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What the Russian papers say


MOSCOW, November 12 (RIA Novosti) Moscow may surprise Indian premier by its pragmatism/ Abkhazia and South Ossetia could follow in Kosovo's footsteps - expert/ Magna launches Chrysler car models production in Russia/ Celtic Resources accepts Russian company's proposal/ Russian society approves new election legislation - sociologists

Vremya Novostei

Moscow may surprise Indian premier by its pragmatism

The Indian media has a nervous tone when covering Indian Premier Manmohan Singh's visit to Russia. The official arrived in the Russian capital Sunday.

New Delhi was concerned by the fact that neither Russian Foreign Minister Sergei Lavrov, nor President Vladimir Putin met with Indian Foreign Minister Shri Pranab Mukherjee, who arrived in Moscow in mid-October to attend a session of the joint commission, although in the past meetings with the Russian president had been routine. New Delhi is puzzling over the reason for the cool down. Experts say it is too early to panic, as the two nations' bilateral relations have simply become more pragmatic.

Well-informed Indian sources told Vremya Novostei that Moscow was probably trying to indicate its dissatisfaction with India's rapprochement with the United States. In addition to the growing nuclear and military cooperation between India and the U.S., India has refused to back Russia's concerns over the deployment of the U.S. missile defense systems in Central Europe. Singh and Putin might not sign a joint political document at their planned meeting, the source said, a break with a long-standing tradition.

Tatyana Shaumyan, the director of the Center of Indian research at the Institute of Oriental Studies, said the minor hitches during the Indian Foreign Minister's October visit were most probably accidental. "It was a coincidence of adverse circumstances. Earlier, Russian officials abandoned all current plans to meet with Indian visitors, but the relations have become calmer and more pragmatic. It is not a reason to panic and exaggerate the problem. All questions have a solution," she said.

Nezavisimaya Gazeta

Abkhazia and South Ossetia could follow in Kosovo's footsteps - expert

The Georgian president who only recently said he was not concerned by public protests and demonstrations seems to have made an about face to the protesting population and called early presidential and parliamentary elections, writes Alexander Rahr, director of the Russian and CIS affairs program at the German Council on Foreign Policy.

Mikheil Saakashvili wants to lift the tensions at all costs and overcome the domestic conflict as soon as possible, but the reasons for such a decision most likely lie outside Georgia.

There are indications that around December 10 Kosovo's Albanians will declare independence. Following that, in the second half of December, a number of countries, and not just Western states, are expected to recognize Kosovo's independence.

If this happens, the issue will immediately crop up - and not just by Russia- concerning independence for Abkhazia and South Ossetia.

Saakashvili is perfectly aware that this moment could decide whether his country remains one or is split into three parts. So Saakashvili must resolve his domestic political problems at all costs and make it up with the protesters in order to gain time and stop the self-proclaimed republics from declaring independence.

Otherwise, Abkhazia's withdrawal would be automatic. The Abkhazians might declare, and their reasoning would be accepted in the West, that they could not afford to remain within an unstable Georgia. And at that moment they could receive the right to opt out of Georgia.

Inside the country the Georgian leader is totally isolated, and virtually all his one-time associates are leading opposition parties.

If the crisis had continued to get worse, Saakashvili would have found it even more difficult to keep office, because the only resource he has left is the West.

How long the U.S. would like to support the leader without any following is a big question mark. The Americans cannot afford to back a leader that behaves no more or less respectably than Lukashenko in Belarus or Karimov in Uzbekistan.


Magna launches Chrysler car models production in Russia

Canadian auto parts manufacturer Magna intends to construct a Chrysler assembly plant in Russia. Magna's partner in this project, which is estimated at $500 million, might be its Russian co-owner, Deripaska's Russian Machines company. Experts think that Russian Machines should take part in this project only if cars are assembled at Chrysler's base and are sold under the Russian brand.

According to Magna's data, which they gave to the Russian Ministry of Economic Development and Trade, the assembly plant's capacity will be 150,000 cars with the possibility of doubling the number. The models have not been approved yet but its main car model will be American Chrysler.

At the end of 2006 Magna signed a memorandum with AvtoVAZ, Russia's largest carmaker, on the construction of a car plant in Togliatti. But the project has not been started so far.

Today Chrysler is a sales outsider in Russia. According to data from the Association of European Business, from January to October 2007 Chrysler sold 4,900 cars under Dodge, Jeep and Chrysler. These models took 32nd, 38th and 40th places accordingly. Chrysler's drop in sales is 13% with 64% of sales growth in new foreign cars in the Russian market.

A partnership between Russian Machines and Magna might be risky, said Mikhail Pak, an analyst at the Kapital Investment Group. Chrysler's sales volume puts assembling profitability in question. Pak said that low profitability was slowing down negotiations between Magna and AvtoVAZ.

Ivan Bonchev, an automotive analyst at Ernst&Young, said that the way out might be assembling D-class cars on Chrysler's base under the Russian brand by analogy with Siber, which Russian automaker GAZ Group produces on the base of the discontinued Chrysler.

"Siber can be considered a pilot project. It will be on a market not more than five years, after that the market will need a substitute. It might be a new car on Chrysler's base, which Magna with Russian Machines will assemble in Russia," said Bonchev. At the same time Chrysler, Magna and Russian Machines might work on lowering the price of Siber. Now its base price is $ 18,000 and experts say it is too high.


Celtic Resources accepts Russian company's proposal

A two-month confrontation between the board of directors of Ireland's Celtic Resources and Russia's Severstal Resurs is over. Celtic Resources has agreed to sell its shares to Severstal Resurs at 2.8 pounds sterling per share. The Irish company's board decided it was useless to continue "holding the fort," because Severstal Resurs had already accumulated over 45% of the Irish company's stock through private deals with its shareholders.

"The board of directors' consent to the Russian proposal was a surprise. Celtic has rejected it several times, and the last 3% rise in the price of its shares is not at all excessive," said Vladimir Popov, a leading analyst with the AntantaPioglobal investment group.

In his opinion, the board saw Severstal Resurs' determination to obtain the Irish gold mining company and the offer was not at all bad, objectively speaking - with a premium of at least 30% of the cost of Celtic assets.

By and large, the Irish company's board had no other way out. Severstal Resurs was close to obtaining control over the company without its consent as it had already bought 45.3% of the shareholders' stock.

Severstal Resurs may compensate the money paid by it. "This purchase is an image-creating move and the expectation of a future rise in gold prices," Popov said. "For at least a year, gold prices will remain at $700-$800 per ounce. However, considering the weakening of the dollar, there may be a further rise in metal prices."

Celtic Resources, which is registered in Ireland, owns assets in Kazakhstan (100% of the Suzdal gold mine, 75% of the Zherek mine and 50% of the Shorsky molybdenum mine), 74.5% in the project to develop the Tominskoye copper and gold deposit, and 100% of the Mikheyevskoye copper and gold deposit in the Chelyabinsk Region. In 2006, the company produced 62,000 ounces (1.93 metric tons) of gold.

Severstal Resurs manages assets of mining enterprises incorporated into the Severstal Group, one of Russia's major steel and metals producer.


Russian society approves new election legislation - sociologists

On October 19-23, influential pollster Levada Center conducted a sample survey involving 1,600 people in 153 populated localities in 46 Russian regions. The poll, which had a 3% error margin, showed that 44% of the respondents were against abolishing the minimal voter turnout rule, while the share of those advocating new election legislation had increased from 24% to 38%.

According to this and other recent opinion polls, Russians like the new legislation for electing the State Duma, the lower house of parliament, and support political parties that are ready to establish law and order by curbing democratic freedoms.

In 2005, the Kremlin and the pro-government party United Russia decided that the outcome of any elections must depend on conscientious people and abolished the 25% voter turnout rule.

Opposition parties said such opinion polls reflected people's fear of the government.

Moreover, the leftists and rightists, who could no longer boycott parliamentary elections, said a government elected by the minority was illegitimate, and that this was fraught with problems.

Last year, 60% of those polled said they opposed the decision to abolish the minimal voter turnout rule.

In all, 53% of the respondents supported the decision to raise the State Duma election barrier from 5% to 7%, while another 21% said they were against it.

Boris Nadezhdin, secretary of the Federal Political Council of the Union of Right Forces (SPS) said 99% of Russians cared nothing about minimal voter turnout and election barriers, and that sociologists had probably told them about new legislation passed by United Russia and signed by President Vladimir Putin.

He said people usually approved of anything associated with Putin.

Sergei Ivanenko, deputy chairman of the Yabloko party, noted the growing share of respondents replying "don't know."

Levada Center director Lev Gudkov said 31% of those polled a year ago replied "DK" when asked about the decision to abolish elections in single-constituency districts, and that their share was now 41%.

Gudkov said, although voters did not understand certain nuances, they realized that the current state system was asserting itself, and that it was better to say nothing rather than to criticize political decisions.

RIA Novosti is not responsible for the content of outside sources.


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