Rising Russia

Russia's geopolitical resurgence is causing major shifts in the balance of power, divesting the U.S. of its world hegemony.

VLADIMIR RADYUHIN in Moscow

RUSSIA'S strategic retreat in the wake of the fall of the Union of Soviet Socialist Republics (USSR) is over. This is the message President Vladimir Putin sent to the world as he entered the final year of his eight-year presidency. In his landmark speech at a security conference in Munich on February 10, Putin said that the United States' unipolar world was both "unacceptable and impossible", and attempts to impose it through "illegitimate actions" and "hyper use of force" had pushed the world into "the abyss of perpetual conflicts".

"One state, the United States, has overstepped its national borders to impose its laws and its entire legal system on other states in all spheres - economic, political and humanitarian. Who will like this? Who will feel happy about this?" he said.

Putin declared what many world leaders may have thought about U.S. policies but dared not say aloud. He threw down the gauntlet to America - a step unthinkable and virtually suicidal for a post-Soviet Russian leader before. But Russia today is no longer the weak state kowtowing to the U.S. that it once was under Boris Yeltsin.

Having restored its integrity and regained economic strength, Russia has reasserted itself on the world stage. Moscow's moves are devoid of the great-power ambitions or the ideological basis that drove the policies of the erstwhile USSR. Instead, they are pragmatic and tied firmly to the country's economic interests.

President Putin has based Russia's foreign policy on two pillars - energy and defence technologies.

With the global demand for oil and gas outpacing their supply, Russia has used its status as the world's second largest exporter of oil and number one producer of natural gas to advance its political and economic interests. A year into his presidency, Putin called for increases in weapons exports as "a considerable and rather effective instrument for influencing (the) processes" of the emergence of "new centres of power and new security systems around the world". Russian arms sales surged from $3.4 billion in 1999, the last year of Yeltsin's presidency, to $6.5 billion in 2006. They are expected to touch $7 billion this year. "For the first time in its history, Russia is beginning to uphold its national interest by using its competitive advantages," Russia's Foreign Minister Sergei Lavrov said.

Putin has championed a new energy security model. It would guarantee not only the security of supply to consumer nations, but also the security of markets for energy-producing nations through diversification of export routes and long-term arrangements between producers and consumers. The concept has met with fierce resistance from the U.S., as it would sideline the spot markets dominated by U.S. multinationals. At the same time, it would benefit the rising economies of the East, particularly India and China, to which Russia is looking to diversify its energy flows away from the West.

Russian energy and defence supplies have formed the core of strategic partnerships Russia has promoted with India and China, which it sees as the rising centres of a new multipolarity. "I believe that the choice of Russia and other leading states, including such civilisation-forming ones as India and China, in favour of a unifying policy will be the main factor ensuring that a split of the world on civilisation grounds will not occur," Lavrov said, commenting on the attempts to provoke a conflict between the Christian and Islamic civilisations.

Russia has joined hands with China to promote the Shanghai Cooperation Organisation (SCO), a powerful regional security group that also includes Kazakhstan, Uzbekistan, Kyrgyzstan and Tajikistan. The SCO has undercut the U.S.'s strategic position in Central Asia. It called on the U.S. to set a timetable for the withdrawal of its forces deployed in the region after 9/11 to support the anti-Taliban campaign in neighbouring Afghanistan. It also encouraged Uzbekistan in 2005 to disallow a U.S. air base on its territory. Last year, the SCO greatly expanded its regional reach by granting observer status to India, Pakistan and Iran.

Moscow has utilised its energy resources to consolidate its leadership role in the former Soviet Union, binding ex-Soviet states closer to itself through substantial investment and reduced gas and oil prices. It has thus thwarted Washington's efforts to strengthen its foothold in the region through "orange revolutions".

In Europe, Russia has offered lucrative energy deals to core members of "old Europe" - Germany, France and Italy - rebuffing U.S. efforts to build a common European front against "Russian expansionism". Last month, Russia signed a long-awaited deal with Bulgaria and Greece to build a Balkan pipeline to bypass Turkey's crowded Bosporus Straits. The pipeline will strengthen Russia's position in the European energy market and undercut U.S. plans to promote alternative export routes for Caspian oil.

Russia has been the moving spirit behind the idea of a `gas OPEC', an organisation of natural gas producing nations. The new body will be formalised at a meeting of the Gas Exporting Countries Forum (GECF) in Doha, Qatar, on April 9. It will unite Russia, Iran and Qatar, which between them account for 60 per cent of global gas reserves, with Algeria, Venezuela and Central Asian gas-exporting countries. Russia has swapped energy assets and developed joint upstream and downstream projects with all of these countries. The idea of a gas OPEC has rattled the U.S. and Europe as it would shift the alignment of forces in the energy markets and leave them out in the cold. Russian politicians admit that the gas OPEC will be called upon, among other things, to offset Western efforts to control the energy markets.

In contrast to Europe and the U.S., India could benefit from the establishment of a gas OPEC. A priority task for the gas cartel would be to carve out gas exports markets to reduce competition among its members. This could lend greater momentum to plans to build the Iran-Pakistan-India (IPI) gas pipeline, which would help Russia avoid clashing with Iran on the European gas market,s by sending Iranian gas to Asia. Putin has confirmed Russia's willingness to provide financial and technological resources for the project.

Putin has used the knockout combination of Russia's energy resources and arms export potential to project its influence across the world. Moscow defied U.S. efforts to isolate Iran, by supplying $700 million worth of Tor-M1 advanced air-defence missile systems to Teheran last year. It was the biggest of several defence contracts between Moscow and Teheran since 2000, when Putin lifted an arms embargo imposed on Iran during Yeltsin's rule. Notwithstanding the nuclear controversy, Iran, armed with Russian weapons and pursuing a common energy strategy, may emerge as Russia's strategic partner in West Asia.

Russia has rebuilt close ties with its traditional ally Syria. Moscow has resumed arms supplies to Damascus and plans to set up a naval base in the Syrian port of Tartus. Putin's historic visit to Saudi Arabia, Qatar and Jordan saw Russia forge energy and defence deals in a region that has long been the exclusive preserve of the U.S. For the first time Riyadh showed interest in buying Russian weapons, including advanced T-90 tanks and air-defence systems, while the Russian oil giant, Lukoil, announced plans to invest more than $2 billion in new gas fields in Saudi Arabia.

Russia's weapons-cum-energy diplomacy has been most successful in Algeria, where Lukoil and Russian gas giant Gazprom gained exclusive access to some of Algeria's largest oil and gas fields. The deals are part of an agreement that involved the supply of $7.5 billion worth of Russian arms to Algeria.

Russia recently made deep inroads in South America, in the U.S.'s backyard. Last year Moscow signed defence deals worth $3 billion with Venezuela. Russia will supply 24 Sukhoi-30 long-range jets and 53 helicopters, and build two factories for the manufacture of Kalashnikov rifles and munitions. Venezuela has also shown interest in buying Russian submarines, air-defence missile systems, infantry fighting vehicles and other equipment.

The breakthrough in Venezuela has paved the way for a large-scale Russian offensive on the South American weapons market, which has so far been dominated by U.S. companies. Russia is currently negotiating a big arms package with Argentina, which will include helicopters, gunboats, air-defence complexes and other weapons.

As in other regions, Russia's arms deals in South America came hand in hand with agreements on utilising its energy resources. Gazprom will help Venezuela develop its huge but largely untapped natural gas reserves. These are estimated at 4.1 trillion cubic metres, the second biggest gas pool in the Western hemisphere after the U.S. reserves. President Hugo Chavez has also invited Gazprom to take part in the construction of an 8,000-kilometre gas pipeline to link Venezuela's gas reserves to Argentina through Brazil, with diversions to Bolivia, Paraguay and Uruguay. Putin said that Russian private investment in Venezuela could reach "hundreds of millions, billions of dollars". Gazprom said it was also discussing investments of $2 billion to $3 billion in Bolivia, which is part of an anti-U.S. "Bolivarian axis" along with Venezuela and Cuba.

Russia's geopolitical resurgence is generating dramatic shifts in the balance of power, divesting the U.S. of its world hegemony. U.S. politicians, both Republicans and Democrats, have unleashed a massive media campaign to demonise President Putin, accusing him of ordering political murders, restoring dictatorship and directing Russia on the wrong path.

In an effort to roll back Russia's rise, Washington has embarked on a new strategy of trying to draw Moscow into a crippling arms race that would tip the strategic balance in favour of the U.S. once and for all. The Pentagon has revived President Ronald Reagan's "Star Wars" programme of building a global missile shield designed to provide total protection against a missile attack. The "Star Wars" contributed to the economic ruin of the USSR in the 1980s, when it attempted to counter the threat with a military build-up. Strategists in Washington hope their "son of the Star Wars" will do the same to Russia.

Earlier this year, Washington announced plans to deploy an anti-missile base in Eastern Europe close to Russian borders, ostensibly to guard against a missile attack by "rogue states" such as Iran and North Korea. Russia has denounced the move as a direct threat to its security. Under the Pentagon plan, the European missile base will expand to become part of a global missile shield that will include a network of radars and hundreds of interceptors deployed in underground silos, on warships and aircraft and in space.

The U.S. has upgraded its first-strike nuclear arsenals. It has built new long-range missiles and equipped them with larger-yield high-precision multiple warheads. This amounts to a last ditch attempt by the U.S. to preserve its global supremacy. It will give America nuclear primacy over Russia for the first time in the past 50 years, and enable it to dictate its will to Russia, China and other perceived rivals.

The nuclear superiority plan hinges on Washington's assumption that Russia, whose defence budget is only one-twenty-fifth of that of the U.S., will not be in a position to maintain strategic parity with the U.S. However, Russia has picked up the gauntlet. President Putin said the Russian response would be "asymmetrical" and relatively cheap. It will involve building a new generation of missiles capable of confounding U.S. missile defences. Putin has also announced plans to speed up the re-armament of Russia's strategic missiles and build an integrated air, missile and space defence system.

Putin's declaration that the U.S.-led unipolar world is "unacceptable and impossible" hinges on Russia's ability to implement these plans.