Russian government to finance economic recovery
The Russian government plans to take a bigger part in the post-crisis economic recovery. According to the 2011 draft budget, state investment in the economy will grow 15.3% to 1.364 trillion rubles ($45.14 billion). The government, which has pinned its hopes on the federal targeted programs, intends to increase their funding by 19.2%.
Independent analysts warn that an increase in state expenditures is most likely to spur inflation.
On Thursday, the Russian government met to discuss and approve the draft budget for 2011 and the medium term, including spending on federal targeted programs. Prime Minister Vladimir Putin said in his opening remarks that state investment is a vital instrument of economic revival in the post-crisis period.
"In the second quarter of 2010, gross domestic product increased by 5.4% and annual inflation reached a record low, under 6%," he said. "The federal targeted programs should be used to consolidate the current positive trends and especially to promote a qualitative change in the structure of our economy."
He said: "State investment in 2011 will total 1.364 billion rubles and possibly even more - an increase of 15.3%. We also plan to increase the funding of federal targeted programs by 19.2% to 981 billion rubles ($32.5 billion)."
The government has found a way to continue programs that are already underway, and "although we had decided not to launch new ones, we have now decided to start new programs in some fields," Putin said.
These are the fields in which Russia is still lagging behind and has problems, where the government must contribute to breakthrough projects that will largely determine the development prospects of entire sectors and the social sphere, the prime minister said.
"In 2011, we will begin implementing policy measures to create the Vostochny Space Center in the Amur Region, to support the pharmaceutical industry and domestic and foreign tourism, and to create the foundation of an information society. We will approve targeted funding to support the machine-tool industry and to create next-generation diesel engines," Putin said.
The government is implementing 53 federal targeted programs in 2010 and intends to implement 63 programs beginning in 2011. However, their funding will decrease from 806.6 billion rubles ($27 billion) in 2012 to 750.1 billion rubles ($25 billion) in 2013.
The government will remain the largest investor in the Russian economy in the medium term, which independent analysts say could spur inflation. The slow price growth this year is largely due to the crisis, which effectively slashed demand. But huge budget injections into the economy that is "on the path toward sustainable growth" could boost inflation to a two-digit figure.
Blast spills blood at Ukrainian church
A terrifyingly cynical crime was perpetrated in Zaporozhye, Ukraine, on Thursday, when unknown criminals blew up a local church during the last day of the Patriarch Kirill of Moscow and All Russia's arch-pastoral visit to the country.
The explosion ripped through the local Cathedral of the Intercession of the Mother of God, part of the Ukrainian branch of the Russian Orthodox Church, at about 4.00 p.m., injuring nine people, including a 74-year-old nun who later died in hospital from burns and other injuries. Eight other blast victims were slightly injured.
Five people were immediately treated for injuries and concussion sustained in the blast as well as for shock. Hundreds of local residents and parishioners gathered around police cordons after the explosions, many of them in tears.
Church priests said a small package lying unnoticed at the entrance to the church had blown up. City Mayor Yevgeny Kartashov, Zaporizhye Region Governor Boris Petrov and local secret-service chiefs visited the crime scene after the blast.
Petrov initially said an improvised explosive device (IED) equivalent to about 500 grams of TNT had gone off. A criminal case was opened under the Ukrainian Criminal Code's premeditated murder clause.
Ukrainian officials, including vacationing President Viktor Yanukovych, a member of the Moscow Patriarchate's Ukrainian Orthodox Church, declined to comment on the issue. The Kiev Patriarchate, the Ukrainian Autocephalous Orthodox Church and other main local opponents of the Moscow Patriarchate are also saying nothing.
"It would be easy to blame the Ukrainian Orthodox Church's main enemies, including ultranationalists from the Freedom Party, the Kiev Patriarchate and others, for this terrible crime. But we should realize that the Church is not a rapidly-reacting political institution. Consequently, we should not expect any immediate comments from Metropolitan Vladimir, the Primate of the Ukrainian Orthodox Church," said Vladimir Anisimov, spokesman for the Moscow Patriarchate's Ukrainian Orthodox Church.
The Cathedral of the Intercession of the Mother of God is located inside an old shopping center at a local marketplace. Therefore the attack was probably commercially motivated. "Even if that is the case, it does not mitigate the fact that those who masterminded the explosion are guilty not merely under the Criminal Code but before people and God," Anisimov told the paper.
Rosnano to invest $300 million in the drugs of the future
Rosnano's head, Anatoly Chubais, has decided to use the company's capital to buy molecules for the development of new drugs. The supervisory council approved the deal: the state-owned corporation will contribute $300 million to the project via its subsidiary Rusnano Capital. Its partner, British investment company Celtic Pharma, will provide a similar amount.
An RBC Daily source at Rosnano has said that the corporation's supervisory council decided to allocate $250-300 million to its Swiss subsidiary Rusnano Capital to purchase and develop experimental drugs. The subsidiary plans to buy molecules capable of producing the pharmaceuticals of the future. British investment company Celtic Pharma will act as a partner and contribute another $250-300 million for a total investment of up to $600 million.
Celtic Pharma was founded in Bermuda and has offices in London and New York. Its current plans include eight new drugs in an advanced state of development. One of them is an immunity therapeutic vaccine (TA-CD) against cocaine dependence. The website says that antibodies of the drug will come in contact with the cocaine molecules in an addict's blood. The molecules then grow too big to reach an addict's brain and give a feeling of satisfaction. Another vaccine, for which Celtic Pharma is seeking capital, is a drug to deal with nicotine addiction.
So far, Rosnano's contribution to Rusnano Capital has been something like $500 million, and the corporation's Western pharmaceutical project will claim half that amount or more. This is not the first project in this field for the corporation, but until recently it has only worked with Russian companies and firms.
In five to seven years, when the drugs pass clinical tests and are approved for consumer consumption, the manufacturing rights will be sold, and Rosnano could see its investments pay off.
Irina Rapoport, Rusnano Capital's general director, says Rosnano and Celtic Pharma are currently drafting an agreement. "I hope we will start working together before the year ends and establish a budget of $600 million," she said. "We are planning to buy both Celtic Pharma's molecules and the experimental drugs of other overseas companies to start pharmaceutical production in Russia." She said the drugs would be marketed globally in the future.
United States reminds Russia of old START violations
The U.S. Department of State has issued a report claiming Russia failed to comply with the terms of the old START treaty, which expired in December 2009. The publication triggered a painful response from the Russian authorities, which in a reply statement seem to have lifted up some of the veil over the classified part of the report. Apparently, the Kremlin expected only encouraging signals from the State Department.
The Russian Foreign Ministry made its official statement unexpectedly quickly, within one day of the U.S. report appearing. "Without citing any facts, the United States has included Russia among the 'violators' of non-proliferation agreements," the Ministry said in a statement issued on July 29.
The U.S. report, published the previous day, deals with treaties on the limitation, control or non-proliferation of various kinds of weapons which Washington signed with other countries. The authors of the study look into how faithfully the sides honor their commitments.
The report says that the United States still has some questions about Russia's compliance with the START treaty. U.S. media say the report has a classified part listing these issues in greater detail.
The Foreign Ministry's statement shed some light on the classified part of the study. "The U.S. reportedly has some unanswered questions, in particular about RS-24 intercontinental ballistic missile inspections," it says. The RS-24 Yars is a missile currently undergoing state trials and scheduled to replace Topol vehicles.
The report, which called in question Russia's ability to fulfill its START obligations, could hand a serious argument to critics of the ratification of the new U.S.-Russian agreement. In the view of some Republican congressmen, the New START treaty should not be ratified because this will shackle U.S. potential, giving Russia new opportunities for the development of its nuclear arsenal.
Evgenia Voiko, a foreign policy expert from the Russian Center for Current Politics, believes the United States is deliberately dragging out the process. "The State Department report confirms the Russian-U.S. 'reset' will not be taking any giant steps forward. The United States is probing the Russian position to see how to negotiate nuclear disarmament in the future," she said. The delaying of ratification may be connected with a U.S. desire to put pressure on Iran, Voiko believes. "Since the cuts in nuclear arms can be seen by Iran as a weakening of the U.S. stand, Washington is seeking to show that it is prepared to abandon this idea if it feels a threat to its security."
Russian court bans YouTube
A court in Komsomolsk-on-Amur in the Russian Far East has ordered all local Internet service providers to block access to YouTube.com and four other websites for publishing extremist materials. Other regions in Russia could follow suit.
YouTube posted a video, Russia for Russians, which is on the federal list of extremist materials.
The other sites to be banned are http://lib.rus.ec, http://www.zhurnal.ru, http://web.archive.org and the electronic library TheLib (http://thelib.ru), which published Hitler's Mein Kampf.
The court's ruling was made following a complaint filed by Vladimir Pakhomov, a prosecutor in Komsomolsk-on-Amur, against the local provider Rosnet. The ruling reads that a survey conducted in accordance with the law on extremism revealed these and other extremist materials, and that all local providers must block access to the resources that published them.
Rosnet president Alexander Yermakov said his company cannot uphold the court's ruling because it has no right to limit people's access to information and that it is the company that created the resource or its administrator who are responsible for its content.
However, the court has ruled that Rosnet as the respondent failed to ensure the safety of users and granted the prosecutor's request.
Yermakov said they have already appealed the ruling.
There is no mechanism for removing extremist materials from a website, said a law-enforcement official. If a resource is registered in Russia, we can deal directly with its owners, he said, but it is virtually impossible to influence the content of sites that are registered in the United States, whose owners refuse to comply citing the First Amendment.
It is only theoretically that a ban can be applied to any resource, the official said.
A Russian representative of Google (YouTube is a Google subsidiary) said it is very easy to remove offensive material from YouTube. You only need to flag it and enumerate your complaints in an accompanying letter, as it was done with the Doku Umarov video, he said.
According to the Russian Ministry of Telecommunications and Mass Media, the ruling of the Komsomolsk-on-Amur court is beyond the ministry's scope of authority as none of the sources mentioned is registered in Russia as a mass media outlet.
The Federal Service for Supervision of Communications, IT and Mass Media has control only over the sources registered in Russia, said Yelena Lashkina, press secretary of the communications minister.
RIA Novosti is not responsible for the content of outside sources.
MOSCOW, July 30 (RIA Novosti)