We are all apt to believe what the world believes about us. - George Eliot

No. 139, Part I, 19 July 1996

This is Part I of the Open Media Research Institute's Daily Digest.
Part I is a compilation of news concerning Russia, Transcaucasia and
Central Asia. Part II, covering Central, Eastern, and Southeastern
Europe is distributed simultaneously as a second document. Back issues
of the Daily Digest, and other information about OMRI, are available
through OMRI's WWW pages: http://www.omri.cz/Index.html


commander claiming to be Salman Raduev, who commanded the
Kizlyar/Pervomaiskoye hostage taking in January of this year and was
reported to have been killed in a March shootout with rivals, gave a
news conference in Gudermes on 18 July, ITAR-TASS and Western agencies
reported. Raduev said he had undergone plastic surgery in Germany after
being seriously wounded by Russian troops. Raduev also claimed that
Chechen President Dzhokhar Dudaev, who was reported to have been killed
in a rocket attack on 21 April, is still alive. -- Liz Fuller

CHECHENS REJECT RESUMPTION OF WAR. Chechen press spokesman Movladi
Udugov stated on 18 July that a group of field commanders had recently
discussed possible options for strikes against Russian troops but
decided to refrain from further full-scale military operations although
they reserve the right to respond to "provocations," Ekho Moskvy and
Reuters reported. Udugov called on the Russian government to honor the
commitments signed in Moscow on 27 May and Nazran on 10 June, and added
that the OSCE's role be upgraded from observer to "guarantor" of those
agreements, according to Reuters. OSCE mission head Tim Guldimann was
quoted by ITAR-TASS as saying that he continued to maintain contact with
both the Russian leadership and the Chechen separatist forces, but he
was not optimistic that peace talks would be resumed. -- Liz Fuller

presenting Igor Rodionov to senior generals on 18 July, President Boris
Yeltsin called on the new defense minister to crack down on corruption
among military officers, Russian and Western agencies reported. Dwelling
on the "moral climate" in the army, he said "the officer corps is being
corroded by corruption as if by rust." Rodionov said he intended to take
up Yeltsin's challenge, arguing that the authority of the army depends
on it. Military corruption has reemerged as a major issue following the
sacking of Pavel Grachev, who has been accused of surrounding himself
with "spongers" and "thieves." Rodionov, who is close to anti-corruption
heavyweight Aleksandr Lebed, has the reputation of being incorruptible.
Previous corruption campaigns in state bodies have, however, had little
success. -- Penny Morvant

. . .AND PLANS TO CREATE DEFENSE COUNCIL. Declaring that "profound
military reform" is needed to create a professional army, Yeltsin also
announced that a new Defense Council will be created to implement the
decisions of the Security Council, deal with issues of defense security,
and supervise military construction projects, Russian media reported on
18 July. Rodionov told Russian Public TV (ORT) that he has "dreamed"
that such a council would be formed to give the army "a second wind"; he
added that it should oversee all aspects of military reform. In May,
Yeltsin promised to phase out conscription and reform the army by the
year 2000 (see OMRI Daily Digest, 17 May 1996). -- Laura Belin

Aleksandr Lebed, who strongly advocated Igor Rodionov's appointment as
defense minister, could gain almost "limitless authority" over the power
structures under a draft law on a proposed new "Military Council,"
Kommersant-Daily reported on 18 July. The article, which was published
before Yeltsin announced the creation of a Defense Council, reported
that Duma Defense Committee Chairman Lev Rokhlin, who also backed
Rodionov, has already prepared a draft law under which the president
would chair the Military Council. Decisions of the council would be
"binding on all ministries and agencies under whose jurisdiction there
may be armed forces, other military units, and military agencies." In
the president's absence, the Security Council secretary would chair the
Military Council. Kommersant-Daily speulated that given the president's
"actual capacity to act" and overcrowded work schedule, the power
structures and armed forces would consequently fall under Lebed's
authority. -- Laura Belin

who supported Gennadii Zyuganov's presidential candidacy apparently will
be excluded from a new left-wing umbrella movement to be called the
Popular-Patriotic Union of Russia (NPSR). Working Russia leader Viktor
Anpilov, Russian Communist Workers' Party leader Viktor Tyulkin, and
Officers' Union head Stanislav Terekhov are not on the NPSR's organizing
committee, which is chaired by Nikolai Ryzhkov, ITAR-TASS and NTV
reported on 18 July. Leading figures in the union, which will hold its
founding congress on 7 August, include Zyuganov, filmmaker Stanislav
Govorukhin, Russian Public Union leader Sergei Baburin, former
presidential candidate Aman Tuleev, Derzhava leader Aleksandr Rutskoi,
and the Agrarian Party leaders Mikhail Lapshin and Vasilii Starodubtsev.
By excluding outspoken "irreconciliables" and depicting the Communist
Party (KPRF) as only one of many groups in the NPSR, organizers hope to
appeal to those who oppose Yeltsin but are reluctant to identify with a
communist movement. -- Laura Belin

Political Consultative Council (PKS), which is chaired by former Duma
Speaker Ivan Rybkin, elected three deputy chairmen at its first meeting
on 18 July--Women of Russia leader Yekaterina Lakhova, Party of Russian
Unity and Accord leader Sergei Shakhrai, and Forward, Russia! leader
Boris Fedorov, ITAR-TASS reported. The PKS will have 12 chambers similar
to the Duma's committees, NTV reported. The presidential order creating
the PKS called for members of all 43 parties that participated in the
Duma election to join, but nine have refused, including the Communist
Party and Yabloko. Vladimir Zhirinovsky participated in the session but
later described it as an "ersatz parliament." Yabloko's Viktor Sheinis
said the purpose of the PKS is merely to oppose the work of the Duma. --
Robert Orttung

DUMA PASSES LAW ON REGIONAL ELECTIONS. The Duma has adopted a law on
elections to regional legislative assemblies, Russian Public TV (ORT)
reported on 18 July. The law stipulates that elections must be held
within three months of the end of the outgoing legislature's term,
although the assembly can set the exact date for the vote. The Duma
turned down a Federation Council proposal that would have granted
legitimacy to all those regional legislatures that had been elected in
1993 for two-year terms but later extended their terms in office by
another two years. According to the law, such regional legislative
assemblies must hold elections by December this year, Segodnya reported.
The Duma confirmed that by the end of the year, regional elections must
be held in all federation subjects as well as gubernatorial elections in
about 50 regions. -- Anna Paretskaya

edition that Russia and the Muslim world can overcome their difficulties
and establish strong political, military, and economic ties. Russia has
been discredited in the eyes of Muslim countries, the paper asserted,
because of its invasion of Afghanistan, its conduct in Chechnya, and its
support for U.S. policies toward Iraq and Libya. Pravda recommended that
Russia should work to lift the UN embargoes on Iraq and Libya and work
to strengthen economic and military ties with those countries. In
return, the Islamic world should understand that attempts to undermine
Russian interests in Central Asia, Transcaucasia, and Chechnya will be
rebuffed and that they only serve the interests of the mutual enemies of
Russia and the Islamic countries. -- Robert Orttung

18 July ordered 10,000 tons of diesel oil to be transferred from state
reserves to Primore, which has been experiencing severe power cuts
because of a non-payments crisis. Primorskii Krai Governor Yevgenii
Nazdratenko welcomed the decision but warned that the crisis is not
over, noting that much more oil will be needed for the winter, Reuters
reported. Nazdratenko blames federal ministries for failing to transfer
subsidies to the region in a timely fashion to cover the difference in
the cost of power production and the price to consumers. He said the
Finance Ministry owes the region 900 billion rubles ($175 million). The
Fuel and Energy Ministry, in turn, blames the regional authorites for
setting electricity prices too low, ORT reported. -- Penny Morvant

NEW PRIVATIZATION PROGRAM APPROVED. The government approved a new
privatization program on 18 July, ITAR-TASS, Radio Rossii and NTV
reported. The program abandons the quantitative approach to
privatization in favor of a case-by-case approach and extends the list
of companies that require government permission to be privatized. It
expands the privatization rights of regions and local authorities but
abolishes privileges granted to companies' employees. The draft
introduces a new principle for estimating a company's assets based on
their market value on the first day of the quarter preceding the firm's
privatization request. The program bars the liquidation of bankrupt
companies with a federal equity stake of more than 25%; it also bars the
privatization of mineral resources, forests, water, and off-shore
resources. Interior Minister Anatolii Kulikov suggested that the
privatization of enterprises dealing with construction and the
production and testing of weapons be banned as a threat to national
security. -- Natalia Gurushina

BUDGETARY PROBLEMS PERSIST. Russia's federal budget revenues for the
first six months of 1996 totaled 136.3 trillion rubles ($27.7 billion)
or 88% of the expected level, expenditures reached 196 trillion rubles
or 98% of the planned figure, while the deficit was 42.9 trillion
rubles, ITAR-TASS and Finansovye izvestiya reported on 17-18 July,
citing First Deputy Prime Minister Vladimir Kadannikov. The government's
priority now is to boost tax collection. Although there was some
improvement in this area recently (see OMRI Daily Digest, 17 July 1996),
tax debt to the federal budget increased from 31.5 trillion rubles in
January 1996 to 61.3 trillion rubles in June. Resource-rich regions--
such as eastern and western Siberia, the Urals, Yamal-Nenets Autonomous
Okrug, and Khanty-Mansii Autonomous Okrug--account for about half of the
increase. -- Natalia Gurushina

Federation Council's meeting on economic security, Security Council
Secretary Aleksandr Lebed said that the state should play a greater role
in economic affairs, NTV and ITAR-TASS reported on 18 July. At the same
time, he stressed that the Chilean model of economic reform is not
suitable for Russia. While calling for maximum regional independence,
Lebed said that stricter controls should be imposed on the usage of
budgetary funds by local authorities. Lebed pointed out that the
question of land ownership is one of the most important aspects of
economic security and that he favors private ownership of land. He
added, however, that it should be achieved gradually by holding regional
referendums. Lebed also called for measures to facilitate weapons
exports and encourage the creation of financial-industrial groups on the
basis of military enterprises. -- Natalia Gurushina


NEW TAJIK CEASEFIRE. Representatives of the Tajik government and the
United Tajik Opposition meeting in Turkmenistan have agreed to a
ceasefire in the area around Tavil-Dara, according to RFE/RL and
Reuters. The Tajik government dropped its requirement that opposition
forces in central Tajikistan return to the positions they held prior to
February; the new agreement allows both sides' forces to remain in their
current positions. Both sides, however, have recently claimed that they
are in control of the regional capital, Tavil-Dara. It is unclear which
side will be permitted to control the town itself, which is near the
only highway linking the capital Dushanbe with the strategic city of
Khorog. -- Bruce Pannier

Prime Minister Mahathir Moahammad and his Kazakhstani counterpart,
Akezhan Kazhegeldin, signed three agreements on economic cooperation and
friendship in Almaty on 19 July, AFP and ITAR-TASS reported. The
agreements call for a cooperation memorandum between the National Bank
of Kazakhstan and the Malaysian Central Bank Negara as well as the
establishement of an air link between Almaty and Kuala Lumpur using
Kazakhstan Airways. Mahathir said he supports Kazakhstan's application
for membership in the ASEAN. A delegation of businessmen accompanying
Mahathir are discussing possible contracts for construction projects in
the new Kazakhstani capital Akmola. -- Bhavna Dave

ARMS SMUGGLING IN UZBEKISTAN. Uzbek customs officials arrested four
soldiers from the CIS peacekeeping mission in Tajikistan who were
attempting to smuggle weapons into Chechnya, ITAR-TASS reported on 18
July. The soldiers had weapons and ammunition worth $5,000 which they
were reportedly planning to sell to Chechen separatists. The increase in
military weaponry in the region as a result of the Tajik and Afghan
crises has been a concern of the Uzbek government. Last week, Uzbek
President Islam Karimov called for an arms embargo on Afghanistan,
asking the UN Security Council to address the issue, the BBC reported on
17 July. -- Roger Kangas

NIYAZOV ENDS IRANIAN VISIT. Turkmen President Saparmurad Niyazov
concluded a four-day visit to Iran on 18 July during which he signed an
agreement that will allow the Telecommunications Company of Iran (TCI)
to build a 600 km optical fiber cable network through Turkmenistan,
Western and Russian media reported. The network will follow up on an
earlier TCI project that established an identical cable connecting
eastern and western Turkmenistan, Reuters reported. Niyazov and Iranian
President Hashemi Rafsanjani also signed agreements on economic
cooperation in anticipation of an increase in trade following the
opening of the Meshed-Sarakhs rail link in May 1996. The current volume
of trade stands at $50 million a year, with the potential value of
Iranian projects in Turkmenistan estimated at $250 million. -- Roger

[As of 12:00 CET]

Compiled by Victor Gomez

            Copyright (c) 1996 Open Media Research Institute, Inc.
                      All rights reserved. ISSN 1211-1570
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