RFE/RL NEWSLINE Vol 1, No. 191, Part I, 8 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

* NEMTSOV ADVOCATES MAJOR RESTRUCTURING OF
ECONOMY

* KULIKOV CRITICIZED OVER PROPOSED CHECHEN
RAIDS

* TENSIONS IN DUSHANBE

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RUSSIA

NEMTSOV ADVOCATES MAJOR RESTRUCTURING OF
ECONOMY. First Deputy Prime Minister Boris Nemtsov says
that in order to secure economic growth in 1998, the Russian
government must pursue "major structural transformations"
this year. He told Interfax on 7 January that taxes must be
reduced and social benefits means-tested so that resources
can be allocated for the truly needy. The government had
sought to enact a new tax code by the end of 1997, but the
State Duma did not approve that document. Duma deputies
also voted down government-backed legislation that would
have reduced spending on various social benefits (see
"RFE/RL Newsline," 26 September 1997). Nemtsov also called
for reducing interest rates in order to stimulate investment
in Russian industry. The Central Bank raised those rates
during last fall's market turmoil to prevent the significant
devaluation of the ruble. LB

GOVERNMENT OVER-FULFILLS PLAN ON
PRIVATIZATION REVENUES. Revenues from sales of state
property in 1997 totaled 23.6 trillion rubles, not taking into
account the redenomination of the ruble ($3.97 billion),
Interfax reported on 7 January, citing the Russian Federal
Property Fund. Of that figure, the federal government
received 18.5 trillion rubles, 2.8 times more than 1997
budget targets. The government accelerated privatization
sales to compensate for huge revenue shortfalls caused by
poor tax collection. State Property Minister Farit Gazizullin
told Interfax on 6 January that some 3,100 enterprises were
privatized in 1997. He added that his ministry will over-
fulfill the plan on privatization revenues for 1998 as well.
The draft 1998 budget calls for 8.1 billion redenominated
rubles ($1.4 billion) in proceeds from sales of state property,
along with 1 billion rubles in dividends on state-owned
shares and 300 million rubles in rent from leased federal
property. LB

NEMTSOV SAYS PRIVATIZATION 'NOT GOAL IN
ITSELF.' Nemtsov told Interfax on 7 January that
privatization "is undoubtedly neither a goal in itself" nor the
"main means to achieve economic growth." He added that
"creating competitive conditions is more important and
healthier for society than privatization. Monopoly is far
more frightful for both the moral and economic health of
society than the sale of this or that package of shares." In
recent months, Nemtsov has repeatedly advocated "people's
capitalism" and a "democratic market." He has also accused
powerful bankers, including Boris Berezovskii, of seeking to
profit from high-level political connections and to obstruct
fair play in the economy. LB

KULIKOV CRITICIZED OVER PROPOSED RAIDS ON
CHECHNYA. On returning from talks with Chechen leaders
in Grozny on 7 January,  Russian Security Council Secretary
Ivan Rybkin condemned Interior Minister Anatolii Kulikov's
proposal to launch preemptive strikes against Chechen
guerrillas, AFP reported. Rybkin said that "hitting first and
thinking afterwards" was an "old Bolshevik principle."
Rybkin's former deputy Boris Berezovskii likewise termed
such attacks "inadmissible," adding that the federal
authorities still have not learned to assess in advance the
possible impact of their actions, Interfax reported.
Berezovskii argued that some Russian leaders believe it is
possible to pay for peace in Chechnya "with human lives
rather than money." In Grozny, First Deputy Prime Minister
Movladi Udugov warned that a Russian attack on Chechnya
would reignite the war, while President Aslan Maskhadov
denied that any guerrilla bases exist. To hunt for them
would be a waste of effort, he commented. LF

CHECHEN PREMIER-DESIGNATE TO PRESENT CABINET
LINEUP. Speaking on Chechen Television on 7 January,
Prime Minister-designate Shamil Basaev said he has drawn
up a list of government ministers that he will submit to
President Maskhadov by 10 January, Interfax reported. The
new government will comprise only 22 ministries and
departments, compared with the previous 48. It will,
however, include but including a defense department (see
"RFE/RL Newsline," 6 January 1998). That agency is likely to
be headed by former field commander Ruslan Gilayev.
Basaev's brother Shirvan, currently prefect of Vedeno Raion,
may head the fuel and energy department, according to
Interfax. In his 7 January television broadcast, Shamil
Basaev saidthat he will resign if his new government fails to
solve social problems within six months. LF

YELTSIN'S GRANDDAUGHTER LAMENTS PRESIDENT'S
WORKLOAD. President Boris Yeltsin's granddaughter Katya
Okulova told the French weekly "Paris Match" that Yeltsin
"works too much and it wears him out," Reuters reported on
7 January. She added that she wishes Yeltsin would leave
politics, since "he is no longer very young and I see how all
that exhausts him." In recent days, Kremlin officials have
announced the postponement of a presidential visit to India
and a CIS summit, both of which were planned for January.
However, officials have stressed that Yeltsin is keeping busy
during his vacation and will have a packed schedule of
meetings from 19 January, when he will return to work,
until the end of the month. LB

FORMER SECURITY OFFICER DEFENDS 'KOMPROMAT'...
Valerii Streletskii, the former head of the department on
high-level corruption in the Presidential Security Service
(SBP), has defended the practice of publishing compromising
information on high officials in the Russian press. Speaking
to the latest issue of the weekly "Argumenty i fakty,"
Streletskii said efforts by law enforcement agencies to curb
high-level corruption are routinely obstructed, leaving the
press as the "only means" of publicizing corruption cases. He
acknowledged that he taped a notorious June 1996
conversation between Anatolii Chubais and Viktor Ilyushin,
a transcript of which was published in November 1996. In
that conversation, Chubais and Ilyushin, who were at the
time advisers on Yeltsin's re-election campaign, discussed
ways to impede the investigation of two associates caught by
SBP officers carrying $538,000 in cash out of a government
building. That incident cost SBP head Aleksandr Korzhakov
his job in June 1996. The criminal investigation involving
those funds was closed in April 1997. LB

...COMMENTS ON CHUBAIS, BANK WAR. Streletskii, who
is considered close to Korzhakov and an opponent of First
Deputy Prime Minister Chubais, told "Argumenty i fakty"
that Chubais's current attempts to "restrain" powerful
Russian bankers are "useful for the country" and consistent
with the state's interests. However, he said that "like every
Bolshevik," Chubais created "with his own hands the system
that will destroy him." Streletskii said the rival financial
groups behind the current war of compromising information
in the Russian media "robbed the country but then fought
over property and started a fight for a place at the state
trough." Streletskii also said he is not afraid of being sued
for accusations made in his new book, which reportedly
accuses many high officials of corruption and even treason.
LB

OFFICIAL VIEWS EFFORTS TO REACH LAND REFORM
COMPROMISE... State Land Committee Chairman Ilya
Yuzhanov says forging a compromise on the land code will
be difficult, since the current draft of that document is
fraught with legal flaws, internal contradictions, and
violations of constitutional norms. Yeltsin vetoed the code
last June, but during roundtable talks chaired by the
president on 26 December, executive and legislative officials
pledged to reach a compromise on land reform within three
months (see "RFE/RL Newsline," 29 December 1997). In a
lengthy interview with RFE/RL's Moscow bureau on 4
January, Yuzhanov slammed many provisions in the land
code, which was drafted by the Duma's Agrarian faction. For
instance, one vaguely worded clause would ban sales of land
below which there are systems such as telephone lines or
water pipes. That would, in effect, ban all sales of land in
cities and industrial complexes. LB

...CONSIDERS BAN ON FOREIGN OWNERSHIP NOT
'SERIOUS'... Yuzhanov told RFE/RL that he is not concerned
about the agreement reached during the 26 December
roundtable talks to prohibit land sales to foreigners.
Yuzhanov noted that he considers such a ban economically
unwise and detrimental to Russian  efforts to create a
favorable environment for foreign investment. However, he
argued that such a ban would not be "serious," since it could
easily be circumvented by foreign companies. For instance,
those companies could gain the right to buy land by
establishing subsidiaries in Russia and registering them as
Russian companies. Yuzhanov added that "we could pass
hundreds of bans [on foreign ownership of land] in our
internal legislation" but that those bans would contradict the
terms of bilateral agreements Russia has signed with several
countries. LB

...UNIMPRESSED BY SARATOV LAND REFORM MODEL.
Yuzhanov also told RFE/RL that the land law recently
adopted in Saratov Oblast is not an ideal model for land
reform. Saratov Governor Dmitrii Ayatskov has hailed the
legislation as an example for other Russian regions to follow,
and Yeltsin has praised it (see "RFE/RL Newsline," 13
November 1997). However, Yuzhanov said the Saratov law is
merely a revised version of the land code passed by the
State Duma, which, he said, is much improved but still
contains many flaws. Yuzhanov said several other regions,
which he did not name, have passed land laws far superior
to Saratov's. LB

HARVEST UP IN 1997, BUT PROBLEMS REMAIN.
Russia's grain harvest was 88.5 million metric tons in 1997,
up nearly 20 million metric tons from the previous year, dpa
reported on 5 January, citing Agriculture Ministry official
Anatolii Kolenko. The government is not importing grain and
is even seeking to export up to 10 million tons of grain.
However, Agriculture Minister Viktor Khlystun has said that
70 percent of Russian agricultural enterprises lost money in
1997 (compared with 80 percent the previous year). In
December, Deputy Agriculture Minister Vyacheslav
Chernoivanov estimated that some 12 million metric tons of
grain were lost in Russia in 1997 because farmers lacked
equipment to bring in the harvest, ITAR-TASS reported on
11 December. Chernoivanov warned that shortages of
tractors and harvesters will worsen in the coming years, as
equipment is overused and farmers do not have sufficient
funds for maintenance. LB

RUSSIA NOT YET ASKING BLISS TO RETURN. Moscow
has still not asked U.S. citizen Richard Bliss to return to
Russia, ITAR-TASS and Reuters reported on 7 and 8 January.
Bliss was accused in late November of espionage in the
Rostov-na-Donu area, where he was carrying out a
surveying project for Qualcomm Inc., a U.S. company
contracted to install a cellular phone system there. Local
authorities detained Bliss on espionage charges but allowed
him to return to the U.S. for the Christmas holidays after he
promised to return by 10 January. Bliss has said he will
honor that promise, but both Qualcomm and U.S. officials
have appealed to Moscow to drop the charges. However,
speaking to Interfax on 8 January, Foreign Ministry
spokesman Valerii Nesterushkin said the charges have not
yet been dropped, while Federal Security Service spokesman
Aleksandr Zdanovich commented that Bliss could be asked
back "if investigators require that." BP

"ALTERNATIVE SERVICE" DIFFICULT TO OPT FOR. The
weekly "Ekspress-Khronika" reports in its latest issue that it
is not very easy for Russians to be accepted for  "alternative"
rather than military service. Article 59 of the Russian
Constitution provides for other forms of service in cases
where personal convictions or religious beliefs prevent
military activity. Over the past four years, the Duma Defense
Committee has repeatedly shelved a law on alternative
service, leaving those who decline military service at the
mercy of local militia document checks aimed at determining
whether an individual has been called up. "Violators" are
usually brought to militia headquarters, sometimes more
than once, to explain their actions. BP

MINISTER ON RISING DRUG ADDICTION, DRUG-
RELATED CRIME. Interior Minister Anatolii Kulikov has
estimated that Russia has more than 2 million drug addicts,
ITAR-TASS reported on 6 January. Kulikov, who chairs a
government commission on fighting the drug trade, told a
meeting of that commission that the number of officially
registered drug addicts has tripled over the last five years to
some 250,000. During the same period, he said, drug use
among Russians under 20 has tripled and drug addiction
among women has increased more than sixfold. Kulikov also
claimed that drug-related crimes nearly tripled in Russia in
1997, even though the overall crime rate dropped by 9
percent. LB

MINERS WANT GOVERNMENT COMMISSION IN
KEMEROVO SOON. Anatolii Chekis, the chairman of the
council of the federation of trade unions in Kemerovo Oblast,
told ITAR-TASS on 8 January that his council still demands
that a government commission come to Kemerovo before 15
January. On 5 January, the oblast administration had
announced that a federal government commission will arrive
in Kemerovo on 19 January to examine problems in the coal
sector. An emergency congress of coal miners in the
Kuznetsk basin recently threatened to call a general strike if
the federal government does not take steps to help the coal
sector in Kemerovo by 15 January (see "RFE/RL Newsline,"
30 December 1997). LB

TRANSCAUCASUS AND CENTRAL ASIA

TENSIONS IN DUSHANBE. RFE/RL correspondents in the
Tajik capital report that on the outskirts of Dushanbe on 6
January, members of the militia sought to detain an armed
oppositionist who refused to give up his weapon. He was
subsequently disarmed by a larger group of militia and
detained until an armed oppositionist group appeared at the
militia station and successfully demanded his release. On 7
January, a similar incident occurred at a bazaar, also on the
outskirts of the capital, when  two opposition members
refused to hand over their weapons. A brief skirmish broke
out, and shots were fired. The militia left the scene and
returned with tanks and armored vehicles. Correspondents
report that the standoff continued on 8 January. BP

RUSSIAN DEFENSE MINISTRY DELEGATION IN
GEORGIA.  Colonel-General Leonid Ivashov, the head of the
Main Directorate for International Military Cooperation of
the Russian Ministry of Defense, held talks with ranking
Georgian defense officials in Tbilisi on 5-8 January. Topics
discussed included the possible transfer to Georgia of former
Soviet military property in that country and of several
vessels from the Black Sea fleet. Last month, Georgian
Defense Minister Vardiko Nadibaidze demanded that Russia
pay Georgia compensation for weaponry worth $10 billion
that had been illegally removed from Georgia in 1992-1993.
Ivashov told Interfax that his demand is "unreasonable." He
also inspected the Russian military base in Akhalkalaki,
which he called  a key link in the CIS air defense system,
according to Turan. On 7 January, Nadibaidze and Ivashov
signed an agreement on military cooperation in 1998, but no
details were released, Caucasus Press reported. LF

HOSTAGE-TAKING IN ABKHAZIA.  Unidentified gunmen
abducted some 30 ethnic Georgians from a bus in Abkhazia's
southernmost Gali Raion on 7 January, ITAR-TASS and AFP
reported. The gunmen subsequently released all female
passengers. The Georgian government has asked the CIS
peacekeeping force deployed in Abkhazia to help locate the
hostages, ITAR-TASS reported on 8 January. Also on 7
January, Abkhaz security officials defused a 10 kilogram
bomb at a power station in Gulripsh Raion, according to
Interfax. LF

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