported, citing officials at Sberbank and in the banking business.

The Russian unit, which operates under the name Cetelem, started in 2007 and offers consumer and car loans in retail outlets and credit cards, the newspaper said. BNP Paribas declined to comment, Kommersant said.

To contact the reporter on this story: Marina Sysoyeva in Moscow msysoyeva@bloomberg.net

To contact the editor responsible for this story: Claudia Carpenter at ccarpenter2@bloomberg.net

Sberbank eyes BNP Paribas Russia retail arm –paperhttp://in.reuters.com/article/2011/05/13/bnpparibas-russia-sberbank-

11:07am IST

MOSCOW, May 13 (Reuters) - Russia's top lender, state-controlled Sberbank (SBER03.MM: Quote, Profile, Research), is in talks to buy BNP Paribas' (BNPP.PA: Quote, Profile, Research) Russian retail business, Kommersant business daily reported on Friday, citing two banking sources.

Kommersant said France's biggest listed bank is the No.7 player on the Russian retail lending market, working under the Cetelem brand.

A Sberbank source confirmed to Kommersant the talks were underway, while BNP Paribas declined to comment.

A number of international banks have recently pulled out of Russian retail banking, including Europe's largest bank HSBC (HSBA.L: Quote, Profile, Research) and Britain's Barclays (BARC.L: Quote, Profile, Research). [ID:nLDE73O047] (Reporting by Maria Kiselyova, Editing by Douglas Busvine and Will Waterman)

Troika Dialog Was Unprofitable in First Half, Vedomosti Reportshttp://www.bloomberg.com/news/2011-05-13/troika-dialog-was-unprofitable-in-first-half-vedomosti-reports.html

By Marina Sysoyeva - May 13, 2011 6:29 AM GMT+0200

Troika Dialog, a Russian investment bank, was unprofitable in the six months to end-March, Vedomosti reported today, citing an unidentified person close to the matter.

Chairman Ruben Vardanian refrained from giving figures, according to the report. Market volatility and Troika’s forthcoming merger with Sberbank, which distracted employees, were among the reasons for the poor performance, the newspaper cited Vardanian as saying.

To contact the reporter on this story: Marina Sysoyeva in Moscow msysoyeva@bloomberg.net

To contact the editor responsible for this story: Claudia Carpenter at ccarpenter2@bloomberg.net

Winsway Coking buy first Russian coal deposithttp://www.steelguru.com/raw_material_news/Winsway_Coking_buy_first_Russian_coal_deposit/204994.html

Friday, 13 May 2011Winsway Coking Coal Holdings, a Chinese importer of Mongolian coal listed in Hong Kong, said its holding company agreed to buy a Russian deposit for USD 90 million. The holding company aims to buy 60% of the Apsatskoye steelmaking coal deposit in East Siberia's Zabaikalsky region, about 1,000 kilometers from a rail link between Russia and China.

Winsway in a statement said that the deposit has an estimated 675 million tonnes of resources. Natural gas trader Itera bought the right to Apsatskoye in 2008.

The statement didn't give details of the remaining 40%.

Mr Dmitry Smolin a UralSib Financial analyst in Moscow said that "This could become the first purchase of coal assets in Russia by the Chinese.” He said that Russia may approve the deal as, unlike oil, gas and non-ferrous metals, coal isn't strategic.

China is ready to spend as much as USD 6 billion to double coal purchases from Russia to more than 20 million tonnes a year by 2016, the Russian Energy Ministry said in September.

(Sourced from Moscow Times)

Morgan Stanley could buy Moscow shopping mall for $1bn

http://www.rbcnews.com/free/20110513105947.shtml

      RBC, 13.05.2011, Moscow 10:59:47.U.S. investment bank Morgan Stanley is in talks to buy Moscow's third largest shopping mall Metropolis from property developer Capital Partners, RBC Daily reported today, citing senior executives of three consulting companies. The value of the deal could amount to $1bn.

      The U.S. bank could buy Metropolis' selling space, which measures 209,000 square meters. The entire shopping and office complex, located on the Leningradskoye Highway, measures 330,000 square meters. It also includes three offices and a parking space.

May 13, 2011 11:26

Russian seaports handle 0.7% less cargo in Jan-Apr – ASOPhttp://www.interfax.com/newsinf.asp?id=243288

MOSCOW. May 13 (Interfax) - Cargo-turnover at Russian seaports dipped 0.7% year-on-year to 166.4 million tonnes in the first four months of this year, according to the Association of Commercial Seaports (ASOP).

Cf

(Our editorial staff can be reached at eng.editors@interfax.ru)

Activity in the Oil and Gas sector (including regulatory)

Gas Agreement With China Likely by Start of Forum http://www.themoscowtimes.com/business/article/gas-agreement-with-china-likely-by-start-of-forum/436733.html

13 May 2011By Irina Filatova

Russia and China are likely to sign an agreement on natural gas supplies during the St. Petersburg International Economic Forum in June, presidential economic aide Arkady Dvorkovich said Thursday.

Gazprom and China National Petroleum Corporation hope to complete talks in the next weeks, he said. Gas is due to start flowing from Russia to China in 2015.

"As far as the agreement with China is concerned, the work on it is under way. Of course we would like this work to be completed before the start of the forum," Dvorkovich said at a news conference devoted to the St. Petersburg Economic Forum.

The two countries have been negotiating the final price of the gas since 2006, with China asking for a discount on the price that Russia charges European countries.

Chinese leader Hu Jintao will participate in the forum's opening ceremony together with President Dmitry Medvedev, who will be at the event for three days, from June 16 to June 18. Medvedev will join some sessions and hold bilateral meetings, said the Kremlin adviser, adding that the president will also chair a meeting of the consultative board he created to advise on making Moscow an international financial center.

Among other high-ranking guests expected to attend the event are Spanish Prime Minister Jose Luis Rodriguez Zapatero and Finnish president Tarja Halonen, who also attended the forum in 2009, Dvorkovich said.

Last year French President Nicolas Sarkozy attended the forum as a special guest.

This year's forum will focus on the new drivers of growth of the global and domestic economy after the financial crisis, said Economic Development Minister Elvira Nabiullina, adding that the event's budget had grown to 880 million rubles ($31 million) — up more than 11 percent from last year.

According to Dvorkovich, the results of the Group of Eight summit — which will take place at the end of this month in France — will affect discussions at the forum on the situation in the Middle East, the global commodity market and the development of the Internet.

At least one session will be devoted to the $10 billion sovereign fund created by the government to attract direct foreign investment. Details of the fund's strategy and the structure of its supervisory board will be discussed in St. Petersburg, Dvorkovich said.

Rosneft Still Weighing Arctic, Swap Deal Before May 16 Deadline on BP Deal

http://www.bloomberg.com/news/2011-05-13/rosneft-weighing-swap-of-bp-for-local-venture-in-arctic-deal-before-may-16.htmlBy Anna Shiryaevskaya - May 13, 2011 10:03 AM GMT+0200

OAO Rosneft, Russia’s largest oil producer, is still weighing a proposal to replace BP Plc (BP/) with the U.K. company’s local venture in an Arctic exploration deal as a May 16 deadline on a related share swap looms.

“The company will make a decision that best meets its shareholders’ interests,” Rustam Kazharov, a spokesman for the Moscow-based Rosneft, said by phone today. “The company wants to take a very balanced approach to making a decision.”

He declined to give a timeframe on a decision.

BP’s billionaire partners in the TNK-BP oil producer won an injunction in February on the Rosneft alliance, saying their shareholder agreement gives the venture exclusive

rights to pursue opportunities for BP in Russia. BP and its partners each own half of TNK-BP, Russia’s third-biggest producer, which accounts for about a quarter of BP’s output and a fifth of reserves.

According to a May 6 arbitration decision, BP gained the right to swap 5 percent of its shares for about 9.5 percent of Rosneft, Russia’s largest oil producer, as long as Rosneft agrees to take on TNK-BP as its partner for Kara Sea exploration.

To contact the reporter on this story: Anna Shiryaevskaya in Moscow at ashiryaevska@bloomberg.net

To contact the editor responsible for this story: Will Kennedy at wkennedy3@bloomberg.net

Russia TNK-BP minority shareholder sues BP –papershttp://in.reuters.com/article/2011/05/13/bp-russia-idINLDE74C04P20110513

12:51pm IST

* TNK-BP shareholder files petition to Siberian court

* Intends to sue BP over planned alliance with Rosneft

* Petition targets BP representatives on TNK-BP board

* Prokhorov estimates damages at $5-$10 billion

MOSCOW, May 13 (Reuters) - A minority shareholder in BP's (BP.L: Quote, Profile, Research) Russian venture TNK-BP (TNBP.MM: Quote, Profile, Research) intends to sue the British oil major in a Siberian court over its alliance with Rosneft (ROSN.MM: Quote, Profile, Research), Russian newspapers reported on Friday.

Andrei Prokhorov filed a petition to the Arbitration Court of the Tyumen Region on May 4, Kommersant and Vedomosti said, claiming $5-$10 billion damages for TNK-BP following BP's tie-up with state-run Rosneft for an Arctic exploration project.

The petitions were filed days before BP agreed to cede its role in the Arctic pact to TNK-BP, bowing to the demands of a group of billionaire shareholders who had fought a court battle to get a slice of the deal. [ID:nLDE7451OC]

Alfa-Access-Renova (AAR), the consortium representing the quartet of billionaires, had objected to the Arctic pact, saying BP was obliged to pursue all its Russian ventures exclusively through TNK-BP.

Both BP and AAR declined to comment on the court case on Friday.

News of the case came as a May 16 deadline nears for BP and Rosneft to finalise agreement on a share swap that was part of a deal agreed in January to search for oil in the Arctic offshore.

BP and AAR reached an arbitration agreement last week that would allow TNK-BP to function as the vehicle for the offshore pact, subject to Rosneft's consent, and allow the share swap to go ahead with restrictions.

BP and AAR are 50-50 owners of TNK-BP Ltd, which controls 95 percent of listed unit TNK-BP Holding. The remainder is in free float. (Writing by Maria Kiselyova, Editing by Douglas Busvine and Mike Nesbit)

TNK-BP minorities seek $10bn in damages from BP

http://www.rbcnews.com/free/20110513111308.shtml

      RBC, 13.05.2011, Moscow 11:13:08.Minority shareholders of TNK-BP have filed lawsuits seeking up to $10bn from U.K.-based majority shareholder BP for infringing their interests by entering into a cooperation deal with Rosneft, RBC Daily reported today.

      Vsevolod Miller, a lawyer from Yukov, Khrenov and Partners law firm, termed such lawsuits as frivolous. They are filed with the purpose of gaining large compensations and winning popularity. Only direct damages could be awarded and neither the minority shareholders of TNK-BP nor Russian consortium AAR, a majority shareholder, incurred direct damages from the BP-Rosneft deal.

TNK-BP shareholders prepare $5-10 bn BP suithttp://www.google.com/hostednews/afp/article/ALeqM5hCXZuW3KWfPd1Uo3TIIcztQYZOmw?docId=CNG.4232f6ae19eb54c58c9d35b7f0b4995b.6b1

(AFP) – 12 hours ago

MOSCOW — A shareholder of BP's Russian joint venture said Thursday said he had filed papers in preparation for a suit seeking up to $10 billion in damages from the British giant over its proposed tie-up with Rosneft.

The news came as BP counts down the hours to a Monday deadline to complete a historic Russian alliance that could either help reverse the company's flagging fortune or deliver another painful blow to its chief Bob Dudley.

Russia's Supreme Arbitration Court website said that TNK-BP shareholder Andrei Porkhorov's papers were filed in the western Siberian region of Tyumen on May 4.

A court official told Interfax that Prokhorov planned to seek $5-10 billion in damages from two divisions of BP but that his initial request to get access to the company's computer data had been denied.

Court records showed that separate papers were filed by Prokhorov and others against Peter Charow and Richard Scott Sloan -- BP's regional director for Russia and TNK-BP chairman of the board.

Prokhorov told Dow Jones Newswires said his rights as a shareholder were "violated by TNK-BP and BP".

He added that a formal suit had not yet been filed but that "we're considering it".

BP has until Monday to complete a $16 billion share-swap agreement with Rosneft that had initially also been due to include a deal to jointly develop Arctic oil reserves controlled by the Russian firm.

The Russian partners in the TNK-BP joint venture managed to block the Arctic portion of the agreement in court by arguing that it broke their shareholder agreement.

They also threatened to sue BP for damages after an arbitration panel ruled that TNK-BP had the right of first refusal on all of the BP's Russian projects.

BP had been planning to use TNK-BP dividend payments to finance the Arctic exploration work.

A revised deal negotiated under arbitration and announced by BP last week will potentially allow TNK-BP to take its parent company's place in the exploration project.

But Russia's state-controlled Rosneft has previously refused to work jointly with the local venture because of its relative inexperience and lack of access to international markets and deposits.

Rosneft has not commented on the terms of the revised deal.

Russia's Surgut proposes flat dividends on 2010http://in.reuters.com/article/2011/05/13/surgut-dividends-idINLDE74C0AH20110513

12:12pm IST

YEKATERINBURG, Russia, May 13 (Reuters) - Surgut (SNGS.MM: Quote, Profile, Research), Russia's fourth largest oil producer, said its board had recommended to pay nearly same amount in dividends from 2010 net profit as on 2009.

The board has recommended a dividend of 1.18 roubles ($0.042) per one preferred share and 0.5 roubles per one ordinary share, the company said in a statement.

It paid a 1.0488 rouble dividend on preferred shares and 0.45 roubles on ordinary stock from 2009 profits. [ID:nLDE64G0QP] (Reporting by Natalya Shurmina; writing by Maria Kiselyova; editing by Andrey Ostroukh)

Gazprom

Gazprom Neft in big profits hikehttp://www.upstreamonline.com/live/article256119.ece

Russia’s Gazprom Neft lifted its first-quarter net profit by 91% year-on-year to $1.437 billion, beating analysts' expectations thanks to better refining data.

News wires  12 May 2011 12:49 GMT

Analysts, polled by Reuters, expected net income to rise to $1.176 billion.

The fifth-ranked Russian producer also said its January-March 2011 revenues increased by 35% to $9.865 billion on the back of rising crude prices, while earnings before interest, tax, depreciation and amortisation were 56% at $2.467 billion.

"EBITDA growth was driven by an increase in refining throughput - an increase of 5.2% - as well as higher revenue from petroleum products sales in the domestic market," the company said in a statement, adding that the rise was tempered by higher taxes and tariffs.

Gazprom Neft, the oil producing unit of Russian gas monopoly Gazprom, said its hydrocarbon production increased by 7.6% in the first quarter. The company aims boost its oil output by 2020 to 100 million tonnes (745 million barrels) from about 60 million tonnes (450 million barrels) at present.

The company also agreed in April on a five-year $600 million club loan at Liobr +1.5%.

At 09:25 GMT, Moscow-traded shares in Gazprom Neft fell almost 4%, underperforming a 1.6% decline in the broader market .

Published: 12 May 2011 12:49 GMT  | Last updated: 12 May 2011 12:50 GMT

13.05.2011

Pakistan Seeks Cooperation With Gazprom on Gas Pipleineshttp://www.oilandgaseurasia.com/news/p/0/news/11369

Pakistan will make an offer to Russian energy giant Gazprom, the largest extractor of natural gas in the world, to participate in two multi-billion-dollar gas pipeline projects – Iran-Pakistan (IP) and Turkmenistan-Afghanistan-Pakistan-India (TAPI) projects, during President Asif Ali Zardari’s visit to Russia.

Prime Minister’s Adviser on Petroleum and Natural Resources Dr Asim Hussain, who is accompanying the president, will brief the Russians about progress on the gas pipeline projects.

Secretary Petroleum Ijaz Chaudhry said that a memorandum of understanding (MoU) on energy cooperation with Russia would also be signed to engage Russian companies in oil and gas exploration in Pakistan.

Gazprom had shown interest in building energy storage facilities in Pakistan. During a meeting of the Pak-Russia Inter-Governmental Commission held in September last year in Russia, Pakistan had invited Gazprom to lay a pipeline for the IP gas project.

Copyright 2011, The Express Tribune. All rights reserved.

Gazprom faces $8 bln hit from taxes, price curbshttp://in.reuters.com/article/2011/05/12/gazprom-taxes-idINLDE74B16G20110512

Thu, May 12 2011

* Gas sector faces 150 billion rouble tax hit

* Lower tariffs growth to cost Gazprom 73 billion roubles

* Analysts see risk to investment case for gas sector

By Vladimir Soldatkin

MOSCOW, May 12 (Reuters) - Russia, looking for new revenue sources and keen to curb inflation before elections, plans to hit Gazprom (GAZP.MM: Quote, Profile, Research) with a double whammy of a tax increase and a lower gas tariff rise that would cost the company $8 billion.

Prime Minister Vladimir Putin, who is considering running in the 2012 presidential election, told his government last month to consider scaling back planned increases in regulated tariffs for household utilities like gas and electricity.

The move was mainly aimed at Gazprom, which was to have been granted a 15 percent increase in domestic gas prices in 2012. Now the government wants to peg tariffs to inflation, which it targets at 5-6 percent next year.

"If tariffs are tied to inflation, Gazprom may lose 73 billion roubles ($2.6 billion) in 2012," Economy Minister Elvira Nabiullina told reporters on Thursday, expressing concern that the cost could affect Gazprom's investment plans.

Finance Minister Alexei Kudrin also plans to hike mineral extraction tax (MET) on gas from 2012 -- after it was increased by 61 percent this year -- and introduce more export fees.

These measures would cost Gazprom, the state-controlled export monopoly that accounts for nearly 80 percent of Russian gas production, and the rest of the industry an additional 150 billion roubles ($5.4 billion).

Together with restraining tariff growth that would cost as much as $8 billion next year -- equivalent to nearly a quarter of its 2010 earnings.

INVESTMENT CASE

Gazprom sells 40 percent of its output in Russia and charges industrial consumers $103 per thousand cubic metres (tcm), while households pay less. That compares with an average export price of $346 to Europe in the first quarter.

CEO Alexei Miller has forecast that export prices, which are linked to oil with a six- to nine-month lag, will reach $500 per tcm by the fourth quarter.

While export prices fluctuate with oil, it has been planned growth in domestic prices that has underpinned the investment case for Gazprom, which forecast earlier this year it would add $24 billion to revenues between 2011 and 2013.

Gazprom posted earnings of 968.6 billion roubles ($34.6 billion) last year on sales of 2.99 trillion roubles. Export sales declined 1 percent to 1.1 trillion roubles as it faced lower-cost competition from liquefied natural gas.

"In effect, a lower-than-planned hike in gas tariffs would destroy the investment case for the gas sector in Russia in the short term," Troika Dialog brokerage said in a note.

Gazprom shares fell by 3.6 percent in Moscow to 203 roubles at 1400 GMT, outpacing a decline by the MICEX index .MCX of 2 percent. The stock has fallen by 18 percent from its high for the year on April 11.

The oil and gas sector accounts for more than half of federal budget revenues, but gas production is subject to a much lower effective rate of mineral extraction tax than crude oil.

The state has been increasing pressure on the energy sector in the run-up to parliamentary election in December and the presidential poll in March, abolishing tax breaks on new oil fields to help fund increased spending in the 2012 fiscal year.

In February, Putin ordered a restriction on price rises at filling stations across the country, in one of a series of administrative measures aimed at curbing inflation then on the brink of double digits.

The price curbs led refiners to boost exports, causing fuel shortages in some regions that forced the government to hike gasoline export duty in May. Nabiullina said the higher duty could be extended to June. (Additional reporting by Darya Korsunskaya; editing by David Cowell)

Gazprom discloses pipeline construction costshttp://www.bne.eu/dispatch_text15164

VTB CapitalMay 13, 2011

News: Gazprom has disclosed construction cost data for the company's major pipeline projects, Bovanenkovo-Ukhta and Sakhalin-Khabarovsk-Vladivostok. The official estimates exceed our expectations by a significant margin. According to the company, the Bovanenkovo-Ukhta pipeline (to be constructed in 2007-15) will be worth almost RUB 1tn (USD 40bn) in 2008 prices, which translates into as much as USD 18mn/km. Sakhalin-Khabarovsk-Vladivostok, on which construction is due to end by 2020, is likely to be worth around USD 15bn (USD 8.7mn/km). These projects are the most capital intense ones, both historically and compared with similar projects elsewhere.

Our View: The reported numbers suggest more room for capex inflation, supporting our earlier argument that Gazprom will come up with increased capex estimates later this year. We view this as a negative development, which somewhat offsets our bullish stance on the European gas market d ynamics this year. We currently estimate Gazprom's capex at just over USD 30bn in 2011, but further management decisions this year could prompt us to review both our capex estimates and FCF assumptions. Along with continuing taxation concerns, this latest news undermines near-term sentiment in the stock.