Russia 110328 Basic Political Developments

Serbia's export to Russia could get hit by EU accession

http://www.emg.rs/en/news/serbia/151007.html

28. March 2011. | 07:09

Source: Tanjug

Russian Ambassador to Serbia Alexander Konuzin said Friday that Russia was interested in what Serbia had to export, especially its agricultural produce, but also wondered whether that export would be compromised by Serbia's EU accession.

Russian Ambassador to Serbia Alexander Konuzin said Friday that Russia was interested in what Serbia had to export, especially its agricultural produce, but also wondered whether that export would be compromised by Serbia's EU accession.

The free trade agreement between the two countries will be void once Serbia joins the EU, which could hurt Serbia's export to Russia, the ambassador explained speaking at a meeting on Serbia's export potential.

Russia has nothing against Serbia's EU integration, says Konuzin, adding that Prime Minister Vladimir Putin has confirmed that by saying that whatever is good for Serbia is good for Russia as well. However, he asked if anyone had come up with projections about the effects of becoming a member of the EU.

The free trade agreement with Russia allows Serbia to be more competitive on the Russian market, but will such competitiveness exist on the EU market also, he wondered.

Serbia's export to Russia went up by around 50 percent in 2010, while agricultural export rocketed up by 250 percent, Konuzin pointed out. This January, the export was up by 200 percent, he added.

Serbian Chamber of Commerce President Milos Bugarin said it was in Serbia's interest to boost its export to Russia because of a large trade deficit with that country.

"Around 75 percent of import from Russia is oil and natural gas," Bugarin noted, adding that the deficit was over USD 2.5 billion until 2010, but that economic diplomacy, the free trade agreement and agricultural production reduced that significantly.

Bugarin says he is among those who believe the EU integration will not harm Serbia's economic cooperation with Russia.

According to Deputy Head of the EU Delegation to Serbia Adriano Martins, the EU has donated around EUR 2 billion to Serbia over the past ten years to help it prepare for accession and there are many active projects in the country that are related to that.

Martins is optimistic about Serbia's ability to cope with the pressure of the EU market, but agrees that Serbia is still not ready for it. However, there is enough time to prepare, he added.

Russians offer USD 3 billion credit for purchase of their jets

http://english.blic.rs/In-Focus/7504/Russians-offer-USD-3-billion-credit-for-purchase-of-their-jets
NIKOLA M. JOVANOVIĆ NEMANJA VLAČO | 28. 03. 2011. - 00:02h

In a package of USD 10 billions that Russian Prime Minister Vladimir Putin offered to Serbian authorities, three billions are meant for the defense. The credit is meant for purchase of military equipment - mainly jets and anti-missile protection, ‘Blic’ learns.

Military analyst Aleksandar Radic says for ‘Blic’ that since that is a credit, the choice to Serbia shall be narrowed to one or two items in the same category only. That is not in line with the idea that modernization of the army is made on open market. Also such purchase would tie Serbia to Russia politically, military and economically on long-term basis.

Serbia Army has over a long period of time a problem with the Air Force since majority of jets are older than 20 years. The jets are mainly of MiG-21 type but there are also of MiG-29 type. At the beginning of 2010 Serbian Ministry of Defense sent to the USA requests for information for F-16 and F-18 jets, to Sweden for ‘Gripen’, France for ‘Rafal’, European Consortium for ‘Eurofighter’ and Russia for MiG-29M and Sukhoi 30.

There was also an option that the existing jets are sent to Israel for overhaul and introduction of the NATO standards, however, that idea was given up. After Putin’s visit, the alternative of purchase in Russia has got concrete details. Apart from MiG-29M and Sukhoi 30 jets, the system of anti-missile defense of S300 range is also being mentioned.

‘For some time already the ‘MiG’ does not have production and does not have any special reputation any more. Sukhoi, however, is in a different position. Those are exceptional jets but with obsolete electronic equipment. With this credit Serbia could buy a strong escadrilla of 18 jets as well as several divisions of anti-missile defense. For me it is more important what Russia’s motif to make such offer is than what the offered package contains’, Radic says.

Aleksandar Dragisic of the International Institute for Security says for ‘Blic’ that our Air Force has been until so far based on Russian arms. ‘From that aspect such purchase would be more suitable for us, but from political aspect it has disadvantages. This purchase needs not necessarily mean definite going away from the NATO since considerable number of the NATO members have Russian armament’, Dragisic pointed out.

Russia arms exports at record level till 2014 –report

http://www.trust.org/alertnet/news/russia-arms-exports-at-record-level-till-2014--report/
28 Mar 2011 07:21

Source: reuters // Reuters

* Contract portfolio $45 billion end 2010

* India tops list of Russian arms importers

By Thomas Grove

MOSCOW, March 28 (Reuters) - Russian arms exports are expected to stay at record levels of about $10 billion a year until at least 2014 as top customer India continues to beef up its armaments, leading military think tank CAST said on Monday. Peddling missiles, submarines and fighter planes, Russia is feeding a hungry market of Asian countries warily eyeing China's growing military might and African nations preparing for the worst in potential regional conflicts.

As the world's second top arms exporter, Russia ended last year with a record $45 billion contract portfolio. Arms exporters signed $15 billion in contracts during the year, CAST estimated.

"The existing portfolio of contracts will be enough to keep Russian arms exports at the current level for another four years or more," CAST said in the report, obtained by Reuters ahead of publication.

Rosoboronexport, Russia's weapons export monopoly delivered $8.6 billion in arms last year. Nearly 20 independent firms make up the difference with sales of spare parts and upgrades. Rosoboronexport generally makes up 80 percent of all arms exports in a given year.

India is carefully watching the growing economic and military prowess of regional rival China, the world's second largest defence spender. New Delhi boosted military spending by more than 10 percent in its 2011-12 budget to more than $36 billion.

By comparison the United States spent $530 billion on core defence spending, while China set defence spending at $78 billion.

Last year Russia delivered 10 Su-30MKI fighter planes to India as part of a broader contract worth a total of $1.6 billion as well as a shipment of 20 T-90 tanks in a $1.24 billion contract, CAST said. India and Russia, whose defence ties date back to Soviet times, also concluded an agreement last year for the design and development of an expected 250-300 supersonic fighter aircraft over 10 years, reported to be worth up to $35 billion.

Orders from China, which has been a big buyer of Russian arms in the past, is expected to stagnate in part due to the country's own defence industry, which analysts say has come into its own in part by copying aspects of Russian technology.

MISSILE DELIVERY TO SYRIA

Uganda became a large importer last year with an order of eight fighter planes worth $350 million. The African nation is nervously watching troubled negotiations between north and south Sudan ahead of the south's formal secession on July 9 as well as violence which it fears could spill over into the region.

South Sudanese politicians walked out of negotiations with the north this month, accusing Khartoum of arming militias in the contested Abyei border region and provoking other fighting.

"Given the growing tensions in southern Sudan, new Ugandan arms contracts can be expected any time now," the report said.

Moscow also delivered Bastion anti-ship missiles to Syria despite protests from Israel in 2010, in a deal previously quoted at $300 million.

Israel fears the sale of the rockets, capable of hitting ships 300 km (190 miles) off Syria's coast, could end up in the hands of Lebanese guerrilla group Hezbollah.

While New Delhi accounted for 41 percent of arms deliveries, Algeria took 12 percent of exports and Syria represented 7 percent of deliveries. (Editing by Matthew Jones)