russia - wikileaks 1010…  · web viewus in talks to buy russia’s mi ... the consultations held...

Russia 101013

Basic Political Developments US in talks to buy Russia’s Mi-17 helicopters for Afghanistan AAF inducts Mi-17 V5 Helicopters - The Afghan Air Force (AAF) inducted four

new Mi-17 V5 helicopters on Tuesday while six much choppers will join the Force soon.Lukashenko decrees to place Belarus’ public bonds worth RUB 15bln in Russia - Bonds will be placed in compliance with the December 23, 2009 agreement on services related to placing Belarus’ Russian rouble-denominated public bonds on the territory of the Russian Federation.

UK For'n Secr, RF leaders seek to "unfreeze" relations - The Russian Minister spoke Tuesday about readiness to remove all irritants in the dialogue with London. "Russia is ready to unfreeze relations. We expressed readiness for this long ago. We see an abnormal situation developed in our relations," Lavrov said.

o Russia - important UK international partner - Hague said that relations between Britain and Russia had aggravated somewhat in recent years. "On issues where we really disagree, I shall speak frankly and clearly, while exploring possibilities of further rapprochement", - said Hague.  

o Haig: The Litvinenko case prevents the Russian-British reboot UK's Hague seeks to improve relations with Russia - UK Foreign Secretary Hague to meet Medvedev, Lavrov; Relations strained by London killing of emigre Litvinenko

o William Hague in Moscow for talks - Ahead of his talks with Mr Medvedev and Foreign Minister Sergei Lavrov, Mr Hague told the BBC that better, businesslike relations were desirable, but that did not mean Britain was setting aside differences with Russia over the Litvinenko murder.

o Hague Tries To Tackle UK-Russia Relations - Foreign Secretary William Hague has set off for meetings at the Kremlin as pledges to improve the "strained" relationship between Russia and the UK.

o Andrei Lugovoi: I will never stand trial in Britain for Litvinenko poisoning - As William Hague visits Moscow, former KGB officer says the UK should stop trying to extradite him and focus on improving relations with Russia

Russian natural resources minister to head to Angola, Namibia -"As part of his visit, Yury Trutnev will hold talks with Foreign Minister, co-chairman of the Russian-Angolan commission on economic and scientific-technical cooperation and trade Assuncao Afonso de Sousa dos Anjos," the Russian Natural Resources Ministry said.

Bahrain, Russia to explore natural gas - Dr Mirza, who received yesterday an invitation from the Russian First Deputy President and Oil and Energy Minister, Viktor Zubkov to visit Moscow, hailed the strong bilateral relations between both the countries.

Hugo Chavez’s visit to reinforce Venezuela’s ties with Russia - Andrei Klimov, deputy head of the lower house committee on foreign affairs, comments on the upcoming visit by Venezuelan President Hugo Chavez later this month as part of his international tour.

Rossiyskaya Gazeta/Russia Today: Bilateral modernization - Dmitry Medvedev spoke about a visa-free regime with the president of Germany

Admiral Panteleyev headed for Japan - Russia’s Pacific Fleet destroyer Admiral Panteleyev has left Vladivostok heading for Hakodate port in Japan.

Medvedev’s visit to Seoul to be landmark in ties with South Korea - The consultations held at the South Korean Ministry of Foreign Affairs and Trade “highlighted preparations to a Seoul visit of Russian President Dmitry Medvedev,” Russian Deputy Foreign Minister Alexei Borodavkin told Itar-Tass before the departure for Moscow. He noted that these meetings “showed very close approaches to the discussed issues.”

Eurasian organizations discuss countermeasures to regional crises - The meeting discussed countermeasures to regional crises, and acknowledged it was necessary to develop new plans to deal with current issues in Central Asia, such as security, drug trafficking and illegal immigrants, CSTO Secretary-General Nikolay Bordyuzha said.

Russian envoy calls for common view on denuclearizing N. Korea - Russia's Deputy Foreign Minister Alexei Borodavkin met with South Korea's new Foreign Minister Kim Sung-hwan during his three-day trip to Seoul that began Monday. Borodavkin is also Russia's chief envoy to the six-party talks on ending North Korea's nuclear programs.

General underscores defence cooperation with Russia - Defence cooperation would contribute to further reinforcing the strategic partnership between Vietnam and Russia, said Defence Minister Phung Quang Thanh at a meeting with the Chief of General Staff of the Russian Armed Forces in Hanoi on October 12.

Akylbek Zhaparov: Union of Kyrgyzstan with Russia and Kazakhstan already exists -“Union of Kyrgyzstan with Russia and Kazakhstan already exists - within the framework of the Commonwealth of Independent States and EurAsEC,” a representative of the party Ar-Namys Akylbek Zhaparov said at a press-conference on Wednesday.

Russia integrates into TRACECA - At forum "Strategic Partnership: Caucasus Region" RZD senior vice president Valeriy Reshetnikov has stated today that by opening of an international ferry line between ports Makhachkala and Aktau and Turkmenbashi, Russia integrated into Transport Corridor Europe-Caucasus-Asia (TRACECA).

Russian Border Service in Armenia: Nobody crossed Armenia-Turkey border - “A prearranged PR action is in question, pursing rather dark aims,” press service of the Border Service, Russian Federal Security Service in Armenia told NEWS.am, commenting on Turkish politicians’ illegal crossing the border along the River Akhuryan.

Criminal case opened against Moscow prefecture officials – Investigations Committee

Vladimir Resin fired assistant member of the Federation Council - Acting mayor Vladimir Resin fired assistant member of the Federation Council's work in Moscow, Viktor Belyakov.

Russian govt will help promote interfaith dialogue – Medvedev: Russian President Dmitry Medvedev has said he supports steps to promote strong interfaith dialogue, including in the North Caucasus.

Opponents ask Russian president not to allow building mosque in Tekstilschiki Moscow Muslims want more mosques, residents stage protests - Recently, around

2,000 signatures were collected by residents in the city’s south who did not want a mosque in their area. Instead, they say, the place could be turned into the park.

Gazeta.ru/Russia Today: Moscow is and not very Muslim Zakayev swears allegiance to new leader of militants - Akhmed Zakayev has

dismissed the government of the Republic of Ichkeria having sworn allegiance to warlord Hussein Gakayev, who from now on will head the new supreme authority of Ichkeria – Shura Majlis, or the State Committee of Defense.

Russia's Medvedev to speak to governors on wildfire consequences Medvedev to present State awards to firefighters Wed Putin to inspect construction of Olympic facilities in Russia's Sochi - Putin will

meet with Jean-Claude Killy, chairman of the IOC Coordination Commission for the 2014 Sochi Winter Olympics, to discuss preparation for the Games.

Putin to meet with IOC delegation in Sochi Wednesday Aleksey Kudrin receives Stolypin medal -    Russian Finance Minister Alexei

Kudrin, who turned 50 on Tuesday, was awarded the Pyotr Stolypin Medal. Soviet-age highly enriched uranium returns from Poland to Russia

o Nuclear Road Trip: Shipping Uranium A Complex Task - A shipment of bomb-grade uranium arrived at a secure facility in Russia on Monday, sent from a research reactor in Poland as part of a race to secure dangerous radioactive material around the world.

Polish archeologists to start work at Kaczynski air crash site - Polish archeologists will on Wednesday start inspecting the site of April's Polish presidential plane crash near the western Russian city of Smolensk. Their work on the tragedy site will last until October 27.

Russian ambassador links spy passport row to adoption deal - RUSSIA’S AMBASSADOR to Ireland has expressed concern that the controversy over allegations that Russian spies used data from Irish passports may overshadow ongoing negotiations towards reaching a bilateral agreement on adoption.

Ras Al Khaimah Free Trade Zone eyes fast growing Moscow market - As part of its mandate to boost investment into Ras Al Khaimah, a top-level trade delegation from the Ras Al Khaimah Free Trade Zone (RAK FTZ) - one of the fastest-growing and most cost-effective free trade zones in the UAE - recently visited Moscow on a strategic business mission.

We must restart our stalled nuclear talks - By Madeleine Albright and Igor Ivanov: Talking about nuclear weapons remains a delicate topic for both our countries. Neither side’s military is excited, for example, about the intrusive verification measures that they may soon have to face. But by pursuing these ideas the US and Russia can cement their improved relationship, give new

impetus to efforts to curb nuclear proliferation, and help build a safer and more secure world – even as we await the ratification of New Start.

With Love from California - President Dmitry Medvedev could benefit from the best sales pitch so far for his flagship innovation project after California Governor Arnold Schwarzenegger yesterday urged American investors to grab the unique business opportunities that modern Russia presents. In the rare celebrity endorsement of his modernization efforts to date, the former Hollywood star likened Medvedev’s Russia to a gold or diamond mine that is beckoning foreign investors to simply “go in there and get it.”

"Day of Wrath" participants detained in Moscowo Moscow police arrest opposition protesters at unsanctioned demo o 2 prominent Kremlin foes arrested as anti-government rally quashed in

Moscow - The high-profile human rights activist Lev Ponomaryov and Sergei Udaltsov, the leader of the anti-Kremlin Left Front movement, were detained during Tuesday's rally.

Number of permanent Orthodox parishioners in Russia may reach 40 million people in next 20 years

Pasternak heirs rage over Moscow monument - Speaking exclusively to The Moscow News, a descendant of the Doctor Zhivago author said the family was delighted that Boris Leonidovich was going to be immortalized – but aghast at Tsereteli’s role.

RIA Novosti Press Review for Wednesday, October 13, 2010

National Economic Trends Rouble falls vs euro to its lowest since early Feb Foreign debt up $24.2bn in 3Q10 Very strong fiscal revenue performance, but spending "strong" too Budget deficit for 9M10 reported at 2.2% of GDP; POSITIVE Goods imports continued to increase at a rapid pace

Business, Energy or Environmental regulations or discussions Raspadskaya, Rosneft, Polyus Gold: Russia Stock Market Preview Mosenergo has been criticised by the current Moscow City Government from

Yury Luzhkov's team Sberbank Urges Russia to Sell Stake in Lender Via Stock Market CBR could reduce stake in Sberbank to below 50% in the medium term Petropavlovsk’s Iron Ore Unit Delays H.K. IPO by Week (Update1) Mail.ru Sees 2010 Net Tripling to $150 Million, Kommersant Says Vimplecom's Orascom buy not a done deal: Telenor Seventh Continent Owner Plans to Take 100% Stake, Vedomosti Says Alexander Zanadvorov to increase stake in Seventh Continent Deripaska asks to extend Strabag option-paper Moscow tops EMEA list of cities for office construction projects - Colliers Forest industry told to watch Chinese-Russian log trade - The New Zealand forest

industry is being warned to keep a watch on the Chinese-Russian log trade, with a potential supply crunch looming.

Russian company signs contract to manage hotel complex in Syria Russia eyes green light for Sochi Grand Prix Renaissance Capital forms business unit focused on agriculture sector Glonass to be Consolidated - Sistema said Tuesday that it plans to consolidate

control of the Glonass satellite navigation project as it seeks to compete with the U.S. Global Positioning System.

News Outdoor’s Accounts Frozen - The Federal Tax Service has ordered banks serving Rupert Murdoch’s advertising company News Outdoor to freeze the firm’s accounts and divert any income to the tax service, to cover a 1.34 billion ruble ($44.5 million) tax bill, Kommersant reported Tuesday.

Silver maker Polymetal said Tuesday that it secured a $150 million credit line from Raiffeisenbank at 3.5 percentage points over Libor. (Bloomberg)

Sakhalin Energy will pay the government $1.8 billion in dividends for 2010 through 2013, Vedomosti said Tuesday, citing two state officials. (Bloomberg)

Total said Tuesday that Gazprom will take a 20 percent stake in the Ipati and Aquio gas licenses in Bolivia, while it will remain the operator. (Bloomberg)

Trakya Cam Sanayii, a Turkish glassmaker, will partner with France’s Saint-Gobain to make glass at a factory in Tatarstan by the middle of 2012, with a total investment of 184 million euros ($254 million), the company said Tuesday. (Bloomberg)

The estimated damage from the drought stands at 41.5 billion rubles ($1.4 billion) as Russia’s grain harvest nears completion, the Agriculture Ministry said Tuesday. (Bloomberg)

Sukhoi Aircraft’s SuperJet, Russia’s first major passenger plane since the collapse of the Soviet Union, will deliver its first jet this year to Armenia’s Armavia, company vice president Paolo Revelli-Beaumont said Tuesday, adding that they have now have a total of 152 orders. (Bloomberg)

Activity in the Oil and Gas sector (including regulatory) Lukoil to Start Drilling at Iraq’s West Qurna 2 Field in 2011 Alekperov helped Lukoil to purchase portion of shares from Conoco Lukoil to approve 2011 business plan Tatneft's 2Q10 US GAAP results to be hit by tax lag TNK-BP plans global push as oligarchs share record $4bn dividend LNG terminal and supply base for Murmansk How long will Russia be able to hold crude oil production rate? Why Cnooc in Texas Should Worry the Kremlin - Russia has more reason to feel

uncomfortable. Cnooc's joint venture is focused on oil, rather than gas. But it is the latest deal giving a Chinese company access to unconventional North American reserves like shale gas and oil sands.

Russian oil and gas - if unborn wells could talk - With a projected federal budget deficit of $60bn and no desire from the state to cut spending, the Finance Ministry's options to raise money boil down to raiding the most efficient parts of the economy, such as the oil industry.

Gazprom Gazprom plans big investment hike in 2011-EconMin - Gazprom (GAZP.MM)

plans to significantly increase its investment programme in 2011 from this year's levels, deputy economy minister Stanislav Voskresensky told reporters on Wednesday.

Gazprom eyeing Moscow's largest energy asset - The change in power in Moscow may give Gazprom hope for securing a stake in the Moscow United Energy Company (MOEK).

Bucharest: Economy ministry officials are expected to meet Alexei Miller, chief executive of Russia's state-owned energy giant Gazprom

Gazprom’s resource base expansion in Kamchatka is fundamental for developing regional gas supply system

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Full Text Articles

Basic Political Developments

11:14   US in talks to buy Russia’s Mi-17 helicopters for Afghanistanhttp://www.prime-tass.com/

AAF inducts Mi-17 V5 Helicoptershttp://pakobserver.net/detailnews.asp?id=56720Monday, October 13, 2010, Ziqa’ad 04, 1431

Special Correspondent

Islamabad—The Afghan Air Force (AAF) inducted four new Mi-17 V5 helicopters on Tuesday while six much choppers will join the Force soon.

According to reports with the induction latest four Mi-17 helicopters the current fleet of Mi-series helicopters will become thirty one.

According to defence sources the delivery of the remaining six Mi-17 V5 helicopters will be complete by the end of 2010.

The sources say that the Afghan Air Force will use the newly inducted Mi-17 aircraft for deployment of troops and air action against insurgents. The Mi-17 latest version choppers will be distributed to air units mostly close to Pakistan border.

Defence experts have noted that the Russian Mi-17 aircraft has been modified with a new

cockpit, gun mounts and a tricolour paint scheme to comply with AAF configuration requirements.

Lukashenko decrees to place Belarus’ public bonds worth RUB 15bln in Russia

http://www.itar-tass.com/eng/level2.html?NewsID=15584798&PageNum=0

13.10.2010, 11.20

MINSK, October 13 (Itar-Tass) -- Belarusian President Alexander Lukashenko has authorized the country’s government to place Belarusian five-year public bonds to the total amount of 15 billion Russian roubles in Russia in 2010-2011, the Prime-Tass economic news agency reported on Wednesday.

A presidential decree to the effect was signed on October 9, 2010.

Bonds will be placed in compliance with the December 23, 2009 agreement on services related to placing Belarus’ Russian rouble-denominated public bonds on the territory of the Russian Federation.

UK For'n Secr, RF leaders seek to "unfreeze" relations

http://www.itar-tass.com/eng/level2.html?NewsID=15583980

13.10.2010, 03.24

MOSCOW, October 13 (Itar-Tass) - Sergei Lavrov, Russian Minister of Foreign Affairs, and William Hague, British Secretary of State for Foreign and Commonwealth Affairs, meet here on Wednesday with a view to "unfreezing" bilateral relations.

The fact that Russian President Dmitry Medvedev will receive the British guest "for a conversation" on Wednesday may serve as a kind of serious positive signal in this respect. This has been confirmed by the Kremlin press service.

The Russian Minister spoke Tuesday about readiness to remove all irritants in the dialogue with London. "Russia is ready to unfreeze relations. We expressed readiness for this long ago. We see an abnormal situation developed in our relations," Lavrov said.

At the same time the Russian Foreign Minister pointed out that "there is no need to speak about a reset on the part of Russia". "This situation emerged not at our initiative," he added.

William Hague, too, prior to the present trip, also expressed readiness to work on an improvement of bilateral relations and also expressed hope that, in due course, the sides would be able to achieve a certain improvement of UK-Russia relations which had been no easy ones in recent years. He said that while in Moscow he would seek to make a beginning of this process.

Analysts believe that such statements are rather reassuring after a series of tense moments in relations between Moscow and London, specifically after the closure of most of British Council offices in the territory of the Russian Federation in 2008, as well as the scandal involving Alexander Litvinenko case.

At the same time analysts point out that London continues to maintain a rather strong stand on the latest issue, demanding the extradition of the chief suspect -- Andrei Lugovoi. In recent days a UK Foreign Office official made public a position that Britain wants to improve relations with Russia but that headway towards this goal will be limited until that issue is settled.

Notwithstanding that, expert opinion is that the plans of new UK Prime Minister David Cameron to "reset" relations with Moscow so as not to miss an opportunity to participate in trade-and-economic projects in Russian provide a chance for a "thaw" in Russia-UK relations.

Russian Foreign Ministry spokesman Andrei Nesterenko emphasized, "Despite a certain decrease in cumulative British investments in Russia, Britain remains our important trade-and-economic partner and one of main foreign investors in the Russian Economy. We note the appreciable level of the presence of British businesses in the Russian economy, and an active dynamism of trade between our two countries".

"The remaining problems in bilateral relations should not hinder the development of interaction in all areas where this appears possible," the diplomat added.

The present visit to Russia will be the first one for William Hague, 49, since he was appointed Foreign Secretary in May in the UK's new coalition government. He visited the Russian capital as Foreign Secretary in the "shadow Cabinet" of the Conservatives in January 2010 to meet with Sergei Lavrov.

Russia - important UK international partner http://english.ruvr.ru/2010/10/13/25674104.html

Oct 13, 2010 01:17 Moscow Time

Russia is an important partner of the UK on a range of international issues, including Iran's nuclear program and a Middle East peace settlement.

This was stated by British Foreign Secretary William Hague, on the eve of his visit to Moscow.

According to him, at the meeting with Foreign Minister Sergei Lavrov up for discussion will be  trade and investment issues, combating drug trafficking, prospects for strengthening economic and cultural ties between the two countries

Hague said that relations between Britain and Russia had aggravated somewhat in recent years. "On issues where we really disagree, I shall speak frankly and clearly, while exploring possibilities of further rapprochement", - said Hague.  

http://www.bbc.co.uk/russian/rolling_news/2010/10/101013_rn_hague_russia.shtmlGOOGLE TRANSLATION

Haig: The Litvinenko case prevents the Russian-British reboot In an interview with BBC on the eve of his visit to Russia, British Foreign Secretary William Hague said that Litvinenko's murder is still clouding the Russian-British relations.His first trip to Moscow as head of the Foreign Office Haig called an important step but not a new page, without rebooting.He noted that to ignore the poisoning of former FSB officer Alexander Litvinenko in London in 2006 is impossible.Today William Hague will meet with his Russian counterpart Sergei Lavrov, as well as with Russian President Dmitry Medvedev.

UK's Hague seeks to improve relations with Russiahttp://in.reuters.com/article/idINLDE69B15820101012

3:32am IST

* UK Foreign Secretary Hague to meet Medvedev, Lavrov

* Relations strained by London killing of emigre Litvinenko

MOSCOW, Oct 13 (Reuters) - Russia and Britain will seek to improve ties badly damaged by the murder in London of a Kremlin critic when British Foreign Secretary William Hague meets Russian leaders on Wednesday.

Hague, part of a coalition government which took office in May, will meet Russian counterpart Sergei Lavrov and President Dmitry Medvedev during his 24-hour visit which began on Tuesday.

Relations between the previous British government and Russia deteriorated badly after the 2006 murder of Alexander Litvinenko in London with a rare radioactive isotope.

Britain has called on Moscow to extradite former KGB bodyguard Andrei Lugovoy to stand trial for the murder. Russian officials and Lugovoy have denied any link to the murder and Moscow has ruled out the extradition.

Hague, who plans to discuss the Middle East peace process and Iran's disputed nuclear programme while in Moscow, acknowledged tensions between the two countries.

"Britain's relations with Russia have been strained by a number of serious issues on which we do not see eye to eye," Hague said in a statement before the visit.

"Where we do differ, I shall say so plainly and clearly, while exploring the scope to address those differences. The door is open to better relations between Britain and Russia; we shall see if a door opens in return."

NO SOFTENING OF LINE

The row over Litvinenko's murder led London and Moscow to expel diplomats three years ago.

Even before the murder, mutual espionage accusations and Britain's granting of political asylum to some of the Kremlin's enemies had harmed bilateral business and trade.

A foreign office source said Britain had no intention of softening its line on Lugovoy.

"The Foreign Secretary is not going to say we give up on the Lugovoy case for the sake of business, that's not where we're at," he said.

More than 1,000 British businesses have a base in Russia, the largest investor being oil company BP through its TNK-BP joint venture. The British are encouraged by the fact that Hague will meet Medvedev but are aware that both sides are getting to know each other after the change of government in London.

"The key part of what we're looking for is to establish the tone of the dialogue with Russia. It's early stages in the new government's dealings with Russia," the foreign office source said.

Moscow suggested they were looking for Hague to provide the impetus after a visit by his predecessor David Miliband last November failed to end the freeze.

"I hope to hear specific responses from my colleague (Hague), because we do not need a 'reset' on the Russian side," Lavrov told reporters on Tuesday.

"We see an inadequate situation in relations. It wasn't our initiative that led to this, and so we are expecting a reaction to our goodwill." (Writing by Keith Weir in London; additional reporting by Alexei Anishchuk in Moscow; editing by Noah Barkin)

13 October 2010 Last updated at 02:46 GMT

William Hague in Moscow for talkshttp://www.bbc.co.uk/news/uk-politics-11529333

The trip is Mr Hague's first to Moscow as foreign secretary

William Hague will hold meetings later with Russian President Dmitry Medvedev in his first trip to Moscow as foreign secretary.

Mr Hague has played down expectations ahead of the visit, but said "the door was open to better relations".

Relations between the two countries have been strained over the murder of ex-spy Alexander Litvinenko in London in November 2006.

Britain's 2007 request for the extradition of a suspect still stands.

UK investigators suspect former KGB agent Andrei Lugovoi of the murder, but he has always denied any involvement in the poisoning of Mr Litvinenko with the radioactive substance polonium-210.

In May 2007, the Crown Prosecution Service formally submitted an extradition request to Moscow for Mr Lugovoi to stand trial in Britain.

Russia has refused to co-operate, saying it would be against its constitution to do so.

Ahead of his talks with Mr Medvedev and Foreign Minister Sergei Lavrov, Mr Hague told the BBC that better, businesslike relations were desirable, but that did not mean Britain was setting aside differences with Russia over the Litvinenko murder.

It's not a problem that can be ignored.”

End Quote William Hague Foreign Secretary

Russia has signalled it hopes Mr Hague's visit will help put irritants aside, and called on Mr Hague to take concrete steps towards it.

Mr Hague, though, insisted it was not yet time to turn a corner.

"[The Litvinenko murder] remains a major problem in bilateral relations and I don't think that problem is going to go away.

"It's not going to be set aside, it's not going to be put behind us, it is something we will have to continue to discuss with Russia.

"So, it's not a problem that can be ignored but I think while we discuss that with Russia there are other things we can be doing."

However, Mr Hague does want to explore the potential for collaborative projects that could help businesses and jobs in Britain.

No "reset button" - as the US has described its hopes for its own relations with Russia - then, or a fresh start, but a small step to improve relations, says the BBC diplomatic correspondent Bridget Kendall.

Afghanistan, Iran's nuclear programme, and the Middle East peace process are also expected to be on the agenda.

Hague Tries To Tackle UK-Russia Relations http://news.sky.com/skynews/Home/Politics/Foreign-Secretary-William-Hague-Flies-To-Russia-To-Improve-Strained-Relations-With-Kremlin/Article/201010215756972?lpos=Politics_News_Your_Way_Region_6&lid=NewsYourWay_ARTICLE_15756972_Foreign_Secretary_William_Hague_Flies_To_Russia_To_Improve_Strained_Relations_With_Kremlin

2:18am UK, Wednesday October 13, 2010

Ruth Barnett, Sky News Online

Foreign Secretary William Hague has set off for meetings at the Kremlin as pledges to improve the "strained" relationship between Russia and the UK.

As he left, Mr Hague said: "The door is open to better relations between Britain and Russia; we shall see if a door opens in return."

The two countries have been less close since the murder of former KGB agent Alexander Litvinenko in London in 2007 as Russia has refused requests to extradite suspect Andrei Lugovoi.

Mr Lugovoi has called on the UK to stop trying to seek his arrest.

"The British press has trampled on my reputation. My family and I have suffered great unpleasantness. I'm not going to compromise. The only trial I'll accept is one in Russia," he told the Guardian.

Mr Hague will meet president Dmitry Medvedev and foreign minister Sergei Lavrov in addition to senior figures linked to business and industry.

He plans to discuss Iran's nuclear programme and the peace process in the Middle East, according to a statement from the Foreign Office.

"My meetings in Russia will also cover trade and investment, counter narcotics, global economic issues and the strengthening of economic and cultural links between our two countries," Mr Hague's statement continued.

Britain's relations with Russia have been strained by a number of serious issues on which we do not see eye to eye.

"Where we do differ, I shall say so plainly and clearly, while exploring the scope to address those differences," he added.

In Mr Hague's first major speech as Foreign Secretary in July, he said it was not in Britain's national interest to be in "permanent confrontation" with Russia but admitted it would take a "major effort on both sides" to tackle the situation.

He said the last Labour government could not be blamed for the deterioration as issues such as the Litvinenko death had made "impossible" to improve relations.

Andrei Lugovoi: I will never stand trial in Britain for Litvinenko poisoninghttp://www.guardian.co.uk/world/2010/oct/12/andrei-lugovoi-interview-alexander-litvinenko-poisoning

Exclusive: As William Hague visits Moscow, former KGB officer says the UK should stop trying to extradite him and focus on improving relations with Russia

Luke Harding in Moscowguardian.co.uk, Tuesday 12 October 2010 17.25 BST

He is the man behind the most serious diplomatic falling out between Britain and Russia since the cold war. If Scotland Yard is to believed, he is also the person who put a fatal dose of radioactive polonium into Alexander Litvinenko's tea, in one of the most notorious assassinations of the modern age.

Today, Andrei Lugovoi said it was time for Britain to "move on" from Litvinenko's agonising death four years ago, and to drop attempts to extradite him to the UK. Speaking before William Hague's arrival in Russia, on his first visit to Moscow as foreign secretary, Lugovoi said he would never travel to Britain to stand trial. "The British press has trampled on my reputation. My family and I have suffered great unpleasantness. I'm not going to compromise. The only trial I'll accept is one in Russia."

The Labour government was to blame for the four-year crisis in relations between Russia and Britain, and had taken an unnecessarily aggressive attitude towards the Kremlin, he claimed.

Hague, who will meet Dmitry Medvedev, Russia's president, tomorrow has described bilateral ties under Labour as "very poor". Before his trip, he said the door was open to improved relations with Moscow.

Britain's coalition government is also keen for UK firms to gain access to Russian oil and gas fields, from which they are currently excluded.

It was unclear whether Hague would meet any of the specific concessions the Russian government has demanded. Moscow wants Britain to resume co-operation on counter-terrorism with the federal security service (FSB), the successor to the KGB, and on the lifting of visa restrictions on Kremlin officials visiting London. David Miliband severed links with the FSB in 2007 and expelled four Russian diplomats in protest over Moscow's refusal to hand over Lugovoi for trial in the UK. The measures conveyed the Foreign Office's belief that the FSB was behind Litvinenko's murder.

Lugovoi admits meeting Litvinenko in London on 1 November 2006, the day the latter was poisoned. The meeting took place at the Millennium Hotel in London, he said, and included another business associate, Dmitry Kovtun. Lugovoi said he could not remember whether Litvinenko drank tea: "Generally he preferred Pepsi." But he scoffed at the idea that he had dissolved polonium-210 in Litvinenko's drink. Litvinenko, a former FSB officer exiled to London after criticising Vladimir Putin, died three weeks later in Barnet Hospital.

"We were all sitting round a table in front of numerous witnesses," Lugovoi said. "What, was I supposed to throw the polonium in like a basketball? Or should I have used a syringe?"

He said Scotland Yard had obtained security camera footage of the encounter, and dismissed Litvinenko as an "adventurist" on MI6's payroll who had most probably poisoned himself by accident. "He was planning some kind of provocation against Putin and Russia and got careless with the polonium," he said.

Speaking at a rustic-themed restaurant in Moscow owned by his 24-year-old daughter, Tatiana, he jokingly referred to Anna Chapman, the Russian at the centre of this summer's unprecedented spy swap between the US and Russia. "I would like to meet her. I think I will meet her," he said. "If any British film company invites me to play the role of James Bond, I'll ask her to be my Bond girl. My only demand is that I get an Aston Martin car as an honorarium."

After the scandal surrounding Litvinenko's death, Lugovoi, a former KGB officer turned businessman, was elected to Russia's parliament – a sign of strong support from Vladimir Putin, then Russia's president, and a position that gave him immunity from prosecution.

He said he was enjoying his job as a member of the Duma, and planned to stand again for election next year. However, he said he missed London: "It's a city with a unique atmosphere. But I can't risk going abroad because I'm on Interpol's wanted list."

Speaking before Hague's arrival, Russia's foreign secretary, Sergei Lavrov, blamed London for the spat, and said Russia was ready to reverse its retaliatory decision in 2007 to close Russian offices of the British Council. "This work was frozen on London's initiative," he said. "We have long been prepared to unfreeze it."

The Crown Prosecution Service charged Lugovoi with Litvinenko's murder in May 2007, but British diplomats have indicated that there is unlikely to be much progress on issues relating to Litvinenko's death during Hague's trip. "Things will only change if Lugovoi is bundled on a plane back to the UK," one source said.

Lugovoi said that detectives had failed to offer any evidence in their case against him as there was not any evidence. "If they have any proof let them put it on the table. They won't do it," he said.

The solution to improved ties was for Britain to stop making "noisy and unhelpful public statements" about the Litvinenko affair, he said, and instead raise their grievances in private. "Relations between Britain and Russia have gone through several difficult patches over the past 200 years. But in life you have to look forward. I don't think there's any point in looking back."

Russian natural resources minister to head to Angola, Namibiahttp://en.rian.ru/world/20101013/160933225.html

01:20 13/10/2010

The Russian natural resources minister will on Wednesday head to Angola and Namibia, the ministry reported.

Yury Trutnev's working trip will last until October 17.

"As part of his visit, Yury Trutnev will hold talks with Foreign Minister, co-chairman of the Russian-Angolan commission on economic and scientific-technical cooperation and trade Assuncao Afonso de Sousa dos Anjos," the Russian Natural Resources Ministry said.

Besides, the minister will hold a working meeting with Namibian Foreign Minister Utoni Nujoma, who co-chairs the Russian-Namibian trade and economic cooperation commission.

The foreign ministers will discuss development of economic ties between the countries.

MOSCOW, October 13 (RIA Novosti)

Bahrain, Russia to explore natural gashttp://www.zawya.com/Story.cfm/sidZAWYA20101013071444/Bahrain,%20Russia%20to%20explore%20natural%20gas

13 October 2010The Oil and Gas Affairs Minister and National Oil and Gas Authority Chairman, Dr Abdulhussain bin Ali Mirza said yesterday the Kingdom would explore joint cooperation with the Russian Federation in the field of natural gas soon.

Dr Mirza, who received yesterday an invitation from the Russian First Deputy President and Oil and Energy Minister, Viktor Zubkov to visit Moscow, hailed the strong bilateral relations between both the countries.

He said he would visit Moscow soon.

Russian Ambassador to Bahrain, Yuri Alexander called on the minister to deliver the invitation of the Russian Government.

The minister cited the landmark visit of His Majesty King Hamad bin Isa Al Khalifa last December to Russia, as a defining moment in bilateral relations between both the countries. The historic visit yielded several agreements, including key memoranda of cooperation on the peaceful use of the nuclear energy, combating organised crime, in addition to a key deal sealed between the National Oil and Gas Authority and Russian Gazprom on importing Russian gas to Bahrain.

By Business Reporter

© Bahrain Tribune 2010

Hugo Chavez’s visit to reinforce Venezuela’s ties with Russiahttp://en.rian.ru/valdai_op/20101013/160921000.html

09:31 13/10/2010© RIA Novosti.

Andrei Klimov

Andrei Klimov, deputy head of the lower house committee on foreign affairs, comments on the upcoming visit by Venezuelan President Hugo Chavez later this month as part of his international tour.

Which priorities do you think will dominate the two countries’ relations over the next few years?

It doesn’t pay to make political forecasts. Right now, Russian-Venezuelan relations have very good prospects. However, there is a chance that this collaboration may slow down or suffer disruption following a change in power in Venezuela. That is why interstate relations should never be built upon personal ties with specific political leaders, but on a more solid foundation.

Russia has such relations based on institutional interaction with Germany, France, Italy and other countries. It is essential for our national interests that no reshuffles or political changes, however hypothetical, whatever the country, should significantly alter the course of our relations.

It is worth noting that Russia tries not to skew its cooperation towards major countries in various parts of the world, be it in Africa, Latin America or North America. We are determined to use each international contact as effectively as possible to further Russia’s national and strategic international interests.

Prime Minister Vladimir Putin’s working visit to Venezuela last April culminated in a series of bilateral agreements. Do you think those initiatives will receive a boost during Hugo Chavez’s visit in October?

Hugo Chavez is in fact coming to Russia to evaluate what has been done on this and discuss new plans and initiatives. Bilateral military-technical cooperation is on the rise now, as are joint oil and gas projects; political cooperation within the UN is also an important element in our relations. Vladimir Putin’s April talks largely focused on economic projects. At the same time, contact with any country’s president always covers a broader range of issues, including political ones. Therefore, I think Chavez’s visit to Moscow will also address foreign political cooperation, not only specific economic projects.

Russia and Venezuela are both major oil exporters; how do you see their future bilateral cooperation in this area?

Russia and Venezuela are solid, civilized partners in the oil and gas sector. I know several leaders of Russian oil companies personally, and I am aware of their international ambitions. I also remember our political leaders’ statements insisting that Russia should do everything it can to integrate with the global economy.

It follows that we must study all possible cooperation schemes, in oil and gas production and processing, and in potential exports to third countries. This should strengthen both our companies’ positions and Russia’s geostrategic status, consequently making the world more interdependent, which is a good thing.

U.S. political analysts have been using the term VIRUS lately to describe what they see as an alliance between Venezuela, Iran and Russia, which allegedly threatens the United States and the West as a whole. Do you think this is a viable theory?

I would call it a brilliant PR stunt, which shows that U.S. political analysts take quite a creative approach. As for the political situation, I would simply continue cooperation across all areas without paying any attention to whatever terms they choose to use. Iran is our neighbor, and Russia is determined to maintain friendly relations with all its neighbors. As for Venezuela, Russia is developing cooperation with that country for different reasons.In international politics, it is important to be able to distinguish between important and unimportant aspects of international relations. If someone dubs us a “virus,” well that’s up to them. The term I would probably use of them is “paranoid,” but I am no specialist in making such diagnoses.

Rossiyskaya Gazeta/Russia Today: Bilateral modernizationhttp://rt.com/Top_News/Press/eng.html#

Dmitry Medvedev spoke about a visa-free regime with the president of Germany

By Vladimir Kuzmin

Yesterday President Dmitry Medvedev held talks with German President Christian Wulff, who assumed his position in early July.

Despite the fact that the German president primarily holds representative powers in his country, he arrived in Russia on a full-fledged four-day state visit. Wulff’s program not only includes meetings in Moscow with Medvedev and Prime Minster Vladimir Putin, but also a trip to Tver and St. Petersburg, where he plans to visit the German cemetery in Sologubovka, as well as a visit to Ulyanovsk, where the president will be hosted by the local state university.

The first item on Wulff’s agenda in Russia was talks with Medvedev, who, in his opening statement, expressed hope in an interesting and productive dialogue.

“Our relations are strategic, cooperative, and remarkably advanced,” he stressed. “Our commercial relations are well developed, but we also have some special connections between the political structures, between the regions, between parties, and civil society institutions. All this forms the fabric of relations.”

“Germany and Russia share a long, checkered history, and we regard your friendship as a great gift to the German people,” the president of Germany said. “Our mutual sympathy and interest confirm the closeness of our people.”

Wulff acknowledged that in his country, people have a keen interest and great attention for all the ongoing events in Russia and consider themselves to be partners in the promotion of modernization.

“We are striving toward further intensification of relations with your country, which is at the stage of transformation, and deeper relations in not only the economic sphere, but also in the field of education, legal protection, social institutions and in the cultural sector,” he said.

The idea of “Partnership for Modernization” was born in relations between Russia and the European Union and continues to develop on the level of our country with individual countries of the EU. All of the Russian president’s visits to Europe are accompanied by discussion of specific possibilities for technological and industrial cooperation.

This time similar opportunities were also discussed.

“This topic fully correlates with the ideas which are considered to be central here,” said the Russian leader. “The ideas for transforming Russia’s economic structure, ideas for transitioning from a resource-based to a high technology-based economy. In this sense, we are counting on friendly relations with Germany. Now may be the best time for this.”

Much time has passed since the document was adopted, but so far it is not fully clear as to what specific projects originated as a result of the partnership. Medvedev agreed that it cannot yet be said that the partnership for modernization has gained momentum.

“We suggested to our partners things that we would be interested in,” he said. “These are not only new projects. Experience and knowledge are no less important. In this sense, with Germany things are going quite well.”

Moreover, partnership is also common standards, which already exist. The resolution of the problem of outdated technical standards in Russia had at one time promoted the idea to apply the European experience here, which was partially accomplished.

The development of a partnership between Russia and the EU could be promoted by a simplified visa regime and a subsequent cancellation of visa barriers. The two sides have long discussed this option, but they have also been moving in this direction for a long time.

“I welcome the fact that the European Union set forth a proposal which includes operative steps toward the introduction of a visa-free regime, when the preconditions are met by all parties involved,” said Wulff. Certain steps to enable people to freely visit each other are being made already today.

Moreover, the EU would also like it if Russia adjusted some of its domestic norms, which could ease the ability of Europeans to travel across the great breadth of Russia.

“So that foreigners don’t have to register and re-register in Russia,” the German president said, noting Russia’s registration practices.

Also ongoing is discussion of a Russian initiative for a new European security agreement, which, as was stressed by the Russian president, no one had countermanded. The EU is not avoiding this idea, and is ready to discuss it, agreed Wulff.

“Security in Europe must be united,” said Medvedev. “It should not be fragmented. Europe is the way it is. It has NATO, it has countries that are not members of NATO, it has the OSCE, the European Union, and the CSTO, about which many forget.” Another exchange of opinions will take place early next week, when a trilateral meeting between the presidents of Russia and France and the chancellor of Germany is held in Deauville, France, prior to the upcoming G20 summit in Korea.

Read the article on the newspaper's website (in Russian)

Admiral Panteleyev headed for Japanhttp://english.ruvr.ru/2010/10/13/25691964.html

Oct 13, 2010 10:40 Moscow TimeRussia’s Pacific Fleet destroyer Admiral Panteleyev has left Vladivostok heading for Hakodate port in Japan.    The Fleet’s press service says the Russian vessel is visiting Japan to foster naval cooperation in the Pacific Rim and cement bilateral ties.     Japanese military ships have called at the Russian port of Vladivostok eight times and once at Petropolovsk-Kamchatski, and the Russian vessels have paid seven visits to Japan. 

Medvedev’s visit to Seoul to be landmark in ties with South Korea

http://www.itar-tass.com/eng/level2.html?NewsID=15584799&PageNum=0

13.10.2010, 10.00

SEOUL, October 13 (Itar-Tass) - The consultations held at the South Korean Ministry of Foreign Affairs and Trade “highlighted preparations to a Seoul visit of Russian President Dmitry Medvedev,” Russian Deputy Foreign Minister Alexei Borodavkin told Itar-Tass before the departure for Moscow. He noted that these meetings “showed very close approaches to the discussed issues.”

“I believe that it will be right to say that this visit will be landmark in our relations with South Korea. The following issues may be high on the agenda of the visit. This is primarily the development of bilateral relations with the focus on tapping the potential of Russia and South Korea in the modernization of our economies,” he noted.

“On October 12, the consultations were held at the South Korean Ministry of Foreign Affairs and Trade with the focus on the meeting with Foreign Minister Kim Sung-hwan. This was his first meeting at a new post with the foreign diplomat. We know each other, we worked together in Vienna, so we met as old friends and were speaking cordially and sincerely,” the Russian diplomat said.

Alongside, the consultations were held with South Korean Deputy Foreign Minister Wi Sung-lac, who is in charge of the issues to make the Korean Peninsula nuclear free, as well as with Deputy Foreign Minister Kim Jae-chin, who is charge of bilateral relations and cooperation in the Asia-Pacific region.

Eurasian organizations discuss countermeasures to regional crises http://english.peopledaily.com.cn/90001/90777/90856/7165030.html

14:12, October 13, 2010Four Eurasian organizations gathered on Tuesday to discuss regional security and cooperation.

The meeting was proposed by the Collective Security Treaty Organization (CSTO), and attended by the Shanghai Cooperation Organization (SCO), the Commonwealth of Independent States (CIS) and the Eurasian Economic Community (EurAsEC).

The meeting discussed countermeasures to regional crises, and acknowledged it was necessary to develop new plans to deal with current issues in Central Asia, such as security, drug trafficking and illegal immigrants, CSTO Secretary-General Nikolay Bordyuzha said.

Participants also exchanged views on security cooperation between the four organizations as well as with other global associations. They agreed to enhance information exchange, carry out mutual emergency aid, and send delegates for cooperation.

Concerning possible cooperation with NATO, Bordyuzha said the meeting was for now confined only to cooperation within the four organizations.

He also said the four sides would work out a mechanism for regular meetings, with the next conference scheduled for Moscow in the autumn of 2011.

CIS Executive Committee Chairman Sergei Lebedev said a working group on cooperation between the four organizations would be established.

"We agreed to set up a working group on cooperation between our organizations, which includes our deputy executive secretaries and deputy secretary-generals from the CSTO, the SCO, EurAsEC and the CIS," he said.

He also said participants agreed on the schedule of meetings to carry out plans for further cooperation and integrating efforts to tackle global problems, such as drug trafficking.

Source: Xinhua

(LEAD) Russian envoy calls for common view on denuclearizing N. Koreahttp://english.yonhapnews.co.kr/national/2010/10/12/18/0301000000AEN20101012008600315F.HTML

By Lee Haye-ahSEOUL, Oct. 12 (Yonhap) -- Members of six-party talks need to form a common view on denuclearizing North Korea and prevent the regime from conducting more nuclear tests, Russia's top nuclear envoy said Tuesday, Russia's Deputy Foreign Minister Alexei Borodavkin met with South Korea's new Foreign Minister Kim Sung-hwan during his three-day trip to Seoul that began Monday. Borodavkin is also Russia's chief envoy to the six-party talks on ending North Korea's nuclear programs.Kim said South Korea will engage with North Korea "if it proves its sincere will (to denuclearize) through action" and if it proposes meeting "on the premise of making progress on denuclearization," an official said.

   Pyongyang recently suggested it could return to the six-way talks it walked out on in December 2008 in protest over U.N. sanctions against it for its nuclear and missile tests. Seoul has repeatedly said it is not interested in talks just for talks' sake. The two Koreas, the U.S., host China, Russia and Japan form the multilateral denuclearization forum.

   Borodavkin responded that the North's negotiating partners "should work together toward an agreement in opinion," according to the official.

   The Russian envoy recalled how his country gave US$100 million worth of aid to the North following the six-party agreements in September 2005 that committed Pyongyang to denuclearize, but Pyongyang went ahead with its nuclear test.

   "This should not happen again," Borodavkin was quoted as saying, adding Russia has strong interests in peace and security in the entire region of Northeast Asia in the long run.

   Later Tuesday, Borodavkin met with Deputy Foreign Minister Kim Jae-shin for an annual policy meeting between the two countries, which this year mark the 20th anniversary of diplomatic relations.

   The two sides "agreed to make joint efforts to expand and deepen" their ties by successfully staging the planned trip to Seoul by Russian President Dmitry Medvedev for next month's summit of the Group of 20 nations, Seoul's foreign ministry said in a statement.

   They also agreed to work closely together to identify specific ways of cooperation for Russia's economic modernization project that calls for advancing such sectors as energy efficiency, nuclear power, medical, information technology and space and communication industries, it said.

   hague@yna.co.kr

Updated : 10:00 AM, 10/13/2010General underscores defence cooperation with Russia http://english.vovnews.vn/Home/General-underscores-defence-cooperation-with-Russia/201010/120405.vov

Defence cooperation would contribute to further reinforcing the strategic

partnership between Vietnam and Russia, said Defence Minister Phung Quang Thanh at a meeting with the Chief of General Staff of the Russian Armed Forces in Hanoi on October 12.

General Thanh hailed General Nikolai Makarov, who is also Russia’s first Deputy Defence Minister, for his presence at the first ASEAN Defence Ministers’ Meeting Plus (ADMM+) and his contributions to the success of the meeting.

He expressed thanks for the valuable assistance that the former Soviet Union and the current Russian Federation have offered to the Vietnamese army and people in the past years.

General Thanh also wished that after the first ADMM+ in Hanoi, the Russian Defence Ministry and other countries would make further contributions to make ADMM+ a really highest defence cooperation mechanism between ASEAN Defence Ministers and eight dialogue partners, strengthening peace, stability and cooperation in the Asia-Pacific region.

General Nikolai Makarov congratulated Vietnam on its successful organization of ADMM+ and spoke highly of the outcomes of the meeting as well as Vietnam’s defence cooperation initiatives.

Within the framework of ADMM+, General Thanh had bilateral meetings with the delegation heads of China, the US, Laos, Cambodia, Singapore, Thailand, Brunei, the Philippines, Indonesia, Malaysia, New Zealand and Australia.

The same day, Chief of the General Staff of the Vietnam People’s Army Senior Lieutenant General Nguyen Khac Nghien received Chief of the Defence Force of Australia General Angus Houston, who came to Vietnam for ADMM+./.

Vietnam Plus

Akylbek Zhaparov: Union of Kyrgyzstan with Russia and Kazakhstan already existshttp://eng.24.kg/cis/2010/10/13/14185.html

13/10-2010 09:57, Bishkek – 24.kg news agency , by Daniyar KARIMOV

“Union of Kyrgyzstan with Russia and Kazakhstan already exists - within the framework of the Commonwealth of Independent States and EurAsEC,” a representative of the party Ar-Namys Akylbek Zhaparov said at a press-conference on Wednesday.

“There are people who are tempted into an alliance with Russia, he said. But the alliance with Russia and Kazakhstan already exists within the CIS and EurAsEC. Hopefully it will be held under the Customs Union in the near future.”

“As to a political union with Russia, I believe that this issue had been raised too early, he continues. No one is waiting for us in such an alliance. Many say about creating a common state, but do not ask about whether Russia wants to join us in the situation we live in. We have riots, about $ 2.5 billion foreign debt. I think we can be friends but not necessarily too close.”

URL: http://eng.24.kg/cis/2010/10/13/14185.html

Russia integrates into TRACECA

http://abc.az/eng/news/main/48642.html

Baku, Fineko/abc.az. Russian Railways (RZD) has made in Baku a range of statements about its policy.

At forum "Strategic Partnership: Caucasus Region" RZD senior vice president Valeriy Reshetnikov has stated today that by opening of an international ferry line between ports Makhachkala and Aktau and Turkmenbashi, Russia integrated into Transport Corridor Europe-Caucasus-Asia (TRACECA).

"Makhachkala port has capacity to serve 20,500 wagons a year that is enough to meet needs in ferry carriages via the east-west and north-south corridors,” he said.

To foster ferry traffic RZD is now acquiring or undertakes management with ferry crossings and ferries in the Black, Caspian and Baltic Seas.

13.10.2010 11:49

Russian Border Service in Armenia: Nobody crossed Armenia-Turkey border (photos)http://news.am/eng/news/34300.html

October 12, 2010 | 22:49

“A prearranged PR action is in question, pursing rather dark aims,” press service of the Border Service, Russian Federal Security Service in Armenia told NEWS.am, commenting on Turkish politicians’ illegal crossing the border along the River Akhuryan.

According to the Federal Security Service, the Turkish mass media’s publications and the politicians’ statements contain substitution of notions. “Despite Turkish politicians from “Strong Turkey” Party (GTP) speak of their good intentions in the light of Armenia-Turkey reconciliation, they flout the legislation of their own country. To implement good intentions, committing a criminal offense, particularly to cross the state border illegally, is impossible,” the press service said.

“Following the Turkish media’s publications, additional investigation was conducted in the pointed section of Armenia-Turkey state border. The site investigation showed, the photo session of Turkish politicians was made from the Turkish side of the border in the region of Ruins of Ani,” the press service reported.

The Border Service provided NEWS.am a number of photos to prove inadequacy of Turkish politician’s statement on crossing the closed Armenia-Turkey border.

The first three pictures clearly show that the mesh fencing is on the opposite side of the river, that is on Turkish territory (Armenian-Turkish border runs through the middle of the river). It is precisely this mesh fence, as insisted by the representatives of the Turkish party, they had crossed (picture 4). Also, one of them (far to the left) is leaning to the post at the same grid. Moreover, the photographs of this section of the Armenian-Turkish border show the ruins of the ancient Armenian capital of Ani (now located in Turkey). The ruins are in the background of the same fence which is entirely located on Turkish territory. As for the Turkish media photos (photo 5), at which representatives of the “Strong Turkey” allegedly crossed the river, according to the Russian Border Service in Armenia, the water depth is at least 1.5meters (five feet), which proves that no one crossed the river, especially wearing suites, and the picture is made in Turkey.

10:41Criminal case opened against Moscow prefecture officials – Investigations Committee (Part 2)http://www.interfax.com/news.asp

http://top.rbc.ru/society/13/10/2010/481059.shtmlGOOGLE TRANSLATION

Vladimir Resin fired assistant member of the Federation Council

Acting mayor Vladimir Resin fired assistant member of the Federation Council's work in Moscow, Viktor Belyakov.As have informed RBC in the government of the city, the appropriate order has been signed. According to the document, Belyakov was dismissed on October 11, 2010. with the phrase "at will". Belyakov was appointed assistant to a member of the Federation Council Oleg Tolkachev August 1, 2007.Note that after the resignation of former Mayor of Moscow Yuri Luzhkov, mayor of the capital ai V. Resin developed active on the reshuffle. The loudest of his decision was the dismissal of the Prefect of the Northern Administrative District of Moscow, Oleg Mitvol. The official was dismissed on the grounds that "its working methods have not found support among the population."Also, was fired deputy state housing inspection capital Sergey Titov "in connection with the retirement-age." In the resigned former acting Deputy Mayor of Moscow Vladimir Silkin and Head potrebrynka Vladimir Malyshkov, and also implicated in a corruption scandal, former Vice-Mayor Alexander Ryabinin.Recall, V. Resin, was appointed Acting Mayor of the capital on Sept. 28 by the same decree of the President, Dmitry Medvedev, who "in connection with the loss of confidence in the president" was dismissed by Mayor Luzhkov.October 13, 2010.

Russian govt will help promote interfaith dialogue – Medvedevhttp://abna.ir/data.asp?lang=3&id=208722

Date: 2010/10/13source: Interfax

Moscow (AhlulBayt News Agency) - Russian President Dmitry Medvedev has said he supports steps to promote strong interfaith dialogue, including in the North Caucasus.

"The state will assist this process in every way. Naturally, it will not interfere in religious work, but will create all of the necessary conditions enabling people of any faith to worship freely," Medvedev said at a news conference after talks with German President Christian Wulff in Moscow on Tuesday.

"Like any other country, our country has encountered acts of religious extremism using pseudo-religious equilibristics to achieve political goals," the Russian president said.

"We cannot stay indifferent to it, and we have been closely watching all of the processes in this sphere. The situation in the North Caucasus certainly poses the greatest problem for us," he said.

"Due to various reasons, contradictions emerged in the North Caucasus at a certain moment. Various methods were used to appease the sides and to restore normal interfaith dialogue," Medvedev said.

Both Muslims and Christians live in the North Caucasus, the president said.

"Naturally, their dialogue should be normal and productive, especially as representatives of different confessions have lived side-by-side for centuries and have achieved very good results," he said.

End item/ 129

Opponents ask Russian president not to allow building mosque in Tekstilschikihttp://abna.ir/data.asp?lang=3&id=208721

 Date: 2010/10/13source: Interfax

Interfax – Opponents of the decision to build mosque and madrasah in Moscow Tekstilschiki district asked Russian President Dmitry Medvedev to interfere in the situation.Moscow (AhlulBayt News Agency) - Interfax – Opponents of the decision to build mosque and madrasah in Moscow Tekstilschiki district asked Russian President Dmitry Medvedev to interfere in the situation.

Authors of the request stressed that they did not have any political demands, but they did not want this "social conflict to grow in interreligious." They wanted to see there a "comfortable park where everyone in spite of national, religious and other characteristics can have a rest."

A few number Muscovites asked the country's head to take the situation under his personal control and to instruct the General Prosecutor's Office to check legal acts adopted by Moscow authorities on the question.

End item/ 129

Moscow Muslims want more mosques, residents stage protestshttp://rt.com/prime-time/2010-10-12/moscow-muslims-mosques-protests.html/print

12 October, 2010, 23:30

Muslims in Moscow say there are not enough mosques in the capital to serve the needs of their community. City Hall refutes the claims.

In recent years, the Muslim community of the capital has repeatedly complained that they need more mosques – the four existing ones are too little for the nearly 2 million believers living in Moscow.

The capital’s officials, however, say that more than enough land has been given over for the purpose of building places of worship.

The lack of mosques has even resulted in Muslims worshipping in Orthodox churches. Islamic leaders are strictly opposed to the initiative, saying that this only triggers hostility between the communities.

At the same time, building new mosques does not help establish better relations between the churches either.

Recently, around 2,000 signatures were collected by residents in the city’s south who did not want a mosque in their area. Instead, they say, the place could be turned into the park.

Orthodox Christian groups added fuel to the fire, saying that they also wanted to use the site for a church but could not get zoning permission, and questioning how their Muslim colleagues were able to get one.

“Many perceive mosques as a threat,” Akhmed Azimov, from the Russia’s Congress of the Caucasus People, told RT. “However, building more will only help solve the problem. New mosques will reduce overcrowding. At the moment, many Muslims have to pray outside, on the streets near the mosque, because not everyone can fit inside. The real threat is that citizens' fears may be used and abused by the ultranationalist groups that unfortunately exist in the city.”

The Islamic world has long been part of Russian life. Muslims make up a large part of the Russian population – there are 20 million in the country. This makes Islam the second largest religion in Russia, after Orthodox Christianity.

Moscow is not the only capital facing this problem. Just recently, New York made headlines around the world in connection with the building of an Islamic center near Ground Zero.

Gazeta.ru/Russia Today: Moscow is and not very Muslim http://rt.com/Top_News/Press/eng.html#

By Andrey Kolesnikov, observer for Novaya Gazeta

The share of the Muslim population in Russia, according to a Pew Research study, equals five percent. That is the same as in Germany, except for Russia, Islam is a traditional faith – it is not a religion of immigrants, but that of an indigenous population. Such figures should be regarded with caution and the approaching census should be the reliable source for this information. Moreover, it’s unclear as to how many of Russia’s Muslims have long resided in the country, how many are newcomers, how many are just now becoming well-established in the country, how many of them are guest workers who are not here to live or become established but to work, and what nationalities prevail.

Without answering these questions, it is impossible to develop a national policy in regard to the Muslim population. Meanwhile, one should realize that it will need to be developed: neither Russia nor Europe can avoid an influx of the Muslim population – it is one of the basic demographic trends which is unavoidably politicized as it continues to progress. The conflict around the blockade of pathways to the Cathedral Mosque in Moscow, which evoked major backlash among Moscow’s Muslims, serves as evidence of this fact.

In this case, the fact that in Moscow, a city with a population of more than 10 million people, there are nearly 1.5 million followers of Islam, which is a considerable number, played a partial role. Not only are the city’s authorities and its population not ready to regulate the possible problems, but they don’t have any idea as to how to deal with the rapidly growing number of Muslims. Otherwise, the management of the Olympic Sports Complex would not have created a parking lot in an area that was allocated by the city’s authorities for prayer while the mosque is being renovated. This is not simply the kind of rudeness that is traditional for big cities, but shortsighted insensitivity to the scale of the problem.

And the fact that the police don’t have a position on this matter is not surprising: intelligent reflection is not their forte. One day, we show tolerance during the Eid al Fitr celebrations by closing the surrounding area of the Peace Avenue (Prospekt Mira) metro station with such fanaticism that people are unable to send their children to school, take their dogs out for a walk, or simply commute to work; another day, on the other hand, we disallow Muslims to approach the place of prayer. Can it be that the change from Luzhkov’s leadership to Resin had indeed changed the policy in regard to Muslims?

We all need to firmly grasp that things won’t get easier. The protests of the Tekstilshchiki residents against the construction of a mosque are not creating problems for the Muslims, but instead, for residents of Peace Avenue. Moscow is, thank God, not New York after 9/11, and here, there are no disputes over mosque construction within blocks of the place of the catastrophe.

We will have to accept mosques and the rise in the Muslim population, while experiencing the same problems that are typical for France, England, Germany, Belgium, Holland and Sweden.

The authorities, meanwhile, will be forced to make some serious efforts to contain a wave of xenophobia, which has already become the answer of the barbaric part of the Russian population to the migration processes. Everyday events will become ideological and politicized, which will in turn lead to a clash of civilizations, or the barbaric components of several cultures. And we will need to work on establishing a boundary for tolerance, readjusting the immigration policy, integrating people from other cultures to the city-wide environment, so as to avoid the appearance of hostile ghettos and ultra-rightwing parties, which are successful in many countries with a large Muslim population, including Sweden.

On the one hand, the chairman of the Russian Council of Muftis, Ravil Gainutdin, is right when he says that the people who attended prayers are “full-fledged workers, patriots, and taxpayers,” and asks the question: “Why is it that in a city in which the ancestors of today’s Muslims have lived for centuries, people have to pray on the streets?”

On the other hand, why is it that the same people had to slaughter sheep on the streets, as was the case in St. Petersburg, despite the culture of their ancestors? Most likely, because the cultural layer is washed out among not only those who display anti-Muslim sentiments, but also those who demonstratively flaunt their ostentatious Islamism. In a hostile environment, the coming culture is showing its passion with a vengeance…

In the grand scheme of things, however, we do not have a problem of a clash of civilizations – say, the Orthodox and the Muslims, for example. There is a problem of a clash of two barbarianisms, the “suburban” subculture, husking sunflower seeds, and the ignorant subculture of “the large number of newcomers” who are unwilling to leave the ghettos. In the end, one of the constants in Moscow is the conquerors of the capital from other Russian settlements, many of whom have since the early times brought with them the “country culture” and lack of sophistication (suffice to recall the late Soviet temporary resident workers).

The same is happening today, and in this case, religions have nothing to do with the rising tensions. The notion of Muscovite-ness itself is changing: the city no longer belongs to the capital’s residents of a certain generation. This Moscow is completely different, just as London and Paris have become different.

Moscow is a giant melting pot in which not all elements of the cultural and ethnic soup will be fully digested. But conflicts and clashes are inevitable if the uncontrolled competition for the title of Muscovite begins and is fueled by police screening based on ethnicity. Then, neither will Ravil Gainutdin nor Patriarch Kirill be able to help.

Read the article on the newspaper's website (in Russian)

Zakayev swears allegiance to new leader of militantshttp://www.newsbcm.com/doc/332

12.10.2010 17:49The State Committee of Defense will be a new government agency of Ichkeria. Photo from website justmedia.ru

Akhmed Zakayev has dismissed the government of the Republic of Ichkeria having sworn allegiance to warlord Hussein Gakayev, who from now on will head the new supreme authority of Ichkeria – Shura Majlis, or the State Committee of Defense.  

The leader of the breakaway Chechen republic said that the departure of the militants from the Caucasus Emirate followed by their refusal to obey Doku Umarov marks a return to the legal field of Ichkeria. "The Chechen fighters have distanced themselves from this mythical state under the name of "Emirate", said Zakayev. Quoting his words, the emirate advocates steered for continuous jihad, forgetting about their main goal – the struggle for independence of Ichkeria. Now that Umarov had come to replace Hussain Gakayev, the new government body - Shura Majlis – will under his command take over the management of the republic.  The new leader of the militants is known to have served as a bodyguard of terrorist Shamil Basayev, and then he led a battalion of suicide bombers. It is interesting to note that the Chechen President Ramzan Kadyrov has repeatedly said that groups like the Caucasus Emirate are only a myth for "squeezing money from the West". In fact, he said, there are only scattered groups of militants who will soon be eliminated by the government troops.

Russia's Medvedev to speak to governors on wildfire consequenceshttp://en.rian.ru/Environment/20101013/160933705.html

02:51 13/10/2010

Russian President Dmitry Medvedev will on Wednesday hold a video conference with top regional officials on work to address the consequences of fires that raged across the country in summer.

The conference will touch upon the implementation of instructions Medvedev had given to regional heads, in particular construction of housing for those who lost roof above their heads during the wildfires.

An unprecedented heat wave hit European Russia this summer, sparking wildfires and severe droughts in many regions. More than 50 people died in the fires, which destroyed over 2,000 homes.

On Wednesday the Russian president will also hand out awards for efforts to extinguish fires.

Prime Minister Vladimir Putin promised in September that the country would allocate 7.5 billion rubles ($249.2 million at current rates) in 2011 to rehabilitate forests and prevent wildfires.

MOSCOW, October 13 (RIA Novosti)

Medvedev to present State awards to firefighters Wed

http://www.itar-tass.com/eng/level2.html?NewsID=15583902&PageNum=0

13.10.2010, 01.36

MOSCOW, October 13 (Itar-Tass) - At a ceremony here on Wednesday, President Dmitry Medvedev will present State awards to firefighters, who grappled with wildfires in almost 20 Russian regions in summer this year.

Both Russian firefighters and those from foreign countries, who helped Russia put out the fires, will be present at the ceremony, which will take place in the Catherine Hall of the Kremlin.

Putin to inspect construction of Olympic facilities in Russia's Sochihttp://en.rian.ru/sports/20101013/160934325.html

04:09 13/10/2010

Russian Prime Minister Vladimir Putin will travel to Sochi to inspect the construction of Olympic facilities together with a high-ranking official from the International Olympic Committee, the cabinet said.

Putin will meet with Jean-Claude Killy, chairman of the IOC Coordination Commission for the 2014 Sochi Winter Olympics, to discuss preparation for the Games.

More than 200 sports and infrastructural facilities are to be built in Sochi by the time of the 2014 Winter Games. The cost of building the facilities and infrastructure is estimated at more than $30 billion.

The southern Russian resort city on the Black Sea won the right to host the Olympics at an IOC session in Guatemala in July 2007 after a close race with South Korea's Pyeongchang and Austria's Salzburg.

Putin, a noted sports fan and participant, was the driving force behind Russia's successful bid.

He took the unprecedented step of delivering a speech in English at the IOC meeting in Guatemala to select the host city, and was credited with swaying delegates to vote for the southern Russian resort.

Russia has never staged Winter Olympics and Moscow's hosting of the 1980 Summer Games was marred by a U.S.-led boycott involving more than 60 countries.

MOSCOW, October 13 (RIA Novosti)

Putin to meet with IOC delegation in Sochi Wednesday

http://www.itar-tass.com/eng/level2.html?NewsID=15583822&PageNum=0

13.10.2010, 00.33

MOSCOW, October 13 (Itar-Tass) -- Prime Minister Vladimir Putin heads to Sochi on Wednesday for a working tour to examine matters connected with the process of preparations for the 2014 Winter Olympic Games.

A government press service official has said it is expected that the Premier, together with Jean-Claude Killy, Chairman of the Sochi 2014 International Olympic Committee (IOC) Assessment Commission, and Gilbert Felli, Games Executive Director, will tour the construction sites of Olympic facilities in the Imereti Valley (Olympic Park).

Besides, the Premier will inspect houses built for people resettled from the Sochi Games zone and the construction of the Adler – Alpica Service road.

Aleksey Kudrin receives Stolypin medalhttp://english.ruvr.ru/2010/10/13/25674292.html

Oct 13, 2010 02:49 Moscow Time   Russian Finance Minister Alexei Kudrin, who turned 50 on Tuesday, was awarded the Pyotr Stolypin Medal. This medal, established in honor of an outstanding reformer of the epoch of the last Russian tsar, is awarded "for achievements in addressing the strategic objectives of socio-economic development".    Recently, the authoritative magazine «Euromoney» acknowledged Kudrin as the best finance minister for 2010. Foreign experts have praised his efforts to establish a stabilization fund, which helped Russia substantially mitigate the impact of the global economic crisis. 

Soviet-age highly enriched uranium returns from Poland to Russiahttp://english.ruvr.ru/2010/10/13/25673340.html

Oct 13, 2010 00:01 Moscow Time

Highly enriched uranium, delivered to Poland in the Soviet era, has returned to Russia.

More than 450 kilograms of radioactive fuel were transported in five phases over 12 months by rail to the Polish ports in the Baltic Sea and then on ships to the coast of Russia.

Uranium was intended for the two research reactors in the Polish town of Otwock-Sverk.

Head of the U.S. National Nuclear Security Administration Thomas D'Agostino referred to the uranium’s return to Russia as "a key milestone in strengthening nuclear security worldwide." According to him, the exported uranium would have been enough to produce more than 18 nuclear warheads.

Nuclear Road Trip: Shipping Uranium A Complex Taskhttp://www.npr.org/templates/story/story.php?storyId=130384916

by Geoff Brumfiel

October 11, 2010

A shipment of bomb-grade uranium arrived at a secure facility in Russia on Monday, sent from a research reactor in Poland as part of a race to secure dangerous radioactive material around the world. There was no way to mistake the shipment for something innocuous like Polish sausage: The trucks were escorted by heavily armed police officers and plastered with large signs saying they carried radioactive material.

"I feel like we're prepared for everything, but you're just a little bit nervous," said Igor Bolshinsky, who is part of a small American team that planned the nuclear road trip. His group was responsible for the transport of the uranium from Poland back to Russia, where it came from in the first place.

The route is complicated: The material will travel by truck to Warsaw, by train to the Baltic port of Gdynia, by boat to the Russian port of Murmansk, and finally by train to a high-security facility in Siberia.

This uranium was never intended for weapons; it was fuel for a small nuclear reactor that scientists use for research. Globally, there are more than 100 research reactors like the one in Poland.

"Most of them were supplied either by the United States or the Soviet Union during the Cold War, and they do all kinds of different work, ranging from training students to even interesting archeology and medical research," says Matthew Bunn, an expert on nuclear security at Harvard University.

These reactors are using highly enriched uranium fuel pure enough for a bomb. Since Sept. 11, 2001, the U.S. government has grown increasingly worried that terrorists could steal the material or buy it. And Bunn says these reactors aren't very well guarded.

"They're just not places where it's plausible that you're ever going to have the kinds of military level security that is really, in my view, appropriate," he says.

A Complicated Move

The solution? Convert the reactor in Poland to run on low-enriched uranium that can't be used in a bomb, then transport the dangerous stuff back where it came from, in this case Russia. Sounds simple enough, right? Guess again: Andrew Bieniawski, the man in charge of the U.S. program to move the fuel, says planning for this single trip took three years.

"There's a lot of diplomatic and technical level — you have people from the ministry of the economy, you have the director of the reactor, you have coordination with the police and the Special Forces," he says. "So those are just a few of the ones that, off the top of the head, we've had to coordinate with."

In April of last year, President Obama set a goal of securing all vulnerable nuclear material in just four years. Every dangerous research reactor probably won't be converted by then, but Bieniawski is hoping to clear out 10 countries. Even that goal seems ambitious.

"It is an aggressive schedule, but I do think we can make it," Bieniawski says.

Russian Cooperation Essential

The global program is moving ahead: In the past three years, Bieniawski's team, part of the Department of Energy's National Nuclear Security Administration, has shut down or converted two dozen reactors in places like China, Bulgaria, Chile and the U.S., which still has several reactors running on bomb-grade fuel. But there's one place the U.S. effort has barely reached.

"One of the biggest and most difficult stumbling blocks at this point is Russia, frankly," says Harvard's Matthew Bunn. "They've been willing to be helpful on converting other country's research reactors, but when it comes to converting their own, which is the world's largest number of research reactors, they've been moving extraordinarily slowly."

But the U.S. needs to tread carefully: Russian cooperation is essential for operations like the one in Poland. In fact, it's a Russian ship that will take the fuel on the leg of its journey from the Polish port to Russia. One by one, the containers are lowered into the hold then covered with heavy plates that will shield the crew from radiation.

After a final check from customs authorities, the boat pulls away from port and the Americans, the Poles and Russians all gather dockside to celebrate with a toast.

Geoff Brumfiel is a reporter with Nature. He covered this story in this week's issue of the journal.

Polish archeologists to start work at Kaczynski air crash sitehttp://en.rian.ru/world/20101013/160934932.html

05:22 13/10/2010

Polish archeologists will on Wednesday start inspecting the site of April's Polish presidential plane crash near the western Russian city of Smolensk. Their work on the tragedy site will last until October 27.

The archeologists will search for body fragments and clues that may help establish the cause of the crash, which killed 96 people, including then president Lech Kaczynski, the first lady and many top state officials.

The worn-out Tupolev Tu-154 airliner with Kaczynski on board crashed near Smolensk on April 10 after hitting the tops of trees in thick fog. The delegation was on its way to a commemoration ceremony of the 1940 Katyn massacre, in which more than 20,000 Poles had been executed by Soviet secret police.

Russian and Polish investigators and experts jointly probe the causes of the crash, while Polish military prosecutors also conduct a separate investigation.

Polish military prosecutors earlier said the results of the excavation at the crash site will become available in late November - early December.

A group of 10-12 Russian archeologists and three geodesists will assist the Polish experts. One of Polish military prosecutors will accompany the group to oversee the excavation work.

Polish officials probing the plane crash said in late September they were "dissatisfied" with the documents supplied by Russia.

MOSCOW, October 13 (RIA Novosti)

The Irish Times - Wednesday, October 13, 2010

Russian ambassador links spy passport row to adoption dealhttp://www.irishtimes.com/newspaper/frontpage/2010/1013/1224280974139.html

MARY FITZGERALD, Foreign Affairs Correspondent

RUSSIA’S AMBASSADOR to Ireland has expressed concern that the controversy over allegations that Russian spies used data from Irish passports may overshadow ongoing negotiations towards reaching a bilateral agreement on adoption.

Ambassador Mikhail Timoshkin raised the concerns during a meeting with Debbie Deegan, director of Irish charity To Russia With Love, yesterday. Ms Deegan was invited to the Russian embassy after it emerged that a passport belonging to a volunteer with her charity had been implicated in the case.

On Monday it emerged that gardaí are investigating allegations that six forged Irish passports containing material copied from valid passports were used by members of a Russian spy ring uncovered in the US this summer.

Passports belonging to a Donegal firefighter and his wife who had holidayed in Russia in 2005 are among those implicated. It is not known how or where the passports were accessed.

Minister of State for Children Barry Andrews discussed progress towards a bilateral adoption agreement between Russia and Ireland at a conference organised by the International Adoption Association on Saturday.

A spokesman for the Russian embassy said the Department of Foreign Affairs had contacted the embassy yesterday regarding the passports controversy. “We have informed Moscow about the developments and the concerns on the Irish side, in the media and in Irish society,” he said.

The embassy had, up to yesterday, insisted it had received no contact from the Irish authorities about the allegations.

However, a spokesman for the Department of Foreign Affairs told The Irish Times that senior officials from the department had, on October 1st, informed Mr Timoshkin and a senior official from Moscow then visiting Dublin that the Government was investigating US allegations that Russian agents had used forged Irish passports.

“[They] made clear that the Government took serious exception to the forgery and misuse of Irish passports,” the spokesman said. “[They] notified their Russian counterparts that, depending on the outcome of the current inquiries, the assistance of the Russian authorities might be sought in furthering this investigation.”

The Russian espionage ring was broken up in June with the arrest of 10 people in New York, Boston, New Jersey and Virginia. All 10, who were later deported as part of a spy swap deal with Russia, admitted conspiring to act as unregistered foreign agents.

Most of the passports being investigated are believed to predate the current security-enhanced passport introduced in 2005. As a precautionary measure, replacement passports are being issued to the six individuals caught up in the case.

Ras Al Khaimah Free Trade Zone eyes fast growing Moscow markethttp://www.ameinfo.com/244989.html

Wednesday, October 13 - 2010

As part of its mandate to boost investment into Ras Al Khaimah, a top-level trade delegation from the Ras Al Khaimah Free Trade Zone (RAK FTZ) - one of the fastest-growing and most cost-effective free trade zones in the UAE - recently visited Moscow on a strategic business mission.

During the visit, the trade delegation identified potential investors in Moscow and other parts of Russia. The delegation held interactive sessions and consultative meetings with potential investors at the Hotel Baltschug Kempinski Moscow. As part of its efforts to attract more investment, RAK FTZ partnered with HSBC and other trade consultants during the mission. RAK FTZ and HSBC has recently signed a strategic cooperation covering a wide range of partnership initiatives.

Among the investment opportunities offered were promotional packages including the Flexi facility for less than US$5,000 for investors, as well as Standard Offices, which were promoted for less than $7,000.

In his comments on the successful mission to Moscow, Oussama El Omari, CEO of RAK FTZ, said: "The Government of Ras Al Khaimah and the RAK FTZ has always supported pro-investment policies which are firmly rooted in the principles of free trade and promoting entrepreneurship. RAK FTZ has enjoyed a steady increase in its client base since it was born 10 years because of its continued diligence to keep abreast of the needs of today's businesspeople; and the trade visit to Russia was a major step in this direction."

El Omari stressed that RAK FTZ is committed to enhance the trade relationships between UAE and Russia; and the visit was a pivotal step in attracting more companies from around the world. "The RAK FTZ offers tremendous opportunities for Russian investors in diverse sectors; and the visit was aimed at identifying potential investments. Our delegation had a very fruitful mission and we are already witnessing very positive signs," he said.

The increasing number of Russian companies registered with the RAK FTZ is a clear indication of the strong business cooperation between Ras Al Khaimah and Russia. "There are over 300 companies from Russia and the former Soviet Republics registered with the free zone since 2004. Of these, nearly 200 companies are from Russia alone; and

the list is growing. We are determined to boost this trade exchange between the two countries," he added.

Nick Levitt, Head of Commercial Bank, HSBC UAE, commented "The success of these road shows clearly demonstrates that there is a healthy international appetite to learn more about the mechanics of doing business in the UAE. Cross-border trade presents a huge opportunity for UAE businesses, and we believe that encouraging inward investment through the development of free zones such as RAK FTZ, will continue to be a major contributing factor to the growth of the commercial sector in the Emirates. HSBC will continue to support our partners at RAK FTZ both within the Emirates and as they continue to proactively drive international business development."

In 2009, RAK FTZ registered 10% growth year on year, and is aiming to register over 2000 companies by the close of 2010, with particular focus on the SME sector.

We must restart our stalled nuclear talkshttp://www.ft.com/cms/s/0/72376fae-d644-11df-81f0-00144feabdc0.html

By Madeleine Albright and Igor Ivanov

Published: October 12 2010 23:34 | Last updated: October 12 2010 23:34

In September the US Senate foreign relations committee voted to support New Start, an important treaty limiting nuclear arms in America and Russia. It was a hopeful step, but sadly politics intervened. The full Senate will not now consider the treaty until after November’s elections, and even then partisan bickering could see delays into 2011. Given that Russia’s Duma is waiting for the Senate, we can now expect delays to a treaty that is in both nations’ interest and will push back the timetable for future nuclear negotiations.

New Start reduces the number of nuclear warheads in both countries, while also boosting the international non-proliferation regime. In signing it Presidents Barack Obama and Dmitry Medvedev bolstered a growing US-Russian partnership. Yet, given these delays, they should now do more. In particular, a number of interim steps can help to maintain momentum.

To begin with, Washington and Moscow should open up new talks on nuclear deterrence. A frank conversation, including a discussion about how missile defence and long-range conventional weapons affect the relationship between both countries, could reveal similarities in thinking. These could, in turn, underpin future negotiations to cut nuclear weapons below even the levels of New Start.

Washington has indicated that it wants limits on tactical nuclear weapons in the next round. Moscow still worries about “non-deployed” strategic warheads, for example those

not on ballistic missiles but kept at storage sites. New Start, while a critical step, does not affect either category, limiting only “deployed” strategic warheads. Including both these other categories will allow US-Russian negotiators, for the first time, to address all nuclear weapons. They should also increase transparency by revealing their total numbers of weapons.

The next round of negotiations will be longer and more complex than even those that produced New Start, and such preliminary exchanges would allow both sides to begin moving forward on a number of tough issues. Talks should certainly examine the verification challenges posed by limits on tactical nuclear weapons and non-deployed strategic warheads, which may need to include monitoring limits on nuclear warheads kept in storage sites, something the US and Russia have never before had to do.

There is also a real chance for co-operation on missile defence. This has long been a daunting issues on the bilateral agenda, although it has been less contentious since the Obama administration’s alteration of US missile defence plans for Europe. But genuine US-Russian – or, indeed, Nato-Russian – co-operation on this issue could convert a long-time problem issue into one of mutual co-operation.

A starting point could be discussions of how Russia and America would co-operate to protect Europe, including European Russia, from a third-country missile threat. This could also help to address Western concerns on Iran. The US and Russia can also push discussions that began at April’s nuclear security summit, when 40 countries pledged to secure their fissile materials by 2014. By pooling expertise, our nations can develop a “gold standard” which all countries can use to secure their fissile material stocks, and keep them out of the hands of terrorist organisations.

Similar moves can be made on non-proliferation. The US and Russia are already working together to curb Iran’s nuclear ambitions and persuade North Korea to abandon its nuclear weapons programme. But they could also develop a new joint diplomatic strategy to urge all countries to agree to give the International Atomic Energy Agency expanded powers to monitor and inspect nuclear activities. That would also make it harder for other nuclear “wannabes” to develop clandestine nuclear weapons programmes.

Talking about nuclear weapons remains a delicate topic for both our countries. Neither side’s military is excited, for example, about the intrusive verification measures that they may soon have to face. But by pursuing these ideas the US and Russia can cement their improved relationship, give new impetus to efforts to curb nuclear proliferation, and help build a safer and more secure world – even as we await the ratification of New Start.

Madeleine Albright was US secretary of state 1997-2001. Igor Ivanov was Russian foreign minister 1998-2004. A paper with ideas they submitted to the US and Russian governments is at www.brookings.edu and www.imemo.ru

Copyright The Financial Times Limited 2010. You may share using our article tools. Please don't cut articles from FT.com and redistribute by email or post to the web.

October 12, 2010With Love from California

http://www.russiaprofile.org/page.php?pageid=International&articleid=a1286903909

By Tai AdelajaRussia Profile

Russia Is Attracting a Lot of Business Interest From American Investors Compared to Its BRIC Rivals, but It Still Hasn’t Shaken Its Image as a Risky Investment Climate

President Dmitry Medvedev could benefit from the best sales pitch so far for his flagship innovation project after California Governor Arnold Schwarzenegger yesterday urged American investors to grab the unique business opportunities that modern Russia presents. In the rare celebrity endorsement of his modernization efforts to date, the former Hollywood star likened Medvedev’s Russia to a gold or diamond mine that is beckoning foreign investors to simply “go in there and get it.”

"President Medvedev has a vision of Russia's development and diversification of its economy,” Schwarzenegger said during a visit to Skolkovo, Medvedev’s vision of a Russian Silicon Valley, on Monday. “I am confident that the leadership of our companies will conclude agreements with their [Russian] partners.”

Schwarzenegger also noted Russia’s high growth potential, saying that now is the perfect time to build on the country’s economic fundamentals “when things are still at a raw level.”  Earlier at a meeting with businessmen organized by the American Chamber of Commerce, the 63-year-old bodybuilder offered particularly effusive praise for Russia's first tech-savvy president, describing him as “a great visionary.” "President Medvedev is a great visionary. He had this vision to create a Silicon Valley in Skolkovo," Schwarzenegger said.

The California governor was in Moscow on a three-day visit as the head of an American business mission to Russia. He was accompanied by executives from leading U.S. IT companies including executives from Google, Microsoft and Oracle. Medvedev invited the former Hollywood star during his visit to California’s high-tech Silicon Valley in June. The Skolkovo innovation city is president Medvedev’s pet project, which he hopes will transform Russia into a high-tech nirvana and diversify Russia's monoculture economy.

Schwarzenegger, who appears to share Medvedev’s love of high-technology, met with his tweet-mate in Skolkovo on Monday. “It was wonderful to see the president’s great enthusiasm about technology, high technology, green technology,” Schwarzenegger said, adding: “I really enjoyed meeting someone that is a visionary, someone that has a very clear vision of the direction Russia ought to go.” The wildly-popular Terminator star

joked that he was in Moscow to fulfill a promise made to the Russian president. “I told you ‘I’ll be back’ – so I’m back,” Schwarzenegger told Medvedev. The Russian president took Schwarzenegger for a spin in an antique Soviet Chaika car after their meeting.

President Medvedev used Monday’s meeting to spell out his vision for Skolkovo. He told a scrum of journalists and entrepreneurs that Skolkovo will be a launch pad for innovative economy in Russia and will become "an example of how one can and must work to create conditions and subsequently to replicate this experience throughout the country, using the enormous scientific potential that our country has." The president said his first impressions of the Silicon Valley were of a place with a "special, creative and at the same time a calm, homely" atmosphere. Russian businesses, he said, have much to learn from the United States both in the creation of congenial business atmosphere and in the commercialization of scientific ideas, but he noted there are homegrown psychological barriers to this vision. Russian business people, he said, are still more inclined to spend capital on consumer items, rather than risk venture capital investments.

However, Medvedev noted that those willing to partake in the Skolkovo Innovations Center project have been given wide-ranging tax preferences and hoped that Monday’s meeting would give further impetus for the development of full cooperation between Russia and America. “We’re extremely interested in your great experience and aren’t ashamed to learn,” Medvedev told Schwarzenegger. “We have to admit that in many areas we’ve unfortunately fallen behind. We’re really counting on our cooperation bearing fruit.”

Is America listening?

While some big names in American high-tech business are visibly “cooperating,” most are still reluctant to pump money into Skolkovo despite preferences and special economic regimes, industry executives said. So far only a few companies such as Cisco, which pledged $1 billion investment and more recently Siguler & Guff, which committed a $250 million investment to a data center are exceptions to the general trend. Franklin Pitcher Johnson, the founder of Asset Management Company, who participated in the Skolkovo meeting, said that Russia’s murky investment climate remains one of the major concerns of American venture capitalists eyeing new prospects in Russia. Skolkovo in itself, he said, would not transform Russia’s investment climate overnight. To attract investors, Russia needs to do more especially in the areas of economic and political freedom as well as combat corruption, he said. He disagreed with the notion of government intervention in business, stressing that government’s only business in business is to leave business alone.

Andrew Somers, president of the American Chamber of Commerce in Russia, downplayed these concerns, stressing that the Kremlin could achieve more by sponsoring targeted projects like Skolkovo. “What the government is doing now is the best way to start – preferences for a specific project backed by the highest authority in the country and focusing on R&D,” Somers told Russia Profile. “You can’t do the whole country at once otherwise you’ll spread all over the place and accomplish nothing. Ironically, this is

the way America might do it because you want to have a flagship project backed by the president and focusing on Russia’s future R&D and its potential.” Somers said two things underpinned the importance of the current visit to Russia by an American trade mission. “One is that the Americans are here and the other is that they have been sufficiently interested in Russia to come over,” Somers said.  “There is a growing recognition among many sectors [in America] that Russia has a tremendous potential for investment,” Somers said.

Lending credence to such optimism, Rusnano Head Anatoly Chubais announced Monday that his nanotech company would hold negotiations on eight or nine deals with representatives of U.S. venture capital businesses currently visiting Moscow. "The deals relate to production projects worth $1 billion and one serious venture capital fund with the potential volume of $400 million," Chubais said, RIA Novosti reported. Earlier, the Rusnano chief said the corporation was working on seven projects worth from $250 million to $500 million after the first visit by U.S. venture capital businessmen to Russia. Rusnano also plans to acquire a share in one of U.S. microelectronics companies in the Silicon Valley by the end of 2010, Chubais said. "We are talking about directly acquiring a share package in the parent company based in the Silicon Valley and, correspondingly, accommodating real business as part of the project's expansion in Russia," he said.

Russia appears to enjoy pride of place compared to its BRIC rivals as far as post-crisis investments are concerned, Somers said.  “Since the crisis, nobody is investing anywhere. There is about a trillion and half dollars sitting idle in American companies. So they are looking at Russia and of course they are also looking at Brazil, China and India. In that context, it is very positive that so many investors have come to Russia.” The negative, Somers said, is that Russia’s image is still not great. “Generally, Russia still has an image in the United States of a country with a very risky investment climate,” he said. 

"Day of Wrath" participants detained in Moscowhttp://english.ruvr.ru/2010/10/13/25674186.html

Oct 13, 2010 02:27 Moscow Time   Participants in an unsanctioned rally "Day of Wrath" were arrested in the centre of Moscow. They were protesting against the policies of the city government and demanding direct elections for mayor. According to various sources, police detained from 18 to 25 people. Among them were leader of the opposition movement "Left Front" Sergei Udaltsov and human rights activist Lev Ponomarev.    On Tverskaya Square, the venue of the “Day of Wrath” protest action, participants of the patriotic movement “Young Russia” scattered leaflets, calling "to do useful things - for example, donate blood or to fight drugs. 

Moscow police arrest opposition protesters at unsanctioned demo http://www.monstersandcritics.com/news/europe/news/article_1590906.php/Moscow-police-arrest-opposition-protesters-at-unsanctioned-demo

Oct 12, 2010, 17:44 GMT

Moscow - Police in the Russian capital Moscow arrested at least 30 anti-government demonstrators as they gathered in a peaceful, but unsanctioned, demonstration Tuesday.

The arrests came as German President Christian Wulff was visiting Russia and just hours after he had spoken to Russian President Dmitry Medvedev about the rule of law in civil society in Russia.

'The police are being even tougher than usual,' said well-known human rights activist Lev Ponomaryov, one of those arrested.

Others said policemen had simply marched into the crowd and thrown people onto buses.

A spokesman told the Interfax news agency that the demonstrators were demanding more freedom of expression in Russia.

Amnesty International accused Moscow's police of violating the protester's human rights.

'Even the Russian constitution guarantees a right to assembly,' said a spokesperson for the group.

Russian police routinely break up unauthorized demonstrations in Moscow, even if they are peaceful.

2 prominent Kremlin foes arrested as anti-government rally quashed in Moscowhttp://www.google.com/hostednews/canadianpress/article/ALeqM5jKbsS0v1Sqb6l84OrkBWXI0aw0nQ?docId=4818212

By The Associated Press (CP) – 12 hours ago

MOSCOW — Two prominent opponents of the Kremlin have been arrested at a downtown Moscow rally demanding a return to the popular election of mayors and regional governors from the current system of presidential nomination.

The high-profile human rights activist Lev Ponomaryov and Sergei Udaltsov, the leader of the anti-Kremlin Left Front movement, were detained during Tuesday's rally.

The longtime mayor of Moscow, Yuri Luzhkov, was fired last month after President Dmitry Medvedev said he lost faith in him.

Medvedev's predecessor, Vladimir Putin, abolished the direct election of the mayor and regional leaders under the pretext of fighting extremism.

Several hundred protesters gathered outside the mayor's central office for the demonstration, which was quickly broken up by police.

Copyright © 2010 The Canadian Press. All rights reserved.

13 October 2010

Number of permanent Orthodox parishioners in Russia may reach 40 million people in next 20 yearshttp://www.interfax-religion.com/?act=dujour&div=154

Moscow, October 12, Interfax – Patriarch Kirill of Moscow and All Russia has cited statistical data saying that number of permanent parishioners of the Russian Orthodox Church in Russia is probable to grow up to 40 million people in coming 20 years.

"Some statistical forecasts say that if things will go on as they do now our country will have over 40 million permanent parishioners, enchurched people in coming twenty years," the Patriarch said on Tuesday at a press conference in Moscow, though urging not to focus on figures but to keep working.

Patriarch Kirill noted that flock of the Russian Orthodox Church has recently become younger. When he served as a hipodeacon (in 1960s - IF), he saw four-five young people among church parishioners on a festival day, but today the situation has dramatically changed.

"When I celebrate divine services, especially on festival days, Easter night, I am impressed as I see not elderly people, not middle-aged people, but I see people in proportions that I see in the streets," the Patriarch shared his impressions.

Among other statistical data, the Patriarch voiced information referring to the level of education in Orthodox families: thus number of children with higher education in Orthodox families is five percent higher than in other families.

Pasternak heirs rage over Moscow monumenthttp://www.mn.ru/local/20101013/188120705.html

by Alina Lobzina at 13/10/2010 11:50

 The controversy swirling around sculptor Zurab Tsereteli is set to intensify with the planned unveiling of his Pasternak memorial in central Moscow.

While the fate of his gargantuan Peter the Great monument remains uncertain, the artist is pressing ahead with Pasternak despite anger from the writer’s family.

Speaking exclusively to The Moscow News, a descendant of the Doctor Zhivago author said the family was delighted that Boris Leonidovich was going to be immortalized – but aghast at Tsereteli’s role.

 Memorial sharks

“We welcomed the plan to put up a monument, and being conscious of the situation with urban sculpture in Moscow we liked the modest scale of the monument,” one of Pasternak’s relatives said, asking not to be named until the family had put forward its official position in public.

“We hoped it would cut out the ‘sharks’ of the memorial business in Moscow, but we were deeply mistaken.

“From the outset the process took a strange turn, seemingly motivated by a desire to exclude those who knew Boris Leonidovich.”

 Tsereteli not welcome

And it is clear that if the family had its way Tsereteli’s designs would be nowhere near the scheme to remember Pasternak.

“Tsereteli embodies all the evil that [ex-mayor Yury] Luzhkov brought to Moscow,” the relative continued. “He created the most odious characters of this period (Peter the Great, the animals at Okhotny Ryad etc) and his work has a lack of basic culture.

“It is characterised by bad taste, revels in luxury and kitsch and is in no way affiliated to real art.

“Needless to say the creativity, vision and life of Boris Leonidovich Pasternak is in no way comparable with the likes of Tsereteli.”

 Willing to change

With the statue already built and due to be installed by the end of the year, Tsereteli says he is happy to listen to the family’s views.

“I have created an image that has won the competition and if someone doesn’t like it, they could just come to me and say – change the eyes, the nose or anything else” he told reporters on Tuesday, adding that “I have a museum, and will be happy to keep this monument there.”

And he added that it is not another epic on the scale of Peter, weighing in at a merely twice life-size.

 More to come

Despite the controversy, Tsereteli has no plans to stop offering the fruits of his muse to Moscow.

With two statues to Luzkhov under his belt and another of Vladimir Putin on display in his Prechistenka [l1] gallery he is thinking of adding Dmitry Medvedev to his roll-call of Russia’s modern-day greats.

“I’ve got plans to create monuments to all my famous contemporaries,” he said. “I’ve got Mikhalkov, Bashment, Tabakov. There’s Putin as well, it’s called ‘Sound mind in a sound body’.”

RIA Novosti Press Review for Wednesday, October 13, 2010http://en.rian.ru/papers/20101013/160935929.html

08:52 13/10/2010

A brief look at what is in the Russian papers today

POLITICS

California Governor Arnold Schwarzenegger encouraged Russia to follow his state's example in promoting renewable energy sources and a green economy while speaking Tuesday at Moscow's Higher School of Economics.

(Vremya Novostei, Moscow Times, Nezavisimaya Gazeta)

Georgia decided to scrap visas for residents of Russia's North Caucasus republics starting Wednesday. Residents of Dagestan, Chechnya, Ingushetia, North Ossetia, Kabardino-Balkaria, Adygea and Karachay-Cherkessia will be allowed to stay for 90 days on Georgian territory without any special permits. Georgia's move angered Moscow.

(Vremya Novostei)

BUSINESS

Russia will sell a 9% stake in its largest state lender Sberbank for almost $6 billion. First Deputy Prime Minister Igor Shuvalov did not rule out that the state could eventually sell the controlling stake in Sberbank as well as some other big companies and banks.

(Kommersant)

SCIENCE

Russia's state-owned corporation of nanotechnologies Rusnano and U.S. investors from the Silicon Valley may establish a joint venture capital fund to support different projects.

(Rossiiskaya Gazeta)

SOCIETY

Russian President Dmitry Medvedev met with rock musicians to speak on urgent issues, including the dismantling of Moscow's monument to Peter the Great, the controversial Okhta business center in downtown St. Petersburg and the situation around the Khimki forest outside Moscow.

(Vedomosti, Kommersant, Nezavisimaya Gazeta, Rossiiskaya Gazeta)

Dmitry Medvedev on Tuesday tapped an unexpected member from his human rights council to take over as chairman, surprising members who had expected the body's acting head to be given the influential post.

(Vremya Novostei, Moscow Times, Nezavisimaya Gazeta, Kommersant)

Downtown Moscow's Tverskaya Square yesterday saw a regular unauthorized Day of Wrath. For the first time opposition members managed to hold out on the square for at least a few minutes.

(Kommersant)

OIL & GAS

Russian energy giant Gazprom's oil arm Gazprom Neft will coordinate the development of Venezuelan deposits. Experts say the company's new status will rather be a problem than a benefit.

(Vremya Novostei)

ACCIDENTS

More than 40 people were killed in Ukraine when a train crashed into a passenger bus on Tuesday.

(Rossiiskaya Gazeta)

SPORTS

Russia's national football team beat Macedonia 1-0 on Tuesday evening to reach the top of Euro 2012 qualifying Group B.

(Sport Express, Rossiiskaya Gazeta)

National Economic Trends

Rouble falls vs euro to its lowest since early Febhttp://www.reuters.com/article/idUSLDE68L07620101013

2:43am EDT

MOSCOW, Oct 13 (Reuters) - The Russian rouble extended losses against the broadly stronger euro EUR= in early trade on Wednesday, hitting its lowest point since early February.

By 0640 GMT, the rouble fell 47 kopecks , or 1.1 percent to 42.15 against the single currency on the MICEX exchange EURRUBTN=MCX, its lowest level since Feb. 2, according to Reuters data.

The rouble aslo slid against the dollar RUBUTSTN=MCX and the euro-dollar basket RUS=MCX bruised by concerns about the deterioration in Russia's fundamentals, dealers say. (Writing by Andrey Ostroukh)

Foreign debt up $24.2bn in 3Q10http://www.businessneweurope.eu/dispatch_text13153

Alfa, RussiaWednesday, October 13, 2010

After declining $11.2bn in 1H10, Russia's foreign debt rose $24.2bn in 3Q10, driven by an increase of $18.1bn in banking sector debt and a modest $5.1bn increase in corporate debt. Increased debt indicates that banks are benefiting from low interest rates, which we view as POSITIVE.

Even though the increase in foreign debt is a positive surprise, suggesting that Russian banks are benefiting from low interest rates, it raises a number of issues. First, Russian banks' excess liquidity of RUB2tn has not yet been absorbed by the economy owing to low demand for loans. Therefore, the increase in foreign debt is intensifying the burden of the unused liquidity cushion and cannot be chalked up to the unsatisfied appetite for borrowing from the real sector. Most likely, foreign borrowing reflects banks' need to

maintain a balanced currency position, their desire for long-term funding not available locally, and plans to borrow money before new foreign borrowing regulations are introduced in January 2011. In other words, rather than being a sign of improved demand for loans, the increase in foreign debt could be a one-off.

Second, at first glance, the $29bn increase in CBR reserves in 3Q10 looks to have been entirely the result of the rise in foreign debt, as the current account surplus declined to $8.7bn in the quarter. However, the increase actually resulted from the weakening of the dollar on global markets, indicating that the capital account was not as strong as was suggested by the increase in foreign debt.

Natalia Orlova

Very strong fiscal revenue performance, but spending "strong" toohttp://www.businessneweurope.eu/dispatch_text13153

Troika, RussiaWednesday, October 13, 2010

The Finance Ministry yesterday reported federal budget revenues at just over R6 trln for 9m10, while expenditures were around R6.7 trln and the budget deficit was a moderate R727.6bn. The deficit reached R104.4bn in September alone, slightly lower than the August figure of R110.5bn despite increased spending (R810bn in September versus R752.6bn in August) as tax collection soared: the government brought in R706.5bn in September (versus R642.0 in August), of which R397.0bn were non oil revenues (R326.6bn in August).

The fiscal performance was in line with our expectations, so for the full year, the government is likely to collect R8.3 8.4 trln (versus the official target of R7.8 trln). That said, the actual budget deficit will be lower (below R2.0 trln, we expect) than the government's projection (around R2.4 trln).

A major problem stems from the fact that the government had spent around 65% of the amended annual budget as of end 9m10, which implies greater spending through year end (mostly in December, and to some extent in November) even though it may not be able to fully allocate the planned R10.2 trln. As usual, inflation is going to be high in January February, which will set a rather active pace of inflation at the beginning of the year. We expect inflation of around 8 9% next year.

Evgeny Gavrilenkov

Budget deficit for 9M10 reported at 2.2% of GDP; POSITIVEhttp://www.businessneweurope.eu/dispatch_text13153

Alfa, RussiaWednesday, October 13, 2010

The federal budget in 9M10 ran a deficit of only 2.2% of GDP, virtually the same as the 2.2-2.3% seen in previous months and well below the 5.3% guided by the cabinet for FY10.

The 9M10 budget execution was a positive surprise: budget revenues were RUB300bn above what we expected, while expenditures were RUB300bn lower than our forecast. The recent increase in oil prices suggests that revenues this year may exceed the projected RUB7.8tn by RUB200bn.

However, the main uncertainty over the deficit comes from the expenditures side: 34% of the annual budget still needs to be spent before year-end. While this is a very large amount, the seasonality of this year's budget spending looks very similar to last year's, when the cabinet spent 33% in Q4, including 15% in December. We therefore believe chances are high that the deficit will be RUB2.2tn, or 4.9% of GDP. However, the decision to finance the deficit so close to year-end is good news for the domestic debt market, and it may delay upward pressure on interest rates.

Goods imports continued to increase at a rapid pace http://www.businessneweurope.eu/dispatch_text13153

VTB Capital, Russia Wednesday, October 13, 2010

up 53% YoY - main drivers were machinery and pharmaceuticals - foreign debt increased USD 14.2bn to USD 480.2bn in 3Q10 - both banks and corporates were net borrowers

News: According to the CBR, the goods trade balance in August reached USD 8.3bn, a decline of nearly 30% YoY and almost a quarter MoM to the lowest print since April 2009. The main driver was the continued rapid growth of imports, which reached USD 23.8bn, up by 53% YoY and 13% MoM. Exports were at USD 32.1bn, up 17.5% YoY but nearly flat MoM. Foreign debt increased USD 24.2bn in 3Q10 to USD 480.2bn, as the government debt remained flat, while banks borrowed USD 18.1bn and corporate borrowers took USD 5.1bn (both net).

Our View: Russia's current account surplus started contacting rapidly in 2Q10 and, according to yesterday's data, continued to do so well into 3Q10. Exports remain stagnant, while imports are growing rapidly. There are many good reasons for the pick-up in imports, including a recovery in consumer demand (driven both by an increase in incomes and the greater availability of credit) and the renewed growth in investment activity (which results in a significant increase in imports of investment goods). There was another, technical, reason for August's growth in imports: the new legislation on pharmaceuticals that came into effect on 1 September (which resulted in a significant increase in imports in August, just before the old regime expired). While this technical issue has now disappeared, we believe that fundamental factors remain in favour of the continued rapid growth of imports.

Meanwhile, foreign debt increased in 3Q10, having contacted for four quarters in a row (as Russian banks were net re-payers). Corporates continued to be net borrowers but, in a change of a trend, banks started actively borrowing again.

We believe this is because banks are running out of the forex liquidity that they accumulated during the 4Q08-1Q09 devaluation and need to raise new foreign currency to satisfy the demands of corporate borrowers' new fx-denominated debt. More generally, we note that the relative importance of the current account in determining pressures on the RUB is declining while that of the capital account is on the increase. As a result, more volatility in the RUB is inevitable, in our view.

Back to top Alexey Moiseev

Business, Energy or Environmental regulations or discussions

Raspadskaya, Rosneft, Polyus Gold: Russia Stock Market Preview http://noir.bloomberg.com/apps/news?pid=newsarchive&sid=aVFbIquY5_7w

By Anna Shiryaevskaya

Oct. 13 (Bloomberg) -- The following companies may have unusual price changes in Russia trading. Stock symbols are in parentheses and share prices are from the previous close.

Russia’s 30-stock Micex Index declined 0.3 percent to 1,477.78 at the close in Moscow.

OAO Raspadskaya (RASP RX): The Russian coking coal miner is due to report its third-quarter trading update. Raspadskaya rose 0.2 percent to 173.62 rubles on the Micex Stock Exchange.

OAO Rosneft (ROSN RX): Crude oil fell for a second day to below $82 a barrel as the dollar strengthened, curbing the appeal of commodities as an alternative investment. Russia’s biggest oil producer added 0.1 percent to 213.14 rubles.

OAO Polyus Gold (PLZL RX): Gold declined for the first time in three days in New York as a stronger dollar curbed demand for the metal as an alternative asset. Russia’s biggest gold producer added 1.1 percent to 1,540.36 rubles.

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

Last Updated: October 12, 2010 22:00 EDT

Mosenergo has been criticised by the current Moscow City Government from Yury Luzhkov's team http://www.businessneweurope.eu/dispatch_text13153

VTB Capital, Russia Wednesday, October 13, 2010

we believe this has to do with the battle over the heat market - Mosenergo might benefit from the imminent change of Mayor

News: Mosenergo has been criticised by the current Moscow City Government, Kommersant reports today. Acting Deputy Mayor Petr Birukov has said that the company is not fulfilling its investment programme properly although it had received the investment component in its heat tariff. Mosenergo has denied this claim, saying that most of its projects (11 out of 20) have already been implemented and commissioned, while three more are to be finished in November. Birukov added that this winter Mosenergo would get priority to load its capacity from MOEK and the latter would miss some RUB 780mn (USD 26mn) of revenues. He suggested Mosenergo splitting the benefits between the two companies.

Our View: We believe this is a continuation of the dispute between Mosenergo and the current Moscow City government (which owns MOEK) over the Moscow heat market. In recent years, MOEK (with its access to end customers) has been winning market share from Mosenergo while the latter has argued that it produces heat more efficiently (MOEK also receives subsidies from the local government for generating heat). Hence, the criticism has to do with Mosenergo getting back its position on the market in our view.

Since such statements have come from the team previously under Yury Luzhkov, we believe that following the change in local government Mosenergo might enhance its position. We remind investors that the new candidates for Moscow Mayor were submitted recently by United Russia (see United Russia submits list of candidates for Moscow City Mayor in the Russia Morning Comment of 11 October) and we might see a decision this or next week.

Back to top Dmitry Skryabin

Sberbank Urges Russia to Sell Stake in Lender Via Stock Markethttp://www.businessweek.com/news/2010-10-13/sberbank-urges-russia-to-sell-stake-in-lender-via-stock-market.html

October 13, 2010, 1:52 AM EDT

By Maria Levitov

Oct. 13 (Bloomberg) -- OAO Sberbank wants Russia’s government to sell its shares in the country’s largest lender through a bourse rather than directly to a strategic investor, Deputy Chief Executive Officer Anton Karamzin said.

“A sale on the market is preferable,” Karamzin said in an e-mailed response to questions. “It would undoubtedly have a postive effect on the banking sector.”

First Deputy Prime Minister Igor Shuvalov said yesterday that the government, which holds 60.3 percent of Sberbank, may sell more than the 9 percent stake first planned to help finance its budget deficit.

To contact the reporter on this story: Maria Levitov in Moscow at mlevitov@bloomberg.net

To contact the editor responsible for this story: Brad Cook at bcook7@bloomberg.net

CBR could reduce stake in Sberbank to below 50% in the medium termhttp://www.businessneweurope.eu/dispatch_text13153

Alfa, RussiaWednesday, October 13, 2010

The Russian government is considering selling a stake of 9% or more in Sberbank. The shares to be sold currently belong to the CBR, which holds 60.3% of the voting shares. While the stake under consideration to be sold is reportedly at least 9%, it could even be large enough to reduce the CBR stake to below 50%+1 share.

As any deal is expected to take at least months to complete, no transaction is expected in 2010. Moreover, as no potential terms or buyers were specifically identified, we do not expect a significant share impact from the news.

Leyla Sharifullina

Petropavlovsk’s Iron Ore Unit Delays H.K. IPO by Week (Update1) http://noir.bloomberg.com/apps/news?pid=newsarchive&sid=apy9GaiscvVE

By Fox Hu

Oct. 13 (Bloomberg) -- Petropavlovsk Plc’s iron ore unit has delayed its stock exchange listing in Hong Kong by a week to Oct. 21, according to terms for IRC Ltd.’s initial public offering.

Final allocation of shares in the offering will be completed by Oct. 20, the terms show. Bank of America Corp.’s Merrill Lynch unit, Bank of China International Holdings Ltd. and UBS AG are managing the IPO.

IRC seeks about HK$1.87 billion ($241 million) selling 1.04 billion new shares at HK$1.80 apiece, according to the terms. The company, which has iron ore projects in Russia, had cut the size of the IPO by more than half, according to a sales document sent to investors on Oct. 8.

Petropavlovsk said in a statement on Oct. 8 that it would alter the terms of the offering after demand from investors failed to meet its “highest expectations.” IRC previously offered 1.325 billion shares at HK$2.20 to HK$3 each to raise as much as HK$3.98 billion ($513 million), according to a Sept. 29 press release.

IRC joins commodity producers including United Co. Rusal, the world’s largest aluminum maker, in raising funds in Hong Kong as Chinese raw-material demand jumps.

To contact the reporter on this story: Fox Hu in Hong Kong at fhu7@bloomberg.net

To contact the editor responsible for this story: Daniel Hauck at dhauck1@bloomberg.net.

Last Updated: October 12, 2010 22:36 EDT

Mail.ru Sees 2010 Net Tripling to $150 Million, Kommersant Says http://noir.bloomberg.com/apps/news?pid=newsarchive&sid=a3FnPeS37jb4

By Anastasia Ustinova

Oct. 13 (Bloomberg) -- Mail.ru Group, the Russian company that owns 2.4 percent of Facebook Inc., expects net income to triple this year to about $150 million, Kommersant reported, citing unidentified people familiar with company data.

Mail.ru, which plans to hold an initial public offering in Russia this year, values itself at about $5 billion, the Moscow- based newspaper said . At the valuation, Mail.ru would have a price-to-earnings ratio of about 27 to 1, Kommersant said.

To contact the reporter on this story: Anastasia Ustinova at austinova@bloomberg.net

To contact the editor responsible for this story: Brad Cook at bcook7@bloomberg.net

Last Updated: October 13, 2010 00:51 EDT

Vimplecom's Orascom buy not a done deal: Telenorhttp://www.reuters.com/article/idUSTRE69C0PJ20101013

12:48am EDT

MOSCOW (Reuters) - Vimpelcom's (VIP.N: Quote, Profile, Research, Stock Buzz) $6.6 billion bid to buy Orascom from Egyptian tycoon Naguib Sawiris is by no means a done deal, the CEO of Telenor (TEL.OL: Quote, Profile, Research, Stock Buzz), one of the Russia telecom group's main shareholders, was quoted as saying.

"We are viewing this deal as a sum of various conditions -- either it will be approved or it will not. A great deal of questions needs to be resolved before this can be called a done deal," Chief Executive Jon Fredrik Baksaas told Vedomosti business daily in an interview published on Wednesday.

A key sticking point in the deal is the battle for control of Algerian telecoms business Djezzy -- Orascom's (ORTE.CA: Quote, Profile, Research, Stock Buzz) most lucrative asset which Vimpelcom wants to keep, but which the Algerian government wants to nationalize.

Asked whether the deal will go ahead even if Vimpelcom does not get Djezzy, Baksaas replied: "There is no answer yet."

Norwegian Telenor is generally seen as taking a more cautious approach on expansion than Vimpelcom's other main shareholder -- Russia's Alfa Group.

Asked if Telenor had been less keen on the deal, Baksaas said: "You may well turn out to be correct in your assumption. But Telenor and Altimo (Alfa's telecoms arm) have equal rights...and such issues require a balanced decision.

(Writing by Toni Vorobyova; Editing by Anshuman Daga)

Seventh Continent Owner Plans to Take 100% Stake, Vedomosti Says http://noir.bloomberg.com/apps/news?pid=newsarchive&sid=aBu4C70B9rQ8

By Anastasia Ustinova

Oct. 13 (Bloomberg) -- OAO Seventh Continent owner Alexander Zanadvorov agreed to buy a 21.3 percent stake from Russian lawmaker Vladimir Gruzdev’s family fund for about $400 million, Vedomosti said, citing an unidentified person close to the fund.

Zanadvorov, who will hold 96 percent of the Russian food retailer after the deal, may then boost his stake to 100 percent by buying shares from minority shareholders, the newspaper said.

To contact the reporter on this story: Anastasia Ustinova in St. Petersburg at austinova@bloomberg.net.

To contact the editor responsible for this story: James M. Gomez in Prague jagomez@bloomberg.net

Last Updated: October 13, 2010 00:07 EDT

Alexander Zanadvorov to increase stake in Seventh Continenthttp://www.businessneweurope.eu/dispatch_text13153

Alfa, RussiaWednesday, October 13, 2010

According to press reports, Seventh Continent founder Alexander Zanadvorov plans to increase his stake in the company to 100%. Mr. Zanadvorov agreed to acquire a 21.3% stake in the retailer owned by a fund controlled by former partner Vladimir Gruzdev. Following this acquisition, Mr. Zanadvorov will control over 96% of the company. SCON shares may then become subject to a minority squeeze-out.

The squeeze-out price must be not less than: (1) the weighted average price of the stock over the six months prior to the submission of the squeeze-out demand; (2) the price determined by an independent appraiser; and (3) the maximum price paid or offered by the majority shareholder or its affiliates for the shares within six months prior to the squeeze-out demand.

Elena Mills

Deripaska asks to extend Strabag option-paperhttp://www.reuters.com/article/idUSLDE69C01X20101013

12:48am EDT

MOSCOW, Oct 13 (Reuters) - Russian tycoon Oleg Deripaska has asked for a one month extension on his option to buy a 25 percent stake in Austrian builder Strabag (STRV.VI: Quote, Profile, Research, Stock Buzz) as he wants to negotiate a payment with assets, Kommersant reported.

The option is due to expire on Oct. 15, but a source familiar with the talks told the Russian business daily that Deripaska's holding company Basel would like the extension to finalise the terms of the deal. Another source confirmed this.

One option on the table is for Deripaska to give his stake in infrastructure firm Transstroy to Strabag in exchange for the shares in the Austrian firm, Kommersant said. Other possibilities are being discussed as well, including a payment part in cash and part in assets, it added.

Basel representative Sergei Babichenko told the paper that the holding intends to use its option, while Strabag said talks were in process, without commenting any further. (Writing by Toni Vorobyova; Editing by Dhara Ranasinghe)

Moscow tops EMEA list of cities for office construction projects - Colliershttp://en.rian.ru/business/20101013/160937175.html

11:35 13/10/2010

MOSCOW, Oct 13 (RIA Novosti) - Moscow has the most office building construction projects of any city in Europe, the Middle East and Africa (EMEA), Colliers International consulting company said on Wednesday.

Some 2.8 million square meters of office space are under construction in the Russian capital, the company said in a report.

Dubai holds the second place in the list with 2.6 million square meters of office space followed by Abu Dhabi, the capital of the United Arab Emirates, and Riyadh, the capital of Saudi Arabia, with 1.2 million and one million square meters, respectively.

Russia's second city St. Petersburg ranks seventh with 636,900 square meters.

Forest industry told to watch Chinese-Russian log tradehttp://www.radionz.co.nz/news/rural/59415/forest-industry-told-to-watch-chinese-russian-log-trade

Updated 18 minutes ago

The New Zealand forest industry is being warned to keep a watch on the Chinese-Russian log trade, with a potential supply crunch looming.

An international forestry consultant, Gerry Van Leeuwen, told the Forest Wood conference in Wellington, via video conference on Tuesday, Russia is the biggest supplier of logs to China, but its exports are declining.

He says a 25% log export tax imposed by the Russian Government in 2008 is hampering the trade.

Mr Van Leeuwen says New Zealand radiata pine logs have a very good fit in China because they are up to $US35 a cubic metre cheaper than other wood imports from Russia and North America that are used as interior finishings.

He says it is important that the inferior New Zealand logs stay affordable.

Mr Van Leeuwen says China's demand for wood is predicted to increase from 250 million cubic metres this year, to 350 million by 2015.

Copyright © 2010, Radio New Zealand

Russian company signs contract to manage hotel complex in Syriahttp://en.rian.ru/business/20101013/160935488.html

07:36 13/10/2010

Russian company Intourist-Sinara, working in Syria, has signed a contract with Turkish firm Dedeman Hotels & Resorts International to manage a hotel complex being constructed in the city of Latakia.

"We signed the contract with Dedeman as it has experience of working in Syria and is a team of professionals," the Russian company's general director, Dmitry Oparin, told RIA Novosti.

Dedeman has three hotels in the Syrian cities of Damascus, Palmyra and Aleppo. Intourist-Sinara hopes Dedeman will help it make the Latakia hotel facilities the country's best.

Oparin said the hotel complex will be situated on the coast of the Mediterranean Sea at an area of six hectares. The 500-room hotel is primarily designed for tourists from Arab countries.

The Latakia facilities are being built by Russian company Monolit Kapital-Stroy. The project is worth some $50 million. It is due to be completed in 2013.

DAMASCUS, October 13 (RIA Novosti)

Russia eyes green light for Sochi Grand Prixhttp://www.google.com/hostednews/afp/article/ALeqM5gEXVr9O5rvEHkDwuHZOCLyo2LvPA?docId=CNG.ae9a7933f732d86f024f48b03d6a2b46.161

By Alexander Fedorets (AFP) – 13 hours ago

MOSCOW — Russia is making a renewed bid to bring Formula One racing to Sochi with F1 supremo Bernie Ecclestone agreeing terms for a Grand Prix to be held in 2014, the same year the Black Sea resort hosts the Winter Olympics.

Russian Prime Minister Vladimir Putin, whose backing was crucial in Sochi winning the right to host the Games, is due in the city on Thursday to sign an agreement for work to begin on the construction of a new 200 million dollar circuit.

Ecclestone told local media that after several rounds of negotiations with the Russian authorities the conditions for the contract have been agreed.

"The document has still not been signed but when the appropriate person from Russia signs it, I will sign it the next day," Ecclestone told Kommersant daily newspaper.

He said that the annual fee Russia would pay for hosting a Grand Prix would be comparable with that of around 40 million dollars paid by new Grand Prix hosts Singapore and Abu Dhabi.

However, racing fans should not hurry to book their tickets after Ecclestone pronounced similar sentiments in 2002 for a proposed Grand Prix in Moscow.

On March 22 that year, the Russian capital's ex-mayor Yury Luzhkov and the F1 boss were set to strike a deal while dozens of journalists came to Moscow's City Hall ready to immortalize the historic moment.

But the deal collapsed at the last minute after the two sides failed to agree financial terms.

"They want to sweep all the profits leaving us to pay all the expenses and stay happy with the smell of the petrol smog," said Luzhkov, who has since been sacked by President Dmitry Medvedev.

The project of showcasing Formula One at a completely new circuit in Sochi's Olympic Park has also raised questions over how Russia can jump from hosting virtually no races of importance to the biggest of them all.

"Staging the Formula One event in Russia in the existing conditions is a pure utopia," Russia's Formula Two pilot Ivan Samarin commented.

"We should build several circuits for staging the national racing series before starting the construction of a Formula One racing course."

Samarin added that Russia should also change its mentality and stop expecting an immediate profit from the investments into the project.

"The construction of the racing circuit is an investment into the future," he said. "The staging of a Formula One race raises the prestige of the entire country and attracts crowds of tourists, who are ready to pay for the show."

"But the investors should be ready to wait years before their investments start bringing profit."

Russia currently has one F1 driver, Vitaly Petrov, who became the country's first ever pilot in the class by being chosen to drive for Renault in the 2010 season.

However, the energy of Putin, who backs the project, may tip the balance.

After securing the Winter Olympics, Putin now has his eyes on the football World Cup and is set to head Russia's delegation at FIFA's meeting in Zurich in December, where the hosts of the 2018 and 2022 World Cups will be chosen.

Renaissance Capital forms business unit focused on agriculture sector http://www.businessneweurope.eu/dispatch_text13153

press releaseOctober 13, 2010

Renaissance Capital announces the formation of a new business unit focused on the emerging markets agriculture sector.

The Global Agriculture Group will provide a seamless investment banking service covering the trading, processing and farming companies which constitute the sector. The team will act as a strategic advisor on mergers, acquisitions, divestments, restructurings and fundraisings across the agriculture value chain, as well as serve public and private companies, national governments and financial institutions.

The Global Agriculture Group will be led by Richard Ferguson, who is joining Renaissance Capital as Global Head of the Agriculture Sector. Previously, Ferguson established an agriculture research group within Nomura in 2006 before founding FAR Consultants, which provides research and advisory services to agricultural companies and financial institutions across emerging markets.

The new business will provide the following strengths:

� Strategic research capabilities which will focus on the structural shifts taking place across the agriculture sector

� Local, in-depth company research covering all major emerging and frontier markets

� Local market knowledge backed by specialists in London

� Strong investment banking capabilities providing agriculture clients with unrivalled access to world capital markets

Said Peter Vanhecke, CEO of Renaissance Capital in Ukraine, Belarus, Central and Eastern Europe, who manages the agriculture sector out of Renaissance's Kiev hub: "The agriculture sector is an area where Renaissance aims for emerging markets dominance worldwide. The creation of the Global Agriculture Group marks an important step in this direction. Its strategic research and execution capabilities will be backed by on-the-ground presence in key agriculture economies, creating unique opportunities for companies and investors".

With the world population expected to reach over 9 billion by 2050, increasing demand for food and urbanization trends will multiply the need for grains to feed animals for meat production. According to the Food and Agriculture Organization of the United Nations, to feed the word's larger, more urban population, food production must increase by 70%, with annual cereal production increasing from the current 2.1bn to 3bn tons and annual meat production rising from the current 270m tons to 470m tons. In the same period, the steadily increasing demand for biofuels will make the agriculture sector vitally important.

Glonass to be Consolidated http://www.themoscowtimes.com/business/article/glonass-to-be-consolidated/419894.html

13 October 2010

Sistema said Tuesday that it plans to consolidate control of the Glonass satellite navigation project as it seeks to compete with the U.S. Global Positioning System.

“The development of the Glonass project and the commercialization of its services are among the top state priorities,” the company said. “Sistema’s board of directors has decided to consolidate the project under one corporation, which will take its operating business to a whole new level.”

Sistema plans to acquire 51 percent of Navigation Information Systems, operator of Glonass, for as much as 484 million rubles ($16 million) from its units Sitronics and RTI Systems, the company said.

Russia plans to require cell phone producers to provide handsets compliant with Glonass, Sistema’s owner Yevgeny Yevtushenkov said in July.

(Bloomberg)

News Outdoor’s Accounts Frozen http://www.themoscowtimes.com/business/article/news-outdoors-accounts-frozen/419769.html

13 October 2010The Moscow Times

The Federal Tax Service has ordered banks serving Rupert Murdoch’s advertising company News Outdoor to freeze the firm’s accounts and divert any income to the tax service, to cover a 1.34 billion ruble ($44.5 million) tax bill, Kommersant reported Tuesday.

The company lost an appeal 10 days ago in a case that started in July 2009 concerning back taxes, which the service claims it is owed because of News Outdoor’s allegedly improper use of tax breaks in 2005-06. News Outdoor has accounts in Raiffeisen and East Bridge bank and is trying to arrange a payment plan for the debt, Kommersant said.

Gary Napalkov, a spokesman for News Outdoor, told Kommersant that a payment of more than 65 million rubles has been made to the tax service, and they should see the money in the coming days. The tax authority says it has no information yet about a payment from the company.

For the Record http://www.themoscowtimes.com/business/article/for-the-record/419898.html

13 October 2010

Silver maker Polymetal said Tuesday that it secured a $150 million credit line from Raiffeisenbank at 3.5 percentage points over Libor. (Bloomberg)

Sakhalin Energy will pay the government $1.8 billion in dividends for 2010 through 2013, Vedomosti said Tuesday, citing two state officials. (Bloomberg)

Total said Tuesday that Gazprom will take a 20 percent stake in the Ipati and Aquio gas licenses in Bolivia, while it will remain the operator. (Bloomberg)

Trakya Cam Sanayii, a Turkish glassmaker, will partner with France’s Saint-Gobain to make glass at a factory in Tatarstan by the middle of 2012, with a total investment of 184 million euros ($254 million), the company said Tuesday. (Bloomberg)

The estimated damage from the drought stands at 41.5 billion rubles ($1.4 billion) as Russia’s grain harvest nears completion, the Agriculture Ministry said Tuesday. (Bloomberg)

Kazakhstan’s grain crop declined by 40 percent this year to 13.6 million metric tons because of the drought, the country’s agriculture minister said Tuesday, but added that the crop will meet domestic demand and allow for “average annual” exports. (Bloomberg)

Sukhoi Aircraft’s SuperJet, Russia’s first major passenger plane since the collapse of the Soviet Union, will deliver its first jet this year to Armenia’s Armavia, company vice president Paolo Revelli-Beaumont said Tuesday, adding that they have now have a total of 152 orders. (Bloomberg)

Activity in the Oil and Gas sector (including regulatory)

Lukoil to Start Drilling at Iraq’s West Qurna 2 Field in 2011 http://noir.bloomberg.com/apps/news?pid=newsarchive&sid=adDV.V9EttmM

By Anthony Dipaola

Oct. 13 (Bloomberg) -- Lukoil OAO plans to start drilling at its West Qurna 2 field in 2011 and aims to produce 120,000 barrels a day by the end of 2012, Paul Hawkins, director of supply and trading at Lukoil unit Litasco, said in a presentation in Singapore today.

To contact the reporter on this story: Anthony Dipaola in Dubai at adipaola@bloomberg.net

To contact the editor responsible for this story: Clyde Russell at crussell7@bloomberg.net

Last Updated: October 12, 2010 23:07 EDT

October 13, 2010 10:30

Alekperov helped Lukoil to purchase portion of shares from Conocohttp://www.interfax.com/newsinf.asp?id=194949

MOSCOW. Oct 13 (Interfax) - Lukoil (RTS: LKOH) President Vagit Alekperov took part in the process of buying shares from Conoco under Lukoil's option to purchase shares.

"I helped, provided funding," Alekperov told journalists.

He did not say whether his own stake in the company had increased.

Lukoil to approve 2011 business plan

http://www.rbcnews.com/free/20101013112130.shtml

      RBC, 13.10.2010, Moscow 11:21:30.Lukoil's board of directors is expected to approve the company's business plan for next year in November 2010, the Russian oil giant's President Vagit Alekperov told journalists today in response to RBC's question. He explained that the board would approve the production plan, as well as the amount of investments for the next year and a plan "for up to three years."

Tatneft's 2Q10 US GAAP results to be hit by tax laghttp://www.businessneweurope.eu/dispatch_text13153

Troika, RussiaWednesday, October 13, 2010

Tatneft will on Thursday become the last of the domestic oil majors to report 2Q10 results. Although we expect a solid top line, with revenues of $3,525m almost unchanged Q o Q, costs will have gone up due to the export duty lag. Duties kept rising in May and June even as the oil price dropped. We expect EBITDA to decline 32% Q o Q to $444m. Although this number looks ominous (especially the further east you are), export duties on crude declined sharply the following quarter, even though the oil price remained fairly stable, which should boost earnings in 3Q10.

There are also likely to be some paper losses below the operating line, as the liability of Tatneft's mostly foreign denominated debt increased with the weaker ruble (the reporting currency). We see net income at just $173m.

Tatneft chose to unveil the first phase of its newly constructed Taneco Refinery this past Sunday. Full scale processing, however, is expected to start only a year from now, in

3Q11. Given total investment of R146.6bn after a VAT rebate, the project's budget came in line with the $4.9bn cost guided back in 2008 - a rare example of on budget completion in Russia. However, the company continues to invest in construction, and the total cost (including initial work on subsequent phases of the plant) will likely exceed $5.5bn. We expect Tatneft to be free cash flow neutral this year.

TNK-BP plans global push as oligarchs share record $4bn dividendhttp://www.telegraph.co.uk/finance/newsbysector/energy/oilandgas/8060182/TNK-BP-plans-global-push-as-oligarchs-share-record-4bn-dividend.html

A record $4.2bn (£2.7bn) dividend will be split between BP and the four Russian oligarchs behind TNK-BP, as the partners in the joint venture seek to raise cash. By Rowena Mason, Energy CorrespondentPublished: 6:00AM BST 13 Oct 2010

The payout is about 70pc more than TNK-BP's first-half net profits of $2.43bn. Despite the huge shareholder dividend, TNK-BP has renewed its ambitions to expand through acquisitions and become an international player, according to its chief operating officer.

Bill Schrader, a former BP executive, said TNK-BP had the "total support" of the Russian government in its "big goal to internationalise the business".

The new strategy will be seen as a major victory for the Russian side of TNK-BP, which has long been pushing for a more global focus. In the past, it has been blocked by BP because of the oil giant's concerns that the two businesses could overlap and compete. The new strategy was agreed at a board meeting earlier in the summer.

TNK-BP is considering buying some of BP's assets in Vietnam, Venezuela and Algeria, but Mr Schrader said the process was going slowly.

"We're looking both at BP assets and other opportunities," he said.

BP and the four oligarchs are back on friendlier terms after a rift forced out TNK-BP's British chief executive, Bob Dudley, in 2008.

Mr Dudley took over the helm at BP at the beginning of this month.

TNK-BP declined to comment on the reason for the 8pc increase in its dividend.

The dividend will be useful to BP as it looks to fund the fallout from its Gulf of Mexico oil spill, with analysts estimating the total costs from the accident will top $30bn.

LNG terminal and supply base for Murmanskhttp://www.barentsobserver.com/lng-terminal-and-supply-base-for-murmansk.4829409-16178.html

2010-10-12 Murmansk Governor Dmitri Dmitriyenko has signed agreements on the development of a ten billion RUB LNG terminal, as well as a new oil and gas supply base, in the Kola Bay.

The two agreements were among a total of 21 investment agreements signed by regional authorities during the recent Murmansk Economic Forum. The agreements have a total value of 121 billion RUB, MBnews.ru reports.

The agreements, most of them linked with the development of the Shtokman gas field and the development of local infrastructure, confirm the current major investment interest in Murmansk.

Alone the agreement signed by the governor and the company BarentsGaz has a frame of ten billion RUB. According to a press release from the regional government, the BarentsGaz company is to develop an investment project on the construction of a base or reloading terminal for storage, reprocessing and shipments of LNG. The capacity of the terminal is to be three million tons, Oilru.com reports. It is to be located on the eastern shore of the Kola Bay, only about ten km from the City of Murmansk.

Among the other deals signed is an agreement with the United Shipbuilding Corporation on the construction of a new supply base. The new base is to facilitate supplies to hydrocarbon projects on the Arctic shelf. It will engage in the bunkering of ships, loading of goods, storage, repair operations and provision of necessary support for drilling missions on the shelf, Portnews.ru reports.

How long will Russia be able to hold crude oil production rate?http://www.glgroup.com/News/How-long-will-Russia-be-able-to-hold-crude-oil-production-rate--50953.html

October 12, 2010

Analysis by: Michael Lynch

Summary

Russia's decision to restrict access to the first major oil and gas field tender in 5 years has resulted in outrage. Russia's oil majors claim that the Kremlin's push for transparency has gone nowhere. In recent years the government has tightened control over the oil and gas sector. Last week, the Ministry of Natural Resources excluded Lukoil and TNK-BP from bidding on the grounds that their applications had not been filed properly. TNK-BP plans to challenge the ministry's exclusion.

Analysis

The above is an extract from a report by Jacob Gronholt-Pederson of Dow Jones Newswires as cited in the Rigzone Newsletter of October 7. Crude oil production under the Soviet regime reached a maximum in1983 at a rate of 12.520 million bbl/day. Then Samotlor and Romashkino, both supergiant oil fields in Western Siberia were major producers. In 1980, Samotlor alone could produce over 3 million bbl/day. Throughout the 1980s, the Soviets continued development of the smaller Western Siberia fields and were able to hold rate above 12 million bbl/day. By 1989, with most of the smaller fields drilled up, production began a decline that would continue until 2000.  But beginning in 2001, a series of redevelopment projects using more modern technology allowed them to recover and by 2009, their rate was over 10 million/day. How long that can be maintained is open to question. The Western Siberia's  redeveloped fields are now declining and if Russia is to continue producing at 10 million bbl/day, a greater effort in a far more hostile environment (Eastern Siberia) will be required. The Kremlin, of course, has historically played favorites. But today with little or no chance that Western Siberia can be revived for a second time, Eastern Siberia is the great hope of the future. Lukoil and TNK-BP are in possession of the kind of technology that Russia needs. Some of the other companies do not yet have that. Based on past performance, Russian production will again fall below 10 million bbl/day within 5 years. At that time, the kremlin will have no recourse but adopt a level playing field. 

OCTOBER 13, 2010

Why Cnooc in Texas Should Worry the Kremlin http://online.wsj.com/article/SB10001424052748703440004575548140384311962.html?mod=googlenews_wsj

By LIAM DENNING

Buying into a joint venture with Chesapeake Energy, Cnooc Ltd. must have been looking over its shoulder for rabid U.S. regulators. But it is Moscow that should really be concerned.

Cnooc's bid for Unocal in 2005 set off Washington's protectionist impulse. The joint venture just announced with Chesapeake is very different. Cnooc will take a one-third stake in a Texan shale oil and gas prospect while agreeing to fund 75% of Chesapeake's own development spending on it.

In effect, in exchange for a minority share, Chinese money will largely fund the cost of developing reserves that will enhance America's energy security. Few congressmen can argue with that.

Russia has more reason to feel uncomfortable. Cnooc's joint venture is focused on oil, rather than gas. But it is the latest deal giving a Chinese company access to unconventional North American reserves like shale gas and oil sands.

America's shale-gas revolution, based on methods developed by the likes of Chesapeake, has turned the global gas market on its head. In particular, it has freed up supply elsewhere to help loosen Russia's grip on Europe's gas consumers. Gazprom has seen its market share decline there and has been forced to adopt less favorable terms on some supply contracts. Developing eastern gas export markets like China would be one way for Russia to counter this.

But Chinese companies partnering with America's gas-rich but capital-poor exploration and production sector can then take what they learn to develop China's own shale-gas resources. These are potentially very large, perhaps more than 100 years' worth of demand, according to Sanford C. Bernstein. This is one area where America's usual grumbling about China piggy-backing on Western technology is unlikely to be heard.

Write to Liam Denning at liam.denning@wsj.com

Russian oil and gas - if unborn wells could talkhttp://www.businessneweurope.eu/dispatch_text13153

Troika, RussiaWednesday, October 13, 2010

With a projected federal budget deficit of $60bn and no desire from the state to cut spending, the Finance Ministry's options to raise money boil down to raiding the most efficient parts of the economy, such as the oil industry.

The modest impact on EBITDA from an MET increase is deceptive, as free cash flow could be dented by at least 15%. We estimate that oil production may fall 2.4% due to the MET hike, should the companies stop drilling wells made unprofitable by the new tax regime. If they do not - which is not an unrealistic scenario - they would transfer more wealth to the state, which implies further nationalization of the industry's cash flows.

Against this backdrop, we do not see the Russian oil industry representing a value proposition at $70 75/bbl oil. We downgrade our recommendations on LUKoil and TNK BP Holding common shares to HOLD, though we recognize the short term defensive quality of the former, with the management incentivized to avoid margin calls on its collateralized shares. Meanwhile, with new taxation coming in just over a year, LUKoil's free cash flow should not exceed $4.0 4.5bn after 2010 and an EV of more than $50bn becomes questionable.

We are bullish on Rosneft while hope remains that the Vankorskoye field retains a reduced export duty. Bashneft has reached our valuation ceiling but the market has yet to

factor in the possible Trebs and Titov victory, which is a free option on Bashneft stock and could contribute up to 15% to the company's value. We raise our target price for Eurasia Drilling Company following a good acquisition and retain a BUY recommendation on the stock. The driller is less exposed to the oil industry's woes as it diversifies toward more stable producers.

We are positive on both gas stocks exhibiting either atypical production growth (NOVATEK) or value (Gazprom). We raise our target price for NOVATEK to $99.00 per GDR on SeverEnergia's contribution and lower than expected medium term taxation. Gazprom offers a rather unusual risk reward profile backed by a P/E of 4.0. We fully recognize concerns about gas pricing pressure in Europe, loss of market share and value destructive greenfields, but we also do not see our $46bn EBITDA estimate to be at risk.

Gazprom

Gazprom plans big investment hike in 2011-EconMinhttp://af.reuters.com/article/energyOilNews/idAFWLA528120101013

Wed Oct 13, 2010 7:53am GMT

MOSCOW Oct 13 (Reuters) - Gazprom (GAZP.MM) plans to significantly increase its investment programme in 2011 from this year's levels, deputy economy minister Stanislav Voskresensky told reporters on Wednesday.

He added that the ministry thought the investment plans were too big, but gave no numbers.

"We are pointing Gazprom towards more active work with costs," he said.

(Reporting by Polina Devitt; Writing by Toni Vorobyova)

Gazprom eyeing Moscow's largest energy asset

http://www.rbcnews.com/free/20101013104512.shtml

      RBC, 13.10.2010, Moscow 10:45:12.The change in power in Moscow may give Gazprom hope for securing a stake in the Moscow United Energy Company (MOEK). According to the RBC Daily newspaper, Mosenergo, which is currently controlled by Gazprom, unexpectedly became the subject of critical reviews by the Moscow mayor's

office. Yesterday, acting Deputy Mayor Pyotr Biryukov accused the energy company of failing to fulfill its investment obligations, the financing of which was incorporated into electricity tariffs. "Out of 20 facilities whose construction is sponsored from the tariffs funds, only five have been completed, six are under construction, and nothing has been done on the remaining nine facilities," the official explained. Mosenergo confirmed that it was expected to implement 20 investment projects in 2010-2011, noting, however, that information about only five facilities being finished was erroneous.

      According to the publication, recent statements by officials from the Moscow mayor's office may be a sign of a new stage involving the largest municipal energy asset - MOEK, which receives energy from Mosenergo and makes money by transporting it to consumers. With that in mind, Gazprom may be interested in MOEK in order to get direct access to end consumers.

BUCHAREST | Wed Oct 13, 2010 2:35am EDT

GAZPROM

Economy ministry officials are expected to meet Alexei Miller, chief executive of Russia's state-owned energy giant Gazprom (GAZP.MM).

http://www.reuters.com/article/idUSLDE69C09P20101013

Gazprom’s resource base expansion in Kamchatka is fundamental for developing regional gas supply systemhttp://www.russia-media.ru/mainmore.php?tpl=Gazprom&iditem=192

[13.10.10]

Tuesday in Petropavlovsk-Kamchatsky Alexander Ananenkov, Deputy Chairman of the Gazprom Management Committee held a meeting dedicated to Gazprom’s resource base expansion onshore and offshore the Kamchatka Peninsula.

Participating in the meeting were heads and experts from Gazprom’s specialized subdivisions and subsidiaries: Gazprom invest Vostok, Gazprom dobycha shelf, Gazflot , Gazprom promgaz, Gazprom gaznadzor and contracting agencies. Opening the meeting, Alexander Ananenkov emphasized that Gazprom’s resource base expansion was a prerequisite for developing the regional gas supply system alongside the construction of gas transmission facilities.

The meeting addressed pre-development of the Kshukskoye and Nizhne-Kvakchikskoye fields located on Kamchatka’s west coast. It was stressed that the pre-development operations were progressing according to schedule. Production wells drilling is underway; the second phase of the comprehensive gas treatment unit (CGTU) installation that will convey gas from the Nizhne-Kvakchikskoye field is nearing completion.

Speaking of Kamchatka’s resource base development in the long run, the meeting participants highlighted the Peninsula’s offshore area as the most promising in this regard. Gazprom is planning to produce in this area up to 20 billion cubic meters of gas per annum. As a result of preparations and engineering activities in the Zapadno-Kamchatsky license block, seismic survey was performed over the area of some 7 thousand linear kilometers between January and September 2010. The 2010 plan envisages surveying 8 thousand kilometers. In 2011 shaping of Gazprom’s geological exploration program for Kamchatka’s offshore area will be finally shaped with due consideration for the seismic survey done and drilling of prospecting and exploration wells will be initiated.

Following the meeting results, Gazprom’s specialized subdivisions were given the appropriate tasks. (Source: Press Release Gazprom)