Russian builds its new empire with finance, not fear

Times Online
February 5, 2009

From Belarus to the Caucasus and Central Asia, Russian power and
influence is at its greatest height since the Soviet collapse

Tony Halpin in Moscow

Whatever the economic calamities ahead, this year is proving an
excellent one for the political project of forging a new Russian
empire.

A plethora initiatives from the of Kremlin is binding most of Russia’s
former Soviet satellites ever more tightly to Moscow. Only yesterday
the Kremlin created a rapid reaction force with six of the states and
an economic bailout fund with four of them.

The reaction force will be under central command, which will
undoubtedly be in Moscow since Russia is providing most of the troops.
Soldiers from Belarus, Armenia, Kazakhstan, Kyrgyzstan, Tajikistan and
Uzbekistan will once again learn to take orders in Russian.

Russia is also putting up $7.5 billion (£5.19 billion) of a $10 billion
mutual rescue fund it established with Belarus, Kazakhstan, Uzbekistan
and Kyrgyzstan. Despite growing hardship for millions of Russians at
home, the Kremlin also offered to throw billions of roubles at Belarus
after both countries agreed to form a joint air defence system pointed
at Europe.

He who pays the piper calls the tune as the United States learned
painfully on Tuesday from President Bakiyev of Kyrgyzstan, who served
notice t
o quit a key airbase for supplying Nato forces in Afghanistan.
A gleeful Kremlin denied any link between that decision and the $2.15
billion in loans and aid it had given the impoverished republic just
moments earlier.

Washington is flirting with Tajikistan as another potential base for
Afghan supplies. President Rakhmon, enjoying the attention, apparently
felt emboldened enough to cancel his visit to Moscow initially, but
quickly thought better of it.

Having squeezed the US military out of Central Asia, Russia is
determined to prevent the European Union becoming a rival for energy in
its backyard. The EU is desperate to break Russia’s grip on gas by
securing new supplies from the region through the Caucasus.

President Medvedev beat them to Uzbekistan where his Uzbek counterpart,
Islam Karimov, pledged last month to double supplies to Russia, adding
reassuringly that Uzbekistan "sells gas to Russia and to Russia only".

Gas-rich Turkmenistan offers hope but only if the Caucasus remains open
as a conduit for pipelines. Since the war with Georgia last summer and
the de facto annexation of Abkhazia and South Ossetia, Russia has
returned to the region with a bang.

Armenia is little more than a vassal state, having sold most of its
economic infrastructure to Russian companies. The "frozen conflict"
between Armenia and neighbouring Azerbaijan over the disputed territory
of Nagorno-Karabakh gives the Kremlin further leverage.
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Moscow denied Azeri claims last month that it had funnelled arms worth
$800 million to Armenia, which is host to a Russian military base. But
both sides understand that Russia could tip the balance of power in
either direction if it chooses.

From Belarus to the Caucasus and Central Asia, Russian power and
influence is now at its greatest height since the Soviet collapse.
While Kremlin ruled its old empire with fear, it is building its new
one on finance.

Only Ukraine remains beyond Moscow’s so-called "sphere of influence"
despite the recent bruising gas war. Presidential elections are just 11
months away, however, offering the Kremlin empire-builders a great
opportunity to avenge the setback of the pro-western Orange revolution.