Russian Widens Its Asian Reach With Arms Deals

New York Times
September 6, 2007
By DONALD GREENLEES

HONG KONG, Sept. 5 — On the way to the annual summit meeting of Asia-Pacific leaders in Australia, President Vladimir V. Putin of Russia has scheduled a brief stop in Jakarta on Thursday. High on his agenda: the signing of a $1 billion arms deal that includes supplying Indonesia with two Kilo-class submarines, the first of a small fleet of the vessels.

This item in Mr. Putin’s itinerary comes on the heels of other deals to sell advanced Su-27 and Su-30 combat fighters to Indonesia, Malaysia and other countries in the region, helping to entrench Russia’s place as the leading arms supplier to Asia.

After beating a strategic retreat from the region with the breakup of the Soviet Union in 1991, analysts say Russia is making a steady comeback with a more modern agenda for exercising regional military and economic power. The signs that the Russian bear wants to return to its old stomping grounds in East Asia and the Pacific have become increasingly apparent in recent times, analysts say.

On Aug. 8, in what looked like a rehash of a cold war script, two Russian strategic bombers flew provocatively close to a United States military base at Guam.

According to the Russian account, United States fighter jets were scrambled to meet the nuclear-capable TU-95 Bear aircraft in a ritual from past decades, with the opposing pilots exchanging smiles. American officials denied the interception took place.

The Russian regional resurgence is still in its early stages, but it could potentially have a significant impact on the strategic environment in East Asia and the Pacific in the next two decades.

The arms deals, for instance, are expected to increase. According to the most recent report on the global arms market by the Congressional Research Center, the United States is the world’s largest arms dealer, followed by France. Russia comes in third, but it is already the leading exporter of weapons to Asia and is aggressively promoting new arms sales. It has ambitious long-term plans to restore the strength of its depleted Pacific fleet and Far East forces. And it will become increasingly vital to Asia’s energy security as it directs a greater share of oil and gas exports to the region.

“The West and the Pacific community must come to terms with the fact that Russia is back,” said Alexey Muraviev, author of several works on Russia’s military presence in the region. “Russia no longer wants to be driven by a Europe-Atlantic agenda alone.”
Mr. Muraviev, a strategic analyst at Curtin University of Technology in Australia, said among the clearest manifestations of Russia’s aim to once again become a “formidable Pacific player” were the growing use of weapons exports for diplomatic and commercial gain and announced plans to significantly increase the firepower of its own military forces deployed in Asia.

Some aspects of the Russian role in the military affairs of the region are already well entrenched.

Between 1998 and 2005, Russia struck agreements for $29.1 billion in arms sales to Asian countries, accounting for about 37 percent of the market, according to a report to the United States Congress on arms transfers to the developing world by the Congressional Research Service. New arms deals signed by the United States during that period accounted for about a quarter of the market.

The consumption of Russian military hardware has been led by two traditional customers, China and India, as both spend billions of dollars to rapidly expand their military capabilities by buying Russian combat aircraft, warships, submarines and missiles. Russia has been deepening both those relationships by establishing joint-development programs of some weapons and agreeing to license the manufacture of others.

But it has also been aggressively seeking new clients.
In Asia, the congressional report said, “Russia’s arms sales efforts, beyond those with China and India, are focused on Southeast Asia.” It said Russia had agreed to flexible payment terms including “counter-trade, offsets, debt-swapping and, in some key cases, to make significant licensed production agreements” to make weapons deals more appealing to relatively poor customers.

The latest deal with Indonesia for Kilo-class submarines, jet fighters, helicopters and tanks hinges on access to a $1 billion Russian loan to be signed during Mr. Putin’s visit, the first to Indonesia by a Russian leader since the collapse of the Soviet Union.

Mr. Putin, who will travel on to the Asia-Pacific Economic Cooperation forum meeting in Sydney, Australia, this weekend, will be discussing several economic agreements with Indonesia, including a joint aluminum smelting project.

Russia has also expressed interest in building a joint satellite launching facility on the eastern Indonesian island of Biak.

But the spearhead for Russia’s engagement across the region has so far been weapons exports. According to the United Nations conventional arms register, Russia has in recent years exported advanced fighter aircraft, attack helicopters, missiles, tanks and artillery to countries including Malaysia, Indonesia, Vietnam, Myanmar, Bangladesh, Laos and South Korea, usually on terms favorable to the buyers.
Payment terms aside, billion-dollar foreign contracts have helped sustain the cash-strapped Russian defense industry during times when domestic purchases of new hardware have been low.

Arms deals can also help Russia rebuild diplomatic relationships and gain leverage in the region. Indonesia, which was cut off from access to United States military equipment and vital parts for several years because of Washington’s objection to its human rights record, knows how effective arms sales can be as a diplomatic tool. The United States has since restored military ties to reward Indonesia for its cooperation in efforts against terrorism.

“The Russians are not indiscriminately selling arms,” Mr. Muraviev said. “Russia has pursued a policy driven by strategic design. If it creates a strong client base, that can later be transformed into a larger relationship.”

Some arms sales have put Russia at loggerheads with the United States and its regional allies. In 2005, Russia made a $700 million agreement with Iran for a surface-to-air defense system. For several years from the mid-1990s, Russia had an agreement with the United States not to sell weapons to Iran.

Similarly, Russia’s sale of the capable Kilo-class submarines to Indonesia might not be a welcome move for some of its neighbors.

Indonesia straddles two of the world’s most important waterways, the Malacca and Sunda Straits, with 75 percent of northeast Asia’s oil imports passing through the Strait of Malacca. The sale of the Kilo-class submarines would provide Indonesia with a significant new military capacity in these sea lanes. Currently, Indonesia has two submarines that, because of technical problems, have at times been unable to submerge.

Russia’s agenda to increase its regional influence goes well beyond the role of arms dealer. It has also announced ambitious plans to restore the might of its Pacific fleet and Far East forces, which declined sharply after the collapse of the Soviet Union.

The Russian military plans to deploy a new detachment of upgraded Su-27 fighter aircraft and missiles to its Far East, starting next year.

It will also upgrade a submarine base on the Kamchatka Peninsula ahead of the launch of a new class of nuclear-powered ballistic missile submarine in 2010.

In mid-July, Vladimir Masorin, the commander in chief of the Russian Navy, told the Russian news media of plans to build six aircraft carriers, with three to be based in refurbished Pacific naval ports.

Still, the ambition of restoring Russian military power in East Asia and the Pacific would be slow and expensive to realize. The aircraft carrier program would require a huge commitment involving the deployment of escort ships and a huge logistics base. Russia, which had two aircraft carriers based at Pacific ports during the Soviet era, now has only one carrier in its entire navy. Until recently, this ship spent two years in port because of a lack of funds to go to sea.

Admiral Masorin predicted the first new aircraft carrier could be in service by 2015, but the whole carrier program would take 20 to 30 years, the Russian newspaper Krasnaya Zvezda reported on July 10.

Peter Rutland, a specialist in Russia and its relations with Asia at Wesleyan University in Connecticut, said the Russian military would have to overcome numerous major hurdles, including a dire shortage of skilled manpower, if it wanted to reassert military power in the region.

“It’s in a very sorry state,” said Mr. Rutland of the Russian military.
“They just allowed the whole infrastructure to degrade.”

Mr. Rutland argued that Russian energy supplies hold the real key to its regional ambitions. He estimates that a much-delayed export pipeline for Siberian oil, together with projects on Sakhalin Island, would lift the proportion of Russian oil that it exported to Asia to 30 percent by 2020 from the current 3 percent.
That would be a boon to the energy security of Asian countries that presently rely on the Middle East for three-quarters of its oil supplies, transported along maritime routes that could be choked off in a conflict.

It would also significantly increase Russia’s influence in the area.

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Putin visit to open new era for Russia-RI ties

World News - Thursday, September 06, 2007

Abdul Khalik, The Jakarta Post, Jakarta

Despite visits by several Indonesian presidents, from Sukarno to Susilo Bambang Yudhoyono, no Russian -- or Soviet -- president has visited Indonesia for five decades.

However, Russian President Vladimir Putin will soon make this record history when he visits the world's fourth most populous nation Thursday.

Putin's landmark Jakarta visit will prompt the strengthening of bilateral relations between Russia and Indonesia, analysts say.

The visit is also seen as underscoring the growing importance of Indonesia in Russia's quest to return to global prominence after the collapse of the Soviet Union in 1989. Present-day Russia is the heir to two-thirds of the Soviet Union's vast territory and resources.

"The visit opens a new era for Russian and Indonesian relations. With Russia almost out of its transition phase after the collapse of the Soviet Union, it is essential that it seeks to foster an alliance with Indonesia if it wants to balance the U.S.," said Hariyadi Wirawan, an international relations expert at the University of Indonesia.
The last visit by any Russian leader to Indonesia was by Soviet Premier Nikita Khrushchev when he met with Indonesia's first president Sukarno in Jakarta in the 1950s.

Russia and Indonesia are expected to sign weapons, mining and oil deals worth billions of dollars during this week's visit.

Putin, who will be accompanied by business leaders -- including the chairman of Lukoil, Vagit Alekperov, the head of the Trade and Industry Chamber, and billionaire investor Vladimir Yevtushenkov -- will meet with Indonesian President Susilo Bambang Yudhoyono on Thursday during a one-day stopover on his way to the Asia-Pacific Economic Cooperation (APEC) forum in Sydney, Australia.

Presidential spokesman Dino Patti Djalal said that both leaders will discuss ways to improve investment and trade relations, which reached only US$680 million in 2006.

"This is very a small (amount) compared to our huge potential," he said.

Russia would extend a US$1 billion line of credit to Indonesia to buy Russian military hardware, said spokesman Dino Pati Djalal, who declined to provide further details.

Indonesian mining company Aneka Tambang will sign a US$3 billion deal with Russian aluminum giant United Company Rusal, while state-owned oil company Pertamina plans to sign a US$1 billion agreement with Russia's LukOil.

Hariyadi said closer relations with Russia could help Indonesia prove to the world, and in particular Muslim nations, that it was independent of U.S. foreign policy.

Hariyadi said Indonesia had long been seen as a loyal U.S. ally, a position harder to maintain with growing worldwide discontent with the U.S. over the invasion of Iraq and its handling of the Israeli-Palestinian conflict.

He added that many have observed that Indonesia's military ties with U.S. have not helped the country gain military technology and independence.

"Russia can fill this gap and offer Indonesia similarly advanced products at a cheaper price (as well as) the transfer of technology," Hariyadi said.

Indonesia in the past heavily relied on the U.S. for military equipment. However, the U.S. slapped a military embargo on the country in 1992 after reports of human rights abuses in Indonesia's then province of East Timor.

The ban forced Indonesia to scrap much of its military equipment because of a lack of spare parts, many of which had to be searched for on the black market.

U.S. military restrictions were withdrawn earlier last year, but the Indonesian government is still seeking other suppliers to avoid the consequences of a possible future U.S. ban.

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EU Presidency wants ‘more active’ EU role in Transforming Atlantic Alliance

The Portugal News, 1 September 2007

The Portuguese EU Presidency has called for a “renovation” of the transatlantic alliance with the United States through a process that would bolster the role of the 27 – nation European bloc. Portuguese Foreign Minister Luis Amado, in comments to LUSA (the Portuguese Government news agency) by telephone from Paris, said he had defended such an initiative at annual gathering of French diplomats on Tuesday.

The renewal of the trans-Atlantic relationship and a more active role for the European Union in process of transforming the Atlantic alliance is essential from our point of view, Minister Amado said.

The proposal renewal, he added, should “not be led only by the United states”.
Minister Amado defended that alliance’s transformation should be based on an “adequate reflection” over the “system of Values” that serves as its foundation“, the need to reinforce the system of defense and security”, the strengthening of economic and social dimension” and “stronger cooperation on the international scene” between Europe, the United States and Canada.

“These are essential elements for the action of transforming the Atlantic alliance toward the strategic objective of the 21st century and for the accompaniment by the European Union of this transformation process that should not be only led by the United States”, he said ha had told the French diplomatic corps.

To this point, my comment is simple and clear. EU clearly has an unresolved issue on its relationship with United States of America. In reference to my previous article regarding the Transatlantic relations, I made an argument to that issue that there was a clear imbalance relationship between the two entities, particularly the way of tackling defense and security matters.

The US has been showing its leadership by acting unilateralism on the other hand the EU remains having problem to accumulate a united decision among them. This situation has been largely owing to the EU internal political problem that in many times hard to be united when confronting with US Global role and interests. The above brief news extracted form Portugal news, support the above mentioned assumption.

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The Transatlantic Relations: Can EU balance the US’ Global Role?

By Perry PADA

It is a fact that along with the successful expansion of the EU 27 (Jan 2007), the European Union has made significant achievements in many fields. With the population close to 487 million, at the same time EU has emerged as one of the most powerful global players in terms of economic, trade and investment shares. It contributed around 51% of the world’s foreign direct investment outflows; its export of goods and services accounted for around 38% of the world market, controlled close to 36% of the world’s GNP, and contributed around 56% of official development assistance.

EU Member States make up the largest block in the Breton Woods institutions: 23% of the votes in the World Bank, and 29% in the IMF, and it constitutes the largest collective number of votes as a regional grouping in the WTO. Noting these, it is also significant to remind ourselves of the ongoing progress of expansion of EU 29 to include the Balkan countries. The EU is becoming a significant global international relations entity in term of its geo-economy and geography. With this rate of achievement, a major question emerges: will the EU become a new global player particularly on the issues of global peace and security as a balancing force against United States hegemony?
It is widely acknowledged by many European scholars and political observers that the ongoing development of the political framework of the EU is however not as mature as the economic framework and achievements. With all of these, EU political unification remains unaccomplished, thus diluting the Union’s ambition to play a global role on political and security issues. It is without doubt that the beneficial synergy of the expansion will gradually restructure American – European future global relations. This restructuring may not prove significant in the area of global security in the immediate future due to US global predominance. America’s global agenda is clearly stated in the Bush’s doctrine that The U.S. will act against threats before they are formed and act alone and preemptively, as the best defense is an offense, recognizing that enemies can not be permitted to strike first -- with a "coalition of the willing" if possible, but alone if necessary .

It is reasonable to assume that the (enlarged) EU, as the result of its developing Common Foreign and Security Policy (CFSP), will enable Europe to become an even more effective international partner with the US in tackling regional and global problems; terrorism, proliferation of Weapons of Mass Destruction and international crimes and other global security issues. Therefore the EU will be a collaborative power with the US, but will it be a restraining power? However, the recent test case of the Iraq and/or the very recent Iranian nuclear issue; it has yet to find a single voice on vital issues of peace and security. Moreover, both crisis, clearly demonstrated that the European Union is not as monolithic as it may appear in rejecting USA unilateralism. Pro and contra of USA interventionist policy among the EU member states on the issue of Iraq speaks for itself. The U.S. has exploited this in its reference to ‘new’ and ‘old’ Europe. ‘Old’ Europe led by French, represented by many of the former Communist countries in the contra camp, while ‘New’ Europe in the pro one. Therefore, the EU’s intention of being a global actor in balancing the USA is not without hurdles. The remedy is strong political unification to realize such a mission.

The current debate exposes the argument that the uneasy process of EU political integration greatly affects its foreign policy capabilities and to some extent weakens its capacity as a new global force to balance the US role. It is therefore questionable whether the EU’s Common Foreign and Strategy Policy framework (CFSP) will be an effective foreign policy, or remain as a merely academic one due to divergent interests. At this point, it can be forecast that the future of the EU CFSP is at stake. Faced as it is with “less obedient member-states”, It is intriguing to examine the argument postulated by many scholars that the real question for European politics lies between “living in an integrated Europe dominated by France and Germany …or preferring to maintain a degree of independence by aligning with the US on security issues”. Is reliance on the US real or merely nominal independence? Supporting this latter argument is the existing ‘good’ traditional relations between US and some individual EU member-states. These bi-lateral relations contribute to the EU’s ineffectiveness, as they tend to neutralize the principle of multilateralism as a counterweight to US Unilateralism.

It can be easily predicted that the major EU member states will adopt divergent positions when confronted with security issues as they did in the Iraqi case. The US unquestionably will pursue an approach of multiple bilateralisms with EU members on security and defense matters, as there leverage is increased. In the context of the ineffectiveness of EU foreign policy, the ability of British, French and German national foreign policy will to a certain extent influence if not dominate the UE foreign policy orientation. Between them, as a rule, France and Germany tilt toward a unified and independent foreign policy, while the British retain their traditional Anglo-American ties. The current partial involvement of EU in the case of the Iran Nuclear debacle by establishing the UE- 3 “European God Fathers” (Britain, Germany and France) to deal with Iran is maybe the exception.

The CSFP with all 27 members should it fully support a position would prove to be little more than illusory if the EU member states maintain a double agenda or disguise their goals. The goals are clear: (1) to pursue their own national agenda to maintain the guaranteed alignment with the US on security issues but retain the right to determine what is a security issue, (2) gain its economic interest at the expense of the collective EU economic trajectories. Is the national foreign policy initiative to always support the national political interest? It is a questionable proposition that the divergent views and internal divisions within the union can be addressed by the decision to create an EU Foreign Ministers and diplomatic service to conduct EU diplomacy. It is, however, possible that the foreign ministers consultation institution can become one of the forums to cope with the problem of internal division. The effort to enhance the existing mechanism stipulated in the EU Constitution is to prevent the EU security system from being torn apart especially when dealing with its ‘global partner’ the USA in a real sense. The EU states “The global relationship is irreplaceable. Acting together, The European Union and the United States can be a formidable force for good in the world. If we build up capabilities and increase coherence, we will be a more credible actor and a more influential partner” .

On the other hand the Director-General of the EU for external and politico-Military affairs Sir Brain Crow has presented a variant analysis: “ [The] EU has been effective in its foreign policy only where the US has chosen not to be significantly engaged, where the EU and the US shared policies and work together, or at least where the EU accepted however reluctantly that it had to work with the US. This statement clearly acknowledges the existing leadership of the US in foreign relations.

The development of EU – US relations reflected at the US – EU summit in Ireland of June 26, 2004 is a clear signal from both sides of a rapprochement after the disagreement over the Iraqi invasion. At the Summit, the US admitted, at least rhetorically, that the EU’s role is very important as it is impossible for the US to play its role unilaterally. The Summit produced several EU - US Joint declarations on the issues of the Middle East and the Mediterranean, Sudan, Iraq, Terrorism, HIV/AIDS, Economic cooperation and Non Proliferation of weapons of mass destruction. The relationship has already been on a positive track, encouraged by their common concern and sense of solidarity and cohesion to combat post 9/11 terrorism and the bombing in Madrid of 11/03/2004. These events, for many European observers, strengthened the global bonds.

For the US part, a strong and stable EU certainly will support its global security agenda in the region; it is a benefit for the US since it realized that the cost was high to tackle alone security problems in Europe. The US President explicitly praised the success of the EU expansion. There remain major reservations about Turkey over fear of including a Moslem – culture country in Europe as well as concern over Turkish immigration in the future. The ‘temporarily’ failure accession of Turkey membership in EU was officially reported by the EU Presidency – Finland, due to Turkey’s inability to implement the “Ankara Protocol” particularly in solving its bilateral conflict with Cyprus. Nevertheless, it can be assumed that the success of EU expansion and its further development may very well lead to the spirit of European togetherness and gain ground as a new global force.

This picture has an alternative possible meaning for the US that is gradually the EU’s role would lessen its hegemonic role in the security area. For example the pro US policy of the EU member states will change its stance to support the old Europe (countries who remain opposed to the interventionist US policy in Iraq). But for many it is still insufficient to fulfill their ambitions to balance US political influence.

The current rapprochement of EU - US relations could be observed at the Vienna EU - US summit meeting in June 2006 which successfully produced a Vienna Summit Declaration. The summit displayed that both sides had been trying hard to increase their bilateral relations by adopting a common view on four areas of cooperation under the title of EU - US strategic partnership, namely:

- Promoting peace, human rights and democracy worldwide;
- Confronting global challenges, including security;
- Fostering Prosperity and opportunity;
- Promoting strategic cooperation on energy and energy security, climate change and sustainable development.

While the four areas of cooperation are too broad to be effectively implemented, the EU – US summit meeting clearly indicated that both sides tried to put behind them the previously held different views particularly the approach to tackling global security issues. Some important areas of cooperation had been reached, among them, continuing close cooperation on the Middle East through the quartet formation; preventing access by terrorists to weapons of mass destruction and their means of delivery and promoting “democratization” in Lebanon, Iraq and Afghanistan and on the Iran Nuclear issue, both sides had a common perspective to urge Iran to suspend its Uranium enrichment program.

For some analysts, the meeting clearly showed a nuanced approach reflecting the desire that both sides were seeking a common strategy on the issue of combating terrorism. Political criticism had been expressed by Europeans regarding the way the US approached combating terrorism and treating of prisoners in violation of international law and human rights principles. The current case of Guantanamo prisoners and US secret prisons scattered in Europe and elsewhere are the strongest to come under criticism but unfortunately no further action is proposed to investigate. Can Europe use its leverage to sway US policy in responding properly to global security and terrorism? The answer is, not likely

To this point, can we expect a balance of EU - US relations within the context of global relations? The immediate answer depends on the EU’s process of greater political unification and the ability of the EU as an effective union to tackle its problematic diversity while trying to replace US political supremacy employing leverage by its own economic policy in the third world. For example, the involvement of EU in Indonesia, in supporting the Aceh peace process and its great contribution through the multi donor trust fund for reconstruction and rehabilitation in post-Tsunami Aceh. This was a relatively successful intervention and substantially increased its leverage in the region.

It is important to note, however, that the recent EU Summit in Brussels during June 2006 clearly indicated that EU political integration needs much more times to be fully mature, this phenomenon can be learned through the rejection of Dutch and French people to ratify the European Constitution (among 25 EU member excluded Romania and Bulgaria, only 15 have ratified the Constitution).

In scholarly language, in order to fulfill its role playing as a global force, the immediate requirement is that the EU has a solid and integrated political framework, while developing its independent security and defense policy supported by an independent military force outside of NATO. Unless this takes place the result of the giant EU is that it will always be fragmented and remain in the shadow of the US and parts of it act as merely a part of “US coalition of the willing”. It is for this reason that the US vehemently opposes such an initiative.

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