RBC: Potential ‘Arab NATO’ members unlikely to abandon Russia

Washington has been laying the groundwork for creating a new military block to provide security – the Middle East Strategic Alliance (MESA) – over the past several months, which is believed to unite the efforts of eight countries (Saudi Arabia, UAE, Kuwait, Qatar, Oman, Bahrein, Egypt and Jordan) against ‘Iranian aggression’ in the region, RBC writes with reference to the Defense News online portal. Initiated back in 2011, the formation of a military union of Arabic countries, or the so-called ‘Arab NATO’, looks even more lucrative for the Trump administration than for the previous Obama White House, which was more enthusiastic about rolling back America’s military presence in the Middle East. Trump’s administration is preoccupied with the region particularly amid a sharp deterioration in US-Iranian relations.

However, some experts say that Middle Eastern countries should assume more efforts to team up in order to form an efficient defense institution.

“The US is trying to give the appearance of an anti-Iranian front, which is not a new idea. Moreover, this initiative broke down previously due to discord among Arab states,” Anton Mardasov, an expert from the Russian International Affairs Council, told RBC, adding that it was particularly obvious during the Yemeni conflict, “with evident problems in command and rivalry between Saudi Arabia and United Arab Emirates.” The Arabic countries also lack a consensus on an approach to Iran, adds Senior Researcher at the Russian Academy of Sciences’ Institute of Oriental Studies Vladimir Sazhin. The two countries that are primarily interested in creating a military alliance against Tehran are the US and Israel, whereas Qatar and Oman maintain good relations with Iran, he explains.

The MESA initiative is unlikely to worry Russia, Maxim Suchkov, an expert on the Middle East, told the newspaper. “First, the idea is half-baked so far, second, Arab states have been demonstrating their desire to diversify relations with international players over the past several years, which means that military and political contacts with Moscow will remain important for them regardless of the progress with the military structure mentioned by the US,” he elaborated. Russia is involved in a military partnership with a few countries that can potentially enter this ‘Arab NATO’, among them are Saudi Arabia, Qatar and Egypt, which are negotiating purchases for S-400s with Moscow. Earlier the US administration urged those states to abandon those deals with Russia, RBC adds.


Kommersant: US may punish India for buying S-400s from Russia

Washington may levy sanctions on New Delhi if it purchases Russia’s S-400 air defense systems. The issue was raised by Assistant Secretary of Defense for Asian and Pacific Security Affairs Randall Schriver, who expressed concerns over India’s intention to purchase Russia’s cutting-edge weapons, Kommersant writes. This comes despite the previous pledge by Congress to make an exception for New Delhi and waive the Countering America’s Adversaries Through Sanctions Act (CAATSA). According to Schriver, the final decision will be made by US President Donald Trump.

Nandan Unnikrishnan, Vice President of India’s Observer Research Foundation, suggests that the recent development means that Washington has decided to compel India to withdraw from the S-400 deal and purchases of other cutting-edge Russian weapons even after making a deal with Congress on the ‘Indian issue’. Director of the Moscow-based Centre for Analysis of Strategies and Technologies Ruslan Pukhov added that the US defense official’s statement coincided with preparations for the first-ever meeting between American and Indian defense and diplomatic chiefs in the so-called ‘2+2’ format that had been expected earlier this year, but was postponed twice – in April and July. “Washington is trying to beef up its arguments for bargaining with India on a wide range of issues covering military and technical collaboration, which is why Randall Schriver’s statement can be viewed as an attempt by the Americans to strengthen their positions prior to the talks,” he told the paper.

Meanwhile, a source in New Delhi close to the Indian government told Kommersant that nothing would make India welsh on the deal with Russia. “Earlier, with previous administrations in the White House, India had repeatedly proved that any pressure on it was counterproductive,” he said, adding that Narendra Modi’s government remains firm in its intention to buy S-400s from Russia.


Kommersant: Russia’s major Mediterranean drills to counter ramped-up regional US moves

The large-scale exercises in the Mediterranean Sea involving 25 vessels and 30 aircraft from the country’s Navy and Aerospace Force announced by Moscow earlier this week and expected to start on September 1, might be seen as a response to US actions in the region, Kommersant writes with reference to a source in the military command. This comes after Russian Special Presidential Envoy for the Middle East and Africa, Deputy Foreign Minister Mikhail Bogdanov said on Thursday that the upcoming drills in the Mediterranean Sea have nothing to do with the situation in Syria’s Idlib province, adding that Idlib is not located in the Mediterranean Sea.

The areas of the drills will be deemed dangerous for shipping traffic and flights, while civilian planes would have to avoid them, the Defense Ministry told Kommersant. Meanwhile, Russian Foreign Ministry Spokeswoman Maria Zakharova said on Thursday that Moscow is concerned about the US-led coalition’s grouping in the Mediterranean Sea zone. It consists of about 70 carriers, around 380 airborne cruise missiles, as well as two US destroyers Carney and Ross, each carrying 28 Tomahawks on board, the diplomat noted. The grouping of missile carriers can be reinforced in just one day’s passage with two more US destroyers and submarines. In the Red Sea, the guided missile destroyer Jason Dunham can arrive within the same period while the Sullivans in the Persian Gulf can return to the attack position, Zakharova said. That is no less than four more seaborne missile carriers with striking power of over 112 Tomahawks that can join any potential hostilities against the sovereign state of Syria within the shortest time possible, she concluded.

Dmitry Gorenburg, a senior research scientist at CNA, believes that Moscow miscalculates Washington’s actions in the region. “The (scale) of forces focused there is of no importance. What is important is the intention. Currently, the US is withdrawing forces and facilities from Syria, and it would be strange to suggest that Washington will undertake an attack in this situation,” he told Kommersant.


Izvestia: French firms operating in Russia have no plans to leave, says expert

Not a single French company has left Russia after the European Union (EU) imposed sanctions against Moscow, Head of the Franco-Russian Analytical Centre Observo Arnaud Dubien said in an interview with Izvestia. He noted, “Unlike American and other companies, French (companies) have not left because they see prospects in Russia,” he said, adding that instead they have adjusted to the new environment, both the economic and legal climate. “French businesses have been firm and have not given up hope on Russia,” Dubien emphasized.

Currently, over 1,000 French firms are operating on the Russian market, and more than 5,000 French companies are involved in exports to Russia, Observo’s director said citing data provided by the Franco-Russian Chamber of Commerce and Industry. Asked about sanctions-related losses for the French economy, he said that though estimations vary significantly, in all cases they amount to the tune of billions of euro. “There are direct losses for those exporters that suspended all operations in Russia and lost the market; there are markets lost due to sanctions’ aftermath – the lack of financing, or due to the fact that the Russian side has chosen a more politically reliable partner. In addition, there are the consequences of the economic crisis in Russia that are not connected with the sanctions,” he explained.

Speaking about lost markets, Dubien mentioned agriculture primarily. “However, it is partially offset by French businesses present in other parts of the agricultural chain. Many French enterprises have launched Russia-branded business based on French technologies and backed by French funds,” Head of Observo told Izvestia. He added that he considers the perception of Russia by the French elite and economic players to be the key problem now. “The main gap lies between those companies that are already in Russia and those that have not yet come. The firms that entered Russia several years ago have stayed here, continue investing and are very satisfied as a rule. Meanwhile, those companies that have not yet operated here are reluctant to come,” he noted, adding that the current focus is to help the latter “cope with prejudice and the negative background, and get them acquainted with those who have been successfully working in Russia for many years.”


Nezavisimaya Gazeta: Ukraine, Russia not rushing to pay back billions in debt

In two weeks, the High Court in London may determine the fate of over $3 bln that Ukraine has to repay Russia over the Gazprom-Naftogaz gas transit dispute. In addition, the arrests of Gazprom’s assets are in full swing. Particularly, the shares of the Blue Stream Pipeline Company, a joint venture between the Russian gas producer and Italian Eni, the operator of the marine section of the Blue Stream natural gas pipeline to deliver gas from Russia to Turkey, were arrested on May 30, 2018, Nezavisimaya Gazeta says. Some experts interviewed by the newspaper are rather optimistic about the arrest.

“It does not stipulate alienation of the owner’s rights, it only limits the right to resell or vest assets in third parties,” Managing Partner at the Law and Business asset managing company Alexander Pakhomov told the paper, adding that Gazprom is not losing its share in the Blue Stream Pipeline Company.

Gazprom and Naftogaz of Ukraine plunged into a litigation over gas supplies and transit contracts with the Arbitration Institute of the Stockholm Chamber of Commerce back in 2014. On February 28, 2018, the Stockholm Arbitration court handed down a final decision on the dispute between the two companies, obliging Gazprom to pay $2.56 bln. On March 29, 2018, Gazprom challenged the ruling in the Svea County Court of Appeal and demanded its partial reversal citing serious procedural violations. On May 28, 2018, Gazprom submitted an appeal to the court to fully overturn the arbitration ruling. “Considering that Naftogaz has the court ruling, which has not been overturned, representatives of the Ukrainian company will continue applying to the courts of countries that acknowledge the Stockholm Arbitration decision, along with those jurisdictions where the Russian company may have assets,” Pakhomov said, adding that this saga may drag on “not just for years, but maybe even for decades.”


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