The Week Magazine...Diplomacy

THE frozen Moskva River was beginning to thaw when Prime Minister Deve Gowda set foot on the Mecca of mafia capitalism on the windy evening of March 24. Moscow's streets were choked with unwashed vehicles, and many cars were still stuck in fender-deep snow in sub-zero temperatures. But the worst of winter was over and pedestrians kept a wary eye on the knife-sharp icicles hanging dangerously from high-rise buildings.

The worst of winter had been long over for Indo-Russian relations as well, and Gowda had ample user for caution during his first prime ministerial visit to a sapped superpower. Yet he was soon skating on thin ice, unmindful of the icicles of international politics. How tricky it was became clear when Russian President Boris Yeltsin thrust upon India a "Strategic partnership" during his 40-minute one-on-one session with Gowda in the Kremlin Palace the next day. It was yet another display of the legendary persuasive sills of the big brash boy from the Urals who as a 12-year-old had made his fellow students jump out of the first-floor window of their school 60 years ago.

Gowda did not jump into the Russian trap with both eyes closed but the announcement of a strategic partnership sprinkled goose pimples on the Indian delegation. There were visions of an oversized military muscle and a grand axis of Russia, China and India against the Americans. Those unconvinced about such a linking of hands were reminded about the strategic lodging of Chinese Foreign Minister Qian Qichen, who incidentally got better media coverage than Gowda.

Qian, who was in town to prepare for Chinese President Jiang Zemin's visit to Moscow for border talks in April, and the three India ministers were put up at Hotel President, where most rooms were fitted with gas masks. (Gowda had a honour of staying in the Kremlin Palace, along with his sons Kumaraswamy and Dr Ramesh, who joined the entourage in great secrecy.) In fact, Yeltsin and Prime Minister Viktor Chernomyrdin met Qian before and after their powwows with Gowda, which intriguingly had no official agenda.

It was as if the Russian had set up a strange ball game with three teams playing simultaneously, and Yeltsin was the star spiker. The hefty 6-foot 2-inch Russian, who was on Sverdlovsk volleyball team for five years in his youth, could punch the diplomacy ball equally hard. Gowda played along, all earnest and attempting nothing spectacular. He was true to his 'humble' self at the dinner that Yeltsin threw in his honour. He spoke in a low, hoarse voice and the text of his speech was tediously bloated unlike the staccato structure of Yeltsin's thunder.

Yet Gowda scored a few points. When Yeltsin exhumed communist jargon to rail against American "expansionism" and announced a strategic partnership, Gowda avoided using the word "strategic". Instead he wanted to "strive for a world free of military blocs and alliances". It could be read either way: as a salvo against the expanding NATO or against Yeltsin's own grand axis dream. Later, on his flight back home, Gowda would dismiss all speculation about joining an axis and take pains to downplay the significance of the strategic partnership. The grandiose phrase would further be reduced to an innocuous cliche with India and South Africa employing it to describe a minor upswing in their relations.

Gowda had obviously seen through the Russian game of using the axis bogy to wrest more concessions from the west. It was also desperate attempt by Yeltsin to dispel the growing feeling that he had surrendered Russia's national interests at the Helsinki summit with US President Bill Clinton. In reality Yeltsin did not fare all that dismally at Helsinki. Though he could not prevent three Soviet allies-Poland, Hungary and the Czech Republic-from joining NATO, he ensured that nuclear weapons would not be stationed in these countries. Clinton also assured him greater investment in Russia, a larger role in the G-8 which it had recently joined, and support for entering the World Trade Organisation and the Paris Club of creditor nations.

Membership of the club will help Russia get back a hundred billion dollars that the Soviet Union had lent its friends, including India. Right now the repayment is a trickle- well below $2 billion a year and most of it in the form of goods. For hard currency Russia is dependent on multinational investors and the IMF, which has granted it a $10 -billion loan. Apart from massive investment, Russia was keen on obtaining high-speed supercomputers from the US. It had placed orders with IBM and Hewlett-Packard for two supercomputers but Washington stopped the sale in October last year, suspecting that they could be used for research in nuclear warfare.

Russia definitely has more to gain from waltzing with the west than with eastern nations like India and China, which have very little technology or money to offer. Its trade with the two countries is nothing to write home about. It, however, needs Indian friendship since India is the largest buyer of Russian weapons. As much as 70 per cent of Indian military equipment is of Russian origin.

They had also a common cause for concern over Ukraine's supply of 350 Soviet-made T-80 tanks to Pakistan. While India sensed a threat from the sale Russia was worried that the tanks were intended for the Taliban in Afghanistan. Though Yeltsin declared that he would starve Ukraine of spare parts for the tanks there was little that he could do to stop Ukraine or Pakistan from obtaining them from other CIS countries. In any case Russian weapons were freely available from the arms smuggling mafia, which recently tried to sell a nuclear-powered submarine to Colombian drug lords.

The Indian delegation had flown to Moscow with a long shopping list of arms and technology. Heading the list were two light water nuclear power reactors for the coastal village of Koodankulam in Tamil Nadu's Tirunelveli district where radioactive minerals are in abundance. These are pressurised water reactor using ordinary water for cooling and moderation. The deal had apparently been signed in 1988 with a Russian offer of a $2.6 billion loan. But the collapse of the Soviet Union and disagreement over the mode of payment came in the way of further progress. There were also reports that the Americans were determined to stop the sale as they feared that India would use the spent fuel for making nuclear bombs.

Gowda could finally take a step forward. He asked the Russian to prepare a Detailed Project Report, which alone would cost India Rs 250 crore. Still, no one knew for sure when the two reactors with a 1000-mega-watt capacity each would start producing electricity, if at all. The Russians will spend two and a half years to complete the project report the Indian atomic energy agencies will need a few more years to study and approve it . Another six years will pass before the Russians complete the constructional and commission the reactors.

By then Koodankumam will have become a battleground for anti-nuke activists. They are already up in arms, claiming that the project will displace thousands of people and rob fishermen of their livelihood. Ironically India commissioned the project report on the eve of the anniversary of the Three Mile Island accident int he US involving a light water reactor on March 28, 1979. The disastrous Chernobyl plant also used light water but with granite for moderation.

Koodankulam is going to be a costly proposition. While the Indian atomic energy establishment asserted that the whole project would cost only $5 bilion a report in The Moscow Times claimed that one Russian light water reactor was priced at $6 bilion. Another order India placed with Russia was for elector-mechanical equipment worth $100 million for the Tehri hydel project in Uttar Pradesh. Russia was eager to sell India a lot more: a discarded aircraft carrier called admiral Gorshokov, frigates, submarines, T-72 tanks, 152-mm artillery guns, MiG fighter planes, and an anti-missile system supposedly better than the American Patriot missiles, which shot down Saddam Hussein's Scuds in the Gulf War. All told, the Russians offered military equipment worth $ 10 billion.

India was keen on taking home many of them, particularly the MiGs and the anti missile system but once again the main problem was payment in hard currency. Mode of repayment of loans was the major point of discussion between Finance Minister P. Chidambaram and the Russian First Deputy Prime Minister Anatoly Chubais, who is also the finance minister. Chidambaram finally agreed to make a part of the annual repayment in dollars.

The Russians, being tough negotiators, refused to sign a finalised extradition treaty and two of the six draft agreement, much to the embrassment of the Indian delegation which had announced that their signing was only a formality. Prime Minister Chernomyrdin, whom Gowda met in the White House on the second day, was also unhappy about the poor turnover in bilateral trade. If Chidambaram kept a rather low profile, Foreign Minister I.K. Gujaral's cerebral fingerprints were all over Gowda's speech at Yeltsin's dinner. A specimen: "As the enlightened Buddha said, the greate victory is one which nobody is defeated and all can share in that victory."

Gujral, the latter-day Gautama, had a seven-fold path to world peace, the most important being non-reciprocity: giving without expecting anything in return. In Moscow, however, India almost gave in to Russia's cold calculations.

Yeltsin's kitchen cabinet

DEVE GOWDA'S toast to Boris Yeltsin at the Russian president's dinner in his honour was ironically appropriate. While Yeltsin wished the Indian people's success and well-being, Gowda toasted to the health and happiness of the host. Good health has been eluding Yeltsin since 1987, when he was thrown out of the Soviet politburo. The problem was insufficient blood flow to the heart. He was hospitalised several times in the last ten ll years, and the doctors stopped his heart for 60 minutes during a seven-hour operation in November last year.

Once back on his feet Yelts inignored the doctor's advice not to drink but the younger of two daughters, Tatyana Dyachenko, made him to bid farewell to the bottle this January. That was a hard decision for a man who in a stupor had refused to get off the plain and meet the waiting Irish prime minister at Shannon Airport three years ago.

A former computer programmer married to a businessman, Tatyana, 37, is a key member of Yeltsin's kitchen cabinet, where First Deputy Prime Minister Anatoly Chubais is the chef. They played a major role in Yeltsin's reelection last year, sidelining his close friends and persuading the maverick Gen. Alexander Lebed to pull out of the race. And Lebed himself was dumped shortly afterwards for demanding that Yeltsin step down from presidency during his convalescence.

It was again to Tatyana that Yeltsin turned when he decided last month to draft the charismatic Boris Nemtsov as First Deputy Prime Minister to assist Chubais nurse the Russian economy back to health. She travelled to Gorkhy,now known as Nizhny Novgorod, to bring the reluctant governor to Moscow. Nemtsov, who became governor six years ago at the age of 31, had transformed the economy of Russia's third largest city with steely resolve. To overcome shortages he bartered the famous volga cars from the Gaz factory in the city for food from other provinces and let our thousand of small plots for farmers to cultivate potato. He was the first in Russia to privatise shops and transport, and break up the collective farms.

Yeltsin's brief to him is to repeat his success all over Russia. High on his action plan are the proposals to remove housing subsidies, reduced the number of taxes from 200 to 30, and raise money by imposing a minimum asset tax on the banks, But his main job is privatisation. A physicist and anti-nuke activist, the telegenic Nemtsov has a unsullied image unlike grim-faced Chubais, a former lecturer from St. Petersburg who has been accused of connections with housing rackets. Chubais, 41, is in fact described as the most hated politician in Russia, having sold the country's factories and mines for a song during the first, disastrous wave of privatisation. Both are potential candidates for presidency when Yeltsin's term ends in 2000.

Another presidential hopeful if Prime Minister Vikrot Chernomyrdin, who is acceptable to the communists as well as the reformers. He was an engineer like Yeltsin (Gowda, too, was a civil engineer though not a graduate) and had headed the giant oil company, Gazprom. Chernomyrdin, however, has displayed a lack of drive and energy to carry out economic reforms . Yet another aspirant is the governor of Moscow, Yuri Luzhkov, a man of the masses who failed to meet Gowda. Then there is the unpredictable Lebed, who heads a recent alliance of ten parties and is believed to be close to the aluminuim industry.

The communists, led by Gennady Zyuganov,are also hopeful of recapturing power. They already dominate the State Duma, the lower house of parliament, and registered a few more electoral victories this March. For all of them the greatest worry is the chaotic economy and lawlessness. Nearly half the industries are idling, exports are mostly of raw mineral wealth, and the government did not pay salaries for several months till workers all over Russia took out a massive demonstration on March 27. There have been reports of soldiers starving, and a man recently set himself on fire near Lenin's mausoleum at the Red Square immediately after Yeltsin gave the nation a pep talk.

Even the dead might feel the pinch. A few months ago Yeltsin suggested closure of the mausoleum and burial of Lenis's body. The body, lying embalmed since 1924 and now looks like a wax figure, coasts the state a fortune to preserve. Yeltsin, however, quickly backtracked following angry protests from the communists.

Despite reports of begging and starvation Moscow appears as affluent as any other western capital and people seem well-fed. The average monthly salary is $ 180, which is equal to more than one million roubles (one dollar=about 5,800 roubles) and so anybody can be called a millionaire. The money is hardly enough to lead a decent life but most Muscovites have become used to doing two or three petty jobs on the side. Besides, many of them have property in the villages.

Most comfortable are the 12 per cent in the employ of the multinational which pay an average salary of $1000. Advertisements for jobs mention the salary in dollars, call-girls and 'hot-men' appear in the classified columns, nigh clubs do thriving business, and crime rate never drops. There were 250 kidnappings by Mafiosi last year and more than 300 cops were killed. Moscow, once the pride of communism, today lives with the worst of American capitalism.

	April 13, 1997
BIG BEAR HUG Russia tries to flatter India into a regional axis with China