August 13, 1997  
This Date's Issues: 1120 • 1121 • 

Johnson's Russia List
#1121
13 August 1997
djohnson@cdi.org

[Note from David Johnson:
1. RFE/RL: Deputy Prime Minister Resigns. (Kokh).
2. Dev Murarka in Moscow: Degeneration. (DJ: I want to
thank Dev for this response to my request for discussion.
I must confess that I do sometimes wonder if people actually
read and pay attention to these JRL emailings.)
3. Boston Globe: David Filipov, US accuses group in Russia 
of theft. Institute linked to Harvard program.
4. St. Petersburg Times: Alexander Zhilin, Why Worry About '
Vodka Riots' in 'Exlandia?' 
5. ITAR-TASS: Szyazinvest Sell-Off Approved by 70 Percent of 
Respondents.
6. Zavtra Claims Japanese Medics See Mental Decline in Yeltsin.
7. Rabochaya Tribuna: 'Tremendous Doubts' About Future of High 
Tech Industry.
8. UPI: Report: U.S. funding research in Russia.
9. Reuter: Russia Assists Tajikistan Peace Talks.
10. Russia Today press summaries.
11. ITAR-TASS: Minister: Army Reform Based on Efficiency, Cost.
12. RIA Novosti: NOBODY WAS GIVEN THE RIGHT TO CONSIDER 
CHECHNYA AN INDEPENDENT STATE OUTSIDE THE TERRITORY OF 
RUSSIA, SAID YEGOR STROYEV.
13. The Philadelphia Inquirer: Peter Slevin, The perils may be many, 
but interest in the Caucasus and Central Asia is high. 
14. Zavtra Claims U.S. Wants International Forces in Caucasus.]

*******

#1
Russia: Deputy Prime Minister Resigns
Moscow, 13 August 1997 (RFE/RL) -- The press service of Russian president
Boris Yeltsin says Deputy Prime Minister and State Property Committee head
Alfred Kokh has resigned. 
Interfax news agency quotes Yeltsin's press secretary Sergei
Yastrzhembsky as making the announcement today. Yastrzhembsky said that the
deputy head of Yeltsin's administration, Maksim Boiko will replace Kokh. 
Yastrzhembsky did not elaborate. It is unclear whether Boiko will
replace Kokh in both his positions. 
Yastrzhembsky gave no reason for the resignation of Kokh, whose
organisation of Russian privatisations was criticised by Prime Minister
Viktor Chernomyrdin last month. 
Kokh was officially on holiday since the beginning of this week. Both
Kokh and Boiko are viewed in Moscow as being close to first deputy Prime
Minister and Finance Minister Anatoly Chubais. 
Kokh has presided over a stormy phase of Russian privatization and was
singled out for criticism recently by Prime Minister Viktor Chernomyrdin. 
The sale this month of a controlling 38 percent stake in Russia's
biggest mining company, Norilsk Nickel, proved controversial, with
Chernomyrdin trying to have the sale stopped. 

*********

#2
From: "Dev Murarka" <devmur@centro.ru>
Date: Wed, 13 Aug 1997 10:53:09 MSK
Subject: Degeneration

Apropos your suggestion about discussing the theme of degeneration in
the Russian upper echelons (JRL 1114, item 1, August 11). Perhaps the
following points should be kept in view when thinking aloud on the subject.
1. The disclosures by Mikhail Poltoranin are hardly news. It
has been known and talked about for years and one has only to drive on the
outskirts of Moscow to see the physical evidence of the new life style of
the administration and its elite. The irony is that Poltoranin was among the
first ones to create a cult of personality around Yeltsin and under this
cover the fighters against privilege have eventually come to be the most
privileged of all people. Surely, Poltoranin is right in maintaining that
the privileges enjoyed by the present administrative-political Russian
oligarchy was undreamt of by anyone in the Soviet hierarchy.
There is a very telling, if unconscious, confirmation of this
in Korzhakov's memoirs. A Gorbachov hater like his ex-boss Yeltsin, he has
written: <We were flying on Mikhail Gorbachev's old plane, which was
surprisingly badly laid out given his fondness for comfort and luxury. The
presidential suite was modest: a cramped lobby, a bathroom and toilet, two
narrow beds and a little fold-away table.>(JRL 1111, item 3, August 3) It
not only gives a lie to the super exaggerated campaign about privileges ten
year ago but also bears revelatory witness to the high expectations and
demands of plush luxury by the new "democratic" rulers. And can Yeltsin's
brand new, luxurious resting place for a few days in Karelia compare with
the rather modest structure built for Gorbachov in Foros, always thrown at
his face because of his alleged <fondness for comfort and luxury>?
2. The primary reason for the tremendous degeneration which
has taken place is that despite lip service paid, there is no longer any
concept of morality in public life or service nor any authority to enforce
it. This breakdown in authority is the most serious drawback of the kind of
feudal system which has evolved under Yeltsin, who has been turned into a
machine for signing decrees, most of them unenforceable and quickly
forgotten, but who is made responsible for all the decisions. The government
and other branches of the state exist to serve his whims, nothing else.
The important contributory factor in this lack of morality in
public life is the prevailing dogma of market economy, applied in a 'unique"
Russian way. According to this received ideology, basically it is no sin to
make as much money as one can, by any means available. Evidently in its
helter-skelter run towards free wheeling capitalism Russia has not yet
reached the stage where any notion of <unacceptable face of capitalism>
would be considered by any one in the ruling group.
3. The question of support from outside is at once simple and
complicated. 
Simple in the sense that the primary sources of political and
financial support are two, the American President, whosoever he might happen
to be, and Chancellor Helmut Kohl of Germany. But this support is, it must
be understood, in the first place for the person of Yeltsin, and only
secondarily, if that, for Russia. Other Western countries follow the
American lead though from time to time the French try to create the
impression that they do not, only to fall in line when the crux comes. 
The rationale for this appears to be that Yeltsin is a
reformer on whom the West can rely on not only for keeping the communists
out but to install younger reformers approved of by the west in such
positions of power and authority that they can take over from him. From this
perspective, the Western line of Western reasoning is justifiable.
What is questionable is the dimension of this support,
which extends far beyond any rational criteria. In fact the west has
unconditionally underwritten all the deeds of Yeltsin, good or bad. Without
this support he would not have emerged politically secure after shelling the
Supreme Soviet in October 1993, or would have carried on the shameful war in
Chechnya for so long. Or for that matter, without direct American
assistance, no doubt sanctioned by the White House, he may not have
succeeded in employing electronic techniques for the murder of the Chechen
leader Zokhar Dudayev. The close American involvement, financial as well
political, in the re-election of Yeltsin is well known enough.
In short, Yeltsin has emerged as the Holy Cow of the
West. There are certain American publishers who did not want to publish a
book on Chechnya because its synopsis was critical of Yeltsin. What did they
expect, praise for the killer of 100,000 persons?
The issue of support becomes complicated when its
effects are looked at, both short and long term ones. In the short term this
uncritical support of Yeltsin, his actions and methods, has prevented
emergence of sound democratic institutions and practices because Yeltsin has
been quick to grasp that the West is not interested in substance but shadow
and so the superficial Western protestations can be safely ignored. It has
meant not only that establishment of genuinely democratic institutions has
been fatally delayed but also that harmful precedents have been created
which will haunt and deform Russian politics for decades to come. 
In the long term, the loud Western, mainly American
insistence on there being only one road to the future, on approval of
certain policies and personalities of the Yeltsin administration has been
extremely counterproductive. It has discredited democracy in the public
perception and made a large section of the people resentful of those so
forcefully supported by the West. Mr. Rowny's letter to the New York Times
(JRL 1112, item 7, August 10), is a perfect example of how to discredit
America, American supported policies, and those friendly to America, in the
eyes of the Russian public.
4. It may be that all that has been written above
about outside support is beside the point. It may be that the real problem,
and the mess it has created, has different causes.
One of them is the dangerous level of personalisation
of international politics at the top. With the advent of the jet age
diplomacy has rapidly gave way to personal meetings of leaders. Another
deformation came in the wake. It became de rigor to call every meeting a
summit, and in further devaluation of language, every summit - historic. The
result is that more and more policies are being determined at the moment of
personal interaction of the leaders. It does not remain simply American
support for Russia. It turns into Clinton support for Yeltsin or vice versa.
In such circumstances policies become bent because
they are perceived as tests of personal relations and loyalties, not of
relations between countries, not of observance or pursuance of principles.
In this connection, an episode can be recalled when Chancellor Kohl was
criticised in the Bundestag for support to Yeltsin during the Chechnya war
and his angry response was that he must remain loyal to his friend.
But eventually a heavy price may have to be paid by
countries for such unprincipled personalisation of policies because it would
make it more difficult for them to adjust when persons at the apex change,
as they must eventually. For instance, is it not evident that following the
exit of Mitterand in France, Kohl has found it difficult to get on equally
well with Chirac and this, among other things, has put a wrinkle on Franco-
German relations? 
The time has come when this practice of endless round
of meaningless summits, involving huge expense of public money and often
producing nothing more than media circuses, should be phased out. The world
leaders should take to using e-mail like us, which will save taxpayers'
money and turn out to be far more productive.

********

#3
Boston Globe
13 August 1997
[for personal use only]
US accuses group in Russia of theft 
Institute linked to Harvard program
By David Filipov, Globe Staff

MOSCOW - In a bitter new dispute surrounding Harvard University's ill-fated
economic reform program here, the US government has accused a Russian legal
institute of stealing $500,000 in office equipment. 
The government made the charge after workers for the Institute for a
Law-Based Economy, or ILBE, removed computers, telephones, and furniture
from the Moscow office it had shared with the Harvard Institute for
International Development, or HIID, until last weekend. 
The US Embassy asked local police to try to prevent the move of the
equipment, most of which had been purchased with funds from the US Agency
for International Development to support HIID's programs with ILBE on
implementing market reforms. After interrogating the movers and ILBE staff
for over two hours, the police left the scene, saying the move was not a
criminal matter, ILBE workers said. 
Harvard and ILBE have been negotiating a separation agreement since May,
when the final $14 million of HIID's $57 million contract with USAID was
canceled in May in the wake of corruption allegations against the program's
directors. 
ILBE was founded by HIID with money from USAID, the World Bank and the
British Know-How Fund, and still has a $31 million grant from the World
Bank. The bank recently cleared ILBE of any wrongdoing following
allegations by USAID that HIID's director in Moscow, Jonathan Hay, and
Harvard professor Andrei Shleiffer, ordered ILBE to provide free investment
services for Shleiffer's wife, Nancy Zimmerman. USAID is still conducting
an investigation. After Harvard fired Hay and Shleiffer in May, Harvard and
ILBE began liquidating their partnership. 
But the severance has not gone smoothly, and the US government and ILBE
disagree on what should have happened to the 45 computers, 64 desks, 103
chairs, and other equipment remaining in the Harvard program's office. 
''Late Friday night and Saturday morning, ILBE took approximately
$500,000 in office equipment and furniture'' belonging to the US
government, US Embassy spokeswoman Olivia P. L. Hilton read from a
statement. ''The United States government very much regrets ILBE's action,
which was taken despite repeated instructions from HIID and USAID not to
take the property. We are hopeful that ILBE will return all of the property
immediately.''
ILBE's director, Sergei Shishkin, said that his staff had not stolen
anything, but that the institute could not turn over the property without a
formal agreement. 
He said the US government and Harvard had known ILBE planned to move and
knew the new address. 
''We wrote them a letter in which we admitted that this is the property
of the USA,'' Shishkin said. ''Of course we'll give it back. But we would
like USAID to understand the problems of a Russian organization that is
under Russian law.''
Shishkin said that he needed a detailed explanation of where the
equipment was going next, so that he could explain to Russian tax
authorities what happened to it. 
''We are ready to work on a divorce, if we need a divorce, but we want
to do it in a civilized way, respecting each other,'' he said. 
A US Embassy official, speaking on condition of anonymity, said that
ILBE had no right to take the equipment. 
''When property is bought under our grant, we decide who gets to keep
it,'' the official said. 

*******

#4
St. Petersburg Times
AUGUST 11-17, 1997
Why Worry About 'Vodka Riots' in 'Exlandia?' 
By Alexander Zhilin
Alexander Zhilin is the military correspondent for Moskovskiye Novosti. 

ANOTHER round of military exercises in the Baltics, called Baltic
Challenge and involving nine countries, has come to an end. These exercises
have drawn more attention from journalists and politicians than Autumn
Forge - the one-time, large U.S. military exercises for airlifting troops
into Europe in response to a possible war with the Soviet Union. The
Russian press was asking itself one question in particular: Just how
dangerous are these exercises for Russia?
To give an honest appraisal of the goals of these military exercises,
one must ask certain questions: Who is considered to be the enemy, and
against whom were the forces directed? Who benefits from the exercises and
what are the national interests and goals of the participating nations? Do
the forces and resources correspond to an opponent's potential threat?
The exercises were formed according to the principle of NATO being a
guarantor of peace. The multinational peacekeeping forces set for
themselves the hypothetical task of reestablishing law and order and
providing humanitarian aid to the fictitious state of Exlandia. The
opponents in the Baltic Challenge exercises are a group of rioters who
threaten democratic freedoms in Exlandia. They demand vodka and access to
protected zones.
But the question arises: Which extremist segments of Exlandia's
population would demand vodka and present such a threat that the nation's
police and army could not contain the problem without foreign help?
American journalists provided the answer: Demoralized by political
speculation, the Russian-speaking population has gone on strike against the
authorities at Moscow's bidding and with its support. According to Baltic
Challenge's confidential scenario, the strikers are being led by
Russian-speaking military personnel who have been discharged into the
reserve forces without pensions or housing on Russian territory.
Proceeding on this assumption, the interest shown by the Baltic States
and their allies in such political-military exercises becomes understandable. 
U.S. interests in holding these exercises were not hidden. The exercises
corresponded to protecting U.S. national priorities, which have been set
forward many times by the president and prominent American politicians, and
the strategy of deploying U.S. troops anywhere on the globe where national
interests of the United States are threatened. This concept was brilliantly
demonstrated during the preparations leading up to Desert Storm when ground
and air forces were deployed in the Persian Gulf.
During the Baltic Challenge exercises, the Americans openly worked on
their own aims of using marines and airborne troops to secure Estonia's
beachheads for the subsequent landing of the main forces. 
The participating U.S. naval group's activities deserve attention. The
supply ships were accompanied by a U.S. destroyer, whose job was to provide
cover during the landing, a minesweeper and a U.S. Coast Guard cutter, as
well as a guided missile frigate that appeared near the exercise area. On
the eve of the exercises, the guided missile frigate crossed the short
distance from Kotka to Klaipeda. This was in violation of the exercise's
official scenario. But who would ever have thought to deliver humanitarian
aid using expensive warships carrying rockets, armaments and airborne
forces instead of civilian ships or chartered military transport planes,
and all at the military's expense?

*******

#5
Szyazinvest Sell-Off Approved by 70 Percent of Respondents 

MOSCOW, August 8 (Itar-Tass) -- Around 70 percent of Russian
respondents polled after the recent tender to sell 25 percent of
Svyazinvest shares positively assessed the results of the tender.
A sociological poll to find out the attitude of the population to the
Svyazinvest holding company and the auction itself was conducted at the
request of Vice-Prime Minister Vladimir Bulgak.
During the poll, respondents expressed a positive attitude both to the
auction itself and its financial results. The sell- off was approved by 70
percent of young and middle-aged people under 60 and over 50 percent of
people advanced in years who have a higher education. The Russian people
believe that the main positive result of the tender is that it offered
another opportunity to pay back wages to the population and above all, to
army servicemen.
The Svyazinvest sell-off was opposed by old people who do not have a
higher education and who were mostly guided by strong emotions, rather
than reasonable arguments, and referred to the deal as the "general
thievery".
The poll showed that over 50 percent of respondents possess a minimum
information about the Svyazinvest holding company and many even believe
that is operates in the area of television only. Besides, the majority of
respondents do not regard the sell-off of the Svyazinvest block of shares
as a fact of privatisation since the term of privatisation is associated in
the minds of many people with distribution of property free of charge and
direct participation of the population in acquisition of shares. "A number
of facts disclosed during the poll showed that we should strengthen
informational and propagandist measures to ensure support to our
activities," Bulgak said.
According to sources close to the Svyazinvest managers, efforts will
be concentrated, above all, on informational and propagandist activities in
covering the next tender to sell 24 percent of shares of the holding
company. In particular, business trips are planned to leading financial
world centers and presentations of shares and investment projects of the
Svyazinvest company. A concept of this campaign is being developed now by
a group of experts directly led by Vladimir Bulgak. This information was
neither confirmed, nor denied by the apparatus of the vice-premier.
Besides, the vice-premier had already announced a programme of
cooperation with journalists entitled "Non-Mass information" which
envisages a series of seminars for representatives of the mass media
devoted to problems which require special studies.The realization of this
programme is to begin in October, 1997.

*******

#6
Zavtra Claims Japanese Medics See Mental Decline in Yeltsin 

Zavtra, No. 30
July 1997
[translation for personal use only]
Item from the "Den Security Service Agents' Reports" column, under
the "Bulletin Board" rubric

According to sources in Japan, a closed consultation of leading
psychiatrists and experts in oriental medicine took place here, to whom
government officials showed video recordings of the Russian president from
the last few weeks, and gave the texts of his radio addresses and written
statements. The consultation established deep divergences in both the tone
and the meaning and turns of phrase between the president's spoken language
and written documents and radio addresses attributed to him. Doctors and
psychiatrists came to the conclusion that "a deep disintegration of the
personality of the subject and structural psychoneurological disruptions in
brain activity" is being observed. The experts conclude that he is not in
control of his utterances and is under the influence of powerful
psychotropic stimulants. Attention is drawn to the radical agressiveness in
his oral statements compared to written statements and radio addresses
aiming at "peaceable harmony." The experts think that in the future, the
process of degradation will develop spasmodically, and will be dependent on
"the level of stress in physiological and working activity." The duration
of the process of "fading out, given increasing doses of stimulants," is
estimated at between 10 and 18 months...

********

#7
'Tremendous Doubts' About Future of High Tech Industry 

Rabochaya Tribuna
August 8, 1997
[translation for personal use only]
Report by Mikhail Dmitruk: "High Technology Show May Be Last in
Russia's History. Third MAKS-97 International Aviation and Space
Salon Will Be Held in Zhukovskiy 15-29 August"

This show will in effect launch the festivities to mark Moscow's 850th
anniversary. That is why the Russian and Moscow City Governments have
tried to do everything to ensure that everything at MAKS-97 is at the
maximum. Visitors to the show will see the largest exhibition of aerospace
technology and all kinds of arms ever shown in Russia. Boris Yeltsin is
expected to open MAKS-97 and Viktor Chernomyrdin and [Moscow Mayor] Yuriy
Luzhkov will take part in the show's work.
Yakov Urinson, deputy chairman of the Russian Federation Government,
Russian Federation minister of the economy, and chairman of the show's
organizing committee, painted an impressive picture when opening the news
conference. Some 328 aerospace firms from 24 countries will be displaying
their best output. A record quantity of aviation technology -- over 150
aircraft -- will be exhibited. And the space exhibition will surpass all
its predecessors. [passage omitted]
You would have thought that this was splendid: On the eve of our
capital's glorious anniversary we will see a splendid show during which the
supreme standard of the aerospace, armored, and other technology produced
in Russia will be on display. But will it maintain that standard in the
future and will it be able to demonstrate it at future shows? Regrettably,
the news conference sowed tremendous doubts on these questions.
Here is what Russian Federation presidential aide Yevgeniy
Shaposhnikov said about the new blueprint for the development of the
aviation industry, which is scheduled for examination at a Russian
Federation Government session this September:
"We set about reducing the types of aircraft. We need
intercontinental, Russian, regional, local, and a couple of freight
aircraft. We do not need any more than that. Russia will have what is
fitting...."
That means, for instance, that the Tupolev firm's new aircraft will
not be on display at the show and possible customers will not find out
about it. Russia is said not to need this "extra" model. A similar fate
awaits many other aircraft, which are by no means the worst examples of
national aviation technology. On the other hand, foreign technology will
be exhibited without artificial restrictions.
The situation is even worse as regards space technology. With a
tremor in his voice Yevgeniy Ivanovich said that his heart sank when he saw
the forgotten Buran shuttle recently at the Baykonur space center. It
would be good, he said, to see it in orbit rather than in Gorkiy Park where
a bar was set up in Buran a long time ago to the shame of the national
space industry.
So, who has decided "what Russia should have" in aerospace technology?
The employees of our plants and design bureaus, who produce that equipment
(and many are no longer doing so) or their foreign competitors? Shall we
surrender our positions in this field in which we used to be the undisputed
leaders, just to please them? We hope to get answers to these and other
pressing questions at the show.

**********

#8
Report: U.S. funding research in Russia 

NEW YORK, Aug. 12 (UPI) _ The U.S. government is reportedly funding
research at Russian facilities that were once top-secret laboratories
involved in the production of biological weapons. 
Sunday's Newsday says the pilot program aims to keep Russian researchers
well employed at home, discouraging them from selling their lethal
knowledge on the world market. 
The newspaper quotes U.S. and Russian sources who say American
scientists hope to use the initiative to share knowledge gained by Russian
scientists over the last 25 years. 
They are most interested in what the Russians have learned through
testing such biological threats as ebola, anthrax and shigella. 
The program is being run by the National Academy of Sciences, a private
group that provides science advice under congressional charter. It's funded
by the Department of Defense. 
Officials say its overall cost has not been calculated, but none of the
eight research projects is budgeted at more than $20,000. 
The projects include research on a Siberian river fluke that causes
human liver cancer, a particular strain of smallpox, and a Russian-
invented chemical that appears to retard the growth of ebola viruses in
test-tube studies. 
Dr. Chris Howson, of the National Academy of Sciences, tells Newsday the
projects are already ``contributing beyond our wildest expectations, '' in
terms of the scientific research and levels of collaboration achieved. 
Officials will decide next month whether to expand the program, and
bring Russian scientists to U.S. labs.

*******

#9
Russia Assists Tajikistan Peace Talks 
August 13, 1997
By Chris Bird 
DUSHANBE, Tajikistan (Reuter) - Tajikistan's President Imomali Rakhmonov
and mutinous Colonel Makhmud Khudoyberdyev started peace talks mediated by
Russian peacekeepers on Wednesday, suspending several days of fighting. 
Russia's Itar-Tass and Interfax news agencies, quoting Russian military
sources, said the meeting was being held at a Russian military base in the
capital Dushanbe. 
Forces loyal to Rakhmonov have been battling Khudoyberdyev in the former
Soviet republic since Saturday. 
There was no independent confirmation or details of the meting. 
Zafar Saidov, Rakhmonov's press secretary, told Reuters by telephone in
the capital Dushanbe: ``Rakhmonov and Khudoyberdyev spoke by telephone last
night...Both sides have said the conflict can only be resolved by peaceful
means.'' 
He added that the Fakhrobad valley 25 km (15 miles) south of Dushanbe,
where government forces exchanged mortar and rocket fire with
Khudoyberdyev's troops on Tuesday, had been quiet overnight. 
Saidov said the colonel had begun to withdraw some of his armour to his
headquarters near Kurgan Tyube, about 110 km (70 miles) south of Dushanbe. 
At a post held by Rakhmonov's presidential guard about 14 km (9 miles)
south of Dushanbe, no clashes could be heard. 
``There were a few rounds exchanged overnight but otherwise it's been
quiet,'' said Tajikistan's deputy interior minister, Nikolai Madzhar, in
combat fatigues and toying with a walkie-talkie at the post. 
``There won't be peace talks,'' said Madzhar. ``There will only be
Khudoyberdyev's surrender.'' 
He would not confirm that Khudoyberdyev had withdrawn forces from the
contested valley, and other soldiers at the post said the rebel colonel's
men were still there. 
The eruption of fighting on Saturday is not linked to the republic's
armed Islamic opposition, with whom Rakhmonov signed a peace accord in June
aimed at ending four years of civil war. 
But the latest clashes have cast further doubt on Rakhmonov's already
weak grip on power, leaving the impoverished republic bordering China and
Afghanistan far from the stability craved by its 5.7 million population. 
Gun law has carved up Tajikistan into a patchwork of independent
fiefdoms under the control of armed groups like those in neighbouring
Afghanistan. 
Khudoyberdyev, 34, the politically ambitious commander of an elite
government armoured brigade, has mutinied twice before in two years, and is
a vociferous critic of the peace struck with the Islamists. 
He moved his armour towards Dushanbe at the weekend after fighting broke
out between between two rival warlords in the capital, but his motives for
doing so are unclear. 
Khudoyberdyev said on Tuesday he had no plans to take the capital and
that he had been provoked by what he said was a move by the presidential
guard on his territory in the south. 
On Monday he lost control of a strategically important aluminium smelter
west of the capital to Rakhmonov. 
``He is thought to have long term ambitions for national leadership,'' a
Western diplomat said on condition of anonymity. ``But he appeared recently
only to be building up his local power base in the south.'' 
``Khudoyberdyev has flexed his muscles and won concessions before but my
feeling is that this time he miscalculated,'' the diplomat said. 
Russia fears unrest along its unstable southern rim and deploys 20,000
troops as the bulk of a Commonwealth of Independent States in the Central
Asian state. 
So far it has reacted cautiously to the fighting. On Tuesday, the
peacekeeping force said it would stay neutral and take no part in the
conflict. 

********

#10
Russia Today press summaries
http://www.russiatoday.com

Segodnya
13 August 1997
Lead story
Will the Government Sacrifice the Law?
TO INSIST ON THE OUTCOME OF THE "MOST HONEST" AND SCANDAL-PROTECTED TENDER 
Summary
Federal Service for Currency and Export Control (VEK) found many
violations in the recent deal, which sold 25 plus one percent of telecom
holding Svyazinvest to the Cyprus-based consortium Mustcom Ltd. The
consortium was led by Russian Uneximbank. 
The State Property Fund (GKI), which organized the tender, remained calm
on the issue, because it said the Federal Service for Currency and Export
Control will not likely go to court to protest the acts of another federal
agency, the fund. 
In any case, violations of currency regulations will probably be ignored
by the government, because the budget is in desperate need of money, a
high-ranking source in the government told the daily. 
RUSSIA TODAY Notes: 
The head of the Federal Service for Currency and Export Control made it
clear that the violations were on the part of the government agencies
conducting the tender, not that of the winner. Mustcom Ltd., acting on
behalf of Russia's Uneximbank and with the backing of American financier
George Soros, bid $1.9 billion for Svyazinvest. 

Nezavisimaya Gazeta
13 August 1997
General Korzhakov Presented His Memoirs 
Summary
Former chief presidential guard Gen. Aleksander Korzhakov presented his
book about the Yeltsin family and their intimates to journalists in Moscow
on Tuesday. 
The book is full of scandalous revelations, said the daily. It is
published by Interbook Publishers, and the company's head, Sergey
Goncharenko, said he faced unprecedented difficulties and complications
with federal authorities in printing it. 
Korzhakov confirmed rumors that the president's family offered him big
money through
an intermediary not to publish his book. He also said he has many tapes and
other materials to back up every episode in his book, should anyone wish to
take him to court over the contents. 
Korzhakov is currently a deputy in the State Duma and so has a
parliamentary immunity. Still, the daily said he has cut some of the most
scandalous fragments from his book. 
The blow struck by the former confidante against Yeltsin and his family
will be hard to recover from, the daily wrote. The book will be distributed
as of Wednesday. 

Pravda-5
13 August 1997
What Does the Rebellious Brigade Commander Want to Achieve? 
Summary
According to information from Tajikistan, pro-presidential forces have
taken the city of Tursun-Zade on the border with Uzbekistan. They have
dissolved "unconstitutional formations" and have control over the Gissar
and Shahrinav districts, populated by ethnic Uzbeks. 
Brigade commander Makhmud Khudoyberdyev, who has control of the
Kurgan-Tyube region, remains the authorities' chief enemy. On Tuesday,
government troops suddenly checked their advance on his supporters 25
kilometers south of Dushanbe. According to some sources, this was done when
Uzbekistan called on Tajik authorities to halt the bloodshed. 
The daily wrote that there is a real danger that with the return of the
mujaheddin refugees to the country, the republic might collapse into a
number of small states. Before fulfilling their agreements with the Islamic
opposition, the Tajik authorities should take measures to secure consensus
within the country. 
RUSSIA TODAY Notes:
It is not clear what Khudoyberdyev's aim is. Fighting has broken out in the
country among rival warlords claiming allegiance to the government. Some
observers say many are unhappy with the government's decision to allow the
return of opposition fighters based in Afghanistan. The decision is part of
a June peace settlement with Islamist opposition fighters, which halted
four years of bloody conflict. The renewed fighting caught many by surprise
and threatens to destabilize the country. The Tajik president has called on
troops to remain loyal to the government and for an end to the violence. He
was scheduled to hold talks with Khudoyberdyev on Wednesday. 

Vecherniy Petersburg
13 August 1997
Lead story
They'll Soon Turn on the Utility Meters 
Summary 
The city government has already approved a plan to install meters for
natural gas, hot and cold water for each apartment and office. 
Such a measure will not be a popular one, since the consumer will have
to pay for the installment, which will be as much as 1.5 million rubles
($265). While the poor will get some relief, it is the average person who
will bear the brunt. You can bet, said the daily, that most people will do
everything possible to avoid installment. 
But use of meters is useful to the consumer in the long run. Now, the
consumer pays a flat rate for water that assumes he uses 300 liters of cold
water and 180 liters of hot water a day. But in fact, said the daily, the
average consumer uses no more than 150 liters of cold water and 130 liters
of hot water each day. As for natural gas, the prices are currently so
cheap that there is no incentive to conserve. So, we will probably see a
rate hike for natural gas soon. 
RUSSIA TODAY Notes:
Currently, each apartment and office only has a meter for electricity. This
process of rationalization of the utilities is all part of government
efforts to bring down the costs of Russia's natural monopolies (for
example, natural gas giant Gazprom and electric grid controller Unified
Energy Systems) and put more of the burden on individual consumers to
lessen the costs for industrial consumers. The government also plans to end
its massive housing and utilities subsidies, gradually increasing the
amount the consumer will have to pay until most will be paying 100 percent
of the costs within a few years. 

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#11
Minister: Army Reform Based on Efficiency, Cost 

KHABAROVSK, Russian Far East, August 11 (Itar-Tass) -- Efficiency,
cost and feasibility are the main criteria to estimate measures on
reforming the Armed Forces, Defence Minister Igor Sergeyev said in
Khabarovsk on Monday.
Addressing here today officers and the command of the Far Eastern
Military District, he outlined the concept for military construction and
military reform.
According to the minister, "it unites seven interconnected and
interconditional packages". A threat to Russia's military security is
examined in the first package.
Sergeyev stated that a strategic forecast based on a system analysis
of the development of military, political, social and economic situation
helped to draw a conclusion that "there is no direct military threat to
Russia in the near future up to the year 2005, while the state of strategic
nuclear forces, provided their combat readiness is maintained at the level
of set demands, will enable the country to counter threats which may
arise".
The minister stressed that precisely this time should be used most
effectively to carry out the military reform. The Russian Armed Forces
must become highly efficient, mobile, well equipped and provided with all
necessities. They should be commensurate in their expenditures to the
country's economy.
The second and third packages of the army's reform define the optimum
level of expenditures for defence and investments in the munitions
industry, based on the exact account of economic, demographic and other
resources of Russia as well as on combat parameters of Armed Forces,
bearing in mind financing them in the volume of 3.5 percent of the
country's Gross Domestic Product.
The minister noted that plans for the first stage of reforming,
calculated up to the year 2000, provide for work under strict conditions of
financing and a search for ways of saving.
The numerical strength of troops will be cut to 1.2 million men during
the current and the next years, but their combat efficiency should not
drop.
The minister spelled out in detail measures to improve the control
system, to reorganise structures of technical supplies, military training
and preparation of personnel as well as to provide high social and other
guarantees for servicemen.
Sergeyev devoted Monday to familiarising himself with the state of
affairs in units of the Far Eastern Military District and was present at
field firing of artillery and armour.
While meeting the administration head of the Khabarovsk Territory
Viktor Ishayev, the sides discussed issues of providing munitions factories
in the territory with military orders as well as other questions.
The defence minister flew to Kamchatka in the afternoon.

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#12
NOBODY WAS GIVEN THE RIGHT TO CONSIDER CHECHNYA 
AN INDEPENDENT STATE OUTSIDE THE TERRITORY OF RUSSIA, 
SAID YEGOR STROYEV
MOSCOW, AUGUST 13 (FROM RIA NOVOSTI CORRESPONDENT VIKTOR
BEZBREZHNY) -- Nobody was given the right to consider Chechnya
an independent state outside the territory of Russia, said
chairman of the Federation Council Yegor Stroyev today at a
meeting with journalists. Commenting on the decision taken by
the Chechen authorities to make the Chechen language a state
language on the territory of the republic, the speaker noted
that "this is their historic right" and "since Chechnya is a
part of Russia the Russian language should also be a state
language on this territory."
Touching upon the Chechen problem as a whole, Yegor Stroyev
noted that "there is no a rapid way out of the Chechen
situation". He believes that it can be settled by way of
"levelling out, stage by stage, the relations between Chechnya
and the federal centre within the framework of a single Russian
state." 

********

#13
The Philadelphia Inquirer
13 August 1997
[for personal use only]
The perils may be many, but interest in the Caucasus and Central Asia is
high. 
Oilmen and U.S. hope dollars and diplomacy will yield a big payoff 
By Peter Slevin 
INQUIRER WASHINGTON BUREAU

WASHINGTON -- Afghanistan, at war with itself, is not exactly a hospitable
place these days. Its rugged, mountainous turf is plagued by kidnapping,
corruption, and nearly 10 million land mines. Travel by Americans, the
State Department warns, is ill-advised.
Marty Miller, a can-do Texas oilman, is just back from there. He
chartered a plane into bomb-battered Mazar-e Sharif and Kandahar to pitch a
pipeline deal worth billions to rival Afghan chieftains.
The Unocal executive is willing to place a large bet on long odds. He
has calculated that the smell of money will inspire warring Afghan leaders
to build a working government in a land that has known only war for nearly
20 years.
``It's not for the faint of heart. A lot of our associates in the
industry still don't think we're playing with a full deck,'' Miller
admitted from Sugar Land, Texas. ``Certainly the political risk is very
high, but oil companies are used to dealing with risk and large sums of
money.''
Large sums, indeed. Lured by analysts' estimates that there is more oil
under the Caspian Sea than there is in Kuwait -- with a potential value of
$4 trillion -- oil companies around the world are racing to invest in the
surrounding nations of the Caucasus and Central Asia. At last count, U.S.
companies had committed $65 billion to just Kazakstan and Azerbaijan.
And U.S. policymakers are newly alert to the possibilities and the
perils of the region.
In search of energy security far from Middle Eastern intrigues,
President Clinton and Vice President Gore have urged Caucasus and Central
Asian leaders to back American projects. Three Caspian region presidents
have visited the White House this summer, and U.S. senators and
representatives are adding the area to their itineraries.
The administration's goals for the nations in this suddenly lucrative
region are independence, stability and democracy, and a level playing field
for American companies. Failure would carry a high price.
``If economic and political reform in the countries of the Caucasus and
Central Asia does not succeed . . . the region could become a breeding
ground of terrorism, a hotbed of religious and political extremism, and a
battleground for outright war,'' Strobe Talbott, deputy secretary of state,
warned July 21 in a speech that defined U.S. policy.
Among the high-powered consultants working with the oil companies are
former Secretary of State James Baker and former national security advisers
Zbigniew Brzezinski and Brent Scowcroft.
Baker is the honorary chairman of the United States-Kazakstan Council, a
business promotion organization. The five honorary advisers to the
U.S.-Azerbaijan Chamber of Commerce are Baker, Brzezinski, former Secretary
of State Henry Kissinger, former Defense Secretary Richard Cheney and
former White House chief of staff John Sununu.
``If these countries didn't have the oil resources to tap into, they'd
be worthless, and we wouldn't be paying much attention,'' said Robert Ebel
of the Center for Strategic and International Studies, a nonprofit
public-policy research organization in Washington and author of a new book
on the subject. ``Oil is a very powerful magnet. It attracts entrepreneurs,
and it attracts nations.''
The region is made up largely of former Soviet republics and client
states, many of them bitter rivals or riven with internal dissension.
Getting the oil out will mean negotiating contracts in landlocked countries
rife with fiefs and feuds, and only the most haphazard legal systems.
``We used to joke that the good news and the bad news was that there was
no law yet,'' Pennzoil executive Frank Verrasto said. ``There's huge
resource potential, but the real trick is going to be to get the oil to
market.''
Oil executives and policymakers are counting on a potent combination of
dollars and diplomacy to make the region safe for oil. By strengthening the
countries born of the collapse of the Soviet empire, the thinking goes, the
United States will project influence over a strategic region while limiting
the reach of Russia and Iran.
``A political vacuum would only give Iran the opportunity to fill it,''
Undersecretary of State Stuart Eizenstat told the Senate Foreign Relations
Committee last month. ``As long as the Caucasus and Central Asia remain
vulnerable to internal instability and ethnic conflict, the danger of
external dominance exists, compounded by the presence of a militant
fundamentalist regime in Iran intent on destabilizing its neighbors.''
To that end, the Clinton administration this year is seeking a 34
percent increase to $900 million in foreign aid to the eight countries in
the region that were once part of the Soviet Union. Talbott called it a
``prudent investment in our nation's future.'' Since 1992, the United
States has delivered $2.2 billion in assistance to the eight (Azerbaijan,
Armenia, Georgia, Kazakstan, Turkmenistan, Uzbekistan, Tajikistan and
Kyrgyzstan).
Clinton has endorsed dual pipelines for the first streams of oil, a
tactic to spread wealth and preserve options for the oil producers and
their buyers.
Among the projects and the pipe dreams, the most outlandish may be the
idea of shipping oil and gas from Turkmenistan through Afghanistan.
The civil war continues. The country is a wreck, and skepticism abounds,
but Miller and his Unocal colleagues and their Saudi Arabian partners persist.
``These guys are used to moving very fast,'' Washington academic S.
Frederick Starr said of the energy companies. ``They're used to rolling the
dice.'' 

*******

#14
Zavtra Claims U.S. Wants International Forces in Caucasus 

Zavtra, No. 31
August 1997
[translation for personal use only]
Item by the "Den Security Services Agents' Reports" column,
under the "Bulletin Board" rubric

Information is coming in from Washington confirming that the biggest
U.S. oil magnates have given Aliyev (who was in the United States on an
official visit) a guarantee that Clinton would soon forcefully deliver
"instructions" about bringing international troops into the conflict areas
in the Caucasus instead of the Russian Armed Forces. The aim is to
encircle Karabakh, isolating it from Armenia, and to deploy subunits in
Abkhazia and South Ossetia -- and subsequently in the Ossetia-Chechnya
zone. Similar actions were also being planned at secret talks with
Shevardnadze, who will soon put forward a number of "significant diplomatic
initiatives." During closed meetings, it was suggested that officials from
Azerbaijan's security services "plan and carry out, in collaboration with
their Caucasian ally [Georgia], some sort of galvanizing actions that would
trigger a new outburst, attesting to the inability of the Russian
Federation to control the situation in the given regions"....

*********