Russian Political, Economic, and Security
Issues and U.S. Interests
Jim Nichol, Coordinator
Specialist in Russian and Eurasian Affairs
July 15, 2010
Congressional Research Service
7-5700
www.crs.gov
RL33407
CRS Report for Congress
P
repared for Members and Committees of Congress
Russian Political, Economic, and Security Issues and U.S. Interests
Summary
Russia made some uneven progress in democratization during the 1990s, but according to most
observers, this limited progress was reversed after Vladimir Putin rose to power in 1999-2000.
During this period, the State Duma (lower legislative chamber) came to be dominated by
government-approved parties and opposition democratic parties were excluded. Putin also
abolished gubernatorial elections and established government ownership or control over major
media and industries, including the energy sector. The methods used by the Putin government to
suppress insurgency in the North Caucasus demonstrated a low regard for the rule of law and
scant regard for human rights, according to critics. Dmitry Medvedev, Vladimir Putin’s chosen
successor and long-time protégé, was elected president in March 2008 and immediately chose
Putin as prime minister. President Medvedev has continued policies established during the Putin
presidency. In August 2008, the Medvedev-Putin “tandem” directed wide-scale military
operations against Georgia and unilaterally recognized the independence of Georgia’s separatist
South Ossetia and Abkhazia, actions that were censured by most of the international community
but which resulted in few, minor, and only temporary international sanctions against Russia.
Russia’s economy began to recover from the Soviet collapse in 1999, led mainly by oil and gas
exports, but the sharp decline in oil and gas prices in mid-2008 and other aspects of the global
economic downturn put a halt to this growth. The government reported an 8% drop in gross
domestic product in 2009. This decline exacerbated existing problems: 15% of the population live
below the poverty line; an unreformed healthcare system and unhealthy lifestyles contribute to a
population decline; domestic and foreign investment is low; inflation hovers around 12%-14%;
and crime, corruption, capital flight, and unemployment remain high. Some economic growth
may occur in 2010.
Russia’s military has been in turmoil after years of severe force reductions and budget cuts. The
armed forces now number about 1.0 million, down from 4.3 million Soviet troops in 1986.
Readiness, training, morale, and discipline have suffered. Russia’s economic revival in the 2000s
allowed it to substantially increase defense spending, and some high-profile activities were
resumed, such as Mediterranean and Atlantic naval deployments and strategic bomber patrols.
Stepped-up efforts were launched in late 2007 to further downsize the armed forces and
emphasize rapid reaction and contract forces. The global economic downturn and strong
opposition among some in the armed forces appear to have slowed force modernization.
After the Soviet Union’s collapse, the United States sought a cooperative relationship with
Moscow and supplied $17 billion in aid for Russia from FY1992-FY2010 to encourage
democracy and market reforms and prevent the acquisition of nuclear, radiological, or
biochemical materials by terrorist groups or nations for use in weapons of mass destruction
(WMD). U.S. aid to reduce the threat posed by WMD proliferation has hovered around $700-
$900 million per fiscal year, while other foreign aid to Russia has dwindled. Despite rising U.S.-
Russia tensions in recent years on issues such as NATO enlargement and proposed U.S. missile
defenses in Eastern Europe, the two countries found some common ground on anti-terrorism and
non-proliferation issues; Russia’s 2008 conflict with Georgia threatened such cooperation. The
Obama Administration has been endeavoring to “reset” relations with Russia, which welcomed
the Obama Administration’s announcement in September 2009 of the cancellation of the planned
deployment of missile defenses in Eastern Europe. The Administration has hailed the signing of a
new Strategic Arms Reduction Treaty on April 8, 2010, and the approval of new sanctions against
Iran by Russia and other members of the U.N. Security Council on June 9 , 2010, as signifying
the “reset” of bilateral relations.
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Russian Political, Economic, and Security Issues and U.S. Interests
Contents
Recent Developments.................................................................................................................. 1
Post-Soviet Russia and Its Significance for the United States....................................................... 1
Political and Human Rights Developments.................................................................................. 2
Background .......................................................................................................................... 2
The Putin-Medvedev Era....................................................................................................... 3
The Impasse of Political Pluralism ........................................................................................ 5
Human Rights Problems........................................................................................................ 8
Insurgency in the North Caucasus ......................................................................................... 9
Defense Reforms................................................................................................................. 11
Trade, Economic, and Energy Issues ......................................................................................... 15
Russia and the Global Economic Crisis ............................................................................... 15
Russia’s Accession to the World Trade Organization (WTO) and PNTR for Russia.............. 15
Intellectual Property Rights (IPR) Enforcement in Russia and Agricultural Trade
Issues......................................................................................................................... 16
Russian Energy Policy ........................................................................................................ 18
Foreign Policy........................................................................................................................... 20
Russia and the West ............................................................................................................ 20
NATO-Russia Relations ................................................................................................ 21
The European Union and Russia ................................................................................... 24
Russia and the Soviet Successor States ................................................................................ 26
U.S.-Russia Relations ............................................................................................................... 28
The Obama Administration “Re-sets” Bilateral Relations .................................................... 29
Bilateral Relations and Iran ................................................................................................. 31
Bilateral Relations and Afghanistan..................................................................................... 34
Arms Control Issues............................................................................................................ 36
Cooperative Threat Reduction ....................................................................................... 37
Russia and Missile Defense........................................................................................... 38
U.S.-Russia Economic Ties ................................................................................................. 44
U.S. Assistance to Russia .................................................................................................... 45
Tables
Table 1. U.S. Merchandise Trade with Russia, 1992-2008 ......................................................... 44
Table 2. U.S. Government Funds Budgeted for Assistance to Russia, FY1992-FY2008 ............. 47
Table 3. Assistance to Russia, FY2009-FY2010, and the FY2011 Request ................................. 48
Contacts
Author Contact Information ...................................................................................................... 48
Acknowledgments .................................................................................................................... 48
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Recent Developments
The United States announced the arrest of 11 Russian spies on June 28, 2010, just days after the
visit of Russian President Dmitriy Medvedev to the United States (one spy was outside the United
States and apparently escaped). Some of the spies had been paired as couples by the Russian
Foreign Intelligence Service. The spies had lived in several U.S. metropolitan areas for up to 10
years or longer. They were arrested on charges that included money-laundering and not
registering as foreign agents. An FBI investigation against the “deep cover” agents reportedly had
been ongoing for several years. The timing of the arrests reportedly was determined by suspicions
of one of the agents that her cover had been blown. The 10 agents were swapped in Vienna,
Austria, on July 9 for four Russian citizens whom Moscow had alleged were U.S. or British spies.
Some U.S. observers suggested that the focus of the 10 Russian agents on seemingly public
information gathering was a reflection of the paranoia and myopia of Russia’s political leaders.1
The Russian Foreign Ministry protested the State Department’s coverage of Russia in its
Advancing Democracy and Human Rights report (released in May 2010) as violating the intent of
the U.S.-Russian “reset” of relations to engage in “constructive criticism and recommendations
on the basis of mutual respect for each other’s positions.” The State Department reported that
Russian authorities “fear that democracy will cause instability,” and place restrictions on some
civil society groups and media or even harass them. The State Department also stressed that
“political activism [in Russia] remains relatively low,” and that “public demand for government
accountability is generally weak, although … there are some modest, detectable changes for the
better.” The Foreign Ministry countered that Russia is open to discussions but not “moral
admonitions and guidance as to how we should build real democracy.” The ministry criticized
U.S. aid to civil society groups as mentioned in the report as “verging on interference in internal
affairs”; disputed a characterization that the Civil Society Working Group of the U.S.-Russia
Presidential Commission “monitors” Russian compliance with democracy standards; and raised
hopes that the United States would take to heart the findings of an upcoming U.N. review of
human rights conditions in the United States.
Post-Soviet Russia and Its Significance for the
United States
Although Russia may not be as central to U.S. interests as was the Soviet Union, cooperation
between the two is essential in many areas. Russia remains a nuclear superpower. It still has a
major impact on U.S. national security interests in Europe, the Middle East, and Asia. Russia has
an important role in the future of arms control, the nonproliferation of weapons of mass
destruction, and the fight against terrorism. Such issues as the war on terrorism, the future of
NATO, and the U.S. role in the world are affected by developments in Russia.
Russia is a potentially important trading partner. Russia is the only country in the world with
more natural resources than the United States, including vast oil and gas reserves. It is the world’s
second-largest producer and exporter of oil (after Saudi Arabia) and the world’s largest producer
1 Financial Times (London), July 1, 2010.
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and exporter of natural gas. It has a large, well-educated labor force and a huge scientific
establishment. Also, many of Russia’s needs—food and food processing, oil and gas extraction
technology, computers, communications, transportation, and investment capital—are in areas in
which the United States is highly competitive, although bilateral trade remains relatively low.
Political and Human Rights Developments
Background
Russia is a multinational, multi-ethnic state with
Russia: Basic Facts
over 100 nationalities and a complex federal
Area and Population: Land area is 6.6 million sq.
structure inherited from the Soviet period that
mi., about 1.8 times the size of the United States. The
includes regions, republics, territories, and other
population is 139.4 million (World Factbook, mid-
2010 est.). Administrative subdivisions include 46
subunits. During Boris Yeltsin’s presidency, many
regions, 21 republics, 9 territories, and 7 others.
of the republics and regions won greater
autonomy. Only the Chechen Republic, however,
Ethnicity: Russian 79.8%; Tatar 3.8%; Ukrainian 2%;
Bashkir 1.2%; Chuvash 1.1%; other 12.1% (2002
tried to assert complete independence. During his
census).
term, President Putin reversed this trend and
rebuilt the strength of the central government vis-
Gross Domestic Product: $2.1 trillion; per capita
GDP is about $15,200 (World Factbook, 2009 est.,
à-vis the regions. In future decades, the percentage
purchasing power parity).
of ethnic Russians is expected to decline because
Political Leaders: President: Dmitriy Medvedev;
of relatively greater birthrates among non-Russian
Prime Minister: Vladimir Putin; Speaker of the State
groups and in-migration by non-Russians. Out-
Duma: Boris Gryzlov; Speaker of the Senate: Sergey
migration of ethnic Russians from many republics
Mironov; Foreign Minister: Sergey Lavrov; Defense
and autonomous regions may result in the titular
Minister: Anatoliy Serdukov.
nationalities becoming the majority populations.
Biography: Medvedev, born in 1965, received a
Implications may include changes in domestic and
doctorate in law from Leningrad (now St. Petersburg)
foreign policies under the influence of previously
State University in 1990. In 1991-1996, he worked
marginalized ethnic groups and federal devolution
with Vladimir Putin as an advisor to the mayor of
Leningrad. In late 1999, he became deputy head of
or even rising separatism.
Putin’s presidential administration, and in October
2003, chief of staff. From 2000-2008, he also was vice
The Russian Constitution combines elements of
chairman or chairman of the board of Gazprom. In
the U.S., French, and German systems, but with an
November 2005, he became first deputy prime
even stronger presidency. Among its more
minister and was elected President in March 2008.
distinctive features are the ease with which the
president can dissolve the parliament and call for new elections and the obstacles preventing
parliament from dismissing the government in a vote of no confidence. The president, with
parliament’s approval, appoints a prime minister who heads the government. The president and
prime minister appoint government ministers and other officials. The prime minister and
government are accountable to the president rather than the legislature. In November 2008,
constitutional amendments extended the presidential term to six years and the term of Duma
deputies from four to five years.
The bicameral legislature is called the Federal Assembly. The State Duma, the lower (and more
powerful) chamber, has 450 seats. In previous elections, half the seats were chosen from single-
member constituencies and half from national party lists, with proportional representation and a
minimum 5% threshold for party representation. In May 2005, a law was passed that all 450
Duma seats be filled by party list election, with a 7% threshold for party representation. In the
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December 2007 legislative election, the pro-Kremlin United Russia Party won 315 seats, more
than the two-thirds majority required to amend the constitution. The upper chamber, the
Federation Council, has 166 seats, two from each of the 83 regions and republics of the Russian
Federation. Deputies are appointed by the regional chief executive and the regional legislature.
The judiciary is the least developed of the three branches. Some of the Soviet-era structure and
practices are still in place. Criminal code reform was completed in 2001. Trial by jury was
planned to expand to cover most cases, but recently was restricted following instances where state
prosecutors lost high-profile cases. The Supreme Court is the highest appellate body. The
Constitutional Court rules on the legality and constitutionality of governmental acts and on
disputes between branches of government or federative entities. Federal judges, who serve
lifetime terms, are appointed by the president and must be approved by the Federation Council.
The courts are widely perceived to be subject to political manipulation and control.
The Putin-Medvedev Era
Former President Boris Yeltsin’s surprise resignation (December 31, 1999) propelled then-Prime
Minister Vladimir Putin into the Kremlin first as acting president, then as president in March
2000. Putin’s meteoric rise in popularity was due to his being presented on state-owned TV and
other mass media as a youthful, vigorous, sober, and plain-talking leader; and to his aggressive
launch of military action against the breakaway Chechnya region. Putin was a Soviet KGB
foreign intelligence officer for 16 years and later headed Russia’s Federal Security Service (the
domestic component of the former KGB). His priorities as president were strengthening the
central government and restoring Russia’s status as a great power.
Under Putin, the government took nearly total control of nation-wide broadcast media, shutting
down or effectively nationalizing independent television and radio stations. In 2006, the Russian
government forced most Russian radio stations to stop broadcasting programs prepared by the
U.S.-funded Voice of America (VOA) and Radio Liberty (RL). Journalists critical of the
government have been imprisoned, attacked, and in some cases killed with impunity.
A defining political and economic event of the Putin era was the October 2003 arrest of Mikhail
Khodorkovski, CEO of Yukos, then the world’s fourth-largest oil company. Khodorkovski’s arrest
was triggered by his criticism of some of Putin’s actions, his financing of anti-Putin political
parties, and his hints that he might enter politics in the future. Khodorkovski’s arrest was seen by
many as politically motivated, aimed at eliminating a political enemy and making an example of
him to other Russian tycoons. In May 2005, Khodorkovski was found guilty on multiple criminal
charges of tax evasion and fraud and sentenced to eight years in prison. A new trial on charges of
embezzlement, theft, and money-laundering could extend his imprisonment.2 Yukos was broken
up and its principal assets sold off to satisfy alleged tax debts. Since then, the government has re-
nationalized or otherwise brought under its control a number of other large enterprises that it
2 S.Res. 189, introduced by Senator Roger Wicker on June 18, 2009, and a similar bill, H.Res. 588, introduced by
Representative James McGovern on June 26, 2009, express the sense of the chamber that the prosecution of
Khodorkovski is politically motivated, calls for the new charges against him to be dropped, and urges that he be
paroled as a sign that Russia is moving toward upholding democratic principles and human rights. See also Senator
Roger Wicker, “International Due Process Rights,” Congressional Record, June 21, 2010, p. S5179. President Obama
also has raised concerns about Khodorkovski. The White House. Office Of The Press Secretary. Transcript of
President Obama’s Interview with Novaya Gazeta, July 6, 2009.
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views as “strategic assets.” These include ship, aircraft, and auto manufacturing, as well as other
raw material extraction activities. At the same time, the Kremlin has installed senior officials to
head these enterprises. This phenomenon of political elites taking the helm of many of Russia’s
leading economic enterprises has led some observers to conclude that “those who rule Russia,
own Russia.”
In September 2004, a terrorist attack on a primary school in the town of Beslan, North Ossetia,
resulted in hundreds of civilian casualties. President Putin seized the opportunity provided by the
crisis to propose a number of political changes he claimed were essential to quash terrorism. In
actuality, the changes marked the consolidation of his centralized control over the political system
and the vitiation of fragile democratic reforms of the 1980s and 1990s, according to many
observers. The changes included abolishing the popular elections of regional governors (replacing
such elections with the appointment of presidential nominees that are confirmed by regional
legislatures) and mandating that all Duma Deputies be elected on the basis of national party lists,
based on the proportion of votes each party gets nationwide. The first measure made regional
governors wholly dependent on, and subservient to, the president. The second measure eliminated
independent deputies, further strengthening the pro-presidential parties that already controlled an
absolute majority in the Duma. In early 2006, President Putin signed a new law regulating non-
government organizations (NGOs), which Kremlin critics charged has given the government
leverage to shut down NGOs that it views as politically troublesome (see also “Error! Reference
source not found.”).
The Kremlin decided to make the December 2, 2007, State Duma election a display of Putin’s
popularity. Despite Putin’s apparently genuine popular appeal, his backers used myriad official
and unofficial levers of power and influence to ensure an overwhelming victory for United
Russia, the main Kremlin party. Putin’s October 2007 announcement that he would run for a
Duma seat at the head of the United Russia ticket made the outcome doubly sure. Russian
authorities effectively prevented the Organization for Security and Cooperation in Europe
(OSCE) from sending an observer team by delaying the issuance of visas until the last minute,
thus blocking normal monitoring of the election campaign. United Russia won 64.3% of the
popular vote and 315 of the 450 seats—more than the two-thirds majority required to amend the
constitution. Two other pro-Putin political parties won 78 seats, giving the Kremlin the potential
support of 393 of the 450 Duma members. The only opposition party in the Duma is the
Communist Party, which won 57 seats.3
Barely a week after the Duma election, Putin announced that his protégé Dmitry Medvedev was
his choice for president. Medvedev announced that, if elected, he would ask Putin to serve as
prime minister. This carefully choreographed arrangement presumably was meant to ensure
political continuity for Putin and those around him. The Putin regime manipulated election laws
and regulations to block “inconvenient” candidates for the prospective March 2, 2008,
presidential election from getting onto the ballot. Medvedev easily won against three candidates,
garnering 70% of the vote. Television news coverage was skewed overwhelmingly in Medvedev’s
favor. As with the Duma election, the OSCE refused to submit to restrictions demanded by
Moscow and did not send electoral observers.4
3 See CRS Report RS22770, Russia’s December 2007 Legislative Election: Outcome and Implications, by Jim Nichol.
4 RFE/RL, Newsline, February 5, 20, 2008.
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There has been considerable speculation about power-sharing between President Medvedev and
Prime Minister Putin. The dual power arrangement between the two leaders has been viewed by
some observers as inherently unstable, although so far it has appeared that the “tandem” has
worked. Tensions in their relationship have appeared, reflected by conflicts between their
respective supporters, including over how to remedy the severe domestic impact of the global
economic downturn. Possible succession scenarios include Medvedev stepping down after his
first term as president or even resigning just short of the end of his first term. In either case, Putin
would be eligible to run, since he would not have served more than two consecutive terms.
Medvedev has suggested that he and Putin would not both run as candidates.5
The Impasse of Political Pluralism
In late 2008, President Medvedev proposed a number of political changes that were subsequently
enacted or otherwise put into place. Observers regarded some of the changes as progressive and
others as regressive. These included constitutional changes extending the presidential term to six
years and State Duma deputies’ terms to five years, giving small political parties more rights (see
below), requiring annual government reports to the State Duma, permitting regional authorities to
dismiss mayors, reducing the number of signatures for a party to participate in elections, reducing
the number of members necessary in order for parties to register, and abolishing the payment of a
bond in lieu of signatures for participation in elections.
Possibly a positive development, in February 2009 Medvedev revived a moribund “Presidential
Council to Promote the Development of Civil Society Institutions and Human Rights,” including
by replacing several pro-government members with prominent oppositionists. He met with the
Council in April 2009, at which criticism of the human rights situation in Russia included that
NGOs were being harmed by the 2006 NGO law. In response to the criticism, in mid-May 2009
Medvedev established a Working Group on Nonprofit Organization Law to consider amendments
to the NGO law. On June 17, 2009, Medvedev submitted amendments proposed by the Council to
the legislature, and they were approved and signed into law on July 20, 2009. Changes included
easing some reporting requirements and limiting the ability of bureaucrats to inspect NGO
facilities. Restrictions on foreign-based NGOs were only slightly eased, however. Some critics
viewed the approved amendments as mainly cosmetic.6.
Perhaps a sign of a future broadening of political accountability, the Federal Assembly approved a
Medvedev proposal in April 2009 for political parties that get between 5%-7% of the vote in
future Duma elections (presently, a party must get 7% or more of the vote to gain seats) to win
one or two seats. Subsequently, Medvedev suggested that the 7% hurdle might be lowered. In
June 2009, Medvedev met with unrepresented party leaders for discussions on how the
government might improve the environment in which the parties operate, such as making media
access more available. He also called for regional authorities to ensure that small parties are
freely able to participate in local elections.
In May 2009, Medvedev submitted legislative amendments to laws on the Constitutional Court
and on a probationary period for judicial appointments that were quickly approved. The changes
to the selection of the Chairman and two other officials of the Constitutional Court—to have the
5 The ISCIP Analyst, November 12, 2009.
6 Michael Allen, “Obama Trip Prompts Token NGO Reform, but Kremlin Incapable of Real Change,” Democracy
Digest, July 6, 2009.
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president effectively select these officials rather than to have the members of the court elect
them—were widely viewed as democratically regressive. Alternatively, the proposal to eliminate
a probationary period for newly appointed judges was viewed as progressive, since it eliminated
an executive branch method of removing non-compliant judges. Zorkin appeared to strongly
oppose the change in the court’s election process, although his reasons may have dealt with
preserving the prerogatives of the members of the court and with preserving existing procedures.
This latter conservative stance may also have been evidenced by an article he wrote in December
2009, which extolled the benefits of authoritarian state order and condemned chaotic
democratization and imposed modernization. The article may have constituted open criticism of
Medvedev.7
Genri Reznik, president of the Moscow Bar Association and member of the Public Chamber,
argued in May 2009 that the presidential selection process for judges was a “mockery of justice,”
since the process was largely based on political rather than professional criteria, and that “the
situation has become much worse in terms of judges’ independence” from political pressure.8 In
August 2009, President Medvedev called for further limiting jury trials (he had signed a law at
the end of 2008 limiting jury trials in terrorist or extremist cases) that involve “criminal
communities,” which some legal experts and civil rights advocates criticized as an effort to
further squelch unwanted acquittals by juries.
President Medvedev authored an article in September 2009 that pledged that Russian democracy
would be developed slowly so as not to imperil social stability and that “foreign grants” would
not be permitted to influence the development of civil society (these views seemed to echo those
of Central Asia’s authoritarian leaders). He pointed to such changes as political party participation
in the Duma (mentioned above) as marking progress in democratization, but also admitted that
“we have only just embarked” on creating a judicial system free of corruption that is capable of
protecting citizens’ rights and freedoms.9 A few days later, Russian Duma Speaker Boris Gryzlov
(who is, along with Putin, the top leader of United Russia) published an article that praised former
President Putin’s abolition of popular gubernatorial elections as strengthening central government
administration. He also asserted that the abolition of the elections did not harm democratization,
and praised Medvedev’s proposal to “perfect” the process by having the dominant local political
party propose gubernatorial candidates to the president. Gryzlov hailed Medvedev’s statement
that Russia would democratize at its own pace and in its own way.”10
On October 11, 2009, mayoral and other local elections took place in most of Russia’s regions.
Candidates from the ruling United Russia Party won overwhelmingly. Alleged irregularities in
many races led the three minority parties represented in the State Duma—the Communist Party,
Liberal Democratic Party, and Just Russia—to temporarily walk out as a sign of protest. President
Medvedev also criticized the elections, but was careful to blame “some regional representatives
of both United Russia and other parties” of turning elections into administrative exercises. He
stated that “we must simply get rid of these people and at the same time these bad political habits
as well.”11
7 Open Source Center. Central Eurasia: Daily Report (hereafter CEDR), December 15, 2009, Doc. No. CEP-46009.
8 CEDR, May 6, 2009, Doc. No. CEP-4003.
9 CEDR, September 10, 2009, Doc. No. CEP-378001.
10 CEDR, September 14, 2009, Doc. No. CEP-23005.
11 The Kremlin. President of Russia. Speech at 11th United Russia Party Congress, November 21, 2009, at
http://eng.kremlin.ru/speeches/2009/11/21/1823_type84779.
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In the state of the nation address to the Russian Federal Assembly on November 11, 2009,
President Medvedev deplored the economic downturn in Russia and proposed a program of
technological modernization. He also appeared to criticize the top-down administrative
authoritarianism implemented by Putin and the “prejudice and nostalgia” of current foreign
policy. He called for 10 political reforms—such as standardizing the ratio of deputies to the
voting populations of the regions, using the internet to disseminate legislative debates and
campaign information, and eliminating the gathering of signatures by parties in order to qualify to
run in elections—that were viewed by some critics as useful but minor. He stated that a session of
the State Council (a conclave of governors) would be held in January 2010 to consider these and
other suggestions from political parties on how to modernize the political system. A few days
later, however, the congress of the United Russia Party approved a “conservative ideology” that
appeared at variance with Medvedev’s call for modernization. Gryzlov then published an article
that proclaimed that conservatism and modernization were compatible, since Medvedev was
advocating incremental rather than revolutionary change that would fulfill Putin’s 2020
development goals and maintain “traditional Russian values.”12
Medvedev convened another meeting of the Presidential Council on Civil Society in November
2009, where he proposed state assistance to NGOs that do charity work. He appeared to reject
criticism of the courts by some attendees, stating that the prestige of the courts should be
enhanced rather than attacked. He also expressed disbelief when told that only 0.04% of criminal
court cases result in acquittal, but pledged to examine the issue. Some human rights activists
praised the meeting as bringing problems to the attention of the president that otherwise would
have been suppressed by bureaucrats.
In June 2010, the Working Group on Nonprofit Organization Law (mentioned above) reportedly
discussed further possible amendments to the NGO law, including the easing of restrictions on
foreign NGO activities in Russia. One Russian analyst suggested that the discussion of possible
amendments was timed to take place just before President Medvedev’s visit to the United States,
where civil society might be a topic of summitry. He also suggested that government restrictions
on foreign NGOs seem less necessary now than earlier, since Russia appears less vulnerable to an
“orange revolution.” Also in June 2010, the Presidential Council to Promote the Development of
Civil Society Institutions and Human Rights sent a legal analysis to President Medvedev in
opposition to a bill that criminalizes disobeying an employee of the Federal Security Service
(FSB) or hindering him in the performance of official duties. The bill also permitted the FSB to
issue warnings to individuals or groups whose actions it felt might jeopardize national security,
even if the actions are not crimes. The Council warned that “this kind of return to the worst and
unlawful practices of a totalitarian state - with the aim of sowing fear and distrust in people -
cannot be perceived by society as anything other that legitimizing the suppression of civil
liberties and dissent.”13
Assessing the balance of Medvedev’s political changes, Freedom House, a non-governmental
organization, has concluded that they mark the deepening of Russian political authoritarianism
over the past year. Political stability is increasingly ensured through repression, including
assassinations of media and civil society personnel. Elections too are increasingly controlled by
the authorities, so that more and more Russian citizens decline to vote. The judiciary remains
subject to political pressure, and media faces ongoing restrictions on coverage. Neither Putin nor
12 CEDR, December 1, 2009, Doc. No. CEP-49009.
13 CEDR, June 22, 2010, Doc. No CEP-4005; June 24, 2010, Doc. No. CEP-950171.
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Medvedev have ruled out running in a presidential election scheduled for 2012, so the current
authoritarian system may continue for some time, Freedom House warns.14
Human Rights Problems
According to the State Department’s Country Reports on Human Rights Practices for 2009, there
were numerous Russian government human rights problems and abuses during the year. Law
enforcement personnel reportedly sometimes used torture to coerce confessions from suspects.
Judges and defense attorneys remained subject to pressure from the executive, military, and
security forces, particularly in politically sensitive cases, according to a Council of Europe report.
In some cases, Russia’s Office of the Human Rights Ombudsman assisted persons whom it
considered to have been treated improperly by the courts, and judges occasionally rejected
confessions obtained without a lawyer present. In December, two Constitutional Court judges
resigned in protest over what they considered violations of judicial independence. The
government increasingly restricted freedom of speech, particularly with regard to sensitive issues
such as the conflict in Chechnya, human rights, corruption, coverage of opposition candidates in
local elections, and economic problems. The government used direct ownership or other means to
control or influence all six national television stations and a majority of regional media. Beating
and intimidation of journalists remained a problem. Eight journalists were killed during the year.
The libel law was increasingly applied against some NGOs and individuals, and officials
continued to accuse NGOs that received foreign funding of disloyalty. Local authorities
increasingly restricted freedom of assembly, and police sometimes used force to disrupt peaceful
protests. Some regional and local authorities prosecuted members of the political opposition and
restricted the freedom of worship of some religious groups. The government’s poor human rights
record in the North Caucasus worsened. In Chechnya, Ingushetia, and Dagestan, the number of
extrajudicial killings and disappearances increased markedly, as did the number of insurgent
attacks against police. Several human rights activists were killed by unknown persons.15
On January 22, 2010, President Dmitry Medvedev convened a meeting of the advisory State
Council (a conclave composed of regional governors) to discuss electoral and legislative reform
proposals he and various political parties had proposed. Strong criticisms about political
developments in Russia by the Communist Party and other opposition parties were televised
nationwide. A report by a State Council commission on the parties’ suggestions basically praised
the current political system (the report had been edited by Vladislav Surkov, first deputy chief of
staff of the presidential administration). Medvedev defended Russia’s electoral system as
basically democratic, stating that allegations that recent local elections were not free and fair had
not been proven in the courts. Some observers speculated that Prime Minister Vladimir Putin’s
appearance at the meeting indicated that there would little progress in political reforms.
The Working Group on Civil Society, part of the U.S.-Russia Bilateral Presidential Commission
held its first U.S. meeting on January 27, 2010. As per agreement, the working group is composed
of government officials and some representatives of non-governmental organizations. The
officials and NGO representatives met in separate sessions, and then the two groups compared
notes. The topics of discussion included corruption, protecting children, and national
stereotyping. Some Members of Congress had called in December 2009 for the Administration to
14 Robert Orttung, “Russia,” Nations In Transit 2010, Freedom House, June 29, 2010.
15 U.S. Department of State. Country Reports on Human Rights Practices for 2009, March 11, 2010.
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boycott the meetings until Russia changed its head of the group.16 The second meeting of the
Working Group took place in Vladimir, Russia, in May 2010, where the participation of civil
society groups in monitoring prison conditions and integrating refugees and immigrants into
society was discussed.
In June 2010, the Duma passed on first reading (introduced) amendments to the Law on the FSB
that permitted the FSB to issue a warning to a person or group “on the impermissibility of actions
that would comprise grounds and create conditions for the commission of crimes.” Another
amendment would introduce a fine by the FSB for “disobeying the legal instruction or directive
of an FSB official.” Prime Minister Putin admitted that he authored the bill. Human Rights
Ombudsman Vladimir Lukin denounced the bill before its first reading, stating that it “violates
the integrity and unity of the Russian Federation’s legal system,” and could transform the FSB
into “a monster of the Beria type.”17 The bill elicited widespread public criticism, so that it was
slightly altered in its second reading on July 9, 2010 (considered the main vote, with a third
reading being the final vote). However, it still retained language permitting the FSB to issue
warnings. Fines for disobeying the FSB are to be issued by courts. Critics raised concerns that
major rationales for the language included further restricting the ability of individuals or groups
to hold demonstrations and of media to operate freely.18 Another bill, passed by the Duma on first
reading on July 9, 2010, would forbid individuals, groups, and political parties with misdemeanor
convictions from organizing rallies. Critics viewed the bill as further restricting public
demonstrations, particularly by disfavored groups.19
Insurgency in the North Caucasus
Some observers have argued that Russia’s efforts to suppress the separatist movement in its
Chechnya region have been the most violent in Europe in recent years in terms of ongoing
military and civilian casualties and human rights abuses.20 In late 1999, Russia’s then-Premier
Putin ordered military, police, and security forces to enter the breakaway Chechnya region. By
early 2000, these forces occupied most of the region. High levels of fighting continued for several
more years and resulted in thousands of Russian and Chechen casualties and hundreds of
thousands of displaced persons. In 2005, then-Chechen rebel leader Abdul-Khalim Saydullayev
decreed the formation of a Caucasus Front against Russia among Islamic believers in the North
Caucasus, in an attempt to widen Chechnya’s conflict with Russia. After his death, his successor,
Doku Umarov, declared continuing jihad to establish an Islamic fundamentalist Caucasus Emirate
in the North Caucasus and beyond.
Russia’s pacification policy has involved setting up a pro-Moscow regional government and
transferring more and more local security duties to this government. An important factor in
Russia’s seeming success in Chechnya has been reliance on pro-Moscow Chechen clans affiliated
with regional President Ramzan Kadyrov. Police and paramilitary forces under his authority
allegedly have committed flagrant abuses of human rights.
16 “Interview: McFaul on U.S., Russian Stereotypes and His Controversial Co-Chair, RFE/RL, January 28, 2010.
17 CEDR, June 14, 2010, Doc. No. CEP-546001.
18 CEDR, July 7, 2010, Doc. No. CEP-8004; July 7, 2010, Doc. No. CEP-8022.
19 Alexey Eremenko, “Duma Cracks Down on Freedom of Assembly,” Moscow Times, July 12, 2010.
20 For background information, see CRS Report RL32272, Bringing Peace to Chechnya? Assessments and
Implications, by Jim Nichol.
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The Center for Strategic and International Studies, a U.S. think tank, has estimated that armed
violence in the North Caucasus—which had ebbed markedly after the mid-2000s with the killing,
capture, or surrender of leading Chechen insurgents—started to increase in early 2007 and was at
an even higher level in 2009.21 Among prominent recent incidents, Dagestani Internal Affairs
Minister Adilgerey Magomedtagirov was killed in June 2009, and the president of Ingushetia,
Maj. Gen. Yunus-bek Yevkurov, was severely wounded by a bomb blast later that month. In July
2009, prominent human rights advocate Natalia Estemirova was abducted in Chechnya and, after
passing through police checkpoints, was found murdered in Ingushetia. In August 2009, Zarema
Sadulayeva and Alik Dzhabrailov, who ran a child rehabilitation center in Chechnya, were
murdered.
After a suicide truck bombing in Ingushetia killed 21 policemen and wounded 150 civilians in
August 2009, President Medvedev fired the republic’s Interior Minister. At a meeting of the
Security Council in Stavropol, Medvedev admitted that “some time ago, I had an impression that
the situation in the Caucasus had improved. Unfortunately, the latest events proved that this was
not so.” He reportedly urged legal and judicial changes that would reduce procedural rights and
streamline the prosecution of “bandits.” At a joint news conference with visiting German
Chancellor Angela Merkel in Sochi, President Medvedev asserted that the murders of human
rights workers and officials in the North Caucasus were carried out by enemies of Russia
financed and supported from abroad.22
Indicating a new widening of the conflict beyond the North Caucasus, the Nevskiy Express
passenger train was bombed outside of Moscow on November 27, 2009, killing over two dozen
civilians and injuring over 100. Some of the victims were Russian officials. The same train had
been bombed in 2007, allegedly by Pavel Kosolapov (an associate of Umarov and the late
Chechen terrorist Shamil Basayev). Russian media termed the Nevskiy Express bombing the
worst terrorist act outside of the North Caucasian region since the August 2004 bombing of two
airliners that had taken off from Moscow, killing 89. On December 2, Umarov allegedly took
responsibility for ordering the Nevskiy Express bombing and warned that “acts of sabotage will
continue for as long as those occupying the Caucasus do not stop their policy of killing ordinary
Muslims.”23 In mid-February 2010, Umarov stated that “Russians do not understand that the war
today is coming to their streets, the war is coming to their homes, the war is coming to their
cities.... The zone of combat actions will be expanded, God willing, to include the whole of
Russian territory.” He stated that a majlis al-shura—composed of rebel leaders from Chechnya,
Dagestan, Ingushetia, Kabardino-Balkaria, and Karachay-Cherkessia—had been formed to
coordinate future operations, and proclaimed that “the final goal is establishing shariah law in the
Caucasus, the independence of the Caucasus, [and] independent Islam in the Caucasus.”24
On March 29, 2010, suicide bombings in Moscow’s subway killed 39 people and wounded
dozens. Prime Minister Vladimir Putin condemned the attack and pledged that law enforcement
21 Center for Strategic and International Studies, Violence In The North Caucasus: Trends Since 2004, 2008; Violence
in the North Caucasus: Summer 2009, 2009. See also PACE. Situation in the North Caucasus Region: Security and
Human Rights, Second Information Report, September 29, 2009.
22 President of the Russian Federation. Russian president addresses Security Council meeting on Caucasus, June 10,
2009, at http://www.kremlin.ru; CEDR, August 14, 2009, Doc. No. CEP-950185; and August 25, 2009, Doc. No. CEP-
546006. See also CRS Report RL34613, Stability in Russia’s Chechnya and Other Regions of the North Caucasus:
Recent Developments, by Jim Nichol.
23 Reuters, December 2, 2009.
24 CEDR, February 16, 2010, Doc. No. CEP-950085.
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personnel would “track down the organizers of the crime [and] scrape them from sewer bottoms
and bring them into God’s light of day.” Another suicide bombing in Russia’s North Caucasus
region of Dagestan two days later claimed 12 lives. Putin suggested that the bombings in Moscow
and Dagestan were linked and that both were “crimes against Russia.” President Dmitry
Medvedev vowed to “eliminate the terrorists” responsible for the bombings, to strengthen
security forces in the North Caucasus, and to continue to carry out “pinpoint strikes” there to
destroy terrorists “and their shelters.” He also stressed that “resolving social and economic
problems is in many respects the key to bringing about change in the situation [in the North
Caucasus republics]. Apart from the security side of things, we also need to work on this, work
with the people, work with communities and offer them better conditions for life.”25 Umarov took
responsibility for the Moscow bombings and stated that they were revenge for an attack by
Russian security forces on the village of Arshty in Chechnya on February 11. President Obama
condemned the “outrageous” bombings in Moscow and classed them with other “violent
extremism and heinous terrorist attacks that demonstrate ... disregard for human life.”26 Many
observers suggested that the bombings were further evidence that Moscow’s ongoing security
operations in the North Caucasus—which have resulted in many human rights abuses—as well as
its efforts to boost the regional economy have not yet ameliorated instability there.
At May 2010 meeting of the Council for Civil Society Institutions and Human Rights, President
Medvedev argued that there needed to be a youth policy for the North Caucasus, including to
ameliorate the 20% unemployment in the region, which heavily impacted youth. He also
requested his presidential staff to study the issues of dwindling schooling and healthcare in the
region. He dismissed calls to investigate past extrajudicial killings and urged focusing on the
future. He also objected to discussants distinguishing between a region and Russia, stating that
“Dagestan is part of Russia,” and rejected use of the term “guerillas” instead of “terrorists.” He
called for forging a new “Russian identity” in the region that would reduce inter-ethnic conflict,
and implored North Caucasian ethnic groups to stop being extra “touchy” and “sensitive” about
the actions of governors he appoints.27
On June 23, 2010, Secretary of State Clinton designated Caucasus Emirates leader Doku Umarov
as a terrorist under Presidential Executive Order 13224, which targets terrorists and those
providing support to terrorists or acts of terrorism, to help stem the flow of financial and other
assistance to Umarov. In the Congress, H.Res. 1315 (Hastings), introduced on April 29, 2010, had
called on the Secretary of State to designate the Caucasus Emirate as a foreign terrorist
organization.
Defense Reforms
Despite the sizeable reduction in the size of the armed forces since the Soviet period—from 4.3
million troops in 1986 to 1.0 million at present—the Russian military remains formidable in some
25 Open Source Center. Central Eurasia: Daily Report (hereafter CEDR), March 30, 2010, Doc. No. CEP-950185;
April 1, 2010, Doc. No. CEP-950200; The Kremlin. President of Russia. Opening Remarks at Meeting with Security
Council Members, March 31, 2010; Voice of America, April 1, 2010.
26 The White House. Office of the Press Secretary. Statement by the President on the Bombings on the Moscow Metro,
March 29, 2010.
27 The Kremlin. Speech at Meeting of Council for Civil Society Institutions and Human Rights, May 20, 2010; ITAR-
TASS, May 20, 2010.
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respects and is by far the largest in the region. Because of the deteriorating capabilities of its
conventional forces, however, Russia relies increasingly on nuclear forces to maintain its status as
a major power. There is sharp debate within the Russian armed forces about priorities between
conventional versus strategic forces and among operations, readiness, and procurement. Russia is
trying to increase security cooperation with the other Soviet successor states that belong to the
Commonwealth of Independent States (CIS).28 Russia has military facilities on the territory of all
the CIS states (even in Azerbaijan, there is a Russian military contingent at a radar site).
Attempting to resist, Georgia, Moldova, and Azerbaijan (and until recently, Ukraine) shifted their
security policies toward a more western, pro-NATO orientation. The passage of legislation in
October 2009 providing for the Federation Council to authorize the use of troops abroad to
protect its “peacekeepers” and citizens, and to combat piracy at sea appears to underline that
Russia might use military force to reinforce the “lesson” that small countries adjacent to Russia
may disregard Moscow’s interests and warnings only at their peril.
The improvement of Russia’s economy since 1999, fueled in large part by the cash inflow from
sharply rising world oil and gas prices, enabled Russia to reverse the budgetary starvation of the
military during the 1990s. Defense spending increased substantially in most of the 2000s, and
even continued to increase slightly after the global financial crisis of 2008 impacted Russia’s
economy. The 2010 defense budget was $39.6 billion, up slightly from $38.9 billion in 2009 and
$33.7 billion in 2008.29 Even factoring in purchasing power parity, Russian defense spending still
lags far behind current U.S. or former Soviet levels. The efficacy of the larger defense budgets is
reduced, however, by systemic corruption. Some high-profile military activities have been
resumed, such as large-scale multi-national military exercises, show-the-flag naval deployments
to the Mediterranean and the Atlantic, and strategic long-range bomber patrols that approach U.S.
and NATO airspace.
In February 2007, then-President Putin appointed Anatoly Serdyukov as defense minister. With a
career outside the military establishment, many observers suggest that Serdyukov was chosen to
carry out a transformation of the armed forces from a mobilization model—large divisions only
partially staffed and dependent upon the mobilization of reserves during emergencies—to
permanently staffed smaller brigades. Problems of force composition, training, command and
control, equipment, and doctrine were highlighted during the August 2008 Russia-Georgia
conflict. According to the British International Institute for Strategic Studies, the poorly executed
Russian invasion of Georgia “increased doubt that the military could be seen as a reliable
instrument to support Russian foreign- and security policy objectives, and also reinforced the
perception that the armed forces could not in the future guarantee reliable conventional defense
capabilities.”30
Partly in response, a reform plan entitled “The Future Outlook of the Russian Federation Armed
Forces and Priorities for its Creation for the period of 2009–2020” was launched in October 2008
that called for accelerating planned cuts in the officer corps, so that the 355,000-strong officer
corps would be reduced to 150,000 within three years. Also, the plan called for abolishing the
non-commissioned officers’ ranks of warrant officer and midshipman in the Russian Army and
Navy. The bulk of these 140,000 NCOs would retire and 78,000 professional sergeants would be
28 Members include Armenia, Azerbaijan, Belarus, Moldova, Russia, Kazakhstan, Kyrgyzstan, Tajikistan, Ukraine, and
Uzbekistan. Georgia withdrew following the August 2008 Russia-Georgia conflict.
29 “Russia,” The Military Balance, International Institute for Strategic Studies, February 3, 2010, p. 219.
30 The Military Balance, p. 211.
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trained. Among other changes, the number of personnel at the Defense Ministry and General Staff
would be cut and the number of higher military schools would be reduced. Also, the four-tier
command system of military districts, armies, divisions, and regiments would be altered to a
three-tier system of military districts, tactical commands, and brigades. The total size of the
armed forces would be reduced from 1.2 million to under 1 million.
During 2009, the brigade system for ground forces was set up and other reforms were carried out.
Russian Airborne Troops, however, rejected abolishing divisions. On March 5, 2010, President
Medvedev claimed that the armed forces re-organization had been completed and that personnel
had been successfully reduced to 1 million. He stated that improving the combat readiness of
combined-arms forces in their new organizational and staffing structure would be the focus in
2010, as well as the development of a 10-year plan for weapons modernization.
Contrary to Medvedev’s assessment, some reports suggested that many or most of the new
brigades were not adequately supplied with weapons and that warrant officers and midshipmen
continued to serve. Similarly, Gen. Makarov stated in February 2010 that the transition to
professional (contract) soldiers had largely failed—less than 20% of armed forces personnel were
contractees—and that conscription would increase. Critics argued that the sums paid to
contractees were far below adequate wages, so that the quality and number of contractees had
remained low. Critics also alleged that large sums in the 2004-2007 defense budgets for
transitioning to contracts had been pilfered.31 The armed forces now face a crisis in finding
enough young men to conscript for a one-year term of service given a sharp decline in births in
past years and unhealthy living conditions. Alternatives include reducing the armed forces below
1 million or increasing the length of service. A program covering the period up until 2015 calls
for units and formations to be staffed with conscripts (privates) and professionals or contract
servicemen (noncoms). The first training center for noncoms was established in Ryazan. Some
elite branches of the military, like Airborne Troops, are planned to be staffed solely with
professionals.
Also contrary to Medvedev’s assertion that reorganization was complete, in July 2010 Makarov
announced that military districts would be abolished and the West, East, South and Central
unified commands would be set up by the end of 2010. In July 2010, President Medvedev
appointed two new deputy defense ministers with an aim of allaying corruption in defense
acquisitions, according to some observers.
Weapons modernization has included the development of the RS-24 strategic nuclear ballistic
missile with multiple independently targetable re-entry vehicles (MIRVs), which reportedly may
begin to be deployed in 2010 or later. However, substantial modernization is contingent on
rebuilding the largely obsolete defense industrial complex. Some observers have argued that
Russia is seeking as a partial alternative purchasing some advanced military weapons and
technology from abroad, such as a contract for twelve unmanned aerial vehicles (UAVs) from
Israel Aerospace Industries (to be delivered in 2010) and a contract with France’s Thales for the
licensed production in Russia in 2010 of thermal imaging systems for T-90 tanks.
In 2009-2010, Russia negotiated with France over the purchase of a newly designed French
amphibious assault warship, called the Mistral. French President Nicolas Sarkozy declared that
the ship would be sold without armaments, while Russian General Nikolai Makarov, Chief of the
31 CEDR, June 24, 2010, Doc. No. CEP-358007.
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General Staff, asserted that a sale was contingent on the inclusion of command and navigation
systems and weapons.32 Some Members of Congress raised concerns with France over the Mistral
negotiations. H.Res. 982 (Ros-Lehtinen), introduced on December 16, 2009, called on the
President and the Secretaries of State and Defense to urge France, other NATO member states,
and the European Union not to sell offensive military arms to Russia until it has: withdrawn its
troops from Georgia and revoked its recognition of Georgia’s breakaway regions; withdrawn its
military forces from the Transnistrian region of Moldova; halted sales of materials usable in the
construction of weapons of mass destruction to state sponsors of terrorism; and made progress in
respecting the rule of law and human rights. On July 5, 2010, Russian media reported that Russia
and France had agreed that France would provide the complete set of navigational equipment and
technical documentation, but that Russia would equip the ships with its own weaponry and
helicopters.33
Force reductions and lagging weapons modernization have increased the Russian government’s
emphasis on its strategic nuclear forces. A new Russian military doctrine released in February
2010 declares that nuclear weapons may be used in local and regional conflicts with non-nuclear
powers. Some observers view this language as lowering the threshold of use, but this issue
remains opaque, since details are provided only in a classified follow-on to the doctrine termed
“Principles of National Nuclear Deterrence Policy to 2020.”34
At the July 2009 U.S.-Russia Summit, the two sides agreed to the resumption of military-to-
military activities, which had been suspended since the August 2008 Russia-Georgia conflict. The
two sides agreed in their work plan to conduct nearly 20 exchanges and operational events before
the end of 2009, and to plan a more ambitious work plan for 2010. The two sides also agreed to
renew the activities of the Joint Commission on POW/MIAs and the four working groups that
seek to account for personnel from World War II, the Korean War, the Vietnam War, and the Cold
War, including Soviet military personnel unaccounted for in Afghanistan. The Commission’s
work had been disrupted since 2004, when Russia downgraded the status of its representatives
and failed to appoint a co-chair in the face of cooling U.S.-Russia relations. As of April 2010, the
Russian side reportedly had not yet designated officials to serve on the commission. In testimony
in March 2010, Admiral James Stavridis, the commander of the U.S. European Command, stated
that there were U.S.-Russia military-to-military discussions on a number of issues, that exchanges
were being explored, and that the two countries were cooperating in anti-piracy efforts off the
Horn of Africa.35
32“Arms Trade,” Moscow Defense Brief, No. 1, 2010; Agence France Presse, March 25, 2010.
33 “Russia Set to Buy Mistral with Transfer of French Technologies,” RIA-Novosti, July 5, 2010.
34 CEDR, January 5, 2010, Doc. No. CEP-358002; December 15, 2009, Doc. No. CEP-677001; The ISCIP Analyst,
October 29, 2009.
35 U.S. Department of Defense. U.S.-Russia Joint Commission on POW/MIAs, at http://www.dtic.mil/dpmo/
sovietunion/jcsd.htm; Bill Gertz, “Inside the Ring,” Washington Times, July 9, 2009; U.S. House of Representatives.
Committee on Armed Services. Hearing on the FY 2011 Budget Requests for the U.S. European Command (EUCOM),
the U.S. Africa Command (AFRICOM) and the U.S. Joint Forces Command (JFCOM), March 10, 2010.
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Trade, Economic, and Energy Issues
Russia and the Global Economic Crisis36
As is the case with most of the world’s economies, the Russian economy has been hit hard by the
global financial crisis and resulting recession. However, even before the financial crisis, Russia
was showing signs of economic problems when world oil prices plummeted sharply around the
middle of 2008, diminishing a critical source of Russian export revenues and government
funding. World oil prices have since increased.
The financial crisis brought an abrupt end to about a decade of impressive Russian economic
growth that helped raise the Russian standard of living and brought economic stability that Russia
had not experienced for more than two decades. Russia had experienced strong economic growth
over the past 10 years (1999-2008), during which time its GDP increased 6.9% on average per
year in contrast to an average annual decline in GDP of 6.8% during the previous seven years
(1992-1998).
In 2008 and into 2009, Russia faced a triple threat with the financial crisis coinciding with a rapid
decline in the price of oil and the costs of the country’s military confrontation with Georgia.
These events exposed three fundamental weaknesses in the Russian economy: substantial
dependence on oil and gas sales for export revenues and government revenues, a rise in foreign
and domestic investor concerns, and a weak banking system. The economic downturn showed up
in Russia’s performance indicators. Although Russia’s real GDP increased 5.6% in 2008 as a
whole, it declined 7.9% in 2009. Russia is expected to show GDP growth in 2010.37 The Russian
government has implemented a number of stimulus programs to boost economic growth.
Oil, natural gas, and other fuels account for about 65% of Russia’s export revenues. In addition,
the Russian government is dependent on taxes on oil and gas sales for more than half of its
revenues. Oil prices have been very volatile in the last two years which have affected the Russian
economy. As of July 2, 2010, the price of a barrel of Urals-32 (the Russian benchmark price) oil
was $74.46 and has remained around that price since mid-February 2010. The price is a 45.9%
drop from its July 4, 2008, peak of $137.61 but a 118.9% rise from its January 2, 2009, low point
of $34.02. Oil price volatility challenges Russian fiscal policy. The drop in oil prices forced the
government to incur a budget deficit in 2009 estimated to be around 7% of GDP; however, the
rise in oil prices during the later months of 2009 prevented the deficit from being even higher.38
Russia’s Accession to the World Trade Organization (WTO) and
PNTR for Russia
Russia first applied to join the General Agreement on Tariffs and Trade (GATT—now the World
Trade Organization [WTO]) in 1993. For many years, Russia’s accession process seemed to move
slowly, but in the last few years, Russia had accomplished some critical steps, including the
36 Prepared by William H. Cooper, Specialist in International Trade and Finance.
37 Economist Intelligence Unit.
38 Economist Intelligence Unit. Country Report—Russia. January 2010.
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completion of bilateral agreements with the European Union (EU), the United States, and most of
the other WTO members that sought such agreements. At the beginning of 2009, Russia was in
the process of completing negotiations with a WTO working party (WP), which includes
representatives from about 60 WTO members, including the United States and the EU.
Throughout this process, WP members have raised concerns about Russia’s intellectual property
rights enforcement policies and practices, sanitary and phytosanitary (SPS) regulations that may
be unnecessarily blocking imports of agricultural products, and Russia’s demand for large
subsidies for its agricultural sector, among other issues.
However, in what has been largely considered a stunning announcement, Prime Minister Putin
stated on June 9, 2009, that Russia would be abandoning its application to join the WTO as a
single entity, a customs union with Belarus and Kazakhstan. It is not clear at this time why
Russia’s leaders had decided to change substantially the country’s application status. Belarus and
Kazakhstan have also applied to join the WTO, but Belarus was not as far along as Russia. The
customs union went into effect in January 2010. The three countries decided to pursue accession
separately but with common proposed tariff schedules.
On June 24, 2010, during their meeting Washington, President Obama and President Medvedev
pledged to resolve the remaining issues regarding Russia’s accession to the WTO by September
30. These issues include the operation of Russian state-owned enterprises, intellectual property
rights protection, and licensing of imports containing encryption technology. The United States
also pledged to provide technical assistance to Russia to speed up the process of Russia’s
accession taking into account its customs union with Belarus and Kazakhstan.
The WTO requires that each member grant to all other members “unconditional” most-favored-
nation (MFN), or permanent normal trade relations status (PNTR). Not granting PNTR usually
requires a WTO member to invoke, upon accession of a new member, a provision of the WTO
that makes WTO rules inapplicable in their bilateral trade relationship.
NTR is used to denote nondiscriminatory treatment of a trading partner compared to that of other
countries. Russia’s NTR status is governed by Title IV of the Trade Act of 1974, which includes
the so-called Jackson-Vanik amendment (section 402). Under Title IV, Russia currently receives
NTR on the condition that the President continues to determine that Russia complies with
freedom-of-emigration criteria under section 402 subject to a semiannual review and to a
congressional resolution of disapproval. In order for Russia to receive unconditional or
“permanent” NTR (PNTR), Congress would have to pass and the President would have to sign
legislation indicating that Title IV no longer applies to Russia. To date, no such legislation has
been introduced in the 111th Congress. Russian leaders consider the absence of PNTR an affront
and Jackson-Vanik a relic of the Cold War that should no longer apply to U.S.-Russian trade
relations, especially since such still ostensibly communist countries as China and Vietnam have
PNTR.
Intellectual Property Rights (IPR) Enforcement in Russia and Agricultural
Trade Issues
The apparent lack of adequate intellectual property rights protection in Russia has tainted the
business climate in Russia for U.S. investors for some time. The Office of the United States Trade
Representative (USTR) consistently identifies Russia in its Special 301 Report as a “priority
watch list” country, as it did in its latest April 30, 2010, report. This report cites industry estimates
that online piracy and other copyright infringements cost U.S. intellectual property owners more
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than $2.8 billion in losses in 2008. While the USTR report acknowledges some improvement in
IPR protection, it also finds that implementation of laws has been slow and enforcement weak. In
particular, the report cites the failure of Russia to fulfill its commitments to improve IPR
protection made as part of the 2006 bilateral agreement that was reached as part of Russia’s WTO
accession process.39
Russia’s treatment of imports of U.S. meats—poultry, pork and beef—is one of the most sensitive
issues in U.S.-Russian trade relations. In the early post-Soviet years, Russia’s agricultural sector,
particularly meat production, was not very competitive, and domestic producers were not able to
fulfill Russia’s expanding demand for meat, especially as the rise of Russian incomes led to a rise
in demand for meat in the Russian diet. U.S. producers, especially of poultry, became major
sources of meat to the Russian market, and Russia became an important market for U.S. exports
of meat. For example, in 2009, Russia was the largest market for U.S. poultry meat exports,
accounting for 20% of total U.S. exports of poultry meat, but has also been an important market
for U.S. exports of beef and pork.40
Russia restricts imports of meats and poultry under tariff–rate quotas (TRQs) largely to support
its fledgling domestic producers.41 At times, Russia has imposed sanitary and phytosanitary
requirements (SPS), ostensibly for health and safety reasons, on poultry and meat products that
have at times limited U.S. exports further.
On January 1, 2010, the Russian government implemented new regulations on imports of poultry,
claiming that the chlorine wash that U.S. poultry producers use in the preparation of chickens
violates Russian standards and is unsafe. These regulations effectively halted U.S. exports of
poultry to Russia. The United States claimed that the wash is effective and safe and that Russian
restrictions are not scientifically based. U.S. and Russian officials conducted discussions to
resolve the issue. At their June 24 press conference, President Obama and President Medvedev
announced that the dispute over poultry trade had been resolved and that U.S. shipments of
poultry to Russia would resume.42
At the end of 2009, Russia imposed restrictions on imports of U.S. pork because of what the
Russian government considered to be excessive amounts of antibiotics in the meat. Russia wants
the United States to establish procedures to certify that the pork meets Russian standards before it
is shipped, essentially establishing separate inspection procedures for shipments to Russia. U.S.
pork suppliers claim that such special procedures would raise their production costs.43 In March
2010 Russia allowed pork imports from some U.S. plants to resume. 44
39 Office of the United States Trade Representative. Special 301 Report. April 30, 2009. p. 16.
40 World Trade Atlas..
41 Under TRQs, products are imported up to a set volume at one tariff rate and at a much higher (sometimes
prohibitive) rate above that volume.
42 For more information on issues pertaining to U.S. exports of meat to Russia, see CRS Report RS22948, U.S.-Russia
Meat and Poultry Trade Issues, by Renée Johnson.
43 Inside U.S. Trade, January 8, 2010.
44 International Trade Reporter. April 1, 2010.
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Russian Energy Policy45
The Russian oil and natural gas industries are important players in the global energy market,
particularly in Europe and Eurasia. Russia has by far the largest natural gas reserves in the world,
possessing over 30% of the world’s total. It is eighth in the world in oil reserves, with at least
10% of the global total. Firms in these industries are either directly controlled by the Russian
government or are subject to heavy Russian government influence. The personal and political
fortunes of Russia’s leaders are tied to the energy firms, as Russia’s economic revival in the
Putin/Medvedev era has been due in large part to the massive revenues generated by energy
exports, mainly to Europe.
Some Members of Congress, U.S. officials, and European leaders (particularly those in central
and eastern Europe) have claimed that European dependence on Russian energy and Russia’s
growing influence in large segments of Europe’s energy infrastructure poses a long-term threat to
transatlantic relations. Analysts have noted that Russia itself views its natural resources as a
political tool. Russia’s “National Security Strategy to 2020,” released in May 2009, states that
“the resource potential of Russia” is one of the factors that has “expanded the possibilities of the
Russian Federation to strengthen its influence on the world arena.”46
Concerns about Russian energy policy have centered largely on Russia’s natural gas supplies to
Europe. In early January 2009, the state-controlled Russian natural gas firm Gazprom halted all
gas supplies transiting Ukraine after the two sides failed to reach agreement on several issues,
including a debt allegedly owed by Ukraine to Gazprom and the price that Ukraine would pay for
gas supplies for 2009. About 80% of Europe’s natural gas imports from Russia transit Ukrainian
pipelines. An increasingly angry EU threatened to reevaluate its whole relationship with the two
countries unless the impasse was resolved. Finally, Russia and Ukraine reached an agreement,
and gas supplies to Europe resumed on January 20. A similar Russian-Ukrainian dispute led to
another gas cut off to Europe at the beginning of 2006. In January 2010, Russia temporarily
slowed down its oil shipments to Belarus in a dispute over prices. Russia’s Druzhba pipeline
transits Belarus (and a southern branch transits Ukraine) to supply oil to Germany, Poland,
Hungary, Slovakia, and the Czech Republic. About 10% of Europe’s oil supplies are delivered
through the pipeline. The crisis was resolved in July 2010. In June 2010, a dispute arose over a
Belarusian debt for gas to Gazprom and over Belarusian demands for increased gas transit
payments. Gazprom reduced gas supplies to Belarus, which in turn led to a supply reduction to
neighboring Lithuania. The standoff was resolved in July 2010. These incidents have provided
further evidence of Russia’s unreliability as an energy supplier, according to some observers.
Concerns about the reliability of gas supplies and transit have caused Russia and some European
countries to propose new pipeline projects. Gazprom has started work on the North European Gas
Pipeline (NEGP, often referred to as Nord Stream) which would transport natural gas from Russia
to Germany via a pipeline under the Baltic Sea, bypassing pipelines running through the states of
central and eastern Europe. Nord Stream will have a planned capacity of 55 billion cubic meters
(bcm) per year, as compared to the Ukrainian pipeline system’s 120-130 bcm per year. After
delays due to environmental concerns by Sweden, Finland, and Denmark, through whose waters
the pipeline would pass, Nord Stream is working on the underwater segments of the pipeline,
45 Prepared by Steven Woehrel, Specialist in European Affairs.
46 The text of the National Security Strategy can be found at the website of the Russian National Security Council at
http://www.scrf.gov.ru/documents/99.html
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with hopes that the first supplies from the pipeline will flow in late 2011, with full capacity
reached in 2012.
Another pipeline project favored by Moscow is South Stream. In November 2007, Gazprom and
the Italian firm ENI signed an agreement to build South Stream, which would run from Russia
under the Black Sea to Bulgaria, with branches to Austria, Italy, and Greece. Serbia and Hungary
have also signed on to the project. Russia plans to start construction of South Stream in 2013, and
begin deliveries in 2015.. Like Nord Stream, South Stream would bypass Belarus, Ukraine,
Poland, and other central European countries. In May 2009, Russia and Italy announced that the
pipeline would have a capacity of 63 bcm per year.
Those concerned about the possible consequences of overdependence on Russia for energy have
called for the building of pipelines circumventing Russian territory that would transport non-
Russian gas supplies to Europe. In May 2009, the EU held a summit in Prague with leading
transit and supplier nations in the South Caucasus and Central Asia. The summit agreed to
expedite the creation of the Nabucco pipeline, which could have a capacity of 31 bcm per year. It
would get its supplies from Azerbaijan and perhaps Turkmenistan through pipelines in Georgia
and Turkey. Nabucco received a further boost on July 13, 2009, when Austria, Hungary, Romania,
Bulgaria, and Turkey signed an intergovernmental agreement on the project. It is hoped that work
on the pipeline could begin in 2011, with the first gas supplies available by 2014 and full capacity
reached in 2019.
While denying that Nabucco and South Stream are conflicting projects, Russian officials have
cast doubt on Nabucco’s prospects, claiming that the gas supplies for such a pipeline may be
difficult to find. Russia has attempted to buy up gas supplies in Azerbaijan and Turkmenistan, in
what some analysts view as an attempt to undermine Nabucco. In order to build political support
for South Stream, Russia has tried to entice key western European companies to participate in the
project. It has also discussed the possibility of changing the route for the pipeline in order to play
potential transit countries off against each other.
Russia has long sought a controlling stake in Ukraine’s pipeline system. Ukrainian President
Viktor Yanukovych, elected in February 2010, has expressed concern about the impact of South
Stream on transit volumes through its pipeline system. He has offered Russia partial ownership of
the Ukrainian pipeline system in exchange for a share in natural gas fields in Russia and
guaranteed transit volumes through Ukraine’s pipelines. Ukraine has also proposed a joint venture
with Russia and the EU in building a new pipeline through Ukraine that would eliminate the need
for South Stream. So far Russia has not accepted these proposals.
In addition to possible competition from Europe for Central Asian energy supplies, Russia also
faces a challenge from other countries. A pipeline from Turkmenistan to China opened in late
2009, delivering 30 bcm of gas per year. Turkmenistan has also expanded its gas pipeline capacity
to Iran, which is expected to reach 20 bcm eventually. Other factors could diminish Russia’s
leverage over Eurasian natural gas supplies. The development of previously difficult-to-develop
“unconventional” gas deposits in Europe and elsewhere could diversify supplies and keep prices
down. The growth of the spot market for natural gas and the development of liquefied natural gas
infrastructure in Europe could also help diversify supplies as well as reduce dependence on
Russian-controlled pipelines.
Like the Bush Administration, the Obama Administration has promoted the diversification of
natural gas supplies and pipelines to Europe, including the building of pipelines from Central
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Asia and the Caspian region that bypass Russia, chief among them Nabucco. However, the
Obama Administration has been less critical of Nord Stream and South Stream than the previous
Administration. Part of the change in tone may be due to the effort to “reset” ties with Russia that
were frayed during the Bush years. Ambassador Richard Morningstar, the State Department
Special Envoy for Eurasian Energy, has denied that the United States and Russia are involved in a
“great game”—that is, a geopolitical struggle—for Central Asian energy supplies. Morningstar
has said that the United States does not oppose Nord Stream and South Stream; that the United
States does not see Nabucco as being in competition with South Stream; and that it was possible
that Russia could provide gas for Nabucco.47
Foreign Policy
Russia and the West
After the collapse of the Soviet Union and the turmoil associated with the Yeltsin period, a
consensus emerged as the Putin era began on reestablishing Russia’s global prestige as a “great
power” and its dominance in “the former Soviet space.” The pursuit of these goals by then-
President Putin and his closest policy advisors seemed to be driven by the belief that the West,
and in particular the United States, had taken advantage of Russia’s political turmoil and overall
weakness during the Yeltsin years. Putin and his advisors were determined to restore what they
believed to be Russia’s rightful place as a significant influence on the world stage.
Fueled in part by the massive inflow of petro-dollars, Moscow’s self-confidence grew over the
several years prior to the late 2008 global economic downturn, and officials and observers in
Europe and the United States expressed growing concern about what they viewed as an
increasingly contrarian Russian foreign policy. This was evident in recent years in Russia’s sharp
political struggles with Estonia and Ukraine, its opposition to a planned U.S. missile defense
system in Eastern Europe, the suspension of compliance with the Conventional Armed Forces in
Europe Treaty, and its strong opposition to NATO membership for Ukraine and Georgia.
According to analyst Dmitri Trenin, then-President Putin became greatly alarmed following the
“rose revolution” in Ukraine in 2004-2005 and the “tulip revolution” in Kyrgyzstan later in 2005,
and his attitude toward the United States hardened. Trenin claims that Putin viewed these popular
revolts as “part of a U.S.-conceived and led conspiracy. At minimum, these activities ... aimed at
drastically reducing Russia’s influence.... At worst, they constituted a dress rehearsal for ...
installing a pro-U.S. liberal puppet regime in the Kremlin.”48 In February 2007, at the 43rd annual
Munich Security Conference, President Putin delivered a particularly harsh speech attacking Bush
Administration policies and condemning the “unipolar” world he alleged the United States was
creating.49
47 Morningstar’s testimony before the Senate Foreign Relations Committee hearing “$150 Oil: Instability, Terrorism,
and Economic Disruption, July 16, 2009; State Department Foreign Press Center Briefing, June 23, 2009.
48 Dmitri Trenin, “Russia’s Spheres of Interest, not Influence,” The Washington Quarterly, October 2009.
49 The full text of Vladimir Putin’s speech at the 43rd Munich Conference on Security Policy, February 10, 2007 can be
found at http://www.securityconference.de.
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In contrast to Putin, President Medvedev has been considered by some observers to be a
potentially pragmatic leader who could shift Russia’s attitudes more positively toward the United
States and the West. However, during Medvedev’s first year or so in office, Russia’s relations
with the west became increasingly tense. In the aftermath of the August 2008 Russia-Georgia
conflict, relations between Russia and the West reached what many considered to be their lowest
point since the Cold War. Russia continued to voice strong opposition to NATO enlargement to
Georgia and Ukraine; invaded Georgia and occupied two of its regions; refused to recognize
Kosovo’s independence; cut off or reduced energy supplies in disputes with Ukraine and Belarus;
boosted ties with Cuba and Venezuela; and attempted to end the use of airbases in Central Asia by
the United States and NATO.
Responding in part to the Obama Administration’s efforts to “reset” relations, Russia has
appeared somewhat more conciliatory toward the EU and the United States in recent months. An
alleged Russian Foreign Ministry document leaked to the media in May 2010 called for the
government to adopt a more conciliatory foreign policy toward the West in order to attract foreign
investment. Similarly, Russian analyst Igor Yurgens has argued that the Russian leadership no
longer is concerned that the West seeks to foment “colored revolutions” in Russia, stating that
“there is no danger that someone from the West will want to rock the situation in our country.”50
NATO-Russia Relations51
Post-Cold War efforts to develop a NATO-Russia relationship characterized by partnership and
cooperation have had mixed results, at best. Russian views toward NATO, particularly since the
beginning of the Putin era, have been marked predominantly by suspicion and skepticism
regarding NATO’s intentions. NATO-Russia ties in the mid- to late-1990s suffered largely due to
Russian opposition to NATO plans to enlarge eastward and to NATO and western involvement in
the Balkan wars. Since NATO-Russia relations reached a new low in the wake of Russia’s 2008
invasion of Georgia, both the United States and NATO have renewed efforts to improve ties with
Moscow. Alliance members continue to disagree, however, on the form future relations should
take and on their assessment of Russian intentions. Although Russian officials have welcomed
NATO and U.S. overtures, they remain critical of many aspects of NATO policy.
The principal institutional mechanism for NATO-Russia relations is the NATO-Russia Council
(NRC), established in May 2002. Recognizing that both NATO and Russia faced many of the
same global challenges and shared similar strategic priorities, Russian and NATO leaders
structured the NRC as a “consensus” forum of equals with a goal of “political dialogue, common
approaches, and joint operations.”
The NRC has recorded some achievements since its inception, including a 2004 comprehensive
action plan on terrorism and a 2005 agreement for providing a joint counter-narcotics training
program in Afghanistan. However, most observers agree that the NRC has fallen far short of its
potential due largely to Russian concerns about NATO’s long-term intentions. Many in Russia
viewed NATO’s 1999 and 2004 enlargements to 10 former Soviet satellite states as an affront to
Russian power and prestige and Russian leaders continue to oppose the idea of NATO
50 Owen Matthews and Anna Nemtsova, “The New Putin Profile,” Newsweek, June 12, 2010; CEDR, June 22, 2010,
Doc. No. CEP-4005.
51 Prepared by Paul Belkin, Analyst in European Affairs.
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enlargement to former eastern bloc countries.52 The establishment of U.S. and NATO airbases in
Central Asia after the September 11, 2001 terrorist attacks on the United States for operations in
Afghanistan and a United States decision to establish military facilities, albeit non-permanent, in
Bulgaria and Romania after NATO’s 2004 enlargement were viewed by some in Moscow as
further evidence of an encirclement of Russia by NATO and the United States.
More recently, Russian leaders appear concerned by NATO and U.S. insistence that the alliance
will not recognize a Russian sphere of influence along its borders. Specifically, Moscow has
criticized NATO member states for their refusal to recognize the Russian-encouraged
independence of Abkhazia and South Ossetia and for their reluctance to establish alliance
relations with the Russian-led Collective Security Treaty Organization (CSTO members include
Armenia, Belarus, Kazakhstan, Kyrgyzstan, Tajikistan, and Uzbekistan). In addition, Moscow has
been critical of those who have suggested a more formal role for NATO in European energy
security issues.
Russian reactions to U.S. and NATO policies it opposes have also caused concern within the
alliance and have exposed differences among the allies on how to manage ongoing relations with
Russia. These include Russia’s 2007 decision to suspend compliance with the Treaty on
Conventional Armed Forces in Europe (CFE Treaty), its vocal opposition to proposals to enhance
NATO ties with Georgia and Ukraine and of proposed U.S./NATO missile defense installations in
Europe, and, most significantly, its August 2008 invasion of Georgia. Finally, Russian proposals
for an alternative European security architecture have been viewed by many as an attempt to
undermine NATO and increase Russian influence in European affairs.
In 2007 Russia suspended its compliance with the CFE Treaty, signed in 1990 by 22 members of
NATO and the Warsaw Pact to limit non-nuclear forces in Europe. The CFE agreement was
designed to limit troop and equipment levels; provide for the exchange of data on equipment and
training maneuvers; provide procedures for the destruction of equipment; and permit on-site
inspections to verify treaty compliance. Moscow claimed that NATO countries were taking too
long to begin the ratification of the CFE Treaty. NATO claimed that Russia had failed to live up to
previous commitments to remove its military forces from Georgia and Moldova.
At NATO’s April 2008 summit in Bucharest, then-President Putin strongly urged NATO not to
offer Membership Action Plans (MAPs) to Georgia and Ukraine. Although NATO, after serious
internal debate, decided not to extend MAPs at the summit, Moscow still appeared disappointed
with NATO’s concluding statement that both Georgia and Ukraine would eventually become
members of the alliance. Putin also warned against the deployment of a U.S. missile defense
system in Poland and the Czech Republic. Some Russian officials even suggested that the
decision could make those two countries targets of Russia’s nuclear arsenal.
Tensions between Russia and NATO escalated in the wake of Russia’s August 2008 invasion of
Georgia, after which the two sides suspended formal ties in the NATO-Russia Council. Russia’s
actions sparked a strong debate within the alliance over how Europe should react to what many
considered a new, more aggressive Russian foreign policy intended to re-establish a Russian
sphere of influence along its border with Europe. Some allies argued that NATO’s inability or
unwillingness to prevent Russia from moving to establish a permanent military presence in
52 The Czech Republic, Poland, and Hungary joined the alliance in March 1999; Bulgaria, Estonia, Latvia, Lithuania,
Romania, Slovakia, and Slovenia joined in March 2004.
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Abkhazia and South Ossetia could lead some to question the credibility of the alliance’s core
principle of collective defense, as enshrined in Article 5 of the North Atlantic Treaty. Although
Georgia is not a member of the alliance, they contended that NATO had given the impression that
it could concede to Russian demands in its relations with aspiring alliance members. Several
Central and Eastern European allies also expressed concern about a perceived lack of NATO
contingency planning in response to the possibility of future Russian action against a NATO ally
or partner.
Despite ongoing disagreement within the alliance on how to manage relations with Russia,
ambassadorial-level meetings of the NATO-Russia Council resumed in April 2009. In subsequent
meetings at both the ambassadorial and foreign minister level, Russian and NATO officials have
agreed that the NATO-Russia Council represents the best approach for promoting Euro-Atlantic
security, agreed to restart military cooperation within the NRC, and pledged to enhance
cooperation in training Afghan and Central Asian authorities for counternarcotics operations.
One issue that some NATO allies have been reluctant to discuss in the NRC is a Russian proposal
for an alternative European security architecture, first raised by President Medvedev in June
2008. President Medvedev has argued that the United States, through its membership in NATO,
continues to exercise disproportionate influence in European affairs and that Russia should have a
more formal role in the current European security architecture. While Russian officials claim that
a new security architecture would improve trust among Euro-Atlantic governments and reduce
the risk of internal European conflicts, many in the United States and Europe view the Russian
proposals as attempts to weaken NATO, constrain the OSCE, and stop further encroachment of
these organizations on Russia’s borders. The United States and most European countries maintain
that any dialogue on the future of European security must build upon the existing Euro-Atlantic
institutions. However, Russia’s proposal has highlighted the need for such discussion and
provided some political impetus in the United States and Europe to engage more robustly with
Russia and each other to enhance the Euro-Atlantic security architecture to better meet the
security challenges of the 21st century.
Since assuming his post in August 2009, NATO Secretary General Anders Fogh Rasmussen has
made improved NATO-Russia ties a priority. He has emphasized the two sides’ shared interests
and called for enhanced cooperation on missile defense and counterterrorism, among other
areas.53 Rasmussen’s efforts have generally been welcomed in Moscow. Nonetheless, observers
point out that while limited progress has been made in some areas, disagreement both within the
alliance and between NATO and Russia persists on some core issues. Russia has allowed the
establishment of air and land supply routes for the NATO mission in Afghanistan on its territory
and has agreed to consider bolstering training for Afghan police forces and to providing financial
assistance for reconstruction projects in Afghanistan. Russian helicopters, operated by civilian
crews, have also begun providing transport in Afghanistan. On the other hand, little, if any,
progress has been made on the issue of Georgia’s territorial integrity and NATO membership
prospects, the unratified CFE Treaty, a proposed NATO/U.S. missile defense system (discussed in
detail later in the report), and Russian calls for more influence within the Euro-Atlantic security
architecture.
53 See, for example, “NATO and Russia: A new Beginning,” Speech by NATO Secretary General Anders Fogh
Rasmussen at the Carnegie Endowment, Brussels, September 18, 2009. Available at http://www.nato.int/cps/en/
natolive/opinions_57640.htm.
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Rasmussen’s efforts to enhance NATO-Russia ties appear in line with the Obama
Administration’s stated intention to pursue a path of constructive engagement with Russia. U.S.
officials have emphasized the need to engage Russia in an effort to improve U.S.- and NATO –
Russia cooperation in areas ranging from the NATO mission in Afghanistan and counter-
terrorism, to arms control and non-proliferation and international efforts to curb Iran’s nuclear
program.54 At the same time, NATO and U.S. officials stress that they will continue to oppose
Russian policies that they perceive as conflicting with the core values of the alliance. They say,
for example, that NATO will not recognize a Russian sphere of influence outside its borders and
will continue to reject Russia’s recognition of Georgia’s breakaway regions, Abkhazia and South
Ossetia. There continues to be concern among some NATO allies that Russia has not changed its
fundamental view of NATO as a security threat and that unresolved issues will continue to plague
NATO-Russia relations. Observers and officials in some allied nations – notably Poland and
Lithuania – have expressed concern that NATO’s reengagement with Russia could signal that the
alliance is not serious about standing up to Russian behavior it has deemed unacceptable. In this
vein, they have urged the United States Administration to consider the interests and views of all
NATO allies as it seeks to improve relations with Russia.
The European Union and Russia55
Attitudes and outlooks on Russia differ widely among the 27 member states of the European
Union (EU). The governments of some countries, such as Germany, France, and Italy, are inclined
to an approach based on pragmatism and engagement. They believe that the maintenance of
extensive ties and constructive dialogue is the most effective way to influence Russia. Supporters
of this approach also argue that Russia should be viewed as a strategic partner and observe that
Russian cooperation is important on issues such as energy, Iran, climate change, and arms control.
Countries such as Poland and the Baltic States, on the other hand, tend to view Russia as a
potential threat to themselves and their neighbors. Difficult relations between these countries and
Russia are deeply rooted in the historical experiences of the Soviet domination of Eastern Europe.
As a result of such internal differences, the EU has had difficulty developing coherent and robust
common policies on Russia, and critics note that the EU lacks a comprehensive strategic
approach to its eastern neighbor. The EU was critical of Russia’s actions during the August 2008
conflict with Georgia and continues to object to Russia’s support of Georgia’s breakaway
provinces. The EU has also sought to pressure Russia on governance and human rights issues, but
some analysts argue that the EU’s attempts to influence Russia in such areas have been tempered
and ineffective. The Lisbon Treaty, the EU reform treaty that came into effect in December 2009,
is designed to give the EU new institutional tools with which to develop stronger and more visible
external policies. Nevertheless, the EU Common Foreign and Security Policy (CFSP) remains
based on member state consensus—CFSP tends to be weak or non-existent in areas where such a
consensus is lacking.
In general, Russia has tended to perceive EU enlargement with less hostility and suspicion than
NATO enlargement. Russian officials, however, have expressed displeasure with the EU’s Eastern
Partnership initiative, which seeks to deepen ties with six countries of the former Soviet Union
54 See Remarks by Vice President Biden at the 45th Munich Security Conference, February 7, 2009,
http://www.whitehouse.gov/the_press_office/
RemarksbyVicePresidentBidenat45thMunichConferenceonSecurityPolicy/
55 Prepared by Derek E. Mix, Analyst in European Affairs.
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(Armenia, Azerbaijan, Belarus, Georgia, Moldova, and Ukraine). At the May 2009 EU-Russia
summit, President Medvedev expressed a view that the Eastern Partnership was directed against
Russia.
Relations between the EU and Russia revolve largely around energy and economics. Russia
supplies the EU with more than one-quarter of its total gas and oil supplies, and some EU
member states are almost completely reliant on Russian energy. As discussed above (see “Russian
Energy Policy”), energy dependence and aggressive Russian energy policies contribute to the
tensions felt by some of the countries of central and eastern Europe with regard to Russia. The
EU’s energy dependence on Russia is expected to grow substantially over the next 20 years and
the apparent Russian inclination to use energy supplies as an instrument of foreign policy has
raised concerns about potential vulnerabilities that could arise from this trend. Many officials and
analysts agree on the need for the EU to diversify its energy supply, but the EU has struggled to
formulate a common strategic energy policy. According to some observers, the willingness of
numerous EU member states to conclude bilateral energy deals with Russia has served to
undermine the prospects of developing a stronger common policy.
Russia signed the EU Energy Charter treaty, which sets out market principles for energy
cooperation, in 1994. Russia never ratified the treaty, however, due to an unwillingness to apply
the requirements regarding transparency and foreign investment reciprocity—before terminating
provisional application of the treaty altogether in October 2009, Russia had in effect applied only
those treaty elements it deemed consistent with standing Russian law. EU and Russian officials
have been discussing the conditions under which Russia might agree to return to the treaty
framework.56
To some extent, however, the EU-Russia energy relationship works two ways: while Russia is a
crucial energy supplier for Europe, Europe is also a vital energy market for Russia. In terms of
trade and investment, the EU is an even more important partner for Russia, accounting for more
than half of Russia’s trade and three-quarters of its foreign direct investment (FDI).57 Russia, in
turn, is the EU’s third largest trade partner (behind the United States and China); EU-Russia trade
totaled some $235 billion in 2009.58
The EU and Russia have been negotiating a new framework agreement to replace the EU-Russia
Partnership and Cooperation Agreement (PCA) that came into force in 1997, but which expired at
the end of 2007. Progress has been slowed by contention over Russia’s bid for membership in the
World Trade Organization (WTO) and by EU objections to the continuing presence of Russian
troops in Georgia’s separatist regions. Under the original PCA, the two sides launched efforts to
develop a more open and integrated Common Economic Space (CES) and to establish deeper
cooperation on issues such as rule of law, human rights, research, education, crisis management,
and non-proliferation.59 The EU-Russia Summit held on May 31-June 1, 2010, launched a
56 Energy Charter Secretariat website, , http://www.encharter.org/.
57 European Commission, DG Trade, http://ec.europa.eu/trade/creating-opportunities/bilateral-relations/countries/
russia/index_en.htm.
58 Global Trade Atlas database, EU27 External Trade: All Commodity Chapters.
59 European Commission, DG External Relations, http://ec.europa.eu/external_relations/russia/common_spaces/
index_en.htm.
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“Partnership for Modernization” in which the EU has pledged to help develop and diversify the
Russian economy.60
Russia and the Soviet Successor States61
Russia’s July 2008 Foreign Policy Concept and the May 2009 National Security Strategy hail
cooperation within the CIS as “a priority foreign policy direction.” The latter document proclaims
that the Collective Security Treaty Organization (CSTO; composed of CIS members Armenia,
Belarus, Kazakhstan, Kyrgyzstan, Russia, Tajikistan, and Uzbekistan) is “the main interstate
instrument” to combat regional military threats.62 The February 2010 Military Doctrine states that
the priorities of military-political cooperation are Belarus (formally part of a union with Russia),
the CSTO, and the CIS. Despite Russia’s emphasis on interests in the CIS, there has long been
scant progress toward overall CIS integration. Many CIS summit meetings have ended in failure,
with many of the presidents sharply criticizing lack of progress on common concerns and Russian
attempts at domination.
The CSTO was formed in 2002 with a headquarters in Moscow.63 An airbase at Kant, Kyrgyzstan,
was designated in 2002 to provide support for Central Asian rapid reaction forces, but the base
has housed Russian troops. President Medvedev called in February 2009 for forming a new and
sizeable CSTO rapid reaction force based in Russia, which he claimed would rival NATO.
Uzbekistan raised concerns that the force could be used by Russia to intervene in its internal
affairs, and refused to sign a June 2009 agreement on the formation of the force. Belarus too
balked at signing the agreement until October 2009, and Tajikistan has not ratified the agreement.
Despite the lack of consensus within the CSTO, Russia moved forward unilaterally, assigning the
98th Airborne Division and the 31st Airborne Assault Brigade (reportedly 8,000 troops) to the
force. Although Russia welcomed Belarus as a member of the force in October, the Belarusian
constitution forbids the use of its troops abroad. The rapid reaction force ostensibly is to be used
to repulse military aggression from outside the CSTO, react to natural disasters, and to combat
terrorist groups, trans-national organized crime, and drug traffickers. The force may be used
outside the CSTO at the aegis of the U.N. The decision to use the rapid reaction force is made by
the presidents of the member-states at the request of one or a group of member states. The worth
of the CSTO has been a matter of debate among its members and others, since it has not been
efficacious in protecting borders or halting internal disorder. The CSTO’s worth appeared to be
placed in added question in June 2010 when Russia and other members balked at Kyrgyzstan’s
request for troops to quell inter-ethnic conflict in southern Kyrgyzstan.
Although Belarus is one of Russia’s closest allies, tensions have arisen between the two countries
in recent years, as Russia has tried to reduce the costs of its subsidies to Belarus’s economy and
Belarusian President Aleksandr Lukashenko has refused to do Moscow’s bidding on some issues.
In early June 2009, Russia banned imports of dairy products from Belarus—Russia is the main
60 Council of the European Union, Joint Statement on the Partnership for Modernisation, June 1, 2010,
http://www.consilium.europa.eu/uedocs/cms_data/docs/pressdata/en/er/114747.pdf.
61 Prepared by Jim Nichol, Specialist in Russian and Eurasian Affairs, and Steven Woehrel, Specialist in European
Affairs.
62 The Kremlin. President of Russia. The Foreign Policy Concept of the Russian Federation, July 12, 2008; Russian
Federation Security Council. Russian Federation National Security Strategy Until 2020, May 12, 2009; The Kremlin.
President of Russia. The Military Doctrine of the Russian Federation, February 5, 2010.
63 The Collective Security Treaty was signed in 1992 and renewed in 1999.
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importer—on the grounds that some paperwork had not been completed. In response, Belarusan
President Alexander Lukashenko boycotted a session of the CSTO, even though Belarus was to
chair the session. Lukashenko also asserted in early June 2009 that he had rejected a Russian
demand that Belarus extend diplomatic recognition to Abkhazia and South Ossetia as a condition
for receiving a $500 million loan from Russia, an allegation that Russia denied.64 In early January
2010, Russia temporarily slowed down some oil deliveries to Belarus to pressure it to agree to
increased export duties. In April 2010, Lukashenko granted asylum to ousted Kyrgyz leader
Kurmanbek Bakiyev, drawing Moscow’s ire. In June 2010, another dispute arose over a
Belarusian debt for gas to Gazprom and over Belarusian demands for increased gas transit
payments. Gazprom reduced gas supplies to Belarus and Belarus threatened to cut off gas
supplies to western Europe. The crisis was resolved in July 2010. A July 2010 Russian television
program cast Lukashenko in a highly unflattering light, provoking speculation in Russia and
Belarus that Russian leaders may be warning Lukashenko that they could seek to undermine his
leadership if he continues to annoy them.
Russian forces remain in the Transnistria region of Moldova against the wishes of the Moldovan
government (and in violation of Russia’s commitment under the adapted CFE Treaty to withdraw
the forces), in effect bolstering a neo-Communist, pro-Russian separatist regime in the
Transnistria region of eastern Moldova. The United States and the EU call upon Russia to
withdraw from Moldova. Russian leaders have sought to condition the withdrawal of their troops
on the resolution of Transnistria’s status, which is still manipulated by Moscow. The election of a
pro-Romanian, pro-European integration government in Moldova after July 2009 parliamentary
elections has not led to a significant deterioration in Russian-Moldovan relations. However,
Moldova’s Acting President Mihai Ghimpu issued a decree setting aside June 28 as a day to
commemorate the Soviet occupation of Moldova in 1940. The move provoked sharp criticism
from Moscow, as well as from some of Ghimpu’s government coalition partners who are eager to
maintain good ties with Russia.65
Moscow has used the Armenian-Azerbaijani conflict over Nagorno-Karabakh to pressure both
sides, maintain Armenia as an ally, and otherwise exercise regional influence. Citing instability
and the threatened spread of Islamic extremism on its southern flank as a threat to its security,
Moscow intervened in Tajikistan’s civil war in 1992-1996 against Tajik rebels. Russia’s policy of
trying to exclude U.S. influence from Central Asia as much as possible was temporarily reversed
by President Putin after the September 11, 2001, attacks, but appeared to be back in place after
2005. On July 29, 2005, the Uzbek government directed the United States to cease its operations
at the Karshi-Khanabad (K2) airbase within six months. Tashkent is believed to have acted not
only in response to Russian and Chinese urging but also after the United States criticized the
Uzbek government’s repression in Andijon in May 2005. In February 2009, Kyrgyzstan accepted
a large loan proffered by Russia and simultaneously requested that the United States wind up
operations at the Manas airbase by August 2009. After intense U.S.-Kyrgyz talks, Kyrgyzstan
reversed course in late June 2009 and agreed to permit U.S. and NATO cargoes to transit through
Manas, reportedly angering Putin.66 In the wake of the “reset” in U.S.-Russia relations in 2009-
64 See also CRS Report RL32534, Belarus: Background and U.S. Policy Concerns, by Steven Woehrel.
65 See also CRS Report RS21981, Moldova: Background and U.S. Policy, by Steven Woehrel.
66 For more on Russian policy in these regions, see CRS Report RL33453, Armenia, Azerbaijan, and Georgia: Political
Developments and Implications for U.S. Interests, CRS Report RL33458, Central Asia: Regional Developments and
Implications for U.S. Interests; and CRS Report R40564, Kyrgyzstan and the Status of the U.S. Manas Airbase: Context
and Implications, all by Jim Nichol.
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2010, there appears to again be some cooperation from Russia regarding a U.S. and NATO
military presence in Central Asia to support operations in Afghanistan.
The international community condemned Russia’s military incursion into Georgia in early August
2008 and President Medvedev’s August 26, 2008, decree officially recognizing the independence
of South Ossetia and Abkhazia. Russian officials announced in September 2008 that two army
brigades, each consisting of approximately 3,700 troops, would be deployed to new military bases
in Abkhazia and South Ossetia (the brigades were reduced to a reported 1,700-1,800 troops each
in mid-2009, allegedly because of Russia’s budgetary problems). A part of the Black Sea Fleet
also was deployed to Ochamchire in Abkhazia. The United States and others in the international
community have called for Russia to reverse these deployments and rescind the recognitions of
independence.
During the presidency of Viktor Yushchenko from 2005 until February 2010, Russia’s relations
with Ukraine were often tense due to differences over such issues as the supply of Russian energy
through Ukrainian pipelines (leading to shut-offs of natural gas to Europe in 2006 and 2009),
Russia’s conflict with Georgia in 2008, the status of the Russian Black Sea Fleet in Ukraine’s
Crimea region, and Yushchenko’s advocacy of NATO membership for Ukraine. The victory of the
pro-Russian Viktor Yanukovych in Ukrainian presidential elections in February 2010 has led to a
rapid improvement in Russian-Ukrainian relations. Yanukovych has dropped Yushchenko’s
NATO membership aspirations, saying that the country will remain outside all military blocs.
Russia and Ukraine have agreed to extend the stay of the Russian Black Sea Fleet in Crimea until
2042, from the original withdrawal date of 2017. In exchange, Russia will provide Ukraine with
discounted prices for natural gas supplies for 10 years, a benefit that the two sides estimated as
worth $40 billion. Yanukovych has offered Russia part-ownership of Ukraine’s gas pipeline
system in exchange for guaranteed gas volumes for Ukrainian gas pipelines and access to Russian
gas and oil deposits. Russian firms, with Russian government support, have also reportedly
stepped up efforts to buy key industrial assets in Ukraine since Yanukovych has come to power.
However, some of Russia’s boldest proposals for improving ties with Ukraine appear to have
gone further than Kiev can support. Ukraine has rebuffed Russian suggestions that it join the
CSTO. It has also so far not accepted Russia’s proposal that that it join the customs union with
Russia, Belarus and other former Soviet countries, which would likely conflict with Ukraine’s
WTO membership and its aspirations for free trade with and eventual membership in the
European Union. Ukraine has rejected Russia’s idea to merge Gazprom with Ukraine’s state-
controlled gas firm Naftohaz, which would amount to a Russian takeover of the Ukrainian
company, due to the former’s much larger size.
U.S.-Russia Relations
The spirit of U.S.-Russian “strategic partnership” of the early 1990s was replaced by increasing
tension and mutual recrimination in succeeding years. In the aftermath of the September 11, 2001,
attacks, the two nations reshaped their relationship on the basis of cooperation against terrorism
and Putin’s goal of integrating Russia economically with the West.67 However, tensions soon
increased on a number of issues that contributed to ever-growing discord in U.S.-Russian
67 For the change in Russian policy toward integration with the West and cooperation with the United States, see CRS
Report RL31543, Russian National Security Policy After September 11, by Stuart D. Goldman.
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relations. Cooperation continued in some areas, and then-Presidents Bush and Putin strove to
maintain at least the appearance of cordial personal relations. In the wake of the August 2008
Russia-Georgia conflict, bilateral ties reached their lowest point since the Cold War.
The Obama Administration “Re-sets” Bilateral Relations
The Obama Administration called for starting a dialogue with Russia from a fresh slate. A
February 2009 speech in Munich by Vice President Biden to “re-set” U.S.-Russian relations was
an early sign of the President’s intentions. At their first “get acquainted” meeting on April 1,
2009, in London, Presidents Obama and Medvedev issued two joint statements on opening
nuclear weapons talks and on U.S.-Russia relations.
In their joint statement on U.S.-Russia relations, the two presidents agreed to “deepen cooperation
to combat nuclear terrorism” and to “support international negotiations for a verifiable treaty to
end the production of fissile materials for nuclear weapons.” President Obama confirmed his
commitment to work for U.S. Senate ratification of the Comprehensive Nuclear Test Ban Treaty.
Both sides also pledged to bring into force the bilateral Agreement for Cooperation in the Field of
Peaceful Uses of Nuclear Energy, which former President Bush had withdrawn from
consideration in the U.S. Senate following the August 2008 Russia-Georgia conflict. Russia
agreed to assist the United States and the international community in responding to terrorism and
the insurgency in Afghanistan and Pakistan, and to drug trafficking from Afghanistan. The two
sides called for the continuation of the Six-Party Talks and for the verifiable denuclearization of
the Korean Peninsula. They also pledged to strengthen Euro-Atlantic and European security,
including through the OSCE and NATO-Russia Council.68
Reflective of Russia’s views of the bilateral relationship, its May 2009 National Security Strategy
states that Moscow strives to establish “an equal and full-fledged strategic partnership” with the
United States. The Strategy claims that the two countries have “key” influence in the world and
should work together on arms control, on confidence-building measures, on the nonproliferation
of weapons of mass destruction, on counterterrorism, and on the settlement of regional conflicts.
The Strategy proclaims that Russia will work to maintain parity with the United States in strategic
offensive weapons even if the United States deploys a global missile defense system.69
At the July 2009 summit, President Obama stated that “the relationship between Russia and the
United States has suffered from a sense of drift” in recent years, and that the two presidents had
“resolved to reset U.S.-Russian relations.” He stressed that the United States wanted “to deal as
equals” with Russia, since both countries are nuclear superpowers, and that the United States has
recognized that its role “is not to dictate policy around the world, but to be a partner with other
countries” to solve global problems. Some observers have argued that these statements were
aimed at assuaging Russian sensitivities about the country’s status in the world. Russia’s
hyperbole about its role in the world, these observers have suggested, was evidenced by President
Medvedev’s statement at the summit that the United States and Russia are “powerful states [that]
have special responsibility for everything that is happening on our planet,” and that strengthened
bilateral cooperation “will ensure international peace and security.”
68 The White House. Office of the Press Secretary, Remarks By President Obama and Russian President Medvedev
after Meeting, April 1, 2009.
69 Russian Federation Security Council. Russian Federation National Security Strategy Until 2020, May 12, 2009.
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The two presidents and other officials signed six accords and issued three joint statements (details
on significant decisions and deliberations at the summit are discussed below). According to
Michael McFaul, the Senior Director for Russian and Eurasian Affairs on the National Security
Council, the main topics at the summit were Iran, a major U.S. concern, and missile defense, a
major Russian concern. One achievement of the summit was the establishment of a U.S.-Russia
Bilateral Presidential Commission intended to strengthen consultations and diplomacy. President
Obama highlighted the commission as the “foundation” element in re-setting relations, since it
would greatly expand communications between the two countries. The presidents are the co-
chairs, and the Secretary of State and the Foreign Minister coordinate meetings.
At the July 2009 summit, President Obama stated that one area where the two presidents “agreed
to disagree” was on Georgia. McFaul reported that President Obama stated that the United States
would not recognize South Ossetia and Abkhazia as independent states and also argued that the
Russian idea of a “sphere of influence” in the Soviet successor states does not belong in the 21st
century. The two presidents did agree, however, that “no one has an interest in renewed military
conflict.” They also discussed the Armenia-Azerbaijan conflict over Azerbaijan’s breakaway
Nagorno Karabakh (NK) region, according to McFaul, and agreed to continue cooperative efforts
to resolve the conflict.
Secretary of State Hillary Clinton reported that her visit to Russia on October 12-14, 2009, had
resulted in progress in negotiations to replace the expiring Strategic Arms Reduction Treaty
(START), support for the Global Initiative To Combat Nuclear Terrorism, and cooperation in
Afghanistan. Discussions about Iran’s nuclear proliferation threat revealed ongoing differences,
with Foreign Minister Lavrov stating that tightened sanctions against Iran were premature while
diplomatic efforts were underway to ensure that Iran does not develop nuclear weapons. Meeting
with Russian human rights advocates, Secretary Clinton argued that the United States would
continue to advocate democratization and respect for human rights in Russia.
During her visit, Secretary Clinton and Foreign Minister Lavrov convened the first meeting of the
U.S.-Russia Bilateral Presidential Commission. They agreed to create added working groups on
counterterrorism, the environment, and on military-to-military ties. Several of the co-chairs of
working groups attached to the Commission also met. McFaul, who co-chairs the civil society
working group, reportedly stated that government officials and representatives of non-
governmental groups would meet separately. Some Russian human rights groups criticized their
exclusion from the working group. Ahead of Secretary Clinton’s trip, some co-chair meetings
already had taken place, including the education and culture working group and the anti-narcotics
trafficking working group in Washington, D.C. in late September. At the latter working group
meeting, Russia urged the United States to greatly step up poppy eradication efforts in
Afghanistan.
Meeting on November 15, 2009, on the sidelines of the Asia-Pacific summit in Singapore,
Presidents Obama and Medvedev continued discussions on START and Iran. President Obama
reported that he had again stressed to Medvedev that added international sanctions should be
applied to Iran if it continued to defy its international obligation not to develop nuclear weapons.
In her January 2010 speech on European security, Secretary of State Clinton stated that Russia
had violated a fundamental principle of U.S. and European policy—respect for the sovereignty
and territory of all states—by invading Georgia and by claiming that Georgia’s breakaway
regions are independent. She more broadly criticized efforts to declare a sphere of influence in
Europe, presumably by Russia. Secretary Clinton called for Russia instead to recognize that the
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enlargement of NATO and the European Union benefits it as well as the rest of Europe by
spreading peace and prosperity. She praised President Medvedev’s proposal for broadening
European security, but rejected his call for a new European Security Treaty. Instead, she called for
existing European institutions—the OSCE and the NATO-Russia Council—to examine how to
enhance European security. Such efforts should include revitalizing the Conventional Armed
Forces in Europe Treaty, which Russia had stopped implementing in 2008. She hailed U.S.-
Russia cooperation on such issues as challenging Iran’s nuclear ambitions, stabilizing
Afghanistan, confronting North Korea, negotiating a new Strategic Arms Reduction Treaty, and
tackling pandemic disease, cyber warfare, and the trafficking of children. The United States also
is exploring cooperation with Russia on European missile defense, she averred.70
The Obama Administration’s National Security Strategy, released in May 2010, asserts that the
United States endeavors “to build a stable, substantive, multidimensional relationship with
Russia, based on mutual interests. The United States has an interest in a strong, peaceful, and
prosperous Russia that respects international norms.” The strategy calls for bilateral cooperation
with Russia—termed one of the 21st century centers of influence in the world—in bolstering
global nonproliferation; in confronting violent extremism, especially in Afghanistan; in forging
new trade and investment arrangements; in promoting the rule of law, accountable government,
and universal values within Russia; and in cooperating as a partner in Europe and Asia. At the
same time, the strategy stresses that the United States “will support the sovereignty and territorial
integrity of Russia’s neighbors.”71
President Medvedev visited the United States on June 22-24, 2010, to focus on business and
technology ties between the two countries. In eleven joint statements, the two presidents pledged
further cooperation to achieve stability in Afghanistan, to foster open government, and to
strengthen counter-terrorism cooperation, among other issues. In a joint statement on strategic
stability, they vowed to continue “the development of a new strategic relationship based on
mutual trust, openness, predictability, and cooperation.” President Obama also called for
accelerating efforts with other members of the World Trade Organization (WTO) to complete the
steps necessary for Russian accession to the WTO. He announced that Russia had agreed to
purchase 50 Boeing aircraft, worth $4 billion, and that the two countries had reached an
agreement that would permit U.S. poultry products to again be exported to Russia.72
Bilateral Relations and Iran
Russian perceptions of the Iranian nuclear threat and its policies toward Iran are driven by a
number of different and sometimes competing factors. Russia signed the agreement to build a
nuclear power plant at Bushehr and provide other assistance to an Iranian civilian nuclear
program in January 1995. Although the White House and Congress have argued that Iran will use
the civilian nuclear reactor program as a cover for a clandestine nuclear weapons program, Russia
refused to cancel the project. Moscow maintains that its cooperation with Iran’s civilian nuclear
program is legal, proper, and poses no proliferation threat, arguing that Iran is, after all, a
70 U.S. Department of State. Remarks on the Future of European Security, January 29, 2010.
71 The White House. National Security Strategy, May 2010.
72 The White House. Office of the Press Secretary. U.S.-Russia Joint Statements, June 24, 2010; Remarks by President
Obama and President Medvedev of Russia at Joint Press Conference, June 24, 2010.
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signatory of the Nuclear Non-Proliferation Treaty, and that the light water reactor built by Russia
is not well-suited for producing weapons-grade fissionable material.
Russia agrees with the United States and many other nations that a nuclear-armed Iran would be
destabilizing and undesirable. After Iran’s clandestine program to master the entire nuclear cycle,
including uranium reprocessing, was revealed, Russia took steps to head off this development.
Moscow withheld delivery of nuclear fuel for the Bushehr reactor, pending agreement with
Tehran about return of spent fuel to Russia for reprocessing. Russia joined the United States and
the “EU-3” group (Great Britain, France, and Germany) in approving a series of limited U.N.
Security Council sanctions related to Iran’s nuclear infrastructure, including asset freezes and
trade bans targeting certain Iranian entities and individuals.73 Moscow temporarily withdrew most
of its technicians and scientists from the unfinished Bushehr reactor in 2007. However, Russia
soon resumed construction and shipment of nuclear fuel to Bushehr. Fuel delivery was completed
in January 2008. Russian officials have stated that the reactor may become operational in August
or September of 2010.
In a joint statement issued at their meeting on April 1, 2009, Presidents Obama and Medvedev
“urged Iran to ... address the international community’s concerns” about its civilian nuclear
energy program. They stressed that Iran had pledged as a signatory of the Treaty on the Non-
Proliferation of Nuclear Weapons to retain its status as a state that does not possess nuclear
weapons, and called on Iran to fully cooperate with the International Atomic Energy Agency.
At the July 2009 U.S.-Russia summit, nuclear and missile proliferation by Iran were the dominant
topics, according to McFaul. President Obama warned that “in the Middle East, there is deep
concern about Iran’s pursuit of nuclear weapons capability not simply because of one country
wanting nuclear weapons, but the fact that ... we would then see a nuclear arms race in perhaps
the most volatile part of the world.” Another concern, he stated, was “the possibility that those
nuclear weapons could fall into the hands of non-state actors.” He also stressed that Iran’s
ballistic missile program could also pose a threat to the broader region. President Medvedev did
not mention Iran by name at the summit press conference, but he did admit that some countries
“have aspirations to have nuclear weapons and declare so openly or, which is worse, [build them]
clandestinely.... These are areas where we should concentrate our efforts together with our
American partners.”
On September 21, 2009, Iran informed the IAEA that it had been building a second uranium
enrichment plant near the city of Qom. Many observers raised fears that the disclosure was
further evidence that Iran intended to build nuclear weapons. On September 23, President Obama
reported that a meeting he held with President Medvedev on the sidelines of a U.N. General
Assembly session dealt mostly with Iran. President Medvedev stated that the international “task is
to create ... a system of incentives that would allow Iran to continue its fissile nuclear program,
but at the same time prevent it from obtaining nuclear weapons.”74 In a meeting with concerned
nations on October 1, 2009 (now termed the Sextet, consisting of the United States, United
Kingdom, France, Russia, China, and Germany), Iran agreed to a late October IAEA inspection of
the Qom enrichment site and initially appeared positive toward a plan to export most of its low-
enriched uranium to Russia or France to be further enriched to fuel the Tehran Research Reactor.
73 See CRS Report RL32048, Iran: U.S. Concerns and Policy Responses, by Kenneth Katzman.
74 The White House. Office of the Press Secretary. Remarks by President Obama and President Medvedev of Russia
after Bilateral Meeting, September 23, 2009.
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After inspecting the enrichment plant near Qom, the IAEA concluded that it was in an advanced
stage of completion and that Iran’s efforts to hide it for years heightened IAEA concerns that
other nuclear facilities were being hidden. Russia reportedly mediated with Iran to urge it to
accept the research reactor fuel deal.
On November 15, 2009, after meeting with President Obama in Singapore, President Medvedev
stated that “we are prepared to work further to ensure that Iran’s nuclear program is only for
peaceful purposes. In case we fail, the other options remain on the table.” The next day, Russia
announced that it was further delaying the start-up of the Bushehr reactor, perhaps indicating
some Russian pressure on Iran to accept the research reactor fuel deal.75 On November 18, Iran
rejected the research reactor fuel deal. On November 27, Russia joined other representatives of
the IAEA in censuring Iran for concealing the enrichment plant near Qom. In February 2010, Iran
stated that it would start enriching uranium to 20% to fuel the Tehran Research Reactor.
In early March 2010, President Medvedev stated that Russia might consider cooperating on a
U.N. Security Council resolution that imposed “smart sanctions” on Iran that impacted only Iran’s
nuclear proliferation capabilities and not its population. In announcing the agreement on the new
START on March 26, 2010, Secretary Clinton stressed that it demonstrates “to states like Iran and
North Korea” that one of the top priorities of the United States and Russia is “to strengthen the
global non-proliferation regime and keep nuclear materials out of the wrong hands.”76 Foreign
Minister Lavrov asserted on March 27, 2010, that Russia would only back a new sanctions
resolution that affirmed the non-use of force against Iran.77 According to some observers, Russia
had changed its stance that its cooperation on further U.N. Security Council sanctions on Iran was
contingent on the United States ending plans for missile defenses in Eastern Europe.78
On June 9, 2010, Russia supported the approval of U.N. Security Council Resolution 1929, which
expressed growing international concern with Iran’s lack of compliance with ensuring that its
nuclear program is peaceful and directed an expanded international arms embargo and added
restrictions on commerce dealing with “proliferation-sensitive activities” in Iran. Explaining
Russia’s vote for the resolution, U.N. ambassador Vitaliy Churkin stated that “it has become
inevitable that additional restrictive measures should be adopted to constrain development in
those Iranian activities that run counter to the task of strengthening the non-proliferation
regime.”79
According to the French government, President Putin informed French President Nicholas
Sarkozy on June 11, 2010, that Russia would freeze plans to supply Iran with S-300 surface-to-air
missiles. Russia has appeared to indicate that the sale will remain in abeyance—even if the U.N.
Security Council resolution is not viewed as specifically banning them—as long as Iran defies the
international community regarding its nuclear program.
After CIA revelations about Iran’s possession of highly-enriched uranium, President Medvedev
concurred in July 2010 that “Iran is nearing the possession of the potential which in principle
75 U.S. Fed News, November 16, 2009.
76 U.S. Department of State. Announcement of New START Treaty, March 26, 2010.
77 BBC Worldwide Monitoring, March 27, 2010.
78 Alexander Gabuyev, “Bushehr Nuclear Power Plant Stopped Moscow and Washington,” Defense and Security,
March 22, 2010.
79 United Nations. Security Council. 6335th Meeting, Meeting Record, S/PV.6335, June 9, 2010.
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could be used for the creation of a nuclear weapon.” He also stated that “we should not forget that
Iran’s attitude [toward cooperation with the international community] is not the best one.” Iran’s
Foreign Minister Manouchehr Mottaki reacted that these “comments made by Medvedev
regarding the Iranian nuclear theme are totally false and we deny them… Russia is our neighbor
and we want to maintain good relations but we are critical of some of its positions.”80 Russia’s
backing for the resolution has contributed to tension in its ties with Iran which both states have
attempted at times to smooth over. Russia has in part appeared to try to deflect Iran’s anger by
denouncing added sanctions imposed by the United States and the EU in the wake of the approval
of the U.N. Security Council resolution.
Bilateral Relations and Afghanistan
In a meeting with Afghan President Hamid Karzai in August 2008, Russian President Medvedev
called for “opening a new page in relations” between the two countries, “because, unfortunately,
our countries are coming up against similar threats and problems.” Russia provides some foreign
assistance and investment to Afghanistan, although it has rejected sending military forces. Russia
hosted a Shanghai Cooperation Organization conference on Afghanistan, counter-terrorism, and
counter-narcotics in late March 2009, which was attended by U.S. and NATO observers. The
conference communique praised the efforts of the International Security Assistance Force (ISAF)
in Afghanistan but offered no substantive assistance. At the July 2009 U.S.-Russia summit, a joint
statement on assistance to Afghanistan called for enhancing cooperation within the U.S.-Russia
Counter-Terrorism Working Group (established in 2000); further implementing the Russia-NATO
Council’s counter-narcotics project; supporting Afghanistan-related activities of the OSCE;
increasing training for the Afghan National Army, police, and counter-narcotics personnel; and
greatly increasing cooperation to halt illicit financial flows related to heroin trafficking in
Afghanistan. The two sides also called for enhancing counter-terrorism cooperation between
Afghanistan and Pakistan.
The State Department reported that an agenda-setting meeting of the Counter-Terrorism Working
Group took place in Berlin in November 2009. In January 2010, the director of Russia’s Federal
Drugs Control Service, Viktor Ivanov, raised concerns that of the 28 anti-narcotics policemen
trained under the Russia-NATO cooperation plan, 26 allegedly had been fired by Afghan officials.
The Russian permanent representative to NATO, Dmitry Rogozin, and Moscow Regional
Governor Boris Gromov (the former commander of Soviet forces in Afghanistan) called in
January 2010 for NATO forces not to “withdraw without victory” in Afghanistan. They argued
that Soviet forces had withdrawn in 1989 after ensuring some political stability, and that the
international community had not “thanked” the Soviet Union for its efforts to combat the first
terrorist threat to Europe. They asserted that the “Russian position” is that NATO should ensure
political stability in Afghanistan and claimed that Russia is forming the CSTO’s rapid reaction
forces to protect Central Asia as a hedge against NATO’s failure in Afghanistan. In late March
2010, Rogozin suggested that Russia should link its cooperation as a transit state for supply
shipments to Afghanistan to a NATO pledge to combat drug trafficking into Russia. Seeking to
80 Ministry of Foreign Affairs of the Russian Federation. Speech by Dmitry Medvedev, President of the Russian
Federation, at the Meeting with Russian Ambassadors and Permanent Representatives to International Organizations,
July 13, 2010; Agence Presse France, July 13, 2010.
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elevate its status, the CSTO repeated a call for NATO to formally cooperate with it in order to
stanch drug trafficking from Afghanistan and to defeat the Taliban.81
Alternative Supply Routes to Afghanistan
In late 2008, the United States and NATO stepped up efforts to develop supplemental air and land
routes into Afghanistan because of growing problems in sending supplies through Pakistan. The
incoming Obama Administration also planned increasing the number of troops in Afghanistan,
which also spurred the search for alternate supply routes. A “northern supply network” was
envisaged for transits through Russia or the South Caucasus to Central Asia and then to
Afghanistan. The U.S. Manas airbase in Kyrgyzstan, established in late 2001, was to be a
component of this route. In February 2009, however, Kyrgyzstan announced that it intended to
close the airbase, but an agreement was reached in late June 2009 to keep it open in exchange for
higher U.S. rent and other payments.
As early as the April 2008 NATO summit, Russia’s then-President Putin had offered to permit the
shipment of non-lethal NATO goods through Russia to Afghanistan. In late 2008, Russia also
permitted Germany to ship weapons and other equipment by land to its troops in Afghanistan.
NATO reached agreement with Russia in February 2009 on the land transit of non-lethal supplies
to Afghanistan, and all the Central Asian states except neutral Turkmenistan also agreed to permit
overland shipments. The first railway shipment from the Baltic states reached Afghanistan—after
transiting Russia, Kazakhstan, and Uzbekistan—in late March 2009.
At the U.S.-Russia summit meeting in early July 2009, Foreign Minister Lavrov and
Undersecretary of State William Burns signed an agreement allowing up to 4,500 annual air
flights of troops and lethal supplies through Russia to Afghanistan. Lauded by McFaul as
“historic,” the agreement complements the NATO-Russia arrangement reached in early 2009 on
land transit. The Administration reports that air transit through Russia could save the United
States government up to $133 million annually in fuel, maintenance and other transportation
costs, and that this agreement would be free of any air navigation charges.
Reportedly, the first flight by the United States using this route took place in early October 2009,
and another took place in November 2009. Allegedly, Russia was slow in facilitating such flights,
and the United States and NATO used air transit through the Caspian region to reach Afghanistan.
According to Assistant Secretary of State Philip Gordon, these air transit problems were resolved.
He stated in mid-2010 that “on average, two U.S. planes a day to fly over Russia carrying troops
and supplies in support of the mission in Afghanistan. To date, over 275 flights have carried over
35,000 passengers and valuable cargo. Russia’s rail network has facilitated transit of more than
10,000 containers of supplies…. About 30% of cargo to Afghanistan goes through the Northern
Distribution Network (NDN) and 60% of the NDN goes through Russia.”82 An Administration
factsheet adds that Russia has provided airlift for over 12,000 flights in support of U.S. operations
in Afghanistan and Iraq, 30% of the fuel U.S. military troops use in Afghanistan, and over 80 MI-
81 ITAR-TASS, January 18, 2010; Boris Gromov and Dmitry Rogozin, “Russian Advice on Afghanistan,” The
International Herald Tribune, January 12, 2010; BBC Worldwide Monitoring, March 31, 2010; “NATO Not
Cooperating Sufficiently with Russia – CSTO Head,” RIA Novosti, March 27, 2010.
82 U.S. Department of State. U.S.-Russia Relations Under the Obama Administration: Remarks at the German Marshall
Fund, June 16, 2010.
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17 helicopters to the Afghan National Army, Afghan National Police, and Afghan Drug
Interdiction Forces.83
Arms Control Issues84
In 2006, in advance of the impending December 2009 expiration of the 1991 Strategic Arms
Reduction Treaty (START), the United States and Russia began to discuss options for the future
of their arms control relationship. Many analysts had expressed concern that the two nations
would not be able to monitor compliance with the 2002 Moscow Treaty without START, as the
newer Treaty lacked any verification provisions. They, and others who saw arms control as a key
feature of U.S.-Russian relations, hoped the two sides would agree to either extend or replace
START. Others suggested the two sides no longer needed to regulate their competition with arms
control agreements, and favored a posture that would allow START to lapse and allow both sides
to pursue nuclear force postures that met their own national security needs. When the discussions
began in 2006, Russia sought to replace START with a new, formal treaty that would include
many of the same definitions, counting rules, and restrictions as START, albeit with lower levels
of nuclear forces. The Bush Administration rejected this approach and offered, at most, to attach
an informal monitoring regime to the 2002 Moscow Treaty. When the Bush Administration
ended, the two sides had not agreed on whether or how to advance their arms control relationship.
The Obama Administration pledged to pursue arms control negotiations with Russia and to,
specifically, negotiate a new treaty to replace START. In April 2009, Presidents Obama and
Medvedev agreed that their nations would pursue stepped-up negotiations toward this end, and
that a new treaty would address deployed strategic offensive nuclear forces, leaving discussions
on nonstrategic nuclear weapons and warheads in storage to a future agreement, and to reduce
their deployed forces to levels below those set by the 2002 Moscow Treaty.
After nearly a year of negotiations, the United States and Russia signed the New START Treaty
on April 8, 2010. This Treaty limits each side to no more than 800 deployed and nondeployed
ICBM and SLBM launchers and deployed and nondeployed heavy bombers equipped to carry
nuclear armaments. Within that total, each side can retain no more than 700 deployed ICBMs,
deployed SLBMs, and deployed heavy bombers equipped to carry nuclear armaments. The treaty
also limits each side to no more than 1,550 deployed warheads. The new Treaty also contains a
number of complex and overlapping monitoring provisions that will help each side verify the
other’s compliance with the treaty. Many analysts believe that this verification regime is
particularly important because it mandates transparency and cooperation between the two sides.
The Obama Administration has argued that the New START Treaty will strengthen U.S. security
and contribute to the “reset” in relations with Russia. The Administration has also noted that the
Treaty contributes to U.S. nuclear nonproliferation goals by indicating that the United States and
Russia are both committed to meeting their disarmament obligations under Article VI of the
Nuclear Nonproliferation Treaty. Some, however, have questioned whether the United States and
Russia need a treaty to maintain stability in their relationship and reduce their nuclear weapons.
They note that Russia is already reducing its forces as it retires aging systems. Moreover, some
83 The White House. Office of the Press Secretary. U.S.-Russia Relations: “Reset” Fact Sheet, June 24, 2010.
84 Prepared by Amy Woolf, Specialist in Nuclear Weapons Policy.
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question whether arms control agreements between the United States and Russia will have any
affect on the goals and interests of nations seeking their own nuclear weapons.
The Senate Foreign Relations Committee began its hearings on the New START Treaty in late
April 2010. It plans to hold up to 14 hearings. The Senate Armed Services Committee and Select
Committee on Intelligence will also hold hearings on the treaty. To date, most witnesses have
praised the treaty, and, although recognizing that it contains only modest reductions in U.S. and
Russian nuclear weapons, have argued that, on balance, it will enhance stability and
predictability. Many have also noted that its verification regime will restore the ability of the
United States and Russia to monitor each other’s strategic forces. Some have, however,
questioned whether the treaty may restrain U.S. missile defense programs. The Administration
has disputed this, noting that the treaty contains no limits on current or planned missile defense
programs and simply acknowledges that robust missile defenses can undermine offensive forces.
Others have noted that the Treaty does not address Russia’s stockpile of nonstrategic nuclear
weapons. Treaty supporters agree with this point but argue that the United States and Russia
cannot move on to a treaty that will address these weapons until the parties ratify and implement
New START.
Cooperative Threat Reduction
Since 1992, the United States has spent over $9 billion to help Russia and the other former Soviet
states dismantle nuclear weapons and ensure the security of nuclear weapons, weapons-grade
nuclear material, other weapons of mass destruction, and related technological know-how. This
funding supports the Cooperative Threat Reduction Program (CTR) managed by the Department
of Defense, along with nonproliferation programs managed by the Departments of Energy and
State. These programs have helped to eliminate nuclear weapons and delivery vehicles in
Ukraine, Belarus, and Kazakhstan, and to transport, store, and eliminate weapons in Russia. They
have also funded improvements in security at storage areas for both nuclear weapons and nuclear
materials. During the Bratislava Summit in 2005, Presidents Bush and Putin agreed to enhance
their cooperation and move more quickly in securing weapons and materials. As a result, the
Department of Energy has nearly completed its efforts to secure nuclear warheads in storage in
Russia and nuclear materials at a number of critical sites. The two sides have also cooperated to
construct a chemical weapons destruction facility in Shchuch’ye, which, after overcoming
congressional concerns between 2000 and 2002, is nearing completion.
The focus of U.S. threat reduction and nonproliferation assistance has changed over the years.
Initially, many in Congress saw U.S. assistance as an emergency response to impending chaos in
the Soviet Union. Even after the sense of immediate crisis passed in 1992 and 1993, many
analysts and Members of Congress remained concerned about the potential for diversion or a loss
of control of nuclear and other weapons. Now, much of the work on strategic offensive arms
reductions has been completed, and the United States has allocated a growing proportion of its
funding to projects that focus on securing and eliminating chemical and biological weapons and
securing storage sites that house nuclear warheads removed from deployed weapons systems.
Further, in recent years, the United States has increased funding for projects that seek to secure
borders and track materials, in an effort to keep weapons of mass destruction away from
terrorists. This has directed a growing proportion of the funding to nations other than Russia.
Many analysts in the United States see the U.S. threat reduction and nonproliferation programs in
Russia as a model for U.S. nonproliferation and anti-terrorism assistance to nations around the
world. Some who support this expansion of U.S. threat reduction assistance argue, however, that
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the United States should not increase funding for other nations at the expense of funding for
programs in Russia because Russia is still home to large stocks of insecure nuclear materials.
Russia and Missile Defense85
Background: Recent U.S. Missile Defense Plans86
Successive U.S. governments have supported the development of a missile defense system to
protect against long-range ballistic missile threats from adversary states. The Bush Administration
argued that North Korea and Iran represented strategic threats and questioned whether they could
be deterred by conventional means. In 2007, the Bush Administration proposed deploying a
ground-based mid-course defense (GMD) element of the larger Ballistic Missile Defense (BMD)
system in Europe to defend against a possible Iranian missile threat. This “European Capability”
(EC) system would have included 10 interceptors in Poland and a radar in the Czech Republic.
Both countries signed agreements with the Bush Administration permitting GMD facilities to be
stationed on their territory; however, the two countries’ parliaments decided to wait to ratify the
accords until after the Obama Administration clarified its intentions on missile defense policy.
In September 2009, the Obama Administration canceled the Bush-proposed European BMD
program. Instead, Defense Secretary Gates announced U.S. plans to further develop a regional
BMD capability that could be surged on relatively short notice during crises or as the situation
might demand. Gates argued this new capability, known as the Phased Adaptive Approach (PAA),
would be based initially around existing BMD sensors and Patriot, THAAD and Aegis BMD
interceptors, and would be more responsive and adaptable to growing concern over the direction
and pace of Iranian short- and medium-range ballistic missile proliferation. The Administration
plans for the PAA to evolve and expand over the next decade to include BMD against
intermediate- and long-range Iranian ballistic missiles. This effort is largely supported by the
Congress.
The Russian Response87
The EC program significantly affected U.S.-Russia relations. At the February 2007 Wehrkunde
security conference in Munich, then-Russian President Vladimir Putin strongly criticized the
Bush Administration’s proposal, maintaining that it would lead to “an inevitable arms race.”
Russia threatened to abrogate the 1987 Intermediate-Range Nuclear Forces Treaty, and also
announced that it had suspended compliance with the Conventional Forces in Europe Treaty. In
August 2008, following the signing of the U.S.-Poland agreement, Russia once more vociferously
objected to the Bush Administration’s missile defense plan; a Russian general stated that Poland’s
acceptance of the interceptors could make it a target for a nuclear attack.
Some analysts argue that Russia had other motives for raising alarms about the U.S. missile
defense system: to foment discord among NATO member states, and to draw attention away from
Russia’s suppression of domestic dissent, its aggressive foreign policy actions, and its nuclear
85 For additional information, see CRS Report RL34051, Long-Range Ballistic Missile Defense in Europe, by Steven A.
Hildreth and Carl Ek.
86 Prepared by Steven A. Hildreth, Specialist in Missile Defense.
87 Prepared by Carl Ek, Specialist in International Relations.
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technology cooperation with Iran. Observers point out that Russian acceptance of NATO
enlargement in 2004 was conditioned on a tacit understanding that NATO or U.S. military
expansion into the new member states would not occur. The proposed European GMD in this
regard was seen as unacceptable to Russia.
On November 5, 2008—the day after the U.S. presidential election—President Medvedev stated
that Russia would deploy short-range Iskander missiles to the Russian exclave of Kaliningrad,
which borders Poland and Lithuania, if the EC were built. In late January 2009, however, the
Russian media reported that Moscow had “suspended” plans to move short-range missiles to
Kaliningrad because the Obama Administration was not “pushing ahead” with the EC
deployment. However, there were reports that President Medvedev at the July 2009 G-8 (Group
of eight highly industrialized nations) summit may have intimated that the Iskander deployment
was still an option.
On February 7, 2009, at the annual Wehrkunde conference, Vice President Biden stated that “we
will continue to develop missile defenses to counter a growing Iranian capability…. We will do
so in consultation with our NATO allies and Russia.”88 However, the Obama Administration also
indicated that it was prepared to open talks with Tehran if it is willing to shelve its nuclear
program and renounce support of terrorism. During a February 10 visit to Prague, Secretary of
State Hillary Clinton said that any change in U.S. policy on missile defense would depend on
Iran, but that “we are a long, long way from seeing such evidence of any behavior change” in
Iran.89
In early March 2009, the media reported that President Obama had sent a letter to President
Medvedev offering to stop the development of the EC if Russia cooperated with international
efforts to halt Iran’s nuclear weapons and missile programs. President Obama denied such a quid
pro quo, stating that “what I said in the letter was that, obviously, to the extent that we are
lessening Iran’s commitment to nuclear weapons, then that reduces the pressure for, or the need
for a missile defense system. In no way does that diminish my commitment to [the security of ]
Poland, the Czech Republic and other NATO members.”90
In a joint statement issued at their “get acquainted” meeting on April 1, 2009, Presidents Obama
and Medvedev acknowledged that differences remained in their views toward the placement of
U.S. missile defenses in Europe, but pledged to examine “new possibilities for mutual
international cooperation in the field of missile defense.” Later that month, however, Russian
Deputy Foreign Minister Sergey Ryabkov charged that “[U.S.] work in the missile defense has
intensified, including in the NATO format.” Shortly thereafter, in a Russian media interview,
Ryabkov was asked to comment on U.S.-Russia-NATO cooperation on missile defense through
the use of Russian radar installations. He explained that the Russian offer was predicated on the
fulfillment of “certain preliminary stages,” including the U.S. cancellation of the EC program,
88 Vice President Joseph Biden’s speech at the 45th Munich Security Conference, http://www.securityconference.de/
konferenzen/rede.php?menu_2009=&menu_konferenzen=&sprache=en&id=238&
89 “Clinton Says Missile Shield Hinges in Part on Iran,” Reuters, February 10, 2009; “Obama Seen Unlikely to Hedge
on Missile Defense,” Associated Press, February 13, 2009.
90 The White House. Office of the Press Secretary. Remarks By President Obama and British Prime Minister Gordon
Brown After Meeting, March 3, 2009.
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followed by a threat assessment, and then by political and economic measures to eliminate the
threat.91
In early June 2009, a Russian official indicated that Moscow would not likely be willing to
reduce its nuclear weapons arsenal unless the United States were to scrap plans to establish its
missile defense site in Poland and the Czech Republic. However, the Russian government also
stated that it still might deploy Iskander missiles to Kaliningrad if the United States were to
transfer Patriot missile batteries to Poland. 92
At the July 2009 U.S.-Russia summit, the two presidents declared in a joint statement that their
governments “plan to continue the discussion concerning the establishment of cooperation in
responding to the challenge of ballistic missile proliferation,” and that both countries would task
experts “to work together to analyze the ballistic missile challenges of the 21st century and to
prepare appropriate recommendations, giving priority to the use of political and diplomatic
methods.” One day after the meeting, however, Russian Foreign Minister Sergey Lavrov stated
that if the Obama Administration decided to pursue missile defense unilaterally, Russia might be
reluctant to reduce its nuclear arsenal.93
As noted above, in September 2009 the Obama Administration’s announced a new program for a
European-based BMD. In Russia, President Medvedev called the change “a responsible move,”
adding that “we value the responsible approach of the U.S. President to our agreement. I am
ready to continue our dialogue.”94 In addition, Moscow appeared to back away from its earlier
signal that it might deploy Iskander missiles to Kaliningrad. In November, the U.S. ambassador to
Ukraine quashed rumors that the United States had been discussing with Kiev deployment of
missile defense facilities in Ukraine.
Some analysts on both sides of the Atlantic, however, argued that cancelling the Bush
Administration’s BMD plan could be viewed by Moscow as a climb-down resulting from
Russia’s incessant diplomatic pressure. 95 Further, some critics faulted the White House for not
having gained anything from Moscow in exchange for its apparent walk-back on missile defense.
However, Obama Administration supporters maintained that Russia likely would not have wished
to reveal an obvious quid pro quo immediately; Administration backers advised critics to wait and
see what actions Russia would take, particularly with respect to cooperation with the United
States on policy toward Iran.
91 “President Obama, Russian President Medvedev Commit To Reduce Nuclear Arms, Reset Relationship,” US Fed
News, April 11, 2009; “Russia Warns U.S. Stepping Up Shield Plans – Agency,” Reuters, April 21, 2009; Russian
Ministry of Foreign Affairs. Interview of Russian Deputy Minister of Foreign Affairs Sergey Ryabkov on Disarmament
Issues, April 23, 2009.
92 “Russian General Links Arms Cuts To Missile Shield,” Associated Press. June 5, 2009; “Russian Source: Patriot
Missiles To ‘Cloak’ Strategic Effort,” Interfax, May 22, 2009.
93 The White House. Office of the Press Secretary. Joint Statement By Dmitry A. Medvedev, President of the Russian
Federation, and Barack Obama, President of the United States, On Missile Defense Issues, July 6, 2009; “Russia
Warns U.S. Over Missile Shield,” Associated Press, July 7, 2009.
94 “Obama Cancels Bush Plan For European Missile Shield That Had Soured Relations With Russia,” Associated Press
Newswire. September 17, 2009; “Medvedev Praises Obama’s Move on Europe Missile Shield,” RIA Novosti,
September 17, 2009.
95 “Russia Could Scrap Baltic Missile Plans Following U.S. Move,” RIA Novosti, September 18, 2009.
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In October 2009, during a visit to Warsaw by Vice President Biden, Polish President Donald Tusk
announced that Poland would participate in the Obama Administration’s new BMD program by
hosting SM-3 short- to medium-range missiles.96
In December 2009, NATO foreign ministers commented favorably on the new U.S. missile
defense plan, and reiterated the alliance’s willingness to cooperate with Russia on the issue,
stating that they reaffirmed “the Alliance’s readiness to explore the potential for linking United
States, NATO and Russian missile defence systems at an appropriate time. The United States’
new approach provides enhanced possibilities to do this.” The Russian media reported that NATO
and Russia had formed a working group to study the issue. In a speech shortly thereafter, NATO
Secretary General Ander Fogh Rasmussen said that he hoped the alliance and Russia would have
a joint system by 2020.97
Before long, however, Russia began to criticize the new U.S. plan for missile defense against
Iran, reviving the argument that it would compromise Russia’s nuclear forces. In late December
Prime Minister Putin tied discussions over missile defense to the re-negotiation of START. He
asserted that Moscow would need to beef up its offensive nuclear weapons forces in order to
“preserve a strategic balance” with the planned U.S. missile defense system. A State Department
spokesperson acknowledged the relationship between offensive and defensive missile
capabilities, but maintained that the two countries should discuss missile defense “in a separate
venue.” The Administration has also said that it “will continue to reject any negotiated restraints
on U.S. ballistic missile defenses.”98 Observers assert that Putin’s intervention would not likely
affect the disarmament talks. Regarding missile defense, in January 2010 Russian Foreign
Minister Lavrov stated that Russia had “told the U.S. and NATO that it is necessary to start
everything from scratch – to jointly analyze the origin and types of missile proliferation risks and
threats.”99
Also in January 2010, the United States and Poland announced that, under the terms of the August
2008 agreement between Warsaw and Washington, a battery of short-range, surface-to-air Patriot
missiles—along with a crew of about 100 U.S. service personnel—would be rotated from
Germany to Poland in June and stationed close to Poland’s border with Kaliningrad. Foreign
Minister Lavrov claimed that he “doesn’t understand” the apparent need for Poland to defend
itself from Russia. In response to the planned deployment of the Patriots, a Russian official
indicated that Moscow might strengthen its Baltic fleet. In February 2010, a Polish official
expressed doubts that the Patriots would be stationed permanently in Poland. 100
96 “US/CEE: Biden Touts New Missile Plan In Central Europe,” Oxford Analytica, October 22, 2009.
97 NATO. Meeting of the North Atlantic Council at the level of Foreign Ministers held at NATO Headquarters,
Brussels: Final Statement, December 4, 2009, at http://www.nato.int/cps/en/natolive/news_59699.htm?mode=
pressrelease; “Russia, NATO Form Working Group on Missile Defense – Rogozin,” RIA Novosti, December 5, 2009;
“Russia Not Ready to Set Up Missile Defense Shield Together With U.S. – Lavrov,” Interfax, January 22, 2010.
98 U.S. Department of Defense. Ballistic Missile Defense Review Report, Pt. IV, February 2010.
99 “Putin Plays MD Card, Placates Hardliners,” Oxford Analytica, December 29, 2009; “Russia to Continue Offensive
Arms to Balance U.S. – Putin,” RIA Novosti, December 29, 2009; “U.S. Missile Shield Holding Up Nuclear Deal –
Putin,” Reuters, December 29, 2009; “U.S. Rejects Russia Shield Concerns,” BBC News, December 29, 2009.
100 “CEE/Russia: CEE Attitudes to Russia become More Sober,” Oxford Analytica, January 21, 2010; “Polish Missile
Base Re-ignites Tension with Russia,” Deutsche Welle, January 22, 2009; “USA May Renege on Patriot Missile
Deployment Accord – Polish Daily,” BBC Monitoring European, February 12, 2010.
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On February 4, 2010, the U.S. and Romanian governments announced that Bucharest had agreed
to host two U.S. short-to-medium-range interceptor missiles to extend missile defense into
southern Europe. The Romanians reportedly hope that the deployment will help cement bilateral
ties, as well as protect Romanian territory—the Bush Administration’s plan would only have
covered the western part of the country from a possible Iranian missile launch. A State
Department spokesperson and Romanian President Traian Basescu both stated that the system
was not intended to guard against Russia.
Russian officials, including the chief of Russia’s general staff, countered that the missile defense
system was indeed directed at Russia, and that the proposed deployment likely would delay
negotiations in arms talks between Russia and the United States. Moscow also expressed vexation
over the possibility of U.S Aegis anti-missile ships patrolling the Black Sea. Nevertheless,
commenting on Iran’s stepped-up uranium enrichment activities, the head of Russia’s National
Security Council appeared to confirm international concerns about whether Iran’s eventual goals
are scientific or military; he stated that international doubts about Iran’s intentions “are fairly
well-grounded.”
However, Dmitry Rogozin, Russia’s ambassador to NATO, stated that “maybe [U.S. BMD] is
against Iran, but this system could be aimed against any other country, including against Russia’s
strategic nuclear potential.” The ambassador took a rather truculent attitude toward the planned
deployment. Writing in Twitter, Rogozin, who reportedly has a reputation for being outspoken,
responded to the Romanian announcement by stating “the Americans and their allies want to
surround the cave of the Russian bear? ... How many times must they be reminded how
dangerous this is!? The bear will come out and kick the ass of these pathetic hunters.”101
Some analysts have argued, however, that the interceptors planned for Romania would not be able
to take out a Russian ICBM launched at the United States. A Russian military analyst, writing in
RIA Novosti, conceded that the Obama-proposed SM-3 interceptors stationed anywhere in Europe
would be incapable of downing Russian long-range ballistic missiles. He argued that Moscow’s
main objections were that 1) it had not been consulted on the decision, and 2) that the U.S. system
might be subject to change. On the first point, a spokesperson for the Romanian Foreign Ministry
maintained that Russia had been kept in the loop, stating that “information coming from our
American partners indicate that in the time that followed the September 2009 announcement by
the U.S. president, the U.S. had detailed consultations with Russia concerning their plans for the
anti-missile defense system.” Also, on February 16, U.S. Undersecretary of State for Arms
Control and International Security Ellen Tauscher stated that Russia had been told of the planned
deployment to Romania. On the latter point, Russia is concerned that the SM-3 interceptors could
eventually be upgraded to bring down ICBMs without Russia’s knowledge, as the United States is
not required to share information about its missile defense system.102
101 “Russia Says Concerned at Romania Hosting U.S. Missiles,” Reuters News, February 5, 2010; “Russia: Disconnect
Between MD Policy, Iran Persist,” IHS Global Insight Daily Analysis, February 5, 2010; “Romania Agrees to Host
U.S. Anti-Missile System,” Oxford Analytica,. February 10, 2010; “Russia Toughens Line on Iran Nuclear Ambitions,”
Agence France Presse, February 9, 2010; “Twitter Diplomacy: Envoy Says Russia Will ‘Kick Ass’ of U.S.” Agence
France Presse, February 10, 2010.
102 “Romania Says U.S. Informed Russia on Anti-missile Shield Plan,” BBC Monitoring European, February 10, 2010;
“U.S. Kept Russia Informed About Romania Missiles Plan – U.S. Diplomat,” Interfax, February 16, 2010; “U.S. and
Romania: A New Alignment?” RIA Novosti, February 9, 2010; “Russia Cool to U.S. Plan for Missiles in Romania,”
New York Times, February 6, 2010.
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On February 12, Bulgaria’s prime minister announced that he supported participation in the U.S.
missile defense system; the U.S. ambassador to Bulgaria confirmed that discussions on such a
deployment were in their early stages with Bulgaria—and with other countries. Bulgaria’s foreign
minister noted that the missile shield would also protect Russia from the threat of Iranian
missiles. Russia, however, professed that it had been caught unawares by the announcement;
Foreign Minister Lavrov stated that “we have already questioned our U.S. partners in Washington
... as to the meaning of this, and why we have this Bulgarian surprise after the Romanian
surprise.” Russian NATO Ambassador Rogozin tweeted that “Bulgarians are our brothers, but
politically they are promiscuous.” A few days later, Russia turned aside an apparent offer by
Transnistria, a breakaway region of Moldova, to host Russian Iskander missiles. 103
It has been argued that the new U.S. focus on Southern Europe is likely viewed with less alarm by
Russia than the former plan, which included Poland and the Czech Republic. However, a member
of the Russian Duma claimed that the possible deployments do not square with the Obama
Administration’s intention to improve relations with the Russian Federation. Konstantin
Kosachyov, chairman of the Duma’s International Affairs Committee, stated on February 16 that
“the most regrettable thing is that these plans [to deploy missile defense facilities] do not fit the
well known ‘reset’ program in Russian-American relations in any way.”104
Russia sought to tie discussions over missile defense to the renegotiation of START, contrary to
the July 2009 agreement reached by Presidents Obama and Medvedev not to link the two.
However, the United States refused to accede to the Russian position, and on April 8, 2010, the
two governments signed the New START treaty. The agreement acknowledges that there is a
relationship between offensive and defensive systems, but does not place any limits on missile
defense or on the expanded system that has been proposed by the Obama Administration.105
On July 3, Secretary of State Clinton and Polish Foreign Minister Radek Sikorski signed an annex
to the 2008 U.S.-Poland agreement permitting the deployment of U.S. BMD in Poland. The
amendment provided approval for the deployment of SM-3 missiles, rather than silo-based
interceptors. After the signing ceremony, Sikorski stated that Russia would be permitted to
inspect the facilities. Russian Foreign Minister Ryabkov stated that Moscow did not believe that
the potential threat from Iran warranted an anti-missile system such as the Obama Administration
was planning to put in place; Foreign Ministry Spokesman Andrei Nesterenko echoed these
comments, and also complained of insufficient consultation. However, a Russian parliamentarian
stated that “there will be detailed discussions [concerning the proposed SM-3 deployment], but
they will not be confrontational.”106
103 “Bulgaria Wants to Participate in US Missile Defense Shield: PM,” Agence France Presse, February 12, 2010;
“Russia Wants Bulgaria to Explain favor of U.S. Missile Shield,” Agence France Presse, February 14, 2010; “Russia’s
NATO Envoy Quashes Transdniestr Missiles Bid – Report,” Dow Jones International Press, February 16, 2010; “U.S.
Missile Shield Not Targeting Russia, Bulgaria Says,” Agence France Presse, February 17, 2010; “Dmitry Rogozin
Accuses Bulgarian Leadership of ‘Political Promiscuity,’” WPS: Defense and Security, February 17, 2010.
104 “U.S. New Missile Defense Plans Do Not Fit Logic of ‘Reset’ Policy – Russian MP,” Interfax, February 16, 2010.
105 CRS Report R41251, Ballistic Missile Defense and Offensive Arms Reductions: A Review of the Historical Record,
by Steven A. Hildreth and Amy F. Woolf.
106 “Moscow Says European Missile Defense Unjustified,” RIA Novosti, July 6, 2010; “U.S. & NATO Good Intentions
at Discrepancy with Deeds – RF ForMin,” ITAR-TASS World Service, July 5, 2010; “Moscow to Discuss Missile
Defense with Warsaw in Non-confrontational Way,” Interfax: Russia & CIS Military Newswire, July 5, 2010.
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U.S.-Russia Economic Ties107
U.S.-Russian trade and investment flows have increased in the post-Cold War period, reflecting
the changed U.S.-Russian relationship. Many experts have suggested that the relationship could
expand even further. U.S. imports from Russia have increased substantially, rising from $0.5
billion in 1992 to a peak of $26.8 billion in 2008. The large increase in U.S. imports reflects not
so much an increase in the volume of trade but the rise in world prices of raw materials,
particularly oil, that comprise the bulk of those imports (64% in 2008). U.S. exports have
increased from $2.1 billion in 1992 peaking at $9.3 billion in 2008. Major U.S. exports to Russia
consist of machinery, vehicles, and meat (mostly chicken).108
Table 1. U.S. Merchandise Trade with Russia, 1992-2008
(in billions of dollars)
U.S.
U.S.
U.S.
U.S.
Trade
U.S.
U.S.
Trade
Year
Exports
Imports
Balances Year Exports
Imports
Balances
1992
2.1 0.5 1.6
2001
2.7 6.3 -3.5
1993
3.0 1.7 1.3
2002
2.4 6.8
-4.4
1994
2.6 3.2 -0.6
2003
2.4 8.6 -6.2
1995
2.8 4.0 -1.2
2004
3.0 11.9 -8.9
1996 3.3
3.6
-0.3
2005
3.9
15.3
-11.3
1997 3.4
4.3
-0.9
2006
4.7
19.8
-15.1
1998 3.6
5.7
-2.1
2007
7.4
19.4
-12.0
1999 2.1
5.9
-3.8
2008
9.3
26.8
-17.5
2000 2.1
7.7
-5.6
2009
5.4
18.2
-12.8
Major U.S. exports: machinery; vehicles; meat; aircraft. Major U.S. imports: mineral fuels; inorganic chemicals
aluminum; steel.
Source: Compiled by CRS from U.S. Department of Commerce, U.S. Census Bureau data. FT900.
Despite the increase in bilateral trade, the United States and Russia still account for small shares
of each others’ trade. In 2009, Russia accounted for about 0.5% of U.S. exports and 1.2% of U.S.
imports. It was the 20th -largest source of imports and 32nd largest export market for the United
States. The United States accounted for 3.6% of Russian exports and 5.7% of Russian imports. It
was the third largest source of imports and ninth largest export market for Russia.109
According to Russian government data, by the end of 2008, the United States accounted for 3.3%
of total accumulated foreign direct and portfolio investments in Russia and was the eighth-largest
source of foreign investment. However, the first three countries were Cyprus (21.5%), the
107 Prepared by William H. Cooper, Specialist in International Trade and Finance.
108 CRS calculations based on data from the Department of Commerce, Bureau of the Census. Global Trade
Information System.
109 Global Trade Information Systems, Inc. World Trade Atlas.
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Russian Political, Economic, and Security Issues and U.S. Interests
Netherlands (17.5%), and Luxembourg (13.0%), suggesting that at least 50% of the investments
night have been repatriated Russian funds.110
Russia and the United States have never been major economic partners, and it unlikely that the
significance of bilateral trade will increase much in the near term. However, in some areas, such
as agriculture, Russia has become an important market for U.S. exports. Russia is the largest
foreign market for U.S. poultry. Furthermore, U.S. exports to Russia of energy exploration
equipment and technology, as well as industrial and agricultural equipment, have increased as the
dollar has declined in value. Russian demand for these products will likely grow as old equipment
and technology need to be replaced and modernized. Russia’s significance as a supplier of U.S.
imports will also likely remain small given the lack of international competitiveness of Russian
production outside of oil, gas, and other natural resources. U.S.-Russian investment relations
could grow tighter if Russia’s business climate improves; however, U.S. business concerns about
the Russian government’s seemingly capricious intervention in energy and other sectors could
dampen the enthusiasm of all but adventuresome investors.
The greater importance of Russia’s economic policies and prospects to the United States lies in
their indirect effect on the overall economic and political environment in which the United States
and Russia operate. From this perspective, Russia’s continuing economic stability and growth can
be considered positive for the United States. Because financial markets are interrelated, chaos in
even some of the smaller economies can cause uncertainty throughout the rest of the world. Such
was the case during Russia’s financial meltdown in 1998 and more recently with the 2008-2009
crisis. Promotion of economic stability in Russia has been a basis for U.S. support for Russia’s
membership in international economic organizations, including the IMF, the World Bank, and the
WTO. As a major oil producer and exporter, Russia influences world oil prices that affect U.S.
consumers.
U.S. Assistance to Russia
From FY1992 through FY2011, the U.S. government has budgeted or requested over $17 billion
in assistance to Russia, including for democratization, market reform, and health needs. The bulk
of this assistance (nearly 60%) has been expended on CTR (Nunn-Lugar) and other security-
related programs aiming to prevent the proliferation of WMD, combat drug-trafficking and
transnational crime, foster law enforcement and criminal justice sector reforms, and support
reconciliation and recovery efforts in Chechnya and other areas of the North Caucasus. U.S.
assistance to Russia as a percentage of all aid to Eurasia has declined over the years, but
historically Russia has received about one-half of all U.S. assistance to Eurasia.111
Annual foreign operations appropriations bills have contained conditions that Russia is expected
to meet in order to receive assistance:
• A restriction on aid to Russia was approved in the FY1998 appropriations and
each year thereafter, prohibiting any aid to the government of the Russian
Federation (i.e., central government; it does not affect local and regional
governments) unless the President certifies that Russia has not implemented a
110 Tendentsii I perspectiva (Trends and Outlook). Russian Economic Report. April 2006. p. 24..
111 See CRS Report RL32866, U.S. Assistance to the Former Soviet Union, by Curt Tarnoff.
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Russian Political, Economic, and Security Issues and U.S. Interests
law discriminating against religious minorities. Successive administrations have
made such determinations each year.
• Since FY1996, direct assistance to the government of Russia has hinged on its
continuing sale of nuclear reactor technology to Iran. As a result, in most years as
much as 60% of planned U.S. assistance to the federal Russian government has
been cut.
• The FY2001 foreign aid bill prohibited 60% of aid to the central government of
Russia if it was not cooperating with international investigations of war crime
allegations in Chechnya or providing access to NGOs doing humanitarian work
in Chechnya. Possibly as a result of Russian cooperation with the United States
in its war on terrorism, the war crime provision was dropped.
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Table 2. U.S. Government Funds Budgeted for Assistance to Russia, FY1992-FY2008
(million dollars)
Fiscal
Year/
Program
Area 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 Total
Economic
Growth
84.68 137.21 1,187.92 231.37 72.69 39.35 51.21 74.01 58.65 60.13 60.62 54.47 33.93 9.54
7.71 3.41
0.7
2,167.6
Governing
Justly &
33.93 66.13 242.86 74.15 50.68 38.45 69.58 85.64 68.26 82.06 79.89 79.98 64.31 63.8
78.7 55.96 67.8 1302.18
Democr.
Humanit.
Asst.
167.89
1,060.4
39.49 48.44
35.34
0.93 6.34 1,167.34
243.1 92.37
23.83 26.1 19.97
1.5 13.23
0.0 0.0 2,946.27
Investing
in People
13.1 8.31 79.85 12.67
10.98
10.59
10.55
15.42 15.88 26.1 27.41 24.36
24.02
35.47 28.3 23.95 29.64 396.6
Peace &
Security
28.81 182.71 361.69 203.19
323.18
456.29
461.36
790.05 667.52 694.86
822.79 727.59
802.43
897.75 854.8 926.11 778.68 9979.81
Program
Support
0.0
0.0 4.0 0.44
0.0
0.0
0.0
0.0 0.0 0.0
0.0 0.0
0.0
0.0 0.0
1.24 1.4 7.08
Total
328.42 1,454.75 1,915.79 570.26 492.86 545.52 599.04 2,132.47 1,053.41 955.52 1,014.54 912.5 944.67 1,008.06 982.74 1,010.66 2886.22 18,807.43
As % of
Eurasia
xxxx
50
aid
Source: U.S. Department of State, Office of the Coordinator of U.S. Assistance to Europe and Eurasia. Includes Freedom Support Act and other program and agency
assistance.
CRS-47
Russian Political, Economic, and Security Issues and U.S. Interests
Table 3. Assistance to Russia, FY2009-FY2010, and the FY2011 Request
(million dollars)
Fiscal Year/Program
FY2009 Actual
FY2010 Estimate
FY2011 Request
Area
Economic Growth
500
500
475
Governing Justly &
33.871 37.021 35.19
Democratically
Investing in People
25.408
22.508
21.979
Peace & Security
10.367
11.566
11.056
Total 70.146
71.595
68.7
As Percent of Eurasian
9 12 11
Assistance
Source: U.S. Department of State. Congressional Budget Justification for Foreign Operations, Annex: Regional
Perspectives, FY2011, March 2010.
Notes: Includes the Assistance for Europe, Eurasia, and Central Asia (AEECA) Account, Foreign Military
Financing, Global Health and Child Survival funds, International Military Education and Training funds, and the
State Department’s Non-proliferation, Anti-terrorism, Demining, and Related Programs. Does not include
Defense or Energy Department programs.
Author Contact Information
Jim Nichol, Coordinator
Amy F. Woolf
Specialist in Russian and Eurasian Affairs
Specialist in Nuclear Weapons Policy
jnichol@crs.loc.gov, 7-2289
awoolf@crs.loc.gov, 7-2379
William H. Cooper
Steven A. Hildreth
Specialist in International Trade and Finance
Specialist in Missile Defense
wcooper@crs.loc.gov, 7-7749
shildreth@crs.loc.gov, 7-7635
Carl Ek
Paul Belkin
Specialist in International Relations
Analyst in European Affairs
cek@crs.loc.gov, 7-7286
pbelkin@crs.loc.gov, 7-0220
Steven Woehrel
Derek E. Mix
Specialist in European Affairs
Analyst in European Affairs
swoehrel@crs.loc.gov, 7-2291
dmix@crs.loc.gov, 7-9116
Acknowledgments
Some portions of this report are based on the work of former Specialist in Russian and Eurasian Affairs
Stuart Goldman.
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