RFE/RL NEWSLINE Vol 1, No. 189, Part I, 6 January 1998

A daily report of developments in Eastern and Southeastern
Europe, Russia, the Caucasus and Central Asia prepared by
the staff of Radio Free Europe/Radio Liberty.

This is Part I, a compilation of news concerning Russia,
Transcaucasia and Central Asia. Part II covers Central,
Eastern, and Southeastern Europe and is distributed
simultaneously as a second document.  Back issues of RFE/RL
NewsLine and the OMRI Daily Digest are online at RFE/RL's
Web site: http://www.rferl.org/newsline

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Headlines, Part I

* YELTSIN'S TRIP TO INDIA POSTPONED

* NEW CHECHEN GOVERNMENT TO HAVE DEFENSE
DEPARTMENT

* GEORGIA, RUSSIA REMAIN AT ODDS OVER
ABKHAZIA

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RUSSIA

YELTSIN'S TRIP TO INDIA POSTPONED. The presidential
press service on 6 January confirmed that  Boris Yeltsin's
trip to India, scheduled for mid-January, has been
postponed "by mutual decision" and will be rescheduled for
later this year. Interfax on 5 January quoted unnamed
Russian diplomatic sources as saying the trip has been
delayed because of "important domestic political events in
India," which is due to hold general elections in February.
Last month, presidential spokesman Sergei Yastrzhembskii
said Yeltsin's trip could go ahead in January, since the
domestic political situation in India does not affect Russian-
Indian relations. The postponement is likely to increase
speculation about Yeltsin's health, although unnamed
diplomatic sources quoted by Interfax said the president
still plans to visit Italy in either late January or early
February. LB

FINANCE MINISTER ON OTHER WAGE ARREARS
PROBLEM...Mikhail Zadornov told reporters on 5 January
that the government has kept its promise to pay all back
wages to state employees, Interfax reported. However, he
noted that Russian enterprises currently owe wage arrears
totaling some 40-45 trillion rubles, not taking into account
the recent redenomination of the ruble ($6.7-7.5 billion).
Many of those enterprises cannot pay their employees
because they are owed huge debts by their own consumers.
The government has not announced specific measures aimed
at reducing the level of non-payments in the Russian
economy. First Deputy Prime Minister Anatolii Chubais told a
cabinet meeting in November that solving the non-payments
crisis will be the government's main task in 1998 and 1999,
Interfax reported on 6 November. LB

...AND ON RUSSIAN BORROWING PLANS. Although he
acknowledged that tax receipts in the first few months of
1998 will likely be lower than during the fourth quarter of
last year, Zadornov announced on 5 January that the
government will not borrow any more money through short-
term treasury bills (GKOs) until the cost of borrowing
through GKOs drops to "an acceptable level," ITAR-TASS
reported. The turmoil on world financial markets in recent
months caused many Russian and foreign investors to sell
GKOs, making it far more expensive for the government to
borrow on the domestic market. The government
consequently took out more foreign loans (see "RFE/RL
Newsline," 22 and 29  December 1997). LB

'NEZAVISIMAYA GAZETA' SAYS GOVERNMENT
FAILED TO PAY DEBTS. "Nezavisimaya gazeta" charged on
31 December that amid the noisy campaign to pay wage
arrears to state employees, the government has been quiet
about its debt of some 12 trillion rubles ($2 billion) to the
armed forces. In a separate article published the same day,
the newspaper said the government has also failed to pay
for numerous state orders. Consequently, many industrial
workers are still owed large wage arrears. "Nezavisimaya
gazeta," financed by Boris Berezovskii's LogoVAZ group, has
strongly criticized the cabinet ministers who are most
directly associated with efforts to clear wage arrears by the
end of the year: First Deputy Prime Ministers Chubais and
Boris Nemtsov. LB

FINANCE MINISTER BLAMES MILITARY LEADERSHIP
FOR WAGE DEBTS. Zadornov claimed on 5 January that the
Defense Ministry received 31.7 trillion rubles ($5.3 billion)
in funding in 1997, some 1.8 trillion rubles more than the
planned spending level. He did not specify whether he was
speaking about the original 1997 budget targets or about
planned expenditures after the government imposed a
"sequester," or reduction in spending, in May. Zadornov
blamed the Defense Ministry leadership for wage arrears to
military personnel, adding that order in paying soldiers'
wages can be restored only after the Defense Ministry's
bank accounts are moved from commercial banks to a
federal treasury. Many accounts for government agencies
have been transferred from "authorized" commercial banks
to the treasury, but an exception was made for Defense
Ministry accounts (see "RFE/RL Newsline," 19 December
1997). LB

HAS INFLATION BEEN CONQUERED? The annual inflation
rate in Russia was 11.3 percent in 1997, down from 21.8
percent the previous year, ITAR-TASS reported on 5
January, citing the State Statistics Committee. The
government has forecast that inflation will fall to 5.7 percent
in 1998. But in an interview published in "Trud" on 4
January, Igor Gadzhinsk, the head of the Economics
Ministry's department on price monitoring, argued that it is
too early to proclaim victory over inflation. He noted that
the inflation rate has declined primarily because of a sharp
reduction in the money supply. Gadzhinsk argued that
federal transfers of 14.5 trillion rubles ($2.4 billion) toward
paying wage arrears in December will cause inflation to rise
in the first quarter of 1998. He added that costs for certain
essential goods and services have risen faster than the
overall inflation rate. LB

NEW CHECHEN GOVERNMENT TO HAVE DEFENSE
DEPARTMENT. The government being formed by Prime
Minister-designate Shamil Basaev will have only some 20
ministries and agencies, rather than the 63 it has now,
ITAR-TASS reported on 5 January. But one of those
structures will be devoted to defense issues. Basaev is
scheduled to present his cabinet on 10 January.  Chechen
officials have indicated that the new government will not
change Chechen insistence that Russian recognize its
independence at any future talks between Moscow and
Grozny. PG

DAGESTANI AUTHORITIES DETAIN WAHHABI
LEADER. Police officials in Dagestan have arrested
Mukhamed-shafi Dzhangishiev, the leader of the Kavkaz
Center, on suspicion that he and his group, which includes
Wahhabi Muslim radicals, were involved in the recent attack
in Buinaksk (see "RFE/RL Newsline," 23 December 1997),
Interfax reported on 5 January. PG

YELTSIN PROMISES TO IMPROVE HUMAN RIGHTS.
Yeltsin has promised UN Secretary-General Kofi Annan that
Russia will "strengthen [its] human rights legislation" in
1998, AFP reported on 31 December. In a message to Annan
released by the Russian presidential press service, Yeltsin
said that "special importance is attached to protecting the
rights of refugees and forced migrants and improving prison
conditions." Yeltsin issued a decree last April declaring 1998
the "Year of Human Rights in the Russian Federation." The
same month, Amnesty International released a report
criticizing Russia's human rights record, particularly prison
conditions and asylum procedures. The State Duma recently
approved an amnesty aimed at alleviating the problem of
prison overcrowding (see "RFE/RL Newsline," 4 April and 30
December 1997). LB

CHERNOMYRDIN FAVORS NEW POLICY ON SUPPORT
FOR MEDIA. Prime Minister Viktor Chernomyrdin says
government concessions for the media should be given only
those outlets that need financial support. In an interview
with the magazine "Zhurnalist," which was also published in
"Rossiiskaya gazeta" on 30 December, Chernomyrdin argued
that the 1995 law on state support for the mass media is
unfair because it grants tax breaks to all media, from small
local newspapers to publications financed by wealthy
bankers. Those tax breaks remain in effect, but journalists
have voiced objections to the government's proposed tax
code, which would revoke the media's special privileges (see
"RFE/RL Newsline," 28 August 1997). Editors of some 20
Moscow-based newspapers signed an appeal in October
urging the government to retain the tax breaks. LB

GROMOV FORMS NEW VETERANS' MOVEMENT. Duma
deputy Boris Gromov was unanimously elected chairman of
a new movement called Brotherhood of Fighters at its
founding congress in Moscow on 26 December, "Trud" and
"Segodnya" reported the next day. The movement seeks to
unite veterans of all wars and military conflicts since the
Second World War. Gromov, a retired colonel-general who
oversaw the withdrawal of Soviet troops from Afghanistan
in 1989, has said Brotherhood of Fighters' only political goal
is to seek changes in government policy toward veterans.
Other politically active retired generals--most notably
Former Security Council Secretary Aleksandr Lebed and
Duma Defense Committee Chairman Lev Rokhlin--were not
invited to the congress, nor did any Kremlin officials attend.
However, "Komsomolskaya pravda" argued on 25 December
that the Kremlin may support Gromov as a potential magnet
for some Lebed voters in future elections. LB

ROKHLIN'S MOVEMENT SEEKING YELTSIN'S OUSTER.
The second congress of Rokhlin's Movement to Support the
Army, which took place in Moscow on 25 December,
approved a political platform outlining the movement's main
goal: the ouster of Yeltsin before his term ends in 2000.
Rokhlin announced he will seek to indict Yeltsin and bring
the case to the Supreme Court, although he acknowledged
that he would certainly lose such a court battle, Interfax
reported. The Justice Ministry has so far declined to register
Rokhlin's movement, which held its founding congress in
September. "Segodnya" predicted on 26 December that the
platform adopted at the congress the previous day virtually
guarantees that Rokhlin's movement will not be registered.
Rokhlin was elected to the Duma in December 1995 on the
party list of the pro-government movement Our Home Is
Russia, but he has sharply criticized the government and
Yeltsin since late June 1997. LB

COURT SAYS CIVIL CODE CAN'T PUT WAGE
PAYMENTS BEFORE TAXES... The Constitutional Court on
23 December struck down a passage in Article 855 of the
civil code saying that enterprises must pay their employees'
salaries before making tax payments and contributions to
non-budgetary funds such as the Pension Fund. The court
ruled that enterprises have the right to decide whether to
pay taxes or wages first. However, tax authorities have the
right to demand immediate payment of tax arrears.
According to the 24 December edition of "Kommersant-
Daily," the controversy arose after an August 1996
presidential decree ordered that banks transfer taxes owed
by enterprises before transferring funds earmarked for
wages. The Duma in October 1996 adopted a resolution
saying the civil code should take precedence over other tax
regulations. In December of that year, the Supreme Court
upheld the Duma's position but asked the Constitutional
Court to rule on the legality of Article 855. LB

...WHILE OFFICIALS WELCOME DECISION. Prime
Minister Chernomyrdin hailed the Constitutional Court's
ruling, saying that Article 855 had caused losses to the
federal budget totaling tens of trillions of rubles in tax
revenues in 1997, ITAR-TASS reported on 26 December. He
added that in Russia, people evade taxes whenever possible,
"especially when there is a loophole in the legislation." (The
court found that Article 855 created opportunities for
financial abuses, whereby enterprises artificially maintained
wage debts so as to avoiding making tax payments, ITAR-
TASS reported on 23 December.) Yeltsin also welcomed the
court's ruling, the presidential press service told Interfax on
24 December. LB

FORMER PRISONER WINS SUIT AGAINST VORONEZH
AUTHORITIES. A district court in Voronezh Oblast has
ruled that the local administration must fulfill its financial
obligations to former political prisoner Georgii Kusurgashev,
"Izvestiya" reported on 6 January. Kusurgashev filed suit
after the Voronezh authorities ceased in March 1997 to issue
compensation payments to former political prisoners, of
whom there are an estimated 10,000 in the oblast. Under a
Voronezh government directive issued before Governor Ivan
Shabanov was elected in December 1996, victims of political
repression during the Soviet period received monthly
payments of up to 34,000 rubles ($6). The Voronezh
administration plans to appeal the court ruling. Shabanov
was elected governor with the support of the Communist
Party. LB

SAFE SEX CAMPAIGN DISCONTINUED IN MOSCOW. The
Moscow city authorities have discontinued an advertising
campaign that sought to halt the spread of the AIDS virus by
promoting the use of condoms, "Segodnya" reported on 24
December. In June, the Russian Health Ministry and the
international organization Doctors Without Borders launched
the campaign, which involved billboards, posters, and
television commercials using the slogan, "Safe Sex--My
Choice." The Moscow authorities did not give an official
explanation for the decision to discontinue the campaign.
The television network TV-Center, which is controlled by the
Moscow city government, has also stopped airing the
commercials promoting safe sex. However, other major
television networks continue to broadcast those
advertisements. In addition, billboards on safe sex have
appeared in Kazan, the capital of Tatarstan, and Doctors
Without Borders will soon launch a similar campaign in
Nizhnii Novgorod. LB

TRANSCAUCASUS AND CENTRAL ASIA

GEORGIA, RUSSIA REMAIN AT ODDS OVER ABKHAZIA.
Georgia and Russia remain deeply divided over what should
be done in Abkhazia, ITAR-TASS reported on 5 January.
Georgian President Eduard Shevardnadze wants the
international community to deploy a Bosnian-style force if
necessary to end the Abkhaz conflict and to do everything in
its power to allow refugees to return. Russia, in contrast,
opposes the use of such a force. A Russian commander in
Abkhazia said on 5 January that deploying international
peacekeeping troops would end all hopes for a solution to
the conflict and possibly lead to a larger war. Meanwhile,
Georgian and Russian defense officials met in Tbilisi on 5
January to discuss how to improve military cooperation. PG

CENTRAL ASIAN PRESIDENTS MEET IN ASHGABAT.
The presidents of Kazakhstan, Kyrgyzstan, Tajikistan,
Turkmenistan, and Uzbekistan met behind closed doors in
Ashgabat on 5-6 January, RFE/RL correspondents  and
Russian media reported. Among the issues on the agenda
were regional cooperation, gas and oil pipelines, and the
situation of the Aral Sea. According to RFE/RL, Uzbek
President Islam Karimov, backed by Kyrgyz President Askar
Akayev, called for improved border security, particularly
along the Turkmen frontiers with Iran and Afghanistan, to
stem the flow of narcotics into their countries from
Afghanistan. ITAR-TASS reported that Turkmen President
Saparmurat Niyazov and Kazakh President Nursultan
Nazarbayev signed a declaration to step up cooperation
toward exporting gas and oil. BP

FORMER AFGHAN PRESIDENT IN TAJIKISTAN.
Burhanuddin Rabbani arrived in Dushanbe on 5 January for
a "working visit," ITAR-TASS and Interfax reported. Rabbani
has been engaged in shuttle diplomacy during the last two
weeks, visiting Tehran and Islamabad in a bid to pressure
all sides in the Afghan conflict to begin negotiations. Tajik
President Imomali Rakhmonov is attending the Central
Asian summit in Ashgabat but is expected to meet with
Rabbani upon his return to Tajikistan. ITAR-TASS speculated
that Rabbani will propose Dushanbe as a possible venue for
Afghan peace negotiations. BP

KYRGYZSTAN, UZBEKISTAN DISCUSS ENERGY
SUPPLIES. Kyrgyz First Prime Minister Kamelbek Nanayev
arrived in Tashkent on 5 January to hold talks with his
Uzbek counterpart, Ismail Jurabekov, on energy and water
supplies, RFE/RL correspondents reported. The two signed
an agreement on Uzbekistan's natural gas deliveries to
Kyrgyzstan in 1998; those supplies almost meet the  Kyrgyz
yearly requirement. No information has so far been released
about Uzbek payments for water from Kyrgyz reservoirs.
Uzbekistan is opposed to such payments, while Kyrgyzstan
claims they are necessary to maintain its reservoir systems.
BP

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