MOSCOW, January 21 (RIA Novosti) Russian-Georgian relations will not improve soon / Russia shows will to defend its interests / Putin takes South Stream to Bulgaria / Indian IT giant launches operations in Russia / Georgian wine imports to Russia: Theater of the Absurd / Threat of xenophobia in Russia overblown
Russian-Georgian relations will not improve soon
Georgia's recently re-elected president, Mikheil Saakashvili, has taken the oath, and a new president will be elected in Russia soon, a respected political analyst writes in the Kommersant popular business daily.
According to Alexei Malashenko, scholar-in-residence at the Carnegie Moscow Center and co-chair of its religion, society and security program, Russian-Georgian relations have reached the lowest level possible and now is the time to start their rise back to the surface.
Russian Foreign Minister Sergei Lavrov attended the inauguration of Saakashvili, who said relations with Russia should be renewed. The current situation may encourage the new-old Georgian president to abandon anti-Russian rhetoric, Malashenko writes.
However, he does not think change will come soon, because it is impossible to start from scratch and extremely difficult to turn the page. The problems of the self-proclaimed republics of Abkhazia and South Ossetia will not go away, and Russia and Georgia are facing a new test over Kosovo, whose independence will be most likely recognized very soon, the scholar writes.
Moscow diplomats say the recognition of Kosovo's independence will open the door to demanding official independence for Abkhazia, because Russians and Abkhazians will not understand why some countries may be allowed to proclaim independence while others may not.
The solution of the Kosovo problem will push the Kremlin into a trap, because it cannot recognize Abkhazia's independence since this would create a precedent for other post-Soviet republics, for example Nagorny Karabakh, which both Armenia and Azerbaijan claim as their national territory.
But if Russia refuses to recognize Abkhazia's sovereignty, this would highlight its political incompetence, and the North Caucasian people, who detest losers, will consider Russia a weakling. There are politicians there who are ready to send volunteers to Abkhazia, Malashenko writes.
Lavrov's mission is not an easy one, especially because Tbilisi is almost totally anti-Russian. Now is the turn of the Kremlin to act. Will it agree to depart one iota from its hard-line policy regarding Georgia, or say there is no difference between Saakashvili during his first and second terms?
Russia shows will to defend its interests
The statement Chief of Russia's General Staff Yury Baluyevsky made Saturday about Russia being prepared to strike first has been reiterated and replicated by all the world's major news agencies since.
Meanwhile, there was nothing really sensational about General Baluyevsky's presentation at the annual conference of the Military Academy. What he did was summarize in brief one of the key provisions of Russia's military doctrine adopted earlier this century.
The doctrine says Russia can preemptively use nuclear weapons against a state or a coalition which have such weapons and is planning large-scale military aggression against Russia or its allies.
The right and possibility to use nuclear weapons for preventive strikes is in fact mentioned in the according official documents in the United States and other nuclear powers. Moreover, Pentagon chiefs even have plans to use nuclear munitions in combat, something not included in Russian combat manuals.
Admittedly though, Baluyevsky failed to check himself before adding that "military force should not be only used during hostilities, but also to demonstrate the government's resolution to defend the country's interests."
How this should be done was not quite clear from his speech. Sending an assault group of the North Sea or Black Sea Fleet warships to the Atlantic and Mediterranean Sea, or dispatching long-range aviation to the borders of NATO countries apparently does not work.
The rearmament in the army and navy is proceeding very slowly. Certain new weapons are still in the testing phase, despite the widely broadcast triumphant statements by government and military officials. The mass production of cutting-edge weapons and battlefield support systems has not started yet, although the government allocates huge sums for defense needs: over 800 million rubles was approved for 2008, over 900 million for 2009 and over 1.1 trillion for 2010.
It is worth questioning whether such enormous spending is justified. Colonel General Alexander Zelin, the airforce commander in chief, said at the same conference that with the current condition of Russia's space and air defense, the country's territory would become vulnerable to space and air strikes by 2020.
Putin takes South Stream to Bulgaria
Last weekend President Vladimir Putin ended his last official foreign visit. Although successful, it called for some compromises. Bulgaria did not balk at signing an agreement to build the South Stream natural gas pipeline: it is to become the first transit country under the new strategic project.
The Kremlin's breakthrough was not total, however. Serbia, which Gazprom asked to be a second transiter, decided against signing an energy deal with Russia last weekend (in exchange for the pipeline and benefits for Serbia Gazprom expects a controlling stake in Serbia's NIS oil state monopoly).
Serbian Prime Minister Vojislav Kostunica never arrived in Sofia, although it was not ruled out that Serbia might officially join South Stream in the course of the Russian president's visit to Bulgaria. The matter will be decided following the presidential elections in Serbia, the first round of which was held on Sunday.
The talks in Bulgaria were difficult. The main stumbling block was ownership of the pipe and guarantees for its capacity use. After Putin flew into Sofia, the negotiators sat through the whole night before reaching any results in the morning.
The initiators of the project - which will run from Russia's Black Sea coast to southern Europe - are Gazprom and Italy's Eni.
The undersea section will be 900 kilometers long and capable of handling 30 billion cubic meters of natural gas and will stretch along the sea bed to Bulgaria's coast. Its completion is planned for 2013.
Feasibility studies will be prepared towards the end of 2008 by the Swiss-based South Stream AG, whose establishment was announced on Friday by Gazprom and Eni. The partners have equal shares in the joint venture.
Later, South Stream AG will become the construction operator of the pipe's underwater section, said a source in Gazprom.
Maxim Shein, a BrokerCreditService analyst, estimates the sea section of the project at $4 billion and the whole undertaking at $10 billion.
On Friday, the parties also signed an agreement to set up an international company to prepare feasibility studies for the Burgas-Alexandroupolis oil pipeline (that will bypass the Dardanelles and Bosporus straits).
The important thing now is not only to control oil and gas reserves, but also their transport, Shein said. The agreement, he said, is "another Russian step towards control over the world's transport assets."
Indian IT giant launches operations in Russia
India's Tata Consultancy Services (TCS), a leading global information technology consulting, services and business process outsourcing company, said it would open an office in Moscow by March, and that it would start marketing corporate products and services in Russia and other former Soviet republics.
Although market players do not consider TCS a serious rival, experts said the company could control up to 10% of the Russian IT services market by 2010.
Alexei Kudryavtsev, the CEO of IT company ISG, said TCS had no chance of obtaining any major contracts because, although it had a powerful lobby in the United States and the U.K., its positions here were quite weak.
Anatoly Gaverdovsky, senior vice president at EPAM Systems, a software company, said the Indian company should buy a large local company, and that he would not view TCS as a serious player unless this happened.
Gabriel Rozman, vice president of TCS' strategic BRIC (Brazil, Russia, India and China) unit, said the decision to open a corporate office in Moscow was motivated by a business-diversification strategy aiming to encompass Eastern Europe, the Middle East, Africa and Latin America.
The new TCS unit will focus on emerging markets now accounting for 25.5% of the $730 billion global IT services market.
Rozman said TCS could subsequently open a software R&D center in Russia, and that it would employ local programmers.
Sergei Karelov, president of the League of Independent IT Experts, said the opening of the TCS office in Russia would increase competition in the sphere of systems integration and business process outsourcing, and that TCS's financial potential was its key advantage.
He also said that, although energy giant Gazprom, the state-owned Sberbank (Savings Bank) and other corporate giants wanted external service providers to manage their IT infrastructure, the players on the IT market could not give the required financial guarantees.
Karelov said he would not be surprised if TCS, which annually earns over $4 billion, received major outsourcing contracts worth $50 million each in Russia.
According to Karelov, TCS will take over one or two local system integrators with a $20 million annual turnover, and that it could control up to 10% of the Russian IT services market, worth over 3 billion rubles ($121.95 million) last year, by 2010.
Georgian wine imports to Russia: Theater of the Absurd
The situation with Georgian wine imports to Russia is becoming increasingly worth presenting at the Theater of the Absurd. Georgian producers are now begging Gennady Onishchenko, Russia's chief health officer and head of the Federal Service for the Oversight of Consumer Protection and Welfare, to begin negotiations, but the latter says he has received no requests. In early January, the Georgian wine producers' union tried to reach Onishchenko through the Russian ambassador to Georgia. But their letter mysteriously vanished.
In that detailed letter, Georgian wine producers invited experts of the Russian consumer rights watchdog to inspect their production processes, as well as the pesticide imports, storage and circulation system, cited as the reason for the embargo in March 2006. The wine producers even suggested that Russian experts come and monitor the harvesting.
But their epistolary style was lost on the Russian officials. "I haven't seen a single official document yet, only heard declarations," Onishchenko said last Friday. "It is January 18th now. Had there been such a document, it would have had enough time to go around the world and reach us," he added with sarcasm.
Incidentally, Onishchenko has a general idea of what they propose - he has read it in the press. But he did not like the idea much. "I do not think they should invite us. I think they should come here instead of sending letters, and hear out our professional proposals on further cooperation. Then we could decide whether or not we should go to Georgia," he said, effectively dotting the I's.
However, Georgian wine producers have no desire to visit Moscow, possibly intimidated by the chief health officer's brusque manner.
This month's letter was not even the first one sent by Georgian wine producers, as they keep asking Russia to resume wine import negotiations almost every month. But Onishchenko dismisses their requests as "inappropriate" and "pretentious." Some of the letters simply vanish into the thin air as was the case this month. Onishchenko said "Georgia never really applied, it only seemed it did."
Threat of xenophobia in Russia overblown
The Russian police are worried by growing xenophobic sentiments in society and an increase in crimes motivated by inter-ethnic strife. They are especially concerned at the growth of youth extremism. However, last year's figures point to no sharp increase in the trend.
At first sight, the figures do look grim. According to the Interior Ministry, in 2007 as many as 356 cases were filed on crimes based on ethnic motives - 2.6 times more than in 2004.
According to the human rights organization Sovacenter, which monitors xenophobia in Russia, 573 people fell victim to nationalists in the first eleven months of 2007, with 57 of them killed. That is more than in the whole of 2006, with 542 victims, including 54 fatalities; and in 2005, when there were fewer victims still.
Valery Tishkov, director of the Russian Academy of Sciences' Institute of Ethnology and member of the Public Chamber, said it was not clear what yardsticks the police used to measure the spread of nationalist sentiments in society as a whole and in the youth environment in particular.
Citing the findings of the Levada-Center, which has been investigating hatred for non-Russian ethnicities in Russian society, Tishkov believes these data are comparable with those in Germany or France.
Experts think the mounting statistics of criminal cases filed against skinheads and the number of attacks on non-resident citizens are a welcome indicator.
But they are not the evidence of growing xenophobia, only that law enforcement bodies are now less often masking ethnic crimes as hooliganism or household offences.
It is not entirely clear why the Interior Ministry is seeking to paint everything in gloomy colors when the situation is, if anything, improving.
It is also necessary to alter police attitudes. According to Bashkirov & Partners, 76% of Tajik guest workers employed in Russia have experienced abuse or humiliation of one sort or another. Of them, 53% were insulted or fined by police or migration officials, and only 18% were the targets of nationalist threats.
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