Self-hypnosis. New summit. New arrest. Gazprom is what it is
November 11, 2021
Self-hypnosis session
Vladimir Putin chaired a meeting of the Military-Industrial Commission, where he summed up the results of discussions with heads of the Defense Ministry and defense industry enterprises (I reported this story a week ago). Once again, he engaged in self-hypnosis, announcing Russia’s “latest weapons...in technical characteristics are not inferior, and in many parameters are much superior to foreign counterparts.”
The meeting discussed the main parameters and priorities of the new state armaments program. “...it is essential for us to carefully consider all the main world trends in the development of military equipment and weapons,” said the Russian president. “First, this is the introduction of advanced information, bio-cognitive technologies. This is an emphasis on the promotion of hypersonic complexes and weapons based on new physical principles, the latest intelligence, navigation, communications, and control systems.”
Traditionally, Putin spoke about the need to increase the production of civilian products at defense enterprises, which grew from 20.9% in 2018 to 25.6% at the end of 2020. However, he understands these products are often non-competitive. Therefore, the president demanded that the government “establish...quotas for state purchases and purchases of companies with state participation.” Within the framework of these procedures, at least half of the purchases of machinery and equipment should be made in Russia.
New summit?
Vladimir Putin and U.S. President Joe Biden may have a video conference call by the end of 2021 and a personal meeting at the beginning of 2022, Kommersant reported. “The details have not yet been fully agreed upon, and therefore neither the Kremlin nor the White House is in a hurry to disclose details,” the newspaper said.
France hopes
France has not lost hope of discussing the situation in Ukraine with Russian Foreign Minister Sergey Lavrov. The French Foreign Ministry said that a meeting of France’s and Russia’s foreign and defense ministers will take place on November 12 in Paris, on the sidelines of the international conference on Libya. The statement says that the parties will discuss the political and military aspects of regional and global crises, particularly the situation in Ukraine and the Sahara-Sahel region, the Iranian nuclear deal, and Afghanistan.
Meanwhile, Russia has not confirmed its readiness to discuss the situation in Ukraine.
The minister has no time
Sergey Lavrov refused to take part in an online conference of foreign ministers on combatting the pandemic held by the United States on November 10. The reason is that the invitation to participate in this meeting came when the minister’s working schedule was already fixed. Because the American side announced that it was not ready to invite persons other than the minister, it was not possible to send another representative of the Russian side, said Maria Zakharova, spokeswoman of the Russian Foreign Ministry.
Service violence
In early October, the human rights project Gulagu.net published over 1,000 videos taken at the prison TB hospital in Saratov (530 miles south-east of Moscow). They depict torture and rape of prisoners. The videos were filmed by officers of the Federal Penitentiary Service of Russia on office video recorders and were stored on office computers. The volume of the published video archive exceeds 40 GB.
After the appearance of these materials, the director of the hospital, the head of the regional department of the Federal Penitentiary Service, and four of his subordinates were fired; several criminal cases were initiated. One of the defendants was former prisoner Sergey Savelyev, who copied and brought out the video archive. After his release from prison, he left Russia and transferred the video to a human rights organization. On October 18, the court recognized Savelyev’s accusation of unauthorized access to official information as legitimate and decided to arrest him in absentia.
New videos of torture and violence at the same hospital were posted to YouTube on November 10. All episodes took place in 2015-2020. According to human rights activists, the abuse of prisoners was carried out by capo activists (prisoners who collaborated with the administration).
On the same day, at the request of the prosecutor’s office, the court cancelled the previous decision on the arrest in absentia of Sergei Savelyev, and the prosecutor’s office ordered the termination of his criminal prosecution.
The new arrest of a supporter of Navalny
Lilia Chanysheva, head of the regional organization Navalny’s HQs in Ufa (840 miles east from Moscow), was arrested and to be held in prison next two months. She is accused of establishing an extremist organization; her punishment can be up to 10 years in prison. During the court session, Chanysheva announced that she was 14 weeks pregnant. Still, the court did not consider this a mitigating circumstance and refused to take softer restrictive measures (house arrest or recognizance not to leave).
Navalny’s HQs organization was declared an extremist and banned by the court in June 2021. After that, a criminal case was initiated against Navalny and his closest associates who are accused of establishing and leading an extremist organization. The punishment for each of the accused can be up to 15 years in prison.
Hundreds or even thousands of people across the country can become potential defendants. Their participation in the current activity of the organization or its financial support will be the essence of acquisition.
Putin is afraid of deficit and inflation
Vladimir Putin discussed the food supply and food prices in Russia with the government. Traditionally, video footage of similar meetings is posted on the Kremlin’s website, but that did not happen this time. Moreover, even the transcript of the meeting was significantly shortened. The discussion seemed to be heated and emotional.
The Russian president is concerned about rapidly rising prices and the danger of Russia’s outflow of food and fertilizers. The government limits the growth of grain, sugar, sunflower oil, and other basic commodities. The government uses tariff and non-tariff restrictions, agreements between manufacturers and retail chains on price containment, and budgetary subsidies. However, according to the Minister of Agriculture Dmitry Patrushev (son of the Secretary of the Security Council, Nikolai Patrushev), using price containment agreements is very limited. So on the sugar market, which the government began to regulate at the beginning of this year, “there are risks of reorientation of sugar beet producers to more profitable crops, including grain and oilseeds,” the minister said. According to the minister’s forecasts, this year’s sugar beet harvest will provide Russia with plenty of sugar. In this regard, he proposed to terminate the agreement and introduce a tariff quota for imports.
In this regard, the new proposals of the government aim at regulating the supply of goods. So, in 2022, a duty-free quota for importing pork and beef into Russia will be introduced. The quota will amount to 200,000 tons of frozen beef (approximately 10% of annual national consumption) and 100,000 tons of pork (3%). The use of quotas will be conditioned by the further processing of meat in the territory of Russia.
In addition, the government decided to further restrict the export of wheat. When setting the export duty, a higher rate will be introduced if the price of wheat exceeds $400 per ton. In addition to the export duty, tariff quotas for its export will be established. The quota size will be determined at the end of the year when the harvest is completed, and the volume of wheat exports for July-December is known.
Gazprom is what it is
Russian Energy Minister Nikolai Shulginov said that he supports the liberalization of gas exports.
The current law gives Gazprom a monopoly on the transportation and export of gas from Russia via pipelines. Russian oil and gas companies have been trying for many years to obtain the right to export gas, but all their efforts have failed, resting on the position of Vladimir Putin. He supports Gazprom’s position that gas export liberalization will lead to competition between Russian companies and lower prices.
Shulginov said that negotiations are now underway between Gazprom and Rosneft to conclude an agency agreement. Rosneft is ready to transfer 10 billion cubic meters of gas per year to Gazprom for sale on the European market. At the same time, Shulginov stressed that “this is not the immediate future.”
In Russia, you can often hear the phrase that Putin understands Gazprom’s problems better than many of the company’s top managers. And only Putin makes decisions on strategic and many tactical issues of Gazprom’s business. Shulginov indirectly noted that the liberalization of prices and the separation of the gas pipeline system from gas production could benefit the Russian economy. However, he added, “We are not considering this issue...the decision has already been made...the topic did not arise yesterday. So far, the solution is what it is. And Gazprom is what it is.”
It’s not that much money
Russian officials and CEOs of state-owned companies have recently shown miracles of ingenuity in proposing new state-owned companies. Obviously, they are well aware that such ideas are to the liking of Vladimir Putin and are a powerful weapon in the struggle to obtain additional budgetary resources.
The algorithm of action is surprisingly simple: The minister reports to Putin on a real (or imaginary) problem, and the president gives instructions to find a solution. The creation of a state-owned company is one of the proposals.
Putin’s lieutenants clearly see that the president does not perceive private business as a reliable partner and does not believe in the market forces. The only way to solve many problems is through government solutions and/or public funds.
On November 10, Putin discussed with Transport Minister Vitaly Savelyev the disruptions in the supply of goods from the Far East ports to Magadan, Kamchatka, Sakhalin, and Chukotka. Delivery of goods to these regions is possible only by sea, and the onset of winter may make transport links unstable. At the end of October, more than 5,400 containers were accumulated in the ports, waiting to be shipped to remote regions. The minister’s list of proposals included the creation of a new state-owned transport company for the transportation of socially important goods in the Far East. After Putin was skeptical about this idea, the minister laid out the main argument: “It’s not that much money.”
This argument worked. “Okay if you wish,” said the president.