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th RUSSIAN FEDERATION and 27 ). On the tape recording, GIORGADZE tells his associate, “I will tell you briefly. I visited the head Politics doctor of the maternity hospital. He conducted echolocation test in my presence. So, the boy is Immediate Rus Strike Against Pankisi Possible healthy, in his ninth month. The delivery will be · One of the Chechen gunmen involved in the normal and no caesarean will be required. So, I September 26th attack on the village of Galashki in have told you everything.” According to Ingushetia said Russian plans to begin operations NATSVLISHVILI, the recipient of GIORGADZE’s in may commence as early as September message was a Georgian politician, or someone 27th, Kommersant reported. According to Russian claiming to be a politician, though he would not troop commander Lieutenant General Valery name a person directly. Deciphering GIORGADZE’s GERASIMOV, 14 Russian soldiers were killed in coded message, NATSVLISHVILI said, “in Septem- the attack and 15 were wounded. This compared to ber, in the ninth month, something that is supposed a total of 100 casualties on the Chechen side. (See to happen will happen.” On the tape, GIORGADZE The Daily Report on September 26th.) Chechen tells his unidentified associate to read the Septem- native Vitaliy SMIRNOV, under the direction of Ruslan ber 2nd issue of Spiegel. Reading from the issue, GELAYEV, led the Chechen detachment. Russian NATSVLISHVILI says, “’s special services Defense Minister Sergei IVANOV called the attack and the military are drawing up a plan for the “the last straw that will make the Russian toppling of President Shevardnadze. It seems that leadership’s patience run out,” Kommersant re- Igor Giorgadze, who used to work as state security ported. According to Kommersant on September minister in , plays the crucial role.” 27th, “It is not ruled out that strikes could be carried NATSVLISHVILI said GIORGADZE made the phone out against Pankisi as early as today.” call from Russia on September 7th and on Septem- …Coup Soon To Follow? ber 11th “the hysteria began during which it was said Georgian Deputy Minister of State Security Lasha absolutely unambiguously that Russia would bomb NATSVLISHVILI appeared on Georgian TV1 to dis- Georgia.” NATSVLISHVILI added, “This is Russia’s cuss the “critical” security situation in Georgia, age-old plan which has not been able to reconcile Kommersant reported on September 26th. Accord- itself to Georgia’s independence for a number of ing to NATSVLISHVILI, “Russia’s aggressive policy reasons.” Today's News Highlights in Georgia” is jeopardizing the country’s national NATSVLISHVILI RUSSIA accused Russia independence. In order to demonstrate the severity Russia Says "No Proof" On Iraq of Georgia’s security crisis, NATSVLISHVILI played of double stan- Russia On U.S. In Central Asia the viewing audience portions of a taped phone dards by allowing Kidnapped Executive Released conversation between former Georgian Security GIORGADZE, Gazprom Media Purchase Chief Igor GIORGADZE and an anonymous male. who is wanted by EUROPEAN REPUBLICS GIORGADZE has been a vocal critic of Georgian Interpol, to move Lithuania Involved In Visa Clash President and is be- freely in Russia Poll- Ukrainian Living Standards lieved to be preparing a coup against the Georgian and to appear on SOUTH CAUCASUS & CENTRAL ASIA government (see The Daily Report on Russia’s Russian televi- Azeri-Russia Strategic Partners Special Report - Giorgadze II Special Report on GIORGADZE, September 26th sion as he did on

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NTV on September 16th. NATSVLISHVILI said, “I am 25th that the Russian government would “declassify absolutely confident that Igor Giorgadze is danger- 90% of defense spending” by the State Duma’s ous for Georgia while he is there, in Russia. Igor second reading of the 2003 draft budget, Interfax Giorgadze is nothing in Georgia and there is no reported on the same day. KUDRIN made the electorate...which would support Igor Giorgadze announcement in the Duma while presenting a and his marginal ideology. It is ruled out. Therefore, report on the 2003 budget. According to KUDRIN, whether he is arrested or not if he comes back to defense spending on armed force maintenance, Georgia is another issue,” Kommersant reported. which comprises 65 percent of all defense articles, will be the first to be declassified. KUDRIN said that Rus Says “No Clear Proof” Of Weapons In Iraq defense spending declassification would allow the th · On September 27 , one day before U.S. defense budget to become “more public, open and Undersecretary of State for Political Affairs Marc controllable for society,” Interfax reported. GROSSMAN is scheduled to arrive in Moscow for talks on Iraq, Russian Foreign Minister Igor IVANOV Economy told reporters there is “no clear proof” that Iraqi President Saddam Hussein has acquired biologi- Ruble = 31.66/$1.00 (NY rate) cal, chemical, or nuclear weapons,” Reuters re- Ruble = 31.56/$1.00 (CB rate) ported on the same day. IVANOV added that any Ruble = 30.85/1 euro (CB rate) attempt to delay the return of weapons inspectors to Iraq would be regrettable. According to IVANOV, “It is the inspectors, working in conjunction with U.N. Security Council resolutions, who can provide 31 answers to all these questions. We believe it would now be an unforgivable error to delay the dispatch 29.5 of international monitors to Iraq,” Reuters reported. 28 Russia Says U.S. Temporarily In Central Asia · Russian Deputy Foreign Minister Viktor 26.5 KALYUZHNY told Interfax that Russia does not expect U.S. forces to remain in Central Asia after 25 the anti-terror campaign in has been 12 19 12 23 1 10 18 28 7 26 6 18 7 22 2 13 25 11 concluded. KALYUZHNY said, “As for the terms and conditions of the presence of the military con- OctNovDecJanFebMarAprMayJunJulAugSep tingents of the United States and some West Euro- pean countries in Central Asia, we proceed from the statements of American administration repre- Rus Must Decrease Raw Material Dependence sentatives that the United States does not intend to · Russian Prime Minister Mikhail KASYANOV set up permanent military bases there and that announced at a cabinet meeting on September 26th military presence is temporary and related to anti- that Russia must increase its exports of manufac- terror tasks in Afghanistan,” Interfax reported on tured goods and decrease dependence on raw rd September 23 . The Deputy Foreign Minister em- materials, Reuters reported on the same day. Rus- phasized that the U.S. presence in Central Asia sia currently exports $40 billion in raw materials should not be considered “as weakening Russian annually. This is more than half of its $60 billion security,” Interfax reported. According to export total. According to Interfax, KASYANOV said, KALYUZHNY, the U.S.-led operation in Afghanistan “If we maintain the current structure and volume of has contributed to increased security for both Cen- export and import a financial and economic crisis tral Asia and Russia. could become probable,” Reuters reported. Re- Gov’t Prepares To Declassify Defense Budget sponding to the announcement, Peter WESTIN, an · Russian Deputy Prime Minister and Finance economist at Aton brokerage said, “It looks to me Minister Alexei KUDRIN announced on September that he is forecasting a massive drop in the oil

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price,” Reuters reported. A drop in oil prices in the shares to Evrofinance will allow it to recover some late 1990s significantly harmed the economy, which of its expenditures. Gazprom says it will continue to rebounded as oil prices increased. According to look for additional investors. Gazprom CEO Alexei Roland NASH, head of research at Renaissance Miller told NTV he hopes to recover funds “once the Capital, Russia’s oil exports have kept the ruble capitalization of the new company grows.” Chair of strong, making Russian manufacturing less com- Evrofinance Vladimir STOLYARENKO admitted petitive. NASH said, “What will tend to happen is the he expects to see a quick return on his company’s exchange rate will appreciate over time, making it investment, Reuters reported. more difficult for the manufacturing section of the economy to function properly,” Reuters reported. EUROPEAN REPUBLICS According to NASH, banking reform in Russia could help channel oil profits into other sectors. WESTIN Lithuania Cancels Visa Agreements warned, however, that Russia is unlikely to become · The Lithuanian Foreign Ministry announced on a large exporter of manufactured goods within 10 September 25th that it would cancel bilateral visa years. He said, “You can’t abruptly change your agreements with Russia and Belarus as of January competitive advantage,” Reuters reported. 1, 2003, Reuters reported on the same day. The Business decision comes as Lithuania prepares itself for European Union membership. According to Kidnapped LUKoil Executive Released Lithuanian Foreign Minister Antanas VALIONIS, · LUKoil Chief Financial Officer Sergei KUKURA, Lithuania’s primary concern is acceptance into the who was kidnapped on his way to work in Moscow EU’s Schengen zone, which will eliminate internal on September 12th, was released unharmed out- border controls. Lithuania’s Foreign Ministry re- side of his home on September 25th, the Associated leased a statement on September 25th that said Press reported on the same day. LUKoil would not neither Belarus nor Russia had responded to re- comment on whether or not the $6 million ransom peated offers to revise the bilateral visa agree- had been paid. A LUKoil official told Reuters on ments in order to bring them in line with EU regula- September 25th, “All I can tell you so far is that he is tions. The current visa privileges between Lithuania free.” According to Moscow Deputy Police Chief and Russia and Lithuania and Belarus have been in Gennady DEINEKO, the details surrounding the place since 1995 and 1994, respectively. Accord- case remain unclear. Some argued KUKURA’s ing to the Ministry’s statement, “Lithuania remains abduction was tied to his knowledge of state se- open to dialogue and negotiations on ways to sim- crets, while others suggested the kidnapping was plify visa issuance for its citizens and those of related to company infighting. LUKoil Press Secre- neighbouring states,” Reuters reported. This most tary Dmitry DOLGOV said, “[Kukura] looked OK.” recent visa clash can be seen in the context of Russia’s ongoing dispute with the EU concerning Evrofinance Purchases Gazprom Media Stake the right to visa-free travel between Kaliningrad and · Evrofinance, a former Russian Central Bank Russia proper via Lithuania. subsidiary, reached an agreement with Gazprom on September 26th to purchase a 49 percent share Poll- Ukrainians Want Higher Living Standard in Gazprom-Media for $700 million, Reuters re- · Speaking at a roundtable on “The Role of Think- ported on September 27th. According to the terms Tanks in Public Policy Formation” in Kiev on Sep- of the agreement, Evrofinance will pay Gazprom- tember 26th, Director of the Razumkov Center’s Media $100 million in cash up front and assume an sociological department Andrei BICHENKO shared additional $600 million in debt to Gazprom, Reuters results of a poll conducted on 2,040 respondents in reported. Gazprom-Media oversees Russia’s third August 2002. According to the Center, 57 percent of largest television broadcaster, NTV, which it ac- Ukrainians polled “are ready to live in a totalitarian quired from founder Vladimir GUSINSKY in early state with high living standards” compared to 14.8 2002. According to Gazprom, it has invested over percent who “favor a democratic state with lower $1 billion into GUSINSKY’s firms and the sale of living standards,” Interfax reported on September

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26th. Of those surveyed, only 7.4 percent consid- ered themselves to “live comfortably.” Only 4.7 SPECIAL REPORT percent of respondents claimed to participate in the state’s “social life,” while 48.5 percent said Giorgadze's War On Shevardnadze, Part II “they do not believe active involvement in social life might change anything in Ukraine,” Interfax re- In recent weeks, Igor GIORGADZE has inserted ported. According to BICHENKO, the results show himself into the war of words between Russia and a lack in respondent’s confidence that they will be Georgia. GIORGADZE has been leading the Rus- able to “influence the authorities.” BICHENKO sian media charge in what Georgian officials have said, “This is exactly what they lack now,” Interfax described as an information (psychological) war reported. The poll demonstrated that respondents against President Eduard SHEVARDNADZE and have little faith in the authorities’ willingness to use the Georgian government. According to Boston state finances in the people’s interest. Over 36 University’s NIS Observed coverage on Septem- th percent of respondents said they believed tax ber 25 by Miriam LANSKOY, “GIORGADZE goes rd money “would be misappropriated by officials,” on to say (in Izvestia interview on September 3 ) while another 35 percent argued that “this money that, according to his Georgian sources, the ter- is taken by the authorities,” Interfax reported. rorists who exploded buildings in Moscow in 1999 are hiding in the Pankisi Gorge and that on 23 SOUTH CAUCASUS & CENTRAL ASIA August, 2002 Georgia’s planes bombed their own territory! (Since GIORGADZE’S interview, the FSB has begun to repeat his allegations that the orga- Azerbaijan Is Russia’s Strategic Partner nizers of the 1998 blasts are hiding out in Pankisi · Russian Foreign Minister Igor IVANOV an- nounced on September 24th that Azerbaijan is Gorge.)” Furthermore, GIORGADZE has accused the Georgian special (intelligence) services of Russia’s strategic partner. According to RIA informing Chechen field commander Ruslan Novosti, IVANOV said, “Russia was sure the fu- GELAYEV and his fighters of the upcoming anti- ture relations with Azerbaijan would be mutually criminal operation in the Pankisi Valley. According beneficial.” IVANOV stated at a meeting with ALIYEV, “We will share the future that will deter- to GIORGADZE, GELAYEV was notified of the “scheduled operation details and its terms.” As a mine our relations.” At the end of the meeting, result, the combatants agreed to withdrawal from IVANOV awarded ALIYEV with a jubilee badge Pankisi before the operation was undertaken. marking the bicentenary of the Russian Foreign Ministry. The badge is reserved for famous Rus- On September 15th, GIORGADZE stated in an sians, as well as foreign diplomats, for their con- interview with the Russian newspaper Russian tributions to Russia. ALIYEV also received a two- Magazine that “high government (Georgian) offi- volume book on outstanding Russian diplomats, cials” have close personal ties with GELAYEV. published for the occasion, and a degree of Hon- GIORGADZE declared that he will publish docu- orable Doctor of the Moscow State Institute of mentation concerning the “spot-check imple- International Relations (MGIMO) for his contribu- mented from Pankisi Valley to Kodori Gorge this tion to relations between the Azeri and Russian Spring by Chechen terrorist Ruslan GELAYEV, its nations. In the meantime, a Russian State Duma finance, techniques and material to be ensured by delegation began a three-day visit to Azerbaijan on official Tbilisi, while interior forces’ units were th September 24 . State Duma Speaker Gennady accompanied by its fighters.” Tensions remain SELEZNYOV announced on the same day that high in the Kodori Gorge as claims of a military Russian-Azeri relations were successfully devel- buildup around the Georgian enclave continue. oping. As further evidence of cooperation between Russia and Azerbaijan, a Interfax-Azerbaijan In- Opposing accusations surfaced on September formation Agency has been established. ALIYEV 25th when Prime News reported that an associate said, "[T]his is a positive example of how of Ruslan GELAYEV confirmed that the Russian coprehensive cooperation should develop between military transported the commander and his fight- the two countries," Interfax reported. ers out of the Pankisi Valley via helicopters at a

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cost of $30,000 per flight (10 flights). Furthermore, sources report that KURASHVILI confirmed during the source claimed that GELAYEV is now in his interrogation that he met with Russian military Chechnya and not Ingushetia, where fighting is intelligence (GRU) and Federal Security Service underway between Russian and armed forma- (FSB) members in Russia, Belarus, and Lebanon tions. On September 26th, the Russian media while planning the 1999 coup attempt. A further claimed it was Georgian helicopters that trans- indication that something may be afoot is that the ported GELAYEV and that he was surrounded in Georgian Security Ministry found 12 heavy machine Ingushetia. The Russian television station RTR guns, which had been stolen from 11th Brigade broadcast on September 26th excerpts from video tanks, near Tbilisi in mid-September. Some fear footage supposedly showing GELAYEV and his they were pre-positioned for an attack against the troops training in the Pankisi Valley. The footage Georgian government. was presumably shot by British cameraman, th Gervaise Roderick John SCOTT, 31, whose body According to Prime News on September 16 , Presi- was found in Ingushetia on September 26th. JOHN dent Eduard SHEVARDNADZE made clear he would worked for “Front-line television” and held a Geor- not resign because “some Georgian politicians” gian visa, Prime News reported. It is important to and public figures “openly and fully propose them- note that the Georgian visa # 364496 found on the selves to our enemies (presumably Russian Spe- body was only valid from June 13th to September cial Services).” SHEVARDNADZE complained that 15th. This will no doubt become another arrow in the the attempts “to change the government in the quiver of Russia’s charges proving Georgian com- country” is a form of aggression against Georgia. plicity with Chechen fighters. SHEVARDNADZE pointed out that in a democracy, rather than the totalitarian structures with which Moreover, GIORGADZE’s associates are also GIORGADZE appears to be most comfortable, only speaking out against the SHEVARDNADZE gov- the Georgian population is entitled to decide who ernment, possibly in preparation for another inter- will head the country, and “never the intelligence nal coup attempt. The former commander of the service of any foreign state (Russia).” Georgian Army’s ground forces, General Gudjar KURASHVILI, who was pardoned by President GIORGADZE, who remains a grave threat to Geor- SHEVARDNADZE in 2002 while serving a prison gian President SHEVARDNADZE and his govern- term on charges of planning a coup with Igor ment, serves as an important symbol of Russia’s GIORGADZE in May 1999, accused the Georgian rejection of Georgian independence. Russia’s claim Defense Ministry of selling Strela missiles to to be serious about joining a global anti-terrorism Chechen guerrillas, Caucasus Press reported on campaign must be viewed with skepticism as long September 17th. This type of missile has been used as Igor GIORGADZE remains a semi-permanent by Chechens in a series of attacks on Russian feature of the Russian media. Until GIORGADZE is military helicopters. The latest helicopter attack extradited to Georgia, as the U.S. Congress has occurred on September 26th during fighting in suggested, Georgia will view Russia as hostile, and Ingushetia. KURASHVILI has dismissed claims the international community will question Russia’s made by Georgian Defense and Security Commit- intentions towards its smaller neighbor. If even half tee Chairman Irakli BATIASHVILI that the Georgian of the accusations are true, however, it is hard to military never had such weapons, RFE/RL re- believe that GIORGADZE will be turned over to ported on September 18th. According to Georgia, given his inside knowledge of Russia’s KURASHVILI, the Georgian army had 44 Strela dirty war against President SHEVARDNADZE and missiles, all of which later disappeared. Intercon Georgian independence.

Paul M. Joyal, President, Editor in Chief Daily Report on Russia is published Monday-Friday (excluding Clifton F. von Kann, Publisher holidays), by Intercon International, USA. Subscription price for Oleg D. Kalugin, Content Advisor Washington, D.C. Metro area: $950.00 per year. A discount is Tiffany G. Petros Ph.D., Principal Editor available for non-profit institutions. Ia Meurmishvili, Contributing Editor Daily Report on Russia is for the exclusive use of the subscriber only. Reproduction and/or distribution is not permitted without the expressed written consent of Intercon. Daily Report on Russia Ó copyright 2001, Intercon International, USA.

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