KURILES. I’m mystified why this issue has suddenly boiled up. Perhaps Medvedev’s visit last November has driven the two capitals into the inevitable rhetorical exchanges. Attempts are being made to calm things down: the two foreign ministers have promised to talk calmly and the chief of Antiaircraft and Missile Troops, responding to a suggestion that S-400 SAMs be deployed there, dismissed the idea as excessive and dangerous. The principal Japanese opposition leader has criticised his government for its language. At present each claims the islands and it is not easy to see how a compromise can appear. But there is at least one international example that might serve as a model – the Åland Islands.

KHODORKOVSKIY. An aide to the judge who sentenced Khodorkovskiy and Lebedev to another prison term has said: “Higher echelons didn’t like the verdict, so it was replaced by another one”. The judge denies it, and, although the aide fully expects to be fired, the court says “it has no plans” to do so. Apart from any other considerations, there has always been a strong political content to the prosecutions because Khodorkovskiy was trying to gain control of the Duma and thence the government.

POLICE REFORM. A detailed analysis of the new law is presented here by my colleague Gordon Hahn. On paper the reform looks good and even if execution is only 50%, it will be a huge improvement.

TOURISTS. One of the more noticeable changes since 1990 is that Russian tourists are all over the place (enough, as I have observed myself, to make it worthwhile to print souvenir booklets in Russian). According to RIAN, 2009’s three favourite destinations were Turkey, Egypt and China; there were about 7 million Russian tourists.

RUSSIA-UK. Moscow-London relations have been rather bad for some time. Moscow is not amused that Berezovskiy has a safe haven there to continue his attempts to overthrow the Russian government and there have been several painful events regarding British companies. The Litvinenko affair irritates both capitals. But, very gradually, relations are improving. Foreign Minister Lavrov has been visiting and so far, the atmosphere seems to be cautiously friendlier. But there is a long way to go: perhaps a serious investigation of the Litvinenko affair would be a good place to start.

EDUCATION. It’s being reformed too. The ministry has posted the projected standards for high school education (Russian) on its website; the idea is to encourage public discussion. Subjects will be taught at “minimum” and “dedicated” levels depending on the student’s choice. Subjects will be grouped as follows: Russia and literature (including the appropriate second language: eg Tatar, Ossetian et al); foreign languages; mathematics and computer science; social sciences; natural sciences; arts or an optional subject. Four subjects will remain compulsory: Russia in the World, life safety basics, physical training and a personal research project. This is supposed to come into effect in 2020. What ought to strike an observer from the West is how solid these subjects are.

CORRUPTION. Yesterday the FSB raided a Moscow Oblast police station over alleged links to illegal gambling; two police officers having been arrested the day before. Medvedev has submitted a draft law to the Duma increasing penalties for accepting bribes and kickbacks.

LUZHKOVS. Police have raided Baturina’s company Inteco. I do believe that we will see charges laid eventually.

COSSACKS. Medvedev has proposed the creation of an All-Russian Cossack Association to unite Cossacks. “The Cossack Question” is something that never quite seems to get off the ground. They exist – or at least there are people who believe themselves to be Cossacks and organise themselves that way – and from time to time the government has muttered about Cossack self-defence organisations, Cossacks assisting the police, or Cossack units in the Army, but nothing much ever seems to happen.

DEMOS. Now there are plenty on Moscow – although none very large. Fearing another nationalist rally, police cordoned off Manezh Square last week and made some arrests. A sanctioned “anti fascist” rally organised by the Caucasus Congress passed off quietly. The sanctioned “Day of Wrath” rally attracted a few hundred but arrests were made as the Left Front movement leader Sergey Udaltsov attempted to move to the Presidential Administration building. I suppose that protests about the inability to protest will die away.

© Patrick Armstrong Analysis, Ottawa, Canada (see http://www.russiaotherpointsofview.com/)

POLICE REFORM. The Police Reform Bill has been passed and signed into law; a simple summary of it by RIA/Novosti is here. Symbolically they will now be called “Police” rather than the revolutionary-sounding “Militia” and will get new uniforms resembling, we’re told, the Tsarist ones. Perhaps the most important part of the reform is that presently serving police will interviewed for their jobs, so to speak, and 20% will be let go. This last strikes at the heart of the problem, which is that too many serving police are corrupt and incompetent. But, as a former bureaucrat myself, I doubt that the process will thin them out much. This is undeniably another step but it takes a long time to change.

ARMS TREATIES. With the new START out of the way – Medvedev signed on the 28th and Obama on the 3rd – there is talk of new arms control discussions between Washington and Moscow. Obama said Washington intended to initiate talks on tactical nuclear weapons, of which Russia is believed to hold many more than the US. At the Munich security conference the Russian Foreign Minister called for re-animation of the CFE Treaty which Moscow finally denounced after NATO kept piling conditions on ratification. This was a particularly useful treaty: it was one of the few disarmament treaties that actually destroyed weapons and the inspection regime and data exchanges were great confidence and transparency builders. At the same conference the US Secretary of State called for cooperation on missile defence and talks at NATO began today on that subject.

THE THIRD TURN. The only mention of Russia in the new US National Military Strategy document speaks of cooperation.

KURILES. Yesterday Medvedev held a meeting with the Regional Development and Defence Ministers regarding the Kurile Islands and gave instructions to improve living conditions and defence readiness. At the same time it was announced that the first two Mistral class ships will be based in the Far East. The island chain runs from Kamchatka to Hokkaido; the issue with Japan relates to islands at the south of the chain: specifically Iturup, Kunashir, Shikotan and a few tiny islands (Habomais), not those north of 45º30’. But, as it happens, the troops that Russia has out there are based on the first two. This is an issue that is very neuralgic in Japan and is legally rather murky. For a long time it was a block in investments – although perhaps no more with the new Toyota agreement. Why Moscow is today talking about defence of these rather insignificant and poverty-stricken islands I do not know.

LUZHKOV’S MOSCOW. The noose does appear to be tightening, The Audit Chamber’s investigation, at the request of the new Mayor, found significant misspending on the transportation sector (especially on Moscow City’s airline – !!??). The head of the Metro resigned amid allegations of unlawful diversion of funds. Luzhkov himself is not having a lot of luck at finding a safe haven.

31. Alexeyeva’s demonstration attracted about 500 people and passed off without incident. When it finished Limonov and a few dozen tried his: they were arrested but quickly released.

KHODORKOVSKIY. Some see hints of a pardon for Khodorkovskiy and Lebedev in Medvedev’s request to the “legal expert community” to look into the case. The Moscow City Court has opened review proceedings on the second trial. But for a pardon Khodorkovskiy has to admit his guilt and this he has said he will not do.

CORRUPTION. The Public Chamber has announced that it will open a phone hotline and a website to receive citizens’ reports of official corruption; perhaps it will name corrupt officials: one author says it will be a “hall of shame”. This follows another reporting site created by the tax service last month

DOMODEDOVO BOMBING. More security chiefs have been fired; two suspects have been arrested. Doku Umarov, the leader of Caucasus Emirate, claimed credit for the bombing but the authorities doubt it, saying that it was an independent cell.

KAZAKHSTAN. Nazarbayev has modestly admitted that he’s prepared to serve for as long as the people want him. In short he will run in April and win. Perhaps he should look at the news from Tunisia and Egypt.

BELARUS. Minsk is back in the Western doghouse with the USA and the EU imposing new sanctions; on the other hand it is reported that nearly all the problems with Russia have been solved.

© Patrick Armstrong Analysis, Ottawa, Canada (see http://www.russiaotherpointsofview.com/)

DOMODEDOVO. A suicide bomber team killed and wounded many in the arrivals area of Domodedovo Airport. Not the first time jihadists have attacked outside the security zone and we will see more. It is possible that this attack may wake up Westerners to the reality that it’s all the same thing: the NORAD commander appears to understand. On the other hand, others still blame the “Putin system”; one assumes these editorialists blamed the December Stockholm bomb on the “Reinfeldt system”. Medvedev has dismissed several officials, blaming lax security. Some of this is the ancient Russian tradition of pretending to solve the problem by firing somebody, but it also fits with Medvedev’s policy of clearing out deadwood.

START. The Duma finally ratified the agreement on Tuesday by a comfortable margin and the Federation Council did so the next day. The question of missile defence is still a potential stumbling block and Russia will denounce the Treaty if it feels US developments in this area threaten it. But that was always the reality and one hopes that a rational settlement will be found.

OPPOSITION ALLIANCE. The alliance of Limonov and his NatBols with the liberals, about which so much was written a few months ago, appears to be over. It was always unnatural: the two groups have quite different aims, no matter how much they may share a dislike of Putin. Lyudmila Alexeyeva appears to be emerging as the principal leader; she has the advantage of not being tainted by the Yeltsin years and Putin cannot say about her what he said about some of the Yeltsin-era oppositionists: “they want to come back and refill their pockets”. She has broken with Limonov who is now calling himself head of the Other Russia party but doesn’t appear to have taken over the website (registration of his party was turned down yesterday). The authorities are probably not unhappy with this development and Moscow City has (again) given permission for her group to demonstrate on the 31st but not Limonov’s. Limonov will likely show up anyway for some street theatre.

THE NEW MEDIA. Medvedev, who must be one of the most Internet-savvy leaders around, had quite a bit to say about it at Davos. It leads to the “creation of communities of people… in different countries… by a shared goal or idea, and no national government can claim to have a strong impact on such communities” (as we see in Egypt and elsewhere today). There are dangers that criminals or terrorists use it. But “this universal connectedness must become a powerful driver of economic growth”. He promised “Russia will not support initiatives that may jeopardise Internet freedom”. There is general agreement that the New Media flourishes in Russia and the government leaves it alone.

LENIN’S TOMB. I think it’s finally going to happen. The official line has always been that the body will be buried in St Petersburg when the population wants it. A Duma Deputy started the current campaign and there is a website on which people can vote; so far a solid majority wants the body moved out of Red Square. So, what will replace the Mausoleum? My bet is whatever was there before. And what about the Kremlin wall necropolis, Stalin’s ashes and all the rest of the Communist Pantheon? Surely, if Lenin goes, Stalin and the others have to too.

ANOTHER OIL ENGAGEMENT PARTY. RosNeft and ExxonMobil have made an agreement to jointly develop hydrocarbon findings in the Russian part of the Black Sea. The wedding season has come early to Russia!

MURDER. Last week another mass murder was discovered – most of a family of a local crime boss was found dead in a garage in Stavropol. Will it be discovered, in this case too, that the local authorities were providing cover for him or for his murderers?

KACZINSKI CRASH. Two defenders of the Russian findings have spoken up. David Learmount accepts them. Poland’s lead investigator agrees. As the first said of the report: “It does not make happy reading for the Polish people or their government, and indeed they are finding its truths difficult to swallow”.

FRIENDS AGAIN. It is claimed that practically all the problems between Moscow and Minsk have been resolved. Of course, now that the West has decided it doesn’t like Lukashenka (again), he doesn’t have many alternatives. There was a brief moment there when Belarus was being spun as a fellow victim of Moscow’s “gas weapon”.

© Patrick Armstrong Analysis, Ottawa, Canada (see http://www.russiaotherpointsofview.com/)

CORRUPTION. A reasonably big fish was hooked yesterday: the head of the CIS anti-organised crime bureau (!), Alexander Bokov, was arrested in Moscow on embezzlement charges. The case seems to be that he extorted a large bribe and then trousered it. A couple of days earlier a case opened in Altay in which several officials were charged with hunting endangered animals two years ago. The former Mayor of Barnaul was charged with what looks to be a privatisation swindle six years ago. Last week the Interior Minister said that “Criminal proceedings were launched against some 10,000 officials, one-third of them were started for taking brides”. The tax Service has opened a 24/7 phone line and e-mail address so that citizens can report corruption examples. This is not nothing; gradually the campaign is starting to bite.

PEOPLE POWER. Russia has its own “WikiLeaks” site: RuLeaks.net. Allegedly shut down for its photos of “Putin’s Palace”, I was able to get on the site without difficulty. The “palace” is surely a state-owned guest house and not Putin’s personal property. As in other countries, high state officials spend their time in elaborate facilities without paying rent. But the story is here (although the source is the Washington Post which never misses a chance to take a shot at Russia).

BP AND ROSNEFT. The two companies have struck a deal to explore oil deposits in the Kara Sea and exchanged blocks of shares to cement their apparent alliance.

SPIRIDOV. Saturday’s rallies in St Petersburg and Moscow commemorating his murder passed off mostly peacefully although police arrested some people they suspected were participants in the riots. An informed summary of what is known and what is speculated about the murder and the immediate police reaction is here.

WHERE DOES THE MONEY COME FROM? A Duma Deputy has asked the Prosecutor General to investigate whether Boris Nemtsov is being funded by foreign sources (illegal under Russian law). I also wonder.

PROTESTS. Now that they are getting demonstration permits, there will be two things to watch. First, is there any point to the “31” rallies protesting their inability to hold rallies? But more interestingly, I suspect we will see a split between the “liberal” protesters like Alexeyeva and Limonov. The fissure is visible already.

NORTH CAUCASUS INVESTMENT. The Presidential Envoy to the North Caucasus has announced that 37 investment projects worth US$13 billion are planned for the area. Given the difference between plans and reality and the “corruption tax”, I wonder how much of this will actually hit the ground.

MISTRAL. As expected, Moscow chose the French ship. Two will be built in France and another two in St. Petersburg and delivery of the first is expected in three years. Latvia and Lithuania are not best pleased: this should lead to some entertaining encounters in the corridors of NATO.

KHODORKOVSKIY. A book of writings and interviews has just been published in Moscow. For someone buried deep in the Russian penal system, he seems to be able to get his words out rather easily.

POVERTY. In what he says is a protest against poverty in Russia, a Yekaterinburg student says he will attempt to live for a month on the official minimum food cost. His blog is said to be here (but I can’t open it). I wonder who will be the first to opine that this is comparable to Mohammed Bouazizi’s suicide and heralds the (long-predicted) end of the “Putin system”.

KACZYNSKI CRASH. Last week the Russian committee published its report (Eng Rus); the crew was blamed. This has not pleased the Polish side. The Interior Minister thought Russian air traffic controllers had some responsibility while Kaczynski’s brother’s reaction is much stronger. President Komorowski and PM Tusk are also critical, although the latter added that opposition members who were calling it “murder” or a “terrorist attack” were wrong to do so. In response, the Russian side announced it will publish complete transcripts of all the conversations. I do not fully understand what is happening: I suspect national embarrassment and internal politics. Personally I think Lech Walesa is right when he said, admitting it was “difficult” to do so: “everything they’ve done in regard to the Smolensk case deserves recognition and thanks, not sputtering”.

UKRAINE. Former President Yushchenko was summoned to the Prosecutor General’s Office to discuss the poisoning story. I have always thought the standard story very fishy and am glad that the case is still open.

© Patrick Armstrong Analysis, Ottawa, Canada (see http://www.russiaotherpointsofview.com/)

FISSURES. Last month exposed, in a way that cannot be ignored, two serious fissures in Russian society. Long-simmering ethnic tensions and their concomitant gangs boiled over and the collaboration of local authorities and criminal groups was revealed in three places. A soccer fan was killed in Moscow in a brawl in early December, apparently by a Caucasian; the suspect was arrested but quickly released (or so Medvedev and Putin said). Protests became riots as the gangs took over. The worst was on 11 December in central Moscow. The police have been taking preventative actions (most recently on Saturday). This problem has been growing for years and the authorities haven’t done much (but the trial of two super-nationalists for the murders of Markelov and Baburova has begun). A series of murders in a small town in Stavropol Kray in November uncovered a criminal gang that had been operating with cover from the local authorities for years. Then an open letter revealed a similar situation in a town near Moscow. Thirdly, the long-suspected belief that there is a connection between the local Khimki administration and attacks on reporters was given support by the arrest of members of the administration. What may tie these two phenomena together is the fact that ethnic gangs can be hired to do violence on behalf of their paymasters. Some will blame this on the “Putin system” but he is not the author of “legal nihilism” – that has very deep roots. But it is a failure: as he said, “I think the entire law enforcement system has failed.” It did, and as PM and President before, he is part of that system. But how do you change it? You can’t fire all the police, good and bad, and then gradually create a better force: see what happens even in “rule of law” countries when the police are absent. Reform can only happen incrementally: corrupt officials arrested where detected, laws and procedures reformed, checks and balances introduced (Medvedev justified creating an independent Investigation Committee “in order to have them do their job properly, i.e. keep an eye on each other”). It has to be gradual; even if pushed with determination, the goal will never fully be achieved and there will be many failures along the way.

CORRUPTION. Bit by bit. In addition to the above, two Moscow police officers were charged with kidnapping a businessman for ransom. The director of Tula Oblast’s Department of Land and Property Relations was arrested on suspicion of demanding a bribe for giving planning permission for a business.

DIVISION OF LABOUR. Reading the Q&A sessions of Medvedev and Putin, I see that Putin is deep in the minutiae (suburban train schedules, health centres, sports infrastructure) while Medvedev is at high altitude (foreign affairs, long-term projects like “modernisation”; reflections on Russia’s culture of belief in “the good tsar and physical force”). About the only points they both touched on was the economy’s relatively good year (at least as compared with what many feared) and the value of the present system of appointing regional leaders. (Their argument is that leaders appointed this way will be better – and less corrupt. Recent events are unlikely to change their minds). I have the impression, by the way, that Putin is much happier in the details. He has remarked that he is “fed up with foreign policy”.

KHODORKOVSKIY. Khodorkovskiy and Lebedev were found guilty. Western opinion was predictable: “Russia hits back at West” being an extreme (No. That’s not why it happened) with some even suggesting that his real crime was being an honest businessman. Eugene Ivanov gives a better informed (and informing) discussion here. But he makes the observation that the new charges look rather like the old ones re-named. The strong flavour of political expediency will be a setback for Russia’s improving reputation.

PEOPLE POWER. A win and a loss: the Okhta Centre will be built but not in the centre of town and the highway will go through the Khimki Forest (although environmental compensations are promised).

KACZYNSKI CRASH. The official Russian report is on the Net (Eng Rus); poor crew training and interference from the high officials on board are blamed. Kaczynski’s brother is not happy with it.

BUREAUCRACY. Medvedev has ordered the reduction of federal officials by 20% by 2013. Many have tried but few have succeeded: bureaucracies are very tenacious animals.

INTERNET. Readers will know that I keep an eye on Russian Internet use (probably because I personally have little use for the Old Media). At last someone else has noticed how big and healthy it is in Russia. By the way, Russians can read translated selections from the Western media here (including uncomplimentary stuff).

© Patrick Armstrong Analysis, Ottawa, Canada (see http://www.russiaotherpointsofview.com/)

MEDVEDEV ADDRESS. He gave his annual address in Tuesday (Russ Eng not available yet). These things are never high rhetoric but are rather a list of points, mostly about domestic concerns. I haven’t read the whole thing yet but Medvedev’s now-customary themes of modernisation, bettering the lives of ordinary people, police reform, the environment and corruption were all present. As far as foreign issues were concerned, we see again the long-time message that Russia is prepared to cooperate but not to be taken advantage of.

OPENING. Two more little signs of things being loosening. Putin announced in Berlin that procedures for foreigners to buy shares in strategic sectors of the economy are to be simplified soon. (How is that going to fit into the Medvedev vs Putin meme? Is there now another, hitherto unnoticed, struggle between Putin I and Putin II? Wouldn’t it be simpler to say that The Team is working on the next stage of the plan?) A Presidential Aide followed this up by stating that visa requirements for high-profile foreign professionals working in Russia will soon be simplified. Obviously something is being prepared.

KHIMKI FOREST. The highway proposal and the future of the forest is an illustration of all that is wrong with Russia today. This piece gives an indication of the interests struggling under the blanket.

PUTIN CNN INTERVIEW. The only thing that struck me as different from what one would expect was the admission that the spy ring in the USA was real. “Let me make it clear once again that we’re dealing here with deep-cover agents, who only become active during crises and when diplomatic ties are severed, when other forms of intelligence become ineffective or impossible.”

QUIETLY, IN THE BACKGROUND. The Atlantic Monthly reveals a story of successful US-Russian cooperation in a tense moment in Libya last year. I’m sure there’s a lot more of this sort of thing going on than we hear about.

QUOTE OF THE DAY. Foreign Minister Lavrov said “WikiLeaks is an amusing read, but in practical politics we are going to be guided by the concrete actions of our partners”.

KATYN. On Friday the Duma passed a resolution that the Katyn massacre was carried out by order of Stalin; the Communists, keeping faith with themselves, still say the Germans did it. I really don’t understand the need for a declaration; after all, the actual document has been out there for a long time. But it pleased Poland and it is the truth. It is also a prelude to Medvedev’s visit to Poland next week.

REPORTERS. A bill imposing harsher punishments for attacks on reporters has been submitted to the Duma.

THE LITTLE COMPANY THAT GREW. It is announced that PepsiCo will pay US$3.8 billion (!) to buy 66% of Wimm-Bill-Dann. I remember its very small start when it chose the name to give the impression that it was from Denmark or some other clean and healthy place.

MORE TROUBLES FOR LUZHKOV? An investigation claims to have turned up numerous examples of violation of construction regulations on the MKAD. I am starting to believe that it is not unimaginable to think that we may see the Luzhkovs on the dock one day.

MOLDOVA. Sunday’s parliamentary elections will continue the deadlock: the Communist Party did best but neither it nor the ruling coalition will have enough seats to elect a president. And, tossing a match into gasoline, Romania’s President said that Moldova could become part of Romania in the next 25 years. Moldova joining Romania was the casus belli of the fighting in the early 1990s. Readers are reminded that Stalin added a slice of the Ukrainian SSR (today’s Transdnestr) to the bits of Romania that he ripped away in 1940. The inhabitants of Transdnestr did not want to be submerged in Romania and the fighting began. There used to be talk of a constitutional amendment allowing Transdnestr to opt out if Moldova were to join Romania but that appears to have fallen by the wayside. Stalin’s legacies just never go away.

GEORGIA. Last week the opposition held a protest against Saakashvili led by Burjanadze’s group; several thousand showed up. No doubt the opposition has been re-activated by Saakashvili’s evident intention to stay in power forever. There were two bomb explosions in Tbilisi on Sunday, one at an opposition party headquarters. As to who did it, take your pick: the government or “forces outside the country”.

KYRGYZ REPUBLIC. Three parties have agreed to form a coalition in parliament. This is to the good.

© Patrick Armstrong Analysis, Ottawa, Canada (see http://www.russiaotherpointsofview.com/)

NATO-RUSSIA. A major change, at least on the rhetorical level. NATO adopted a new Strategic Concept. About Russia it said: “NATO-Russia cooperation is of strategic importance… we want to see a true strategic partnership between NATO and Russia… the security of NATO and Russia is intertwined”. Medvedev attended the last day and a joint statement reiterated the above. Russia was invited to join a Europe-wide missile defence system. Medvedev welcomed all this at the press conference. Undeniably a major step forward in cooperation, quite unimaginable two years ago. But, given that I regard NATO as little more than a “rhetorical organisation”, implementation will have to come from bilateral activity. As a first result Moscow has signed an agreement that NATO’s military equipment can pass through Russia; in both directions it seems.

CORRUPTION. Ella Pamfilova gives the most intelligent discussion of what she calls Russia’s “systemic corruption” I’ve seen so far, neither the extreme of “nothing is happening” nor that it’s all under control. (JRL/2010/216/2). Formerly human rights council head, she now heads the Russian branch of Transparency International (it is reported that she will receive the Order of Honour “for her longstanding productive government activity”). She said that before changes in 2008, Russian law had been completely inadequate. For her the principal problem is people “ensconced within the regime” feeding off state contracts. She was insistent that there must be the possibility of bottom-up action: media freedom is essential; informers must be protected; elections give the possibility of removing corrupt officials whereas, if appointed from above, “there is absolutely nothing that people can do”. The Web will also help. (“If you can electronically enrol your child in a kindergarten, who are you going to pay — the computer?”). Visible arrests of important people are necessary: the effort has to be seen to “draw blood”. Worth a read.

POLITICAL COMPETITION. There isn’t much in Russia. “Liberals” only quarrel with each other, Zhirinovskiy and the Communists have a comfortable existence inside the status quo, and the pedestal party sweeps up those who want to be in tight with Power. As for Just Russia, it exists, but I don’t see how there can be two parties of power with slightly different flavours. United Russia is reported to support Medvedev’s initiative to encourage political competition. Of course the Pedestal would never be seen to disagree with the Statue, but UR members have little interest in sharing the fruits of obsequiousness. Political pluralism cannot come from the top and there isn’t a lot of evidence, over the past 15 years, to suggest that it is coming from the bottom.

INFRASTRUCTURE. Medvedev worries about infrastructure, saying “According to estimates, over 60% of the public utilities infrastructure has outlived its service life”. Fortunately Russia these days has the money to do something about it. I keep thinking that Eisenhower’s highway development is a model of how Russia can grow. It can be done mostly with internal resources, it creates wealth as it is done and creates wealth when it is finished. But investment is happening: see below.

FACTORIES. I was intrigued with the pictures of this pipe-making plant in Chelyabinsk. A reminder that, while the foreign MSM obsesses with Medvedev v Putin speculation, many more important things are happening. The pipe plant reminded me a bit of this ultra-modern VW plant in Dresden. Also see this small lumberyard (although they could use some protective equipment) and a plethora of modern equipment at Domodedova. Most of the equipment appears to be foreign, but that’s an indication that energy revenues are not being squandered. (Thanks to Arthur Vanzetti).

POLITKOVSKAYA. It is reported that Russian investigators are looking for her killers in Belgium. The investigators have all along said the person who ordered the killing is in Europe.

GEORGIA. On Tuesday Saakashvili told the European Parliament “that Georgia will never use force to restore its territorial integrity and sovereignty, that it will only resort to peaceful means”. Moscow and Sukhum are sceptical. As am I: he wouldn’t be saying this if his attempt to use force had succeeded two years ago. It’s a stunt. Unless it’s a declaration to South Ossetia and Abkhazia witnessed and guaranteed by everyone else; but I’d be very surprised if he did that. Meanwhile the opposition has started up again.

KYRGYZ REPUBLIC. The trial of former President Bakiyev and other officials for ordering the violence against the protesters in April has begun. He, still in Belarus, denies responsibility.

© Patrick Armstrong Analysis, Ottawa, Canada (see http://www.russiaotherpointsofview.com/)

PRIVATISATION. The government has approved a privatisation plan for state-owned entities. Economic Development Minister Nabiullina hopes that it could raise US$33 billion over the next 3 years. Some big entities will be affected. But only United Grain Company is fully for sale; for all the others the government will retain the dominant share and, therefore, control. So it’s not clear how attractive small pieces of these companies will prove to be. The other problem of course is that the big privatisations of the 1990s were rigged, the government got little and well-connected individuals became super rich. But there are some important differences today – apart from better government control. The assets of Soviet-era monster companies of the 1990s were entwined with enormous debits owing to the Soviet custom of running social amenities out of factory complexes. Therefore it was difficult to work out what a fair price for something like, say, Norilsk Nikel would have be. While the buyer acquired some valuable plant and a big supply of the raw material, he also essentially had to take responsibility for the city, which in true Soviet style, was little more than an extension of the plant. So together with things a buyer actually wanted came polyclinics, rest houses, soccer teams, some incredibly obsolete plant (part of the “assets” was machinery put in Finland in the 1930s by Inco and shipped back to the USSR as war booty), egregious over-manning and so on. One assumes the companies now for sale are leaner and more efficient. To my mind the main significance of the privatisation is that it is another step in Medvedev’s mission of loosening control. It will also be a test of legality and transparency.

NATO-RUSSIA. More straws in the wind. The Russian Foreign Minister said Moscow was ready to cooperate with NATO on missile defence on condition that the security of all nations was taken into consideration (whatever that means). And the Air Force Commander says he’s ready too. A session of the NATO Parliamentary Assembly emphasised the importance of relations with Russia. It sounds more and more if the coming NATO summit will have some agreement on missile defence with Russia.

CASPIAN. At long last the various presidents met in Baku and, according to Medvedev, agreed to divide the Sea up along national lines. The obvious solution, now that most of them have found hydrocarbons in their own patch, but a long time coming.

THE THIRD TURN. Readers will recall I have been talking about a change in the West’s perception of Russia. The first – big brother helps little brother – didn’t come to much; the second – the Russia enemy meme – failed reality. I believe a third, calmer and more realistic, is underway. My argument is here.

LUZHKOVS. A spokesman for the Investigative Committee says a criminal case has been launched into the sale of land to companies connected to Yelena Baturina, Luzhkov’s wife. They might be nibbled to death by cases.

RUSSIA INC. RosStat informs us that fixed capital investment has begun to grow – up about 10% year-on-year.

FEDERATION COUNCIL. More mutterings that members of the Federation Council should be directly elected: this time from the Speaker. The system has been through several variations: if I remember aright they were first appointed by the President, then there was a period when the local heads were ex-officio members, and now they are selected by the ruling parties in the regions. I expect direct election for these (and governors) will come in the next five or so years.

AUDITS. The head of the Russian Audit Chamber has announced that the efficiency of the Ministry of Defence’s arms procurement practices will be examined next year. The Russian Audit Chamber now – and for some years – sees its job not just checking that money allocated for X actually was spent on X but also the more subtle assessment of whether X was the most effective way to spend the money.

SOUTH STREAM. Putin was in Bulgaria signing a deal to create a Russian-Bulgarian JV to oversee the construction of the Bulgarian section of the pipeline. The line will carry Russian gas under the Black Sea to Europe. If all the proposed lines are eventually built, there will be many routes from Russia to its customers. Which would be good for everyone.

BLUE LIGHTS. Yesterday the Interior Ministry hit Moscow; 86 car owners, including 18 police officials, were fined for misuse of flashing lights. A victory for the “blue buckets”. Traffic flow seems to be the new Mayor’s chief obsession. Not an easy problem, given the “dartboard” design of the city.

© Patrick Armstrong Analysis, Ottawa, Canada (see http://www.russiaotherpointsofview.com/)

NATO. NATO’s courtship of Russia proceeds: now, according to the Secretary General, Russia is a “partner of strategic importance”. An earlier meeting between Russia’s CGS and SACEUR seems to have passed off productively. So maybe, although inevitably it will be concealed in NATO’s wooden language, the Lisbon summit may produce a breakthrough in relations – long overdue but welcome nonetheless. I could understand if Moscow, after 15 years of abuse and no longer the suppliant, were cool to NATO’s overtures. But for the good of us all I hope it rises to the occasion.

GAS WARS. Now that the zero-sum emotions are draining out of the gas price question, negotiations are quietly proceeding. Ukraine, which is in dire economic straits (the EU has just granted it a loan – after billions from the IMF), probably can’t pay the price previously agreed to (indeed one can wonder whether that’s where the loans have gone). So somewhat of a reduction appears to have been negotiated and a working group has been set up. In the meantime Moscow and Warsaw have quietly made an agreement. As another indication of the “Third Turn”, the EU Energy Commissioner proposed that Russian experts participate in developing the new European energy strategy. Amazing what you can do when you take geopolitical fantasies out of business discussions. The customers need the gas, Russia needs the customers: each has the upper hand, so to speak.

PROTESTS. The “31” protest on Triumfalnaya Sq attracted 800 or so people and passed off without incident. Except from Limonov, that strange ally of people who call themselves democrats, who, naturally, tried to make trouble. (Report) (Film) On the other hand, a small unsanctioned rally at the Japanese Embassy was broken up. The Duma passed amendments to the law which would have restricted protests. Medvedev vetoed them. And pretty forthrightly too: the amendments placed unwarranted restrictions on the right to protest. (Text in Russian here). Clearly the authorities have stopped worrying about peaceful protests (after all, a “coloured revolution” imported from outside is utterly inconceivable now; however unrealistically, I believe the authorities feared that one might be attempted back when they were the fashionable thing). And it’s a victory for the protesters and now we’ll see if there is actually anything there. But they should cut loose from Limonov and his NatBols.

RATINGS. A recent Levada poll puts approval ratings of Medvedev and Putin nearly even at 76% and 77% respectively. This will fire up the Putin vs Medvedev for next president industry. Not Putin I say. Another poll shows a good level of satisfaction and optimism in the population. Which is, of course, directly connected to the first poll. It’s not all that complicated: you don’t need huffing and puffing “that the country is living through a fresh round of repressions reminiscent of Soviet times” to explain the Duumvirate’s high support.

KASHIN. A newspaper reporter was severely beaten up on Saturday reawakening concerns about reporters’ safety. Medvedev ordered the Prosecutor General and Interior Minister to closely supervise the investigation. Most violence to reporters in Russia is because they run foul of biznessmen; this will no doubt be the same.

CORRUPTION. Investigators have sent the case against Sergey Storchak, a former deputy finance minister accused of embezzlement, to the Prosecutor General for a decision on whether to go to trial. Meanwhile, Konstantin Chuichenko, the head of the presidential financial oversight administration, says that corruption costs about 2.9% of GDP every year. This estimate is much lower than many that we have seen (often absurdly high, I think) but I gather that he’s talking mainly about kickbacks on state procurements. He proposes a monitoring board to reduce the problem.

AFGHANISTAN DRUG RAID. Last month Russian and US agents cooperated in a raid on a heroin factory in Afghanistan. President Karzai was reported to have been seriously offended because the raid was a surprise to him. However Medvedev spoke to him a few days later and apparently the issue has been resolved. Poppy cultivation is a major concern for Moscow because so much of the heroin winds up in Russia.

GEORGIA. The Iranian Foreign Minister visited Georgia on the 3rd and 4th. Highlights of the trip were agreements on visa-free travel between the two and the opening of an Iranian consulate in Batumi which is a significant port and the terminus of an oil pipeline. This ought to make even Saakashvili’s flacks in the USA, who tend to be suspicious of Tehran, give pause. I wonder if Saakashvili has decided he wants a new sponsor, given that the West wasn’t much help in his war in Ossetia.

© Patrick Armstrong Analysis, Ottawa, Canada (see http://www.russiaotherpointsofview.com/)

NATO-RUSSIA. Lots of things are rumoured: see this in the Independent for example. On a personal note I feel a lot of schadenfreude here. When I was working for the government, I wrote many briefing notes saying that NATO should listen to what Moscow was saying and take it seriously; not necessarily agree, but seriously think about it. But no, NATO light-heartedly (not my expression but George Kennan’s) went ahead and expanded here, there and everywhere, broke its promises, enjoyed its adventures, all under the complacent assumption that Russia was negligible and its objections could be dismissed as mere self-interest, or spun as threats. No more. NATO has discovered that it really needs Russia in Afghanistan. But, NATO has to learn that words have meanings: the Secretary General cannot say, one week, that Georgia will be a member of NATO one day, and on another that it wants to have a “true strategic partnership” with Russia. Georgia, under present management, is not acceptable to Moscow: there are reasons why this is so. NATO must make the, apparently difficult, attempt to understand those reasons. Nonetheless, the movement is encouraging: after all, NATO and Russia share the essential element of a military alliance – which is common enemies.

GULAG ARCHIPELAGO. Solzhenitsyn’s widow presented an abridged version for schools, where it is required reading. Some Western media outlets expressed surprise when Putin called it “essential reading”: “unusual words of praise from a former KGB agent” said AP. Had they spent more time learning what Putin has said and done, they might be able to shuck off the tired KGB trope that is the beginning and end of much comment.

INTERNET. ITAR-TASS reports that 44 million Russians say they use the Internet at least once a week and 30 million claim to be very active users. I repeat that the conventional reports of press freedom ignore Russians’ increasing use of the New Media. Not a surprise, I think: many members of the Old Media are barely aware of it. As an amusing example of hubris leading to nemesis see Newsweek in 1995, in 2005 and today.

POLICE LAW. Medvedev has submitted it to the Duma: it has been on the Net since August.

THE PROTEST GAME. Well, somebody had to break the impasse and the City has (perhaps with a nudge, as it were, from the Kremlin). An anti-Putin demo on Saturday passed off without incident. After some dickering over the size, the City has granted a permit for 1000 people on the 31st at Triumfalnaya Sq. One of the organisers says she (“we”) will accept the terms; we shall see what happens.

MOSCOW. To no one’s surprise the Moscow legislature elected Sergey Sobyanin and he was sworn in as Mayor on Thursday. Traffic, he says, will be a priority. Good luck. Will Luzhkov, still grumbling, appear in London as Russia’s new democratic spokesman? My bet is no – people aren’t as naïve about Russia as they were when Berezovskiy morphed from “gangster capitalist” to fighter for democracy.

DEFENCE PURCHASES. I am intrigued by the fact that the Russian Defence Ministry is open to buying foreign weapons. It has just been announced that it will manufacture light AFVs under licence from Italy and it has announced a tender for amphibious ships (presumably France will win). Two things here: it’s a sign of the “Third turn” in Europe but, equally significantly, that Moscow regards itself as part of the world.

MILITARY REFORM. Defence Minister Serdyukov says the new reorganisation into four strategic commands is complete ahead of schedule. This, of course, is nonsense – something this profound, overturning decades of Soviet and Imperial organisation – will take months, if not years, to be fully worked out. And it will have to be tested with real emergencies before its real point – unified command – operates smoothly.

JIHADISM. I again recommend people read Gordon Hahn’s regular coverage of jihadism in the North Caucasus. His latest report gives these numbers for last month: 92 jihadist attacks (3 of them suicide attacks), 47 officials and 22 civilians killed. This is a reality that few in the West seem to be aware of.

RUSSIA-UKRAINE. Putin visited Kiev and two agreements that have been announced cover cheaper than expected gas and a nuclear fuel agreement. Yanukovych has created an advisory council on Ukraine-Russian relations headed by his Chief of Staff. Better relations with Russia do not preclude better relations with Europe. A via media is Ukraine’s wisest strategy.

KYRGYZ REPUBLIC. The leader of the party that did best in the recent elections (about 9%), Kamchibek Tahiyev of the Ata-Zhurt party, says an assassination attempt on him on Saturday failed; he accuses the security forces.

© Patrick Armstrong Analysis, Ottawa, Canada (see http://www.russiaotherpointsofview.com/)