MOSCOW, March 16 (RIA Novosti)

People outraged over regional elections / Kremlin launches new party / Russia and the EU can save Ukraine / India to become main importer of Russian arms

Vedomosti, Nezavisimaya Gazeta

People outraged over regional elections

The recent parliamentary elections in Russia's regions have shown that the Kremlin would be better off abandoning its current practice of appointing governors.

The pro-Kremlin United Russia party received far fewer seats than in the 2007 campaign, even losing to other parties in several major cities; while opposition parties that are not banned fared much better this year. All of that cannot be explained simply by seasonal factors or the influence of the economic difficulties.

It is equally improbable that regional bureaucrats have heeded the presidential appeal for fair competition. In fact many incidents testify that the opposite is true, such as the use of "black" PR strategies against United Russia's opponents in addition to the usual methods of working the electorate.

The outcome of the elections shows that traditional election technologies no longer have a strong effect on regional voters, especially in local parliamentary campaigns. Moreover, crude pressure coupled with a drop in people's personal financial position naturally puts people off politics. Many of them end up voting for any candidate or party who openly criticizes official policy or who pledges to focus on social issues such as employment, road and housing improvement, and better utilities services.

United Russia will find it harder and harder to win regional campaigns using grandiose pledges and brandishing portraits of the ruling tandem. Its members are already losing quite often, and not only in remote Ural and Siberian regions, but even as near as the Moscow Region.

Kremlin adviser Gleb Pavlovsky, head of the Effective Policy Foundation, commented on the recent campaign: These were "real elections that revealed real problems." The party in power has either ignored its voters or seriously annoyed them. "One can say that new groups of people have been forming in cities, call them the annoyed citizens, whom United Russia cannot reach," he added.

By replacing gubernatorial elections with an appointment procedure Moscow has in fact assumed full responsibility for what is going on in the regions. Presidential appointees, who currently account for more than a half of all regional governors, often prove ineffective in handling economic and social problems. Without relevant administrative experience or the skills needed to deal with the annoyed citizens, they fail to meet their goals.

If the Kremlin finds it hard to admit to erroneous personnel decisions and form a reserve of crisis managers, one logical way out would be to go back to electing governors. This move would help redistribute responsibility between the federal government, the governor and the local residents who have elected that governor.

RBC Daily, Kommersant

Kremlin launches new party

The United Russia party has set up a new liberal club for businessmen sympathetic to conservative ideas. The club could transform itself into a new party as early as this year. According to a source in the Kremlin administration, the idea of establishing a new party to replace Right Cause was suggested by former head of the administration Alexander Voloshin. Tatiana Dyachenko, the daughter of Boris Yeltsin, could be asked to be the new party's face.

United Russia now has four clubs, two of them liberal. When the first club, November 4, was in the making, there were plans for a conservative party spin-off. "But at the time the idea was abandoned for fear of United Russia disintegrating and eroding," says Alexei Makarkin, vice-president of the Center for Political Technologies.

The Kremlin administration has been working on this new liberal project for several months now. If successful, the project could see a party created as early as this year. It will replace the Right Cause party, which has failed to live up to expectations and investment in it, although there is public demand for conservative ideas.

The establishment of one more club within United Russia is an attempt to institutionalize the liberal idea. As conceived by the administration, the party will align itself with the presidential idea of economic modernization. According to Kommersant, the Kremlin administration believes that Dmitry Medvedev, whom the party of power recommended for this post, is far more liberal than the most liberal part of United Russia, and they want to see this synchronized. "Why should the section of the party that makes a liberal electoral pitch not model itself on the president?" a source in the administration said.

An RBC Daily source in the Kremlin says Voloshin, chief of staff under Boris Yeltsin and Vladimir Putin, is behind the initiative. The source has named Tatiana Dyachenko, the daughter of the first president, as one person who could be the new party's "face." Her Live Journal blog has been frank about the Yeltsin days and she has been leaking Kremlin secrets to bloggers for several months now.

It is not ruled out that big business might be invited to join this new project. On Monday, news broke that Mikhail Prokhorov, president of the Onexim Group, had agreed to spend 45 million rubles subsidizing part of the pro-Kremlin youth forum that vacations on Lake Seliger in the Tver Region every year. Rosmolodezh (Federal Youth Affairs Agency) has been officially organizing the forum since last year.

Vedomosti

Russia and the EU can save Ukraine

Given the dramatic economic problems and the need to take unpopular political measures, the new Ukrainian government is reminiscent of a suicide club, a Russian analyst writes.

Ukrainian Finance Minister Fedir Yaroshenko has admitted that the country is facing a financial catastrophe but fears cutting state expenditures and increasing taxes to try to avoid it. Unfortunately, Ukraine will attempt to shift part of its problems onto Russia, writes Konstantin Simonov, general director of Russia's National Energy Security Fund.

Ukraine thinks that it could be saved if Russia cut prices of its natural gas. Should Russia do it? And if so, why?

Some people would say that "brothers should not think of energy prices in a time of crisis," but I wonder what they would say if a Russian politician proposed that they sold the Crimea for debts. After all, parliament members in Germany have proposed that Greece should sell some of its islands to resolve its financial problems.

Moreover, the new Ukrainian government is still seeking European integration and is not eager to embrace Russia, Simonov writes.

This brings us to a second problem: How can Ukraine integrate with Europe without adjusting its legislation to European laws? For example, the European Council has long appealed to Ukraine to liberalize its gas market. Contrary to the general belief, this would suit Russia because liberalization implies broader access to infrastructure for natural gas producers.

It is true that Russian companies would have to compete with other producers, but the effort would be worth the prize. Russia could still win the battle against Qatar's liquefied natural gas or pipeline gas to be shipped through Nabucco.

On the other hand, it could have other rivals, because former Prime Minister Yulia Tymoshenko once proposed replacing natural gas with straw, while former parliament speaker Arseny Yatsenyuk called for building 10 to 12 nuclear power plants.

But the game is worth the candle. Liberalized access to Ukraine's gas transportation infrastructure could allow Russia not to buy into the share capital of the Ukrainian gas pipeline owners, who need at least $2 billion to modernize the pipelines, gas storage facilities and compressor stations, and also repay the debts of the state oil and gas company Naftogaz.

But there are other, more serious problems involved. Can economic modernization succeed in a divided country? Ukraine is like Belgium, where the identity crisis is hindering the solution of current economic and administrative problems, even though they are not as complicated as in Ukraine, Simonov writes.

On the other hand, Ukraine could preserve its integrity because Russia and the EU know that its future is their shared problem and agree that they should not try to evade this burden, he concludes.

Gazeta.Ru

India to become main importer of Russian arms

According to calculations made by the Stockholm International Peace Research Institute (SIPRI), Russia and the United States dominate the global arms market. However, SIPRI analysts only assess deliveries of heavy weapons, and their estimates are not based on market prices.

Therefore, although Russia's state arms exporter Rosoboronexport posted a 10% increase in arms sales in 2009, SIPRI reduced the Russian share by 8%.

In 2005-2009, the United States, Russia, Germany, France and the United Kingdom ranked as the five main arms exporters, accounting for 76% of global arms sales. The United States and Russia remain the largest exporters at 30% and 23%, respectively.

In 2000-2004, Russia even overtook the United States at 31% and 30%, respectively, SIPRI analysts said.

"In some cases, SIPRI places Russia in the first place. However, this does not reflect the reality as the United States exports 10-fold more than all other countries," said Dmitry Vasilyev, editor-in-chief of Arms Exports magazine.

SIPRI estimates the value of Russia's 2009 arms exports at $4.5 billion, whereas the figure given by Rosoboronexport is $7.4 billion. According to Rosoboronexport, its arms sales have increased by 10% last year on 2008. Vasilyev estimates Russian arms exports at $8.5 billion.

The discrepancy can be explained by different calculation methods. Dr. Paul Holtom of the United Kingdom, a senior researcher with SIPRI and one of the report's co-authors, explained that SIPRI calculations were not based on current market prices, and that an index stipulating approximately equal prices of similar aircraft types from various manufacturers was used to assess arms delivery volumes.

"Naturally, U.S. or European aircraft are more expensive than Russian planes. Low prices are one of Russia's advantages," Vasilyev told the paper.

Dr. Holtom said SIPRI only monitored deliveries of heavy conventional weaponry. Vasilyev believes this explains why Israel has such a low rating despite selling equipment worth $5 billion. The same is true of United Kingdom, which is involved in numerous co-production arrangements.

Asia accounts for over 69% of Russian arms exports. Russian weapons make up for 89% of China's arms import volumes. All analysts note the China's declining arms import share. In the past five years, China accounted for 20% of global arms imports in the past five years, and now its share has plunged to 9%, SIPRI said. India's share has fallen from 14% to 7%.

According to Dr. Holtom, China receives fewer ground-based weapons systems. Although Russia will continue to deliver components and subsystems to China, SIPRI predicts that India will become the main importer of Russian weapons in the next few years, Dr. Holtom said.

"China, which prioritizes domestic industrial growth, downsizes arms imports and substitutes them with its own weapons. China buys only those systems which it cannot manufacture. This is fraught with reduced Russian arms exports to China. Russia will eventually face a new rival, who is unlikely to remember how much he owes us," Vasilyev said.

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