SOURCE: The St. Petersburg Times
DATE: Issue #1118 (84), Tuesday, November 1, 2005
**************************************************************************


TITLE: Russia Agrees to UN Resolution on Syria
PUBLISHER: The Associated Press
TEXT: UNITED NATIONS — The UN Security Council unanimously adopted a resolution Monday demanding Syria’s full cooperation with a UN investigation into the assassination of Lebanon’s former prime minister and warning of possible “further action” if it refuses. 
The United States, France and Britain pressed for the resolution following last week’s tough report by the UN investigating commission, which implicated top Syrian and Lebanese security officials in the Feb. 14 bombing that killed Rafik Hariri and 20 others. The report also accused Syria of not cooperating fully with the inquiry.
The three co-sponsors agreed to drop a direct threat of sanctions against Syria in order to get support from Russia and China, which opposed sanctions while the investigation is still under way. Nonetheless, the resolution was adopted under Chapter VII of the UN Charter, which is militarily enforceable.
The resolution requires Syria to detain anyone the UN investigators consider a suspect and let investigators determine the location and conditions  in which the individual would be questioned. It also would freeze assets and impose a travel ban on anyone identified as a suspect by the commission.
These provisions could pose a problem for Syrian President Bashar Assad, as well as his brother, Maher Assad, and his brother-in-law, Assef Shawkat, the chief of military intelligence. The Syrian leader has refused a request from the chief UN investigator to be interviewed. Investigators also want to question his brother and brother-in-law.
The U.S. invited foreign ministers of the 15 Security Council nations to attend the meeting to send a strong message to Syria to cooperate with the inquiry, and a dozen ministers showed up, including U.S. Secretary of State Condoleezza Rice and ministers from Russia, China, Britain and France.
Rice told the council that Syria had been put on notice by the international community that it must cooperate with the inquiry by German prosecutor Detlev Mehlis.
“With our decision today, we show that Syria has isolated itself from the international community — through its false statements, its support for terrorism, its interference in the affairs of its neighbors, and its destabilizing behavior in the Middle East,” Rice said. “Now, the Syrian government must make a strategic decision to fundamentally change its behavior.”
“The Chapter VII resolution that we are passing today is the only way to compel the Syrian government to accept the just demands of the United Nations and to cooperate fully with the Mehlis investigation,” she said.
British Foreign Secretary Jack Straw said the Security Council is “putting the government of Syria on notice that our patience has limits.”
“The people of the Lebanon have become all too acquainted with grief,” he said. “We owe them a better future, and this resolution is one way of providing them with that better future.”
France’s Foreign Minister Philippe Douste-Blazy stressed that the resolution has one aim: “the truth, the whole truth about Rafik Hariri’s assassination in order that those responsible for it answer for their crime.”
By adopting the resolution, he said, the council showed solidarity with Lebanon, support for the Mehlis commission’s work which has been extended until Dec. 15, and demanded “firm and urgent cooperation” from Syria.
Syrian Foreign Minister Farouk al-Sharaa, who flew to New York to attend the council meeting, listened to minister after minister demand his government’s cooperation. Several noted Damascus’ recent promises to cooperate.
Assad on Saturday ordered that a judicial committee be formed to investigate Hariri’s assassination. A presidential decree said the committee will cooperate with the U.N. probe and Lebanese judicial authorities.
Brazilian Foreign Minister Celso Amorim, whose country has large Lebanese and Syrian communities, made clear that any further action against Syria would require Security Council approval.
“Brazil will not favor hasty decisions that may lead to an undesirable escalation of the situation or further endanger the stability of the region,” he said.
Russian Foreign Minister Sergey Lavrov said the resolution was useful because it showed the council’s determination to discover the truth behind Hariri’s assassination. “The final text of the resolution, of course, is not ideal,” he said. 
Russia said last week it opposed sanctions against Syria, its longtime ally. Late Sunday, Lavrov criticized what he described as attempts to turn the Security Council into an investigative body, in comments broadcast by Russia’s Channel One television. 
Although the final text dropped the threat of sanctions, it said if Syria doesn’t cooperate “the council, if necessary, could consider further action.” That could, ultimately, include sanctions. 
In another concession to try to get Russia and China on board, the co-sponsors also agreed to drop an appeal to Syria to renounce all support “for all forms of terrorist action and all assistance to terrorist groups.” 
The final negotiations on the text began Sunday night at a dinner hosted by Rice for the foreign ministers of the four other permanent council nations — Lavrov, Straw, China’s Li Zhaoxing and France’s Philippe Douste-Blazy. The talks resumed early Monday, and then the entire council met behind closed doors.

TITLE: October Surprise Could Be Repeated
AUTHOR: By Irina Titova
PUBLISHER: Staff Writer
TEXT: October, to misquote T.S. Eliot, was the cruelest month.
A balmy Indian summer prolonged St. Petersburg’s usually brief autumn to give the city warm, sunny days for much of the month. But in the last days of October, the city was in the grip of a unwelcome cold snap.
Sudden snowfall and a plunge in temperatures on Wednesday caused more than 1,000 road traffic accidents in St. Petersburg, local media reported.
It had been one of the warmest Octobers recorded in the city, head of the Meteorological Service at the City Meteorological Center Alexander Kolesov, said Monday. 
“But no records were broken,” he said.
The unusual warmth was caused by active anti-cyclones that covered Russia’s Northwest until late October, Suleiman Musamandi, weather forecaster at the City Meteorological Center, said on Friday.
However, these conditions yielded to an Arctic cyclone that arrived in the area thanks to the onset of winter, Musamandi said.
The cyclone brought cold weather, snow and frost.
On the first day of the cyclone, snowfall caused more enormous traffic jams as snow ploughs were brought into service to clear the city’s roads.
As the snow froze on sidewalks, 42 people were reported Friday as suffering falls that caused injuries. 
At least 33 of those people were hospitalized. 
It was also reported at the same time that 26 people were hospitalized with hypothermia.
Forecasters are predicting better weather for the first three weeks of November.
“November is expected to have temperatures close to the norm,” Kolesov said.
“In the first 20 days of the month the weather will be sunny, with average temperatures ranging from plus 2 degrees Celsius to plus 7,” he said. “The nights will be rather cold with temperatures from minus 4 degrees Celsius to plus 1.”
But, in a repeat of October, November is promising a frosty sting in its tail.
“The last 10 days of November will be cold and snowy with daytime temperatures ranging from plus 4 to minus 1, and down to minus 10 degrees Celsius at night,” Kolesov said. 
Traditionally, Dec. 1 is considered to be the first day of winter in Russia.

TITLE: Proposed Unification With Belarus Seen as Patriotic Ploy
AUTHOR: By Francesca Mereu
PUBLISHER: Staff Writer
TEXT: MOSCOW — After several years gathering dust, the long-standing proposal to unite Russia and Belarus into a common state is being revisited, with plans afoot to draw up a draft constitution next month. It is unclear, however, whether the move is anything more than a Kremlin attempt to court an electorate nostalgic for the Soviet Union.
An alternate scenario much discussed in the Russian press — that the formation of a Russia-Belarus union could be used as a way to keep President Vladimir Putin in power beyond 2008 — is thought less likely, due to strong resistance from officials in both countries to the idea. 
A joint commission of Russian and Belarussian officials announced earlier this month that they would draw up a draft constitution by mid-November, a document that would pave the way for creating the union’s executive and legislative bodies.The commission will submit the draft to a Russian-Belarussian intergovernmental group, the Supreme Council of the Union State, by Nov. 15, which would then call for a referendum on the constitution in the two countries, State Duma Speaker Boris Gryzlov said after an Oct. 20 session of the commission.
If adopted, the constitution, which calls for a two-chamber parliament, a cabinet and a supreme council, would enter into force 30 days after being published in Russian and Belarussian newspapers, Gryzlov said.
The announcement prompted speculation in the Russian press that Russia-Belarus integration is being accelerated so that Putin can move on to run the common state after his second term expires in 2008.
“The only meaning this move has is to please those who are nostalgic for the Soviet Union in both countries,” said Tatyana Stanovaya, a political analyst with the Center for Political Technologies. The Supreme Council would be the top executive body of the union and would be co-chaired by the presidents of Russia and Belarus, according to the current draft constitution.
But Pavel Borodin, the secretary of the Russia-Belarus Union, is lobbying for the draft constitution to be changed so that a president and deputy president run the union.
“An union state cannot develop without independent and effective power exercised by a president,” Borodin said, the official government newspaper Rossiiskaya Gazeta reported last Thursday.
Borodin said the union’s president and deputy president should serve seven-year terms. He has repeatedly called for Putin to become president of the union between the two countries after he completes his second term as Russia’s president in 2008.
Stanovaya and Yury Korgunyuk, an expert from the Indem think tank, said they thought the project had been resuscitated to please voters ahead of parliamentary and presidential elections.
“People like to hear populist statements that two Slavic countries like Russia and Belarus are working to unite,” Korgunyuk said.
A union would not help the Kremlin to find a solution to “the 2008 problem,” said Vladimir Pribylovsky, head of the Panorama think tank.
Speculation has been swirling for months about what will happen after Putin’s current second and constitutionally final term ends, and Kremlin critics have expressed doubt that Putin will leave office. Pribylovsky said that even if the constitution were amended as Borodin suggested, the president of a future Russia-Belarus union would not have the power to rule in Russia.
“Putin would just get a symbolic job, since he would be a president of a union that doesn’t mean anything,” he said.

TITLE: Report Says Audit Chamber Needs More Independence
AUTHOR: By Anna Smolchenko
PUBLISHER: Staff Writer
TEXT: MOSCOW — Sergei Stepashin, the country’s top auditor, came under unusual scrutiny on Monday when Britain’s National Audit Office presented him with an evaluation of his work.
Stepashin’s Audit Chamber received high marks for its talented staff and outreach to the regions, according to the first independent assessment of the chamber in its 10-year existence.
But if the Audit Chamber gains more independence, its employees will play an important role in building civil society and fighting corruption, Sir John Bourn, head of Britain’s auditing office, told government officials and State Duma deputies during the presentation of the report.
“An independent audit chamber is one of those crucial institutions and it makes democracy work,” he said on the sidelines of the gathering.
The audit falls into a larger project on reviewing the performance of state bodies commissioned by the Russian government and funded by Britain’s Department for International Development.
A key recommendation for the Audit Chamber was making it financially independent of the Finance Ministry, which currently controls its purse strings.
“For a modern supreme audit institution, independence is more than just words on paper,” said Bourn. 
The report recommends the creation of a Duma committee that would allocate funds to the Audit Chamber and oversee its activities, much as in Britain today. 
But Bourn added that 20 years ago, the situation was not much different in Britain, with the National Audit Office answering to the finance ministry. “This of course was crazy,” he said. “That was bad practice.”
With greater independence, Russian auditors would help increase accountability in the public sector, Bourn said.
The Audit Chamber could find additional sources of income — independent of the budget — by seeking auditing contracts with large international organizations like United Nations agencies.
By being open to suggestions and tip-offs from the general public, he said, auditors help strengthen civil society.
Furthermore, the Audit Chamber should not only focus on monitoring government activities but engage in projects that serve the greater public good, Bourn said.
For example, the National Audit Office has presented studies into how to increase attendance at English schools or cut the number of deaths from cancer.
Stepashin, the man whose job it normally is to look over other people’s shoulders, listened to Bourn’s comments attentively.
“This is a revelation for me. A very pleasant revelation,” he said.
However, Stepashin said that Bourn’s recommendations should be addressed to the government as a whole, and not just the Audit Chamber.
Oleg Morozov, a deputy speaker of the Duma, acknowledged that the legislature could work closer with auditors, as in Britain. 
But he also said the chamber should do a better job of reaching out to the public.

TITLE: IN BRIEF
TEXT: Young Uzbek Killed
ST. PETERSBURG (SPT) — A young Uzbek citizen died of knife wounds in Moscow on Sunday after an attack near the People’s Friendship University, police said.
Prosecutors have identified three attackers and are investigating, Interfax said. The victim, whose name was not given, was 22. 

Stavropol Nomination 
ST. PETERSBURG (SPT) — The Stavropol regional legislature unanimously confirmed incumbent Governor Alexander Chernogorov for another term on Monday, Interfax reported.
Chernogorov, who has been the region’s governor since 1996, asked President Vladimir Putin in September to renominate him.
A resident in a Stavropol region village complained of a water supply problem there during Putin’s televised call-in show in September. Putin said that Chernogorov needed to fix the problem to be nominated again. 

Alkhanov on Abductions
ROSTOV-ON-DON (AP) — Chechen President Alu Alkhanov called Monday for more to be done to end abductions that continue to plague the region, which is to have elections next month. 
Chechnya is to hold elections to the regional legislature on Nov. 27. 
“Measures against abductions should be vigorous and uncompromising,” Alkhanov said during a meeting with officials, Interfax reported. “Otherwise, confidence in the authorities will be shattered. When people know that their relative or friend has been abducted, and we keep silent, respect for authorities does not grow and this shameful practice does not disappear.” 
Meanwhile, two Russian soldiers were killed Sunday in the latest clash in the southern Shatoi region. 

Belarus Claim Denied
MINSK (AP) — The U.S. Embassy in Minsk on Monday rejected a Belarusian official’s allegations that Washington was trying to destabilize the country. 
“The United States doesn’t seek to destabilize, threaten or undermine the Belarusian state and continues to respect the independence, sovereignty and territorial integrity of Belarus,” the embassy said in a statement. 
The statement followed remarks by Vasily Dementei, the first deputy chief of Belarus’ KGB security agency. “The facts prove that the basic goal of the security services of foreign nations, in particular the United States, is to destabilize the political situation in our country ... up to the point of intervention,” Dementei told lawmakers on Thursday.

TITLE: Captain Jailed For Death of Six Sailors
AUTHOR: By Irina Titova
PUBLISHER: Staff Writer
TEXT: A captain charged with negligence leading to the death of five navy cadets and one officer was sentenced to five years imprisonment by the St. Petersburg Navy Court on Friday.
When the verdict was announced, Captain Maxim Gavrilov was led away as mothers of the dead cadets shouted “It’s not negligence, it’s murder!”
In the verdict the court changed the charge against Gavrilov from “exceeding authority to cause severe consequences” to “negligence causing death,” the offices of the court announced.
The court also said that for three years after his release, Gavrilov will have no right to be employed in managerial or executive positions. The court excluded the charge that when committing the crime Gavrilov was drunk, as this could not be proved, Interfax reported.
In the verdict the court said that in June of this year, Gavrilov took a group of cadets to sea in a small yacht for drills without authorization and violating a number of rules. 
Gavrilov made a number of mistakes in the preparation of equipment which later resulted in the boat capsizing two kilometers from shore. Gavrilov allowed five cadets and one officer to try to swim to the shore but all those who swam died before reaching land, the verdict said. 
Gavrilov and cadet Ivan Pikul remained near the boat and were saved by fishermen in the area.
During the announcement of the verdict the mothers of the cadets who died held pictures of their sons in their hands.  
The prosecution initially asked for six years imprisonment for Gavrilov but the mothers believed he deserved more, Fontanka.ru reported.
However, the court considered that Gavrilov had no intention of committing the crime, and took into account Gavrilov’s actions to save Pikul. The court also took into account that Gavrilov is the father of a small child, Fontanka.ru said.
During the court martial, navy cadets sat on the first row to provide security after one of the dead cadet’s mothers tried to tear off Gavrilov’s epaulets.

TITLE: Airplanes Linked to Nalchik Terror Attacks
PUBLISHER: The Associated Press
TEXT: NALCHIK — Deputy Prosecutor General Nikolai Shepel said Friday that his office was investigating allegations that militants who raided Nalchik earlier this month might have planned to use civilian planes in terrorist attacks.
Shepel said investigators were probing the motives behind militants’ plans to seize an airport in Nalchik and whether they had planned to use planes located there for terror attacks, according to a statement released by his office.
At least 139 people died in the assault on Nalchik, the capital of Kabardino-Balkaria, including 94 accused attackers, according to official tallies.
Shepel’s statement followed official statements that federal authorities had received a tip-off about the militants’ plan to seize the airport at Nalchik. Some media speculated that the militants might have intended to use aircraft for suicide attacks. Officials said they had tightened security at the airport and other facilities prior to the raid, which helped defeat the attackers quickly .
Meanwhile, dozens of relatives of  the men killed during the attacks protested outside Nalchik’s only working mosque Friday, demanding officials turn over bodies for proper burial.
Authorities have refused, saying that the law forbids turning over the bodies of terrorists.
Valery Kokov, Kabardino-Balkaria’s 64-year-old former president, died of complications from cancer, a government spokeswoman said Saturday.
Kokov died overnight in a Moscow hospital, said Jamila Khagharova, a spokeswoman for the region’s current president. Kokov, who spent nearly 15 years at the head of the republic, was considered by the Kremlin to be key to stability in the volatile region. Federal President Vladimir Putin attended Kokov’s funeral in Nalchik on Sunday.

TITLE: Most Russians Distrust State
PUBLISHER: The Associated Press
TEXT: More than half of respondents in a recent nationwide poll said they did not trust a single branch of government in Russia, according to findings released Monday,. 
The survey of 1,600 people conducted by the independent ROMIR polling company in October highlighted low public respect for authorities widely viewed as corrupt and dishonest. 
In the poll, 52 percent of respondents said they did not consider a single branch of power to be honest; 30 percent said they believed the president was honest. The level of trust for the nation’s top courts, prosecutor general’s office and parliament was in single digits. 
On Transparency International's scale of corruption for 145 countries, Russia was placed No. 90, along with Mozambique and Malawi.

TITLE: Police Hunt Syringe Assailant
AUTHOR: By Carl Schreck
PUBLISHER: Staff Writer
TEXT: MOSCOW — A man wielding a syringe has carried out a series of attacks on pedestrians in Yekaterinburg recently, stabbing passers-by and fleeing the scene undetected, health authorities in the city said Monday.
Five victims in the last 10 days have reported to the city’s health department with concerns that they may have been infected with HIV or hepatitis after the attacks, and the victims have given similar physical descriptions of the assailant, department spokeswoman Inna Abelinskene said by telephone Monday.
“Almost all of them have described the attacker as a young man wearing dark clothing,” Abelinskene said. “He jabs them with the needle and then runs off.”
Leonid Semyonov, spokesman for the city’s police, said by telephone Monday that none of the victims had reported the incidents. But he said police were aware of the reports and searching for suspects.
“If a suspect is detained he would probably initially be charged with hooliganism,” Semyonov said. “But if it turns out the needles were infected, he could face more serious charges.” 
Under Russian law, a person convicted of intentionally infecting more than one person with the HIV virus can receive a prison sentence of up to eight years.
Abelinskene said the chances of being infected with HIV in such an attack were relatively low, but not impossible.
An infection could occur if there is blood on the needle that contained a high concentration of the virus and the puncture wound is especially deep.
“We recommend that victims in such attacks take immediate measures,” Abelinskene said. “They should go to a doctor and have their blood tested.”
Victims should then have their blood tested again three months later, when traces of the virus would begin to appear in an infected person, she said.
Abelinskene said, however, that health authorities were more concerned about Hepatitis-C infections.
“Hepatits-C is much more contagious than HIV,” she said.

TITLE: Russia, China Join Moon Race
PUBLISHER: The Associated Press
TEXT: MOSCOW — Russia and China may cooperate in a lunar exploration program that would culminate with a manned moon mission in less than two decades, Interfax news agency quoted a Russian space official as saying Monday. 
China has asked Russia to help with an unmanned lunar probe program, Interfax quoted Federal Space Agency deputy chief Yury Nosenko as saying in China, ahead of a meeting between the two countries' prime ministers in Beijing on Wednesday. 
 That Chinese program, which would only involve Russian assistance, could be followed by a joint lunar study and exploration program — possibly in 2012, when Russia is planning to launch a research probe to the moon, Nosenko said, according to the report. 
After that, “We may undertake a joint project designed for 5-10 years" that would end with a manned moon mission,” Interfax quoted Nosenko as saying. 
Nosenko also said that Russia has proposed that the two countries develop a small satellite to orbit Mars.

TITLE: A Wife’s Long Journey to a Prison in Chita
AUTHOR: By Catherine Belton
PUBLISHER: Staff Writer
TEXT: KRASNOKAMENSK, Chita Region — Inna Khodorkovskaya is still reeling from the tremendous turnaround her life, and her husband’s, has taken. From quietly enjoying the comforts of being the wife of the nation’s richest man and keeping a low profile throughout his highly publicized trial, she has been thrust into the spotlight while visiting her husband inside an east Siberian prison camp.
“I never thought it would go this far,” she said in an interview in Krasnokamensk on Friday after a three-day stay in the town’s prison camp, YaG 14/10. Wearing jeans and a sweater, she looked tired and pale, but somehow still collected despite the arduous journey from Moscow to the camp with the press pack hunting her down. 
Like many others when Mikhail Khodorkovsky was arrested two years ago, she said she did not believe he would remain in jail for long. Before he was arrested at gunpoint at a Siberian airport, she knew things were tense, she said, but had no real inkling he could end up in jail.
“He was not able to talk to me in the week ahead of his arrest. He was on a business trip in the region... It was a big program,” she said. “I was waiting for him on Saturday, and on Saturday he was arrested.
“I wasn’t expecting anything. Things were tense, but I did not expect this at all,” Khodorkovskaya said.
Now, she finds herself crossing Russia to visit her husband in the prison camp in Krasnokamensk, a small company town in the Chita region named after the red rock of uranium ore found in the mines just 15 kilometers away. Town life is based around the hazardous mines and the plant that processes the ore into uranium concentrate. 
After a six-day train journey, Khodorkovsky arrived here in mid-October to serve out the remainder of an eight-year sentence. The Yukos owner was convicted in May of fraud and tax evasion in a case seen as a backlash against the threat he seemed to pose to Kremlin power. His business partner Platon Lebedev has been sent to a prison camp in Kharp, a small town near the Arctic Circle in the Yamal-Nenets autonomous district. 
Having had no contact with her husband for two years apart from mouthed words across courtrooms where he was kept in a cage and brief conversations through a glass barrier in the Moscow detention center where he was held, Khodorkovskaya was granted a three-day visit with him in a small room inside prison camp grounds. Under prison regulations, Khodorkovsky is allowed four three-day visits per year and six visits of three hours each. 
In addition to bags filled with clothing, Khodorkovskaya said she brought a sack of potatoes and cooked her husband his favorite meal of fried potatoes on a stove in the room. She said they spent the days talking about family matters, not politics.
When asked by journalists at a press conference what it was like to be back with her husband after two years of separation, she said: “I recognized him,” implying that he had not changed.
“I can say that I think we have gotten even closer to each other. This is the most important thing,” she said. 
“After two years of not seeing my husband and not sensing him by my side, this is ... You can’t put this into words.”
While she said Khodorkovsky told her little about conditions inside the prison, he said he had been offered work in the camp’s sewing operations. 
“He’s been offered work as a specialist in sewing. He is ready to learn,” she said.
In an interview in a hotel room later, Khodorkovskaya said she believed her husband was holding up well to the huge change in his fortunes and the legal attack. 
“Now his mood is different. I saw him as being totally peaceful. There is no tension. He sees everything as it is,” she said.
“When you go through the meat grinder, some people weaken, and others become more philosophical. This is how he is, and he is totally stable,” she said.
She held the press conference several hours after she was smuggled out of the prison camp Friday by Khodorkovsky lawyer Albert Mkrtychev and three bodyguards, dressed mainly in black. Using decoys and false alarms, they had outwitted a gang of journalists who were waiting for her to emerge just outside the prison gates.
That evening, she boarded a train for a 15-hour journey to the city of Chita. From Chita, there are direct flights to Moscow. 
During the press conference, Khodorkovskaya expressed fears for her husband’s health. When asked about reports of high levels of radiation in the area emanating from the uranium plant, she said she was concerned but that there needed to be more investigation into whether this was really the case.
Reporters from Russian Newsweek carrying a Geiger counter recorded a level of 52 microroentgens per hour while standing just outside the prison camp fence. Natural radiation is usually between 20 and 30. 
Town officials deny radiation levels are higher than the norm, and say winds carrying uranium dust blow toward China and not toward the town. But without constant monitoring, no one seems to know for sure. In Soviet times, a counter was fixed on the wall of the town administration building for all to see. Now, that’s disappeared and it’s not clear who is keeping record.
A local Orthodox priest, Father Sergei, who visited Khodorkovsky for 20 minutes on Friday, said Khodorkovsky asked him to pray for his three children and even hinted he could convert to Russian Orthodoxy.
“He deeply believes in God, and said he feels closer to Orthodoxy than anything else,” Father Sergei said outside the town’s only church. 
The priest, who says he spent four years in a camp in Perm, said he felt a deep connection with Khodorkovsky as a fellow political prisoner. “When I told him that I had shared a cell with [prominent human rights activist] Sergei Adamovich Kovalyov and that he had had a huge influence on me, he said he had great respect for him.”
Father Sergei said he had told prison camp officials on Friday that he was refusing their request to bless their administration building as long as a political prisoner was being held on the grounds.
With so much attention and controversy surrounding Khodorkovsky, it was not clear yet how he was being received in the prison. Khodorkovskaya said in the interview that it was difficult to tell because he had been there for only two weeks, half of which was spent in quarantine. She said, however, that the other inmates appeared to be calling him just by his patronymic, Borisovich, which she read as a sign of respect.
A former inmate, who says he was freed two months ago and remains in contact with those inside, said prison officials were trying to keep Khodorkovsky away from all the noise and interest his arrival had caused. 
“They are trying to shield him from all the attention,” said Pavel, the former inmate, who would speak only on condition he did not have to give his surname. “But of course there are those who are trying to get close to him.”
Even though Khodorkovsky is in the same barracks as the kings of the prison, the blatniye, or bandits, he was unlikely to join their ranks, Pavel said. 
“He’s likely to try to do the opposite and keep himself separate from them. He’s not a little boy who is going to want to involve himself in all that.”
Khodorkovsky is likely to have a lonely life in the camp, though he could win himself better living conditions if he plays by the rules, the former inmate said.
“Where you live depends on your behavior,” he said. “There are barracks where you can live in spacious rooms and it is pleasant; or you can live in an ordinary dormitory where it smells and it’s dark and there’s influenza, where it’s like living in a cellar.”
Decisions on where inmates are housed are made by a commission of prison officials, based on case files they keep on each prisoner, he said.
The former inmate said Khodorkovsky should not eat at the prison stolovaya, or canteen. He said he had avoided eating there for a whole year, and just ate bread and drank water and made his own meals using food from the kitchen. 
“Once you start going to the stolovaya, you will always go there,” he said. “The stolovaya is different from the stolovayas in town. You are ordered when to sit and when to stand. It’s not that they feed you like pigs, but the system humiliates you. It beats you down.”
Even though Khodorkovsky is said to be living in the same conditions as the other inmates, there are signs that prison improvements were made before his arrival. Some barracks were repaired and fixed up this summer, according to Father Sergei.
Some Krasnokamensk locals were still wondering why Khodorkovsky had been sent to their town. “We’re just 60 kilometers away from the border with China. They must be preparing to engineer his escape,” said a shop assistant, who did not want to give her name. “That’s the only reason they could have for sending him all the way out here.”

TITLE: Pressure On Dam Finally Threatens Breakthrough
AUTHOR: By Yekaterina Dranitsyna
PUBLISHER: Staff Writer
TEXT: St. Petersburg’s dam was given a boost Thursday, with the announcement of a new manager together with a massive increase in spending. Thanks to pressure at both local and federal levels the project is now due for completion in 2008. 
Begun in the Gulf of Finland in 1980 but neglected for more than 15 years due to a lack of funding, the dam will next year receive 2.4 billion rubles ($84.137 million) from the federal government, compared to the 467.6 million rubles ($16.4 million) it received this year.
The figures were disclosed by Boris Paikin, head of the Directorate of the flood protection barrier construction, at a news conference last week. “I have no doubts that the city will have the dam by 2008. Of course, what infrastructure there was has been destroyed, and we have to update the works according to new technologies,” he said.
Construction of a 25.4-kilometer complex was resumed in 2003 and would comprise 11 stone and earth dams with two ship passages in between. A highway would be laid on top of the dam. To complete the construction 15 billion rubles ($525.67 million) are needed Paikin said.
Thanks to President Vladimir Putin’s personal interference the project got a second wind this year. Apart from an increased budget the dam received a new manager, straight from the private sector.
On Nov. 1 Paikin is to leave the Directorate of the Flood Protection Barrier Construction, and will be replaced by Vladimir Kogan, giving up his posts as chairman of the Industrial and Construction Bank and president of St. Petersburg Banking House to run the challenging dam project.
According to Igor Gorsky, general director of Kommercheskaya Nedvizhimost Becar, there is no technical obstacle preventing the completion of the dam on time.
“The dam was not completed earlier because it was not being constructed. At the moment all necessary documentation is ready. The most difficult part — earth mound and concrete constructions — is finished. Only highway and ship passages are left to complete,” he said. 
Gorsky said that if the financial schedule was met then the dam could be completed by 2008. However, he admitted, financing has so far been rather irregular, intermittently rising and falling.
“That is exactly what the new team headed by Vladimir Kogan is supposed to improve. Financial specialists are coming to run the project, people who know how to count money and how to give grounds to spending,” Gorsky said.
Demonstrating confidence in the project, Gefest insurance company insured the project until the last quarter of 2007 for 1.5 billion rubles ($52.57 million).
“The insurance covers construction of protective dams linked to sluices and anti-waves protective barriers. After completion of those works the north part of the dam will be finished,” Vladimir Karyukin, insurance department director of Gefest, said in a statement.

TITLE: Sweet Deal For Ice Cream Firm
AUTHOR: By Evgenya Ivanova
PUBLISHER: Staff Writer
TEXT: A St. Petersburg-based ice-cream company will become a national leader in ice cream production and sales following its acquistion of a smaller rival, Talosto said Friday. The company may then take advantage of a growing trend in Russia to consume ice cream at home.
Metelitsa, an ice cream producer based in Moscow will be legally incorporated in the Talosto group of companies in the first quarter of 2006 when the deal is due to be finalized, an official press release from Talosto said.
The combined capacities of Metelitsa and Talosto will allow production of more then 60,000 tons of ice cream per year. “Talosto will be able to claim itself the leader in Russian ice cream production,” the general director of Talosto Alexey Abrosimov said Friday.
“Regarding ice cream production, we have established our leading position long ago, but after merging with Metelitsa, we will be ahead [on the Russian ice cream market] in sales as well as in production,” Talosto’s public relations manager Dmitri Beldyagin said in a telephone interview Friday.
Talking about the acquisition, Beldyagin rejected recent media speculation of Talosto’s total buyout of the Muscovites.
“We didn’t buy 100 percent of Metelitsa’s share. They [media reports in question] were based not on information coming from us, but on some other sources, unknown to me,” Beldyagin said.
Talosto called its purchase a “strategic step” as the company plans to benefit from Metelitsa’s strong position in the segment of a so-called “home” ice cream, a type of ice cream that is specially produced to be consumed at home rather then on the street.
“The strongest position of Metelitsa is in home ice cream production, this makes it unique compared to other producers, who are traditionally oriented on the impulse product [an ice cream bought on the street for immediate consumption]. It’s a well-known fact that this sector is currently in active development in Russia,” Abrosimov said.
Comcon, a St. Petersburg based market research center has noted this trend too. Mickhail Podushko, its strategic development director, said fewer and fewer people in Russia are buying the traditional wafer cup and eskimo ice creams, with overall street consumption, however slowly, falling each year.
According to recent Comcon’s statistics, the number of people who eat ice cream in the privacy of their own homes has continued to grow, with more then 80 percent of all ice cream consumers saying they eat ice cream at home.
Svyatoslav Radvansky, press-secretary of the Moscow-based Union of Russian Ice Cream Makers welcomed Talosto’s strategy and regarded the move as natural.
“Metelitsa has developed an extensive production of family (or home) ice creams like ice cream cakes —that’s exactly what Talosto lacks,” Radvansky said in a telephone interview Friday.
However, Ilya Gordeyev, president of Ramzay, another large ice cream producer, said he didn’t see any correlation between Metelitsa’s focus on production of home ice cream and Talosto’s decision to buy Metelitsa. 
It is more likely, that Metelitsa was a strategic acquisiton because of its good standing in the region and its high quality products, Gordeyev said Monday in an emailed satement.
Although admitting that the market for home ice cream is growing in Russia, he said it will take a long time before the Russian home ice cream market reaches similar volumes of sales as those of Western Europe and the United States.
Gordeyev said that in contrast, Russians (with the some exceptions in Moscow and St. Petersburg) tend to shop more than once a week, and buy food in smaller amounts. 
Besides, Westerners normally have not only a fridge but also large freezers, where they can store up to five kilograms of ice creams, Gordeyev added.
“In our [Russian] families there is only one fridge, therefore there is no point buying ice cream to take home, because very often there is nowhere to keep it,” Gordeyev added.
As with many industries in Russia at present, the ice cream market is in its consolidation stage, analysts say. According to Gordeyev of Ramzay this trend was something that Ramzay predicted some years ago, and it follows on from consolidation of the confectionary and meat markets.

TITLE: Study Charts Mid-Term Future
AUTHOR: By Anna Smolchenko
PUBLISHER: Staff Writer
TEXT: If Russia diversifies its economy and capitalizes on its advantages in agriculture, transportation and science, the country could reach Germany’s present per capita income by 2020, according to a study published Friday.
While foreign economists have been generous in providing tonics, prescriptions and admonitions for Russia’s mid-term development, the report by the Center for Macroeconomic Analysis and Short-Term Forecasts makes interesting reading because Russian experts rarely take a view beyond the next presidential elections.
“So far, Russia’s political horizon has been limited to three years,” Mikhail Dmitriyev, head of the government-linked Center of Strategic Research said at a conference dedicated to Russia’s longer term development.
Dmitriyev said the logic of the country’s political establishment evokes the words of British economist John Maynard Keynes, who once said, “In the long run, we’re all dead.”
Russia could travel four different roads in the next 15 years, said economist Andrei Belousov, author of the report.
“We have a lot of unengaged potential for growth,” he said, sketching out his best-case scenario, dubbed “super-industrial modernization.”
That model foresees Russia, with 10 percent of the world’s arable land, once again becoming the world’s breadbasket. It also has Russia turning into a transit hub between Europe and Asia and building on its scientific talent to become a center for research and development.  
Such aggressive diversification of the economy would come at the hefty price of $4.2 trillion, including more than $650 billion in foreign direct investment, over the next 15 years.
Andrei Klepach, head of forecasting at the Economic Development and Trade Ministry, said the study was predicated on an influx of foreign capital vastly higher than today’s levels.
“The current situation is not viable in the mid-term perspective,” Klepach told the conference. Last year, foreign direct investment amounted to $11.7 billion, according to the Organization for Economic Cooperation and Development. 
Support from the Group of Seven industrialized nations would be essential, Belousov said, and the creation of a ruble zone uniting Russia, Kazakhstan, Ukraine and Belarus would also be necessary. Under those conditions, per capita gross domestic product could reach $30,000 by 2020, the current level of Germany or France, the report said.
Under Belousov’s worst-case scenario, called “energy autism,” the country fails to diversify and to develop a middle class and is isolated from the global economy. 
The other two scenarios fall somewhere in between. 
Whatever path it takes, Belousov said that Russia is likely to face three crisis points in the next 15 years that parallel the electoral cycle: an increase of social problems in 2007-08; the exacerbation of tensions as the country is fully exposed to global competition as a full-fledged WTO member in 2011-12; and the expected exhaustion of current oil fields and a worsening demographic crisis in 2015-17.
Belousov does not put a heavy emphasis on the oil price — which he predicts will hover around $50 per barrel of Urals, Russia’s benchmark. 
A recent report by Aton brokerage, which posited an oil price of $50 per barrel, forecast Russia’s per capita GDP approaching that of Portugal’s in 2015. With oil at $100 per barrel, Russia’s per capita GDP would exceed Portugal’s by 2012.
Natalya Zubarevich, director for regional programs at the Independent Institute for Social Policy, took issue with Belousov’s assumption that President Vladimir Putin’s painstakingly crafted “power vertical” would be flexible enough to bend to the demands of the challenges facing the country. “A stick doesn’t bend,” she said.
Arkady Dvorkovich, head of Putin’s expert department, acknowledged the difficulties facing the administration.
“It’s obvious to me that we are still at the start of the road,” he said. “So far, the most plausible scenario is that aliens will come to us and make everything good.”

TITLE: IN BRIEF
TEXT: Norway in Murmansk
OSLO (Reuters) — Norwegian bank DnB NOR plans to take over a mid-size Russian bank based in the Arctic port of Murmansk, DnB NOR said Thursday. 
The bank said it would acquire 97.3 percent of Monchebank for $21 million from Moscow-based Rosbank, one of Russia’s biggest banks, owned by metals tycoon Vladimir Potanin. 
DnB NOR — the third Scandinavian bank to enter the Russian market — said the acquisition would give it a foothold in a region fitting into its three core areas of energy, fishing and shipping. 
“The acquisition of Monchebank will give us a sound position in an area with exciting prospects once the large oil and gas fields in the Barents Sea are due for extraction,” Svein Aaser, group chief executive at DnB NOR, said in the statement. 
Monchebank, which currently has 180 employees, was set up in 1990 in Murmansk as a commercial bank focusing on operations with metals companies working in the minerals-rich region.

Ice-class Vessel Growth
GENEVA (Bloomberg) — The fleet of oil tankers designed to pass through ice-bound waters around the Russian port of Primorsk will grow 33 percent by capacity in the coming northern hemisphere winter, according to Riverlake Shipping SA.
About 35 so-called ice-class vessels of 3.8 million deadweight tons will be available for taking cargoes from the Baltic port in the coming December-to-April period, compared with 28 carriers of 2.9 million deadweight tons a year earlier, Luis Mateus, an analyst at Riverlake Shipping in Geneva said in a report Friday.
“All of a sudden, ship-owners realize the importance of building ice-class vessels,” Mateus said in the report.
“Investing in such ships, historically giving a poor return on capital, became a prime investment target.”
Ice-class vessels are required to navigate in the Baltic and Barents seas, where waters freeze between December and April. Crude export capacity at Primorsk, in northwest Russia, is set to rise to 1.2 million barrels a day at the start of 2006, up from 1 million barrels a year earlier, Riverlake Shipping said.
“Primorsk was, and still is, the main driving force in the construction of new ice-class vessels,” Mateus said.
Deadweight tons are a measure of a ship’s capacity for carrying cargo, fuel and supplies.

High-speed Rail Link
ST. PETERSBURG (SPT) — A high-speed rail link between Moscow and St. Petersburg will be developed in 2006, Interfax quoted Igor Levitin, Russian Transport Minister as saying Friday.
“In 2006 the federal budget has allocated 1 billion rubles ($3.5 million) for investment projects in transport infrastructure, of which 200 million is being directed towards the development of a project for the new line.”
 According to Levitin, the project will be a partnership between public and private, with the state company Russian Railways building the line and buying carriages. The latter will conform to the requirements of a high-speed line where trains travel at over 200km per hour, and be bought “either in Germany, Italy or France, because of the interest shown by these countries,” he said. 
In addition, Levitin mentioned a separate project of a high-speed rail link between St. Petersburg and Helsinki. “ We have suggested that Finland participate in this project through purchasing the carriages,” the minister added.

TITLE: Boom Reveals Manager Vacuum
AUTHOR: By Andrew Hurst
PUBLISHER: Reuters
TEXT: As Russia’s economy powers ahead driven by high oil prices, business education is failing to keep pace and employers complain of a chronic shortage of managers trained to international standards.
More than 100 business schools have been established since the collapse of the Soviet Union but many have failed to gain credibility among Russian and international employers, who still prefer foreign-trained managers for top jobs.
A recent study by consultants McKinsey shows how far management training has to go in Russia before it catches up with the West.
Just three Russians out of every 100,000 have a Master of Business Administration (MBA) compared to 20 in Europe and 70 in the United States.
Increasingly in the United States and Western Europe, an MBA degree is seen as indispensable for those seeking success.
“In the 1960s just 10 percent of U.S. executives had an MBA but now 60 percent do. It’s considered almost a must for a successful career,” Vitaly Klintsov, a partner at McKinsey, told a recent conference in Moscow organized by the World Economic Forum.
An MBA also allows young business people to catapult themselves into the big-salary league. In the United States and Europe, business students can more than double their salaries after completing an MBA course at a prestigious school.

THE BEST GO ABROAD
Klintsov believes Russian business schools are in a bind.
“It is very difficult to get top students because they go to the West (to study) and if you do not get top students you do not get the best teachers,” he said.
Many of Russia’s top businessmen bulldozed their way to the top in the 1990s, despite not having any formal training in business. Many did, however, have degrees and even doctorates in mathematics or natural sciences.
“It is easier to turn physicists into accountants than vice versa,” Charles Ryan, chief executive officer at Moscow investment bank UFG, told the conference.
Business education has also been held back because budding entrepreneurs in the 1990s were often fearful that they would miss out on too many opportunities if they took a year or two off to hone their management skills at a school.
“The best people do not want to quit their jobs because they simply cannot afford to do so,” said an executive at an international auditing firm, who asked not to be named.
That may be starting to change as the Russian business scene consolidates. 
“The opportunity cost (of giving up a job to study for an MBA) is less today as organizations become more institutionalized,” said UFG’s Ryan.
The shortage of highly-trained Russian managers has attracted hundreds of foreigners who are employed by top local companies and often command salaries several times higher than those they would earn at home.
“Here I can earn three times what I would earn in Italy,” said an Italian businessman who recently left a top job with a European company to join a Russian group.

ACTIVE LEARNING
What business education is on offer in Russia is often very theoretical with little opportunity for students to acquire any sound practical experience.
“One of the big problems is the balance between theory and practice,” said  Carl Fey, of the Stockholm School of Economics, which has offered MBA courses in Russia since the late 1990s.
“We need active learning. There is too much passive learning.”
To tackle the problem, Russia’s government is keen to promote flagship schools in the country.
“We recognize that a lack of management talent is one of the big challenges for the country,” said Aigool Khalikova, an adviser to Russia’s liberal-minded Economy Minister German Gref.
“We have decided to allocate tens of millions of dollars to develop national champions in business education. Without the support of business, there is no way this can succeed,” she said.
The lack of a recognized elite business school to rival INSEAD in France, the London Business School or Harvard is prompting local businessmen to act.
Ruben Vardanian, founder of Russian investment bank Troika Dialog, is drawing up plans with the backing of a group of local and international companies to set up a school in Moscow which he hopes could compete with the best worldwide.
“We are trying to establish something that will be a benchmark. Now is the right time and this will be a big challenge,” said Vardanian, who said he wants $200 million to launch the school.
The New Economic School, set up in Moscow in 1992 with the help of private donations from abroad, is seen as an example of a new home-grown higher education institute which has quickly established a reputation for academic excellence.
Although it does not teach business courses, it has hired lecturers with doctorates from top American and European universities, and graduates from its masters programs are sought after by companies. But most seeking management training still go abroad.
“About 70 percent of our graduates are going into business,” Sergei Gureyev, the school’s rector, told Reuters. “And every year, our top 10 students go to the best universities and business schools in the United States and Britain.”

TITLE: Report: Police Crack Mafia Extortion Ring
AUTHOR: By Kevin O’Flynn
PUBLISHER: Staff Writer
TEXT: Police have foiled a mafia group’s attempt to extort 1.5 million euros from a British company, law enforcement officials said Friday.
“The extortionists were caught red-handed,” a law enforcement source told RIA-Novosti, saying three men were arrested in the foyer of Moscow’s Renaissance Hotel during the exchange of a payment order for the sum of 1 million euros. 
“They turned out to be two unemployed [men] and a teacher from the All Russian State Academy of the Federal Tax Service,” he added.
The three men were trying to extort a total of 1.5 million euros from British events organizer ITE Group, RIA-Novosti reported the police as saying. 
All members of the Taganskaya organized crime group, the men had threatened to destroy company property and send compromising information to the media if they did not pay, police said. 
An ITE Group spokesman, Richard Wightman, said Friday that there had been an incident and that it had gone to the authorities. He refused to give further details. 
The three have been charged with extortion and face from seven to 15 years in jail if convicted of extortion as part of an organized group. Police could not be reached for comment Sunday.
Russian media named the tax academy teacher as Nikolai Bashkirov, 32, but there was doubt as to whether he was still employed at the institution, which the government set up in 1996 to train tax officials.
Komsomolskaya Pravda reported an academy official as saying he had received his doctorate degree at the academy and worked as a teaching assistant but left in May. Bashkirov’s cousin Nikolai Korovin told the paper that he worked at ITE Group.
The arrest is the third incident involving extortion accusations and tax officials this month.

TITLE: Plans For New Holland Run Aground
AUTHOR: By Yekaterina Dranitsyna
PUBLISHER: Staff Writer
TEXT: The redevelopment of an 18th century island located in the heart of St. Petersburg will need an investment of $300 million and take at least 7 years to complete, the city governor’s press service said last week in a statement.
The tender to choose an investor, architect and developer for the project to reconstruct the New Holland island, situated between the Moika river and Kryukov and Admiralteisky canals, that should have been issued at the end of August will now be declared on Wednesday.
“The process dragged on because of the need to get approvals from federal bodies,” Governor Valentina Matviyenko  explained.  However, experts believe there are other complications in running the tender for the 220,000 square meter island.
A new requirement for applicants to consider is the specified construction period of 7 years. Earlier the city government publicized other general terms, including a required total investment of $300 million to finance construction of housing, offices, hotels and a variety of social infrastructure.
The development of a multifunctional center of 10,000 square meters is also obligatory. Such a center will remain under state ownership and be used for conferences, exhibitions and Mariinsky theater performances.
Other conditions include 1,000 car-park spaces, and one road and several pedestrian bridges to provide public access to the island.
Tender participants should prove their solvency and experience in working with architectural monuments in the construction and reconstruction of large multifunctional spaces and must already have run investment projects in Moscow and St. Petersburg.
For the tender to be valid, no fewer than two teams must submit a bid.  However, a real estate expert was of the opinion that many investors had examined the project, but not found any potential profits tempting enough.
“New Holland is a complicated object, located in an unsuitable place and demanding huge and long-term investment. It would hardly generate sufficient cash flow to provide profitability,” said Alexei Chizhov, director of the real estate department at Becar Consulting.
He explained that despite being located in the city center, New Holland suffers from underdeveloped transport links and the “depressing environment” of a poor district.
“The New Holland project is possible only as part of redeveloping the whole district — the opening of Admiralteiskaya metro station, construction of a tunnel under the Neva river, and restoration of housing.
“Without significant municipal investment into district infrastructure, the talks about developing New Holland will remain just talks,” Chizhov said.
Eduard Tiktinsky, general director of RBI construction holding, said in a telephone interview in August that before the city receives any bids for the project, the island needs to be subject to a thorough engineering and geodetic survey, which would assess the infrastructure and soil conditions. 
“Only after fully understanding all the island’s parameters, can I prepare and offer an optimal concept for tender,” Tiktinsky said, adding that predictability of expenditure was especially important given that foreign companies are expected to participate in the tender.
According to the governor’s press service, tender results will be declared by February 2006. St. Petersburg governor Valentina Matviyenko, also head of the Federal agency for culture and cinematography, together with the director of the Mariinsky theater, Valery Gergiyev, will chair the tender commission.

TITLE: State Property Sales Boost Local Budget
AUTHOR: By Yekaterina Dranitsyna
PUBLISHER: Staff Writer
TEXT: More than 50 plots of land will be auctioned off in the last quarter of this year, in line with the general trend of state property management in the city, a St. Petersburg official said last week.
City authorities follow an “assets optimization policy,” which means selling state-owned shares, land and non-residential property, Vladimir Zhukovsky, deputy director of the St. Petersburg property fund, said at a meeting organized by AH Conferences.
Sales of property earned as much as $205 million for the local budget this year, compared to $102 million last year and only $21.5 million in 2003.
Last year the St. Petersburg property fund simplified the sales procedure by introducing open tenders, replacing investment commissions. With the new scheme “less dominant companies and outsiders win the tenders,” Zhukovsky said.
In August Duze Investments, a development company registered in Cyprus, won the tender for the A-class Atrium business center located on Nevsky Prospect, paying $2 million, that is $850,000 in excess of the asking price.
The auction starting price is defined by independent assessment companies and usually varies between $350 and $450 per square meter, Zhukovsky said.
Unlike property, land is rarely sold through tenders. However, “investment rent agreements” might go to auction.
The company offering maximum rent is awarded a rent agreement for 2 to 6 years. After completing the project, investors can buy the land or negotiate a long-term rental agreement. However, if the investor fails to complete the project within the defined period of time, the city can break the agreement and revoke the land.
Timothy Stubbs, partner of Salans international law firm in Moscow, said the very fact that land is being sold in St. Petersburg is positive, in contrast to the Moscow practice of providing private firms only with long-term rental agreements.
Land ownership “allows the maximizing of IRR (Internal Rate of Return) for investment projects by attracting bank financing,” one expert said.
Another reason for buying property instead of leasing it is the general increase of property and land rents since January.
A real estate expert said that no single approach can be applied to property investment.
“Buying the land could be considered an investment project. The profit comes from the difference between the land rent and land tax,” said Alexei Chizhov, office real estate department director at Becar Consulting.
The difference between property rent and tax is of still more importance since the first could be high while the second often concerns not the market price, but the balance-sheet depreciated value of the property, Chizhov said. Property tax is currently 2.2 percent per annum.
On the other hand, tenants of state-owned property benefit from lower than average rents, he said.
In general it is true that conservative investors such as banks and investment groups are more likely to embark on projects with low rates of return. “Retail companies, enjoying profitability of over 30 percent, would not invest in property as a low-profit asset,” Chizhov said.

TITLE: High Salaries To Hurt Russia’s IT Sector
AUTHOR: By Yuriy Humber
PUBLISHER: Staff Writer
TEXT: The much-vaunted talent of Russian IT programmers could be their undoing if a rise in salaries continues, without there emerging government subsidies to lower the infrastructure costs of the industry, Motorola’s executive vice president, Padmasree Warrior, said Thursday in an interview in St. Petersburg.
Warrior, also Motorola’s Chief Technology officer, and probably the most powerful woman in technology today, said that in assessing the cost-effectiveness of Russian research and development centers, global companies could as easily switch their work elsewhere.
“Russia is a very important market for us. We see it as a high-growth market for our products and also a high-growth area for talent,” Warrior said. “However, other countries are competing [to attract IT companies].”
The wide interest of IT giants like Google, which is reportedly considering building an R&D center in St. Petersburg, has put a squeeze on the numbers of available programmers in Russia, resulting in several hikes in IT staff wages in the last two years.
Unless the Russian government can offset the growing staff costs by providing tax incentives, infrastructure, and easier access to land plots, the country could lose out to competitors like China, India, Brazil or Malaysia — locations Motorola targets for major expansions of its operations, Warrior said.
“It’s very important to have government support and have sponsorship from the government for us to be [in a country],” she said.  “And I still speak about buildings and land, and how easy it is to grow.”
“The way we manage our R&D is ... we go where the talent is, and those engineers are developing products for the whole company across the board,” she said.
As long as the quality of programming in Russia satisfies the corporate stand “and we keep our costs at a reasonable level, Russia is still attractive. But if costs rise so much, and all else remains the same, then the attraction wanes,” Warrior said.
Victor Naumov, head of Intellectual property and IT protection group with DLA Piper in St. Petersburg, noted that the Russian government has been slow to respond to IT sector needs.
“If the government continues to ignore the industry needs, business will find it hard to develop their enterprises in Russia,” he said.
One stimulus the government has hoped to give the domestic IT industry has been the creation of IT parks nationwide, with the first federally backed project, the Bonch-Bruyevich St. Petersburg State University of Telecommunications, is expected to commence in 2008.
Vladimir Polutin, head of Motorola’s R&D center in St. Petersburg, said the state’s IT parks scheme feeds industry interest, but also confuses. While Motorola was watching closely the law on special economic zones, passed by the State Duma in August, “we still want to see how the legislation will be executed in practice,” Polutin said.
The IT parks scheme has been successful in India, Warrior’s country of origin, but Motorola’s vice president said that this has more to do with geo-social conditions than corporate strategy.
“I think for India it made sense, because [the country] was growing and very urbanized. So just from a space constraint point of view it made sense,” Warrior said.
In St. Petersburg, Polutin said progress with IT parks has been dogged by inconsistencies — first of all over which project will get the much-promised tax breaks, among other initiatives, that have been written into the law on special economic zones.
“The city is planning to apply on November 1 for at least two techno-parks to be made special economic zones,” Polutin said, citing the outcome of a recent meeting beween the city’s IT companies, universities and the head of St. Petersburg’s committee for industry, trade, and economic development, Vladimir Blank.
Neither of the two bids is for the Bonch Bruyevich IT park project, although it has received federal backing.
“So, you see, there isn’t consistency even on a local level,” it being out of sync with federal designs, Polutin said. “Sometimes in Russia the law is in place, but the execution of the law can be done better,” he said.
Naumov added that the legislature on special economic zones was set up in a way so that it mainly benefits new market players and start-ups. “For small businesses, and those already well established, it is a burden to transfer to another location and also convince their staff that the move makes sense,” he said.
A more promising law to benefit IT firms, especially those involved in offshore programming, is currently being drafted by the Ministry of IT and Telecommunications, Naumov said. Though not yet made public, the law is expected primarily to ease the rates of tax paid by Russian IT outsourcing companies without taking account of their office location.

TITLE: IN BRIEF
TEXT: MegaFon’s Profits Jump
MOSCOW (Bloomberg) — MegaFon, Russia’s third-largest cellular-phone operator, said profits jumped 85 percent in the first half of this year. Net income rose to $187.5 million from $101.6 million in the same period last year, the Moscow-based company said Friday in a Regulatory News Service. 
Revenue rose 65 percent to $1.03 billion under U.S. generally accepted accounting principles. Earnings before interest, taxes, depreciation and amortization rose 71 percent to $458.2 million.
MegaFon, in which Stockholm-based TeliaSonera AB owns 44 percent, has said it may sell shares to the public to finance expansion.

MegaFon Bombed
MOSCOW (Bloomberg) — A bomb destroyed a mobile-phone base station belonging to MegaFon in Russia’s Ingushetia region Monday, cutting out service in the area, Interfax news agency reported, citing local Interior Ministry officials.
The bombing, in the city of Nazran, occurred at about 8:30 a.m. local time and was the fourth in as many weeks against a MegaFon transmission facility in the restive North Caucasus, Interfax said. No injuries were reported, the news service said. 
MegaFon and rival VimpelCom said earlier this month that their offices were targeted when armed rebels made near- simultaneous attacks on Nalchik, the capital of the Kabardino- Balkaria region, which, like Ingushetia and war-ravaged Chechnya, is in the North Caucasus.

Pirates Sunk in Siberia
KRASNOYARSK (RIA Novosti) — Police in the Siberian city of Krasnoyarsk have confiscated more than 280,000 pirated CDs and videos in a raid, a senior official said Monday. Yury Semesko said police had also discovered labels, cases, and other accessories in a storeroom, and seized over a million rubles ($35,000) from the safe of an underground firm. 
Police experts said the firm had used “good quality equipment”. A packing machine found at the site, for example, cost $20,000. 
All the materials and end products had been delivered by air to and from Krasnoyarsk, which is about 2,500 miles from Moscow.

TITLE: Delays In Mobile Payments Frustrates Users
AUTHOR: By Ilya Shatilin
PUBLISHER: Special to The St. Petersburg Times
TEXT: Mobile phone subscribers complaining of not having enough credit in their accounts to make a call – nothing new one might think;  just a question of them finding a shop to top up. In St. Petersburg, however, a subscriber might just as well head straight for a public payphone to explain to friends and family that the phrase “Subscriber is temporarily blocked” in no way reflects the trials of life. 
What has just been described is the result of delays in the transfer of funds into mobile phone accounts. Many clients blamed dealers, but the real reason one’s money has gone AWOL for several weeks is the billing system of the provider. 
The problem may be one of two things. Firstly, in connection with preventative works, such as the renovation of phone software, billing is placed on a different schedule or mode. About this providers normally issue advance warnings, in, for example, the following manner: 
“Dear respected subscribers of BeeLine GSM! 
As a result of work in Moscow the following interruptions in service will be observed on Saturday the 16th of October 2005  – 
A delay in connection/disconnection of the roaming service.
A delay in subscriber information received on 611.”
A second explanation is the spontaneous failure of the billing system. Then problems occur not only with the non-registering of payments but in other ways too, such as the billing of incorrect amounts. In this way a situation may arise, when, for instance, a subscriber puts $20 onto his or her account only for the phone to be disconnected almost immediately. The subscriber runs to the shop to put more money into his account only to find that no money appears, and the phone remains redundant. 
Most of the recent complaints have been directed towards the company MTS, because, according to a market analyst, of their new billing system Foris. The latter was installed in addition to an older one, CBOSS, to serve prepaid subscribers. Why a second system was installed is the subject of another article, but one fact remains: the untested Foris system is still interrupting the relatively stable and recently installed CBOSS.
Problems have also occurred with the company BeeLine, but with this provider the problem is predominantly one of unstable channels connected with the exterior payment systems which dealers use. 
According to a poll cast in August  2005, the overwhelming majority of citizens (approximately 66.1 percent) believe that payment into mobile phone accounts should be transferred immediately, 27.6 percent that it should take less than one hour, 6.3 percent less than three hours, and 2.3 twelve hours.
Nevertheless, only just under 18 percent of Russians are happy with a more effective means of transferring money to a mobile phone account — the express payment card. It’s true that it is difficult to buy such cards without paying a commission to the seller, which means spending $10 for eight dollars worth of calls. Moreover, many customers appear pathologically afraid of the simple operation which activates the card, i.e. writing down one’s phone number and giving the operator a sum of money.

TITLE: Two Years On, Yukos Faces Final Curtain
AUTHOR: By Catherine Belton
PUBLISHER: Staff Writer
TEXT: The net is starting to tighten around what is left of Mikhail Khodorkovsky’s shattered Yukos empire as court marshals, foreign governments, banks and the Rosneft state oil company begin to close in for the kill.
Two years since Khodorkovsky, the company’s CEO and majority shareholder, was arrested at gunpoint on a Siberian runway on Oct. 25, 2003, Yukos is in tatters. Once the nation’s biggest crude exporter, it says it can no longer afford to export any oil at all, never mind make any payments toward its mammoth back tax bill.
After a 10-month hiatus, the Federal Court Marshals Service have issued new threats to break up the company for the first time since they auctioned off Yukos’ main production unit, the million-barrel per day Yuganskneftegaz, last December. On Oct. 14, marshals warned they could sell off the remains of the company as payment for the $7 billion in back taxes Yukos still owes, possibly before year’s end.
For their part, the Slovakian and Lithuanian governments are trying to sell off the remnants of Yukos’ foreign oil assets. Meanwhile, foreign creditors seeking $475 million in debt payments are trying to make sure they are paid out of the proceeds of any sale.
Rosneft, the new owner of Yugansk, is also striking back in the asset chase, filing suit in the Netherlands to prevent Yukos getting its hands on any cash from foreign sales, and in Russian courts claiming up to $11 billion in debts from Yukos.
“Yukos is under attack from all sides,” said a former Yukos executive who wished to remain anonymous, citing the sensitivity of the situation. “It’s in conflict with the Lithuanian government. There’s conflict between the main shareholder and the management on how to pay off its debt, and there’s conflict between the Russian and Lithuanian governments on whom to sell the assets to. Yukos is caught right in the middle.”
In the meantime, the asset chase is speeding up again, after a long pause. “By the end of the year, it looks like the state will have one of the other production units,” he said.
The trigger for the renewed fight could have been the completion of the sale of Sibneft to Gazprom for $13 billion, announced last month, as Gazprom and Rosneft race to scoop up oil assets.
“The pressure has now resumed across the board,” said Chris Weafer, chief strategist at Alfa Bank. “The attack has been held back for the last nine months while the government moved to start a peace process with big business and to give time for the negotiations on taking over Sibneft to proceed. Those shackles have now been taken off.”
The race for the rest of Yukos could herald a new stage in the state’s growing domination of the oil sector. 
Gazprom’s Sibneft buyout was the gas giant’s first real move into the oil sector and could make it hungry for more, while Rosneft could be anxious to make sure it stays on top in the oil race by securing control over the rest of Yukos. 
With little action against Yukos in recent months, even badly bitten Yukos investors had started to hope the rest of the company, which includes production units Samaraneftegaz and Tomskneft and produces 550,000 barrels per day — still more than Qatar — might be left in relative peace. 
Shares even rose on hopes that the company in its reduced form would survive. But following raids on Yukos offices in Moscow and the Netherlands over money-laundering allegations and the court marshals’ threat of break-up, they have since slumped to less than a dollar. Two years ago, before Khodorkovsky was arrested, they were worth more than $14.
Lithuania’s moves to sell Yukos’s majority share in the country’s Mazeikiu refinery also sparked a new wave of legal action. Yukos is hoping to recoup up to $1 billion from a sale.
First, a consortium of foreign banks filed suit in the London High Court to try and secure payment on the $475 million outstanding on $1 billion loan to Yukos. The Moscow Arbitration Court on Sept. 29 upheld the London court’s ruling, increasing the chances that the claim could be used to bankrupt Yukos.
Few, however, believe that foreign banks will initiate bankruptcy proceedings since, according to Russian law, they would be among the last creditors to be paid. Their move has been seen more as an attempt to ensure payment out of the proceeds of any sale abroad.
Just as Yukos’ financial position appeared to be recovering with the prospect of more than $4 billion in cash via foreign asset sales and the potential sale of its 20 percent stake in Sibneft, Rosneft stepped back into the fray.
As Yugansk’s new owner, Rosneft moved to block any foreign sales of Yukos assets. Through Yugansk, it filed suit in Amsterdam. The Dutch court on Oct. 6 ordered an asset freeze against the three firms that have held shares in Yukos’ foreign interests. Saying it was seeking to uphold a ruling it obtained in Moscow in May on $2.2 billion it claims Yukos owes Yugansk from transfer pricing schemes, it won a 90-day freeze on the Dutch companies’ assets. Rosneft said the action was necessary to prevent Yukos illegally moving its foreign assets out of creditors’ reach.
In its Dutch lawsuit, Yugansk cited a number of transfers of shares in Yukos’ foreign assets between Yukos’s 100 percent-owned Dutch subsidiary Yukos Finance BV, Yukos International BV, and a trust run by senior Yukos managers named Stichtung Administratiekantoor Yukos International. 
“The unmistakable intention — and consequence — of this ‘restructuring’ was to take the assets of Yukos Finance out of the reach of Yukos’ creditors (including Yuganskneftegaz),” said Yugansk’s filing, a copy of which was obtained by The Moscow Times.
Yukos denies any wrongdoing in the case.
Even though it is unlikely to win a ruling in a Dutch court on the $2.2 billion Rosneft says Yukos owes it, the temporary freeze, which could be extended further after three months, could complicate the Lithuanian government’s attempts to sell off Yukos’s stake in Mazeikiu.
“This appears to be designed to stop the sale of Mazeikiu Nafta rather than anything else,” said Tim Osborne, a director of Group Menatep, Yukos’ majority shareholder. “This is just a blocking tactic.”
“They take action anytime Yukos looks anywhere near like it might be able deal with its debt,” Osborne said, citing growing prospects for a foreign sale and for Yukos’s sale of its 20 percent stake in Sibneft.
“We’ll either see Rosneft getting the production units in settlement of the claims Yugansk has filed against Yukos, or if the government has not yet decided who will get them, they will be sold off at auction as payment for the back tax bills,” Osborne said. “Either way, it’s looking pretty bleak for anyone who thinks Yukos might survive. Now it’s a question of how and when, rather than if there will be a break-up.”
“It looks like they’re on the move.”
Rosneft has taken multiple steps to secure its hold over Yukos. On Sept. 27, the Moscow Arbitration Court named the Menatep vehicle set up to hold shares in Yukos, the Cyprus-based Hulley Enterprises, as a co-defendant in Rosneft’s transfer-pricing lawsuit against Yukos. Although hearings in that case have been postponed till April 2006, targeting other Menatep entities could be a fallback option for Rosneft, if it is unable to take over Yukos assets via back tax claims. Hulley currently owns 49 percent of Yukos, industry insiders said.
Either way, Rosneft appears to be setting its sights on gobbling up the rest of Yukos. Rosneft president Sergei Bogdanchikov has said his company does not want any more assets, just payment on Yukos’s debts. 
Rosneft declined to comment for this article despite repeated requests. Other market players said Rosneft appeared to be after Yukos’s foreign assets too.
Even though the Lithuanian government last week named TNK-BP, the joint venture between BP and Tyumen Oil, as its buyer of choice for the Mazeikiu sale, the Russian authorities could block the sale, said one trader who used to work with Mazeikiu.
“The Lithuanian government has the right of first refusal to buy the shares. But if they sell them to anyone the Russian government does not approve of, Moscow will say: Fine, but where is the oil coming from?” the trader said, speaking on condition of anonymity. They can stop Transneft sending any oil to Mazeikiu, he said, adding that Moscow had used this tactic successfully in the past.
TNK-BP spokeswoman Marina Dracheva said the sale had been overly politicized. She said, however, that TNK-BP had been in talks with the Russian government over its Mazeikiu bid.

TITLE: The Government Simplifies Tax Administration
AUTHOR: By Boris Brouk
TEXT: It seems like Russian taxpayers can expect a New Year gift from the government. That senior officials are talking about simplifying the tax system is in itself no novelty. This time, however, the respective bill has just passed through the Russian parliament. The new bill is expected to come into effect on Jan. 1, 2006 and will modify the system of collecting deficiencies, late payment interest, and fines.
Individual entrepreneurs will enjoy tax treatment similar to what is currently applied to legal entities and representative offices of foreign companies.  In particular, tax authorities will be able to seek collection of what they see as unpaid tax and late payment interest without going through the judiciary. They will be given the right to withdraw the appropriate sum from the individual entrepreneur’s bank account, and, in the case of insufficient funds, allowed to file an appropriate claim with a bailiff to go after other property of that individual .  
The bill provides for only two exceptions to the new procedure. Tax authorities will have to go through the courts if their assessment is based on reclassification of underlying transactions entered into by the individual entrepreneur. The authorities are also denied the use of extra-judicial collection if over 60 days has passed after the failure of a taxpayer to respond to a voluntary payment notice. 
Although the new piece of legislation does imply that tax penalties can be reclaimed outside the courtroom, a certain threshold has been set. For individual entrepreneurs no more than 5,000 rubles ($175) can be taken per each unpaid tax within a tax period and/or each other violation of tax legislation. For legal entities the limit is 50,000 rubles ($1,750) per each unpaid tax within a tax period and/or each other violation of tax legislation.
The bill explicitly provides for a postponement of the automatic collection of fines, if a taxpayer appeals to a higher level of tax authority.  However, no similar affirmative statement is made, if, on the other hand, the taxpayer decides to challenge the assessment in court. In the latter case the judge may issue an injunction against the enforcement of the assessment, but only if persuaded to do so by the taxpayer. 
Obviously, given the thresholds, the bill under discussion will primarily affect small and medium size companies and individual entrepreneurs. 
Announced as being aimed at taking pressure off the arbitrage courts, the bill will lessen the strain placed on the tax office, as from now on the taxpayers (rather than the authorities) will initiate proceedings. Given the fact that almost 70% of tax cases brought to court are ruled in favor of the taxpayers, we would not predict that the number of those who contest tax assessments, even concerning relatively minor sums, will decrease significantly.
The emphasis the bill places on the possibility to file appeals within the higher levels of the State Tax Service is unlikely to become effective until the latter changes its approach to dealing with taxpayer complaints. Current legislation also allows for the possibility of administrative appeal, yet the procedure is one seldom used by taxpayers, who lack confidence that they will receive a fair hearing. 
The last few years have shown that the appeal process is only efficient when it concerns, for example, a clear error of arithmetic, while in most cases the higher tax bodies always support their direct reports. Nevertheless, the creation of new semi-independent tax dispute panels, where agreement on cases would be reached before going to the courts, is expected soon, though how they will be implemented is yet to be seen.
Finally, one could argue that the provisions of the bill contradict the view of the Russian Constitutional Court. In one of its 1996 decisions the Constitutional Court has stated that without judicial control the enforcement of tax collection from individuals, as well as of penalties from both individual and corporate taxpayers, would breach the balance between public and private interests and therefore could not be acceptable. The Constitutional Court reiterated this position in a number of subsequent pronouncements. Therefore, it is not inconceivable that we may witness the taxpayers attempting to question the constitutionality of the bill in the future.

Boris Brouk is Senior Consultant at Deloitte in St. Petersburg.

TITLE: St. Petersburg Summers for Strauss, the ‘Waltz King’
AUTHOR: By Shasta Kearns Moore
PUBLISHER: Special to The St. Petersburg Times
TEXT: Johann Strauss, Jr., the “Waltz King,” spent 11 summers in the mid-1800s entertaining St. Petersburg high society at Pavlovsk’s musical train station. The 180th anniversery of the composer’s birth on Oct. 25 1825 was marked on Tuesday.
In the new Vitebsky railway station in southern St. Petersburg, smartly dressed men and women rush about to catch their trains. The women look elegant in their fabulous evening gowns, which are puffed up and back-weighted in the latest 1850s fashion. Excitement is running high and everyone is preparing themselves for the short train ride to a grand evening of world-class music and dancing. 
The Waltz King is in town. 
Johann Strauss, Jr. arrived in St. Petersburg at the start of an exciting new era in Russia. It was 1856 and the new tsar, Alexander II, had just announced the end of the Crimean War and promised new economic reforms and modern advances, including expansion of the nation’s railway lines. 
On Oct. 10 1837, Russia’s first railway was inuagurated, running from St. Petersburg to Pavlovsk, a royal palace. The train station at Pavlovsk was nothing less than royal Russian extravagence, recalling London’s Vauxhall Pleasure Gardens — giving rise to the Russian word vokzal — a train station. 
The magnificent terminus was called “The Musical Station” and was surrounded by a beautifully manicured park and included among its many amenities a concert hall to seat one hundred. 
Some years after its construction, the Russian railway company invited Strauss Jr. — the scion of an Austrian dynasty of composers — to play at the station. He arrived with a 26-man orchestra and played his first concert on May 6, 1856. And so began St. Petersburg’s 11 seasons of Strauss. 
Strauss was instantly popular in Russia, especially among the ladies. Portraits of their idol were widely sold in bookstores, and jewelry shop windows carried rings and brooches with his image. Even uptown florists offered bouquets named after his waltzes. Strauss was, in short, the 19th century equivalent of a pop star. 

Love in St. Petersburg 
One particular St. Petersburg lady was very taken with Strauss — and the feeling was mutual. 
Olga Smirnitskaya, the daughter of a Russian bureaucrat, was a sensitive person with a talent for the piano and a composer of several romances. After she met Strauss in 1858, the young lovers employed adolescent strategies to keep their relationship a secret. They wrote notes to each other on candy wrappers and delivered them through mutual friends. Later, they would play hide and seek in a particular tree trunk in the park at Pavlovsk. The nearly a hundred letters written between them that exist today are wonderfully romantic. 
Strauss’ compositions “Viennese Bonbons” and the remorseful “Parting with St. Petersburg” were inspired by Smirnitskaya and the love they shared. 
Sadly, women of that era did not marry outside their social rank, even to composers as great as Strauss, and in 1860 the affair ended when her parents refused to sanction a union. 
Despite this, Strauss was admitted to the highest levels of St. Petersburg society and was considered a friend of the Romanovs. 

The Royal Family 
Tsar Nicolas I’s youngest son, Mikhail, himself a skilled musician, became very close to Strauss through their mutual passion for music. Tsrevich Mikhail even displayed his talent publicly, occasionally playing violin in Strauss’ orchestra at Pavlovsk. Several of Strauss’ compositions were written for or influenced by the Tsar and his family. 
For esample, Opus No. 107 was written for the occasion of Tsar Nicolas’ and his sons’ visit to Vienna in 1852. The piece is filled with good humor and was praised by the press for being a breath of fresh air from the normal pomp and circumstance that other composers were churning out for such occasions. 
“The Coronation March” was the first of Strauss’ works to be played in Russia, written in honor of Tsar Nicolas II’s ascension to the throne and his September 1856 coronation. 
But honoring the leaders of Russia was not always a politically wise decision. 
Strauss’ homage to Tsar Alexander II, presented in 1864, came after a high-profile and unpopular massacre of nationalist revolutionaries in Poland. In Strauss’ hometown of Vienna, the homage would have outraged high society as a tribute to a monster, or worse, a tribute to the massacre itself. The piece was actually written for a concert benefiting Polish orphans and widows, but Strauss was still afraid of political backlash so the work was neither published or played in Vienna. 
“Public Relations” often played a significant role in Strauss’ management decisions. The titles of several of the works he wrote for Russian audiences were changed when they were published in Austria to reflect Viennese tastes and attitudes. 

Discovery of Tchaikovsky 
Strauss could also be credited for bringing Pyotr Tchaikovsky to the world stage. While still in school as one of the first students of the St. Petersburg Conservatory, the young Tchaikovsky became a favorite of Professor Anton Rubinshtein. 
It was Rubinshtein who brought Tchaikovsky’s school project “Characteristic Dances” to Strauss’ attention. Strauss quickly recognized the budding genius in the piece and gave Tchaikovsky his first concert. 
The envy of all his schoolmates, Tchaikovsky, who as a young boy was considered a worthless music student, conducted to the crowd’s delight. 
From that moment forward, Tchaikovsky was destined to become one of the world’s most loved composers. Strauss’ 11 magical summers at Pavlovsk were ended with the composition “Russian March Fantasia.” 
He was to have performed the piece during his 12th season in Russia but St. Petersburg’s fans never heard it. Strauss skipped out on the Russian capital and instead accepted an invitation from the “World Peace Jubilee” in the United States. 
Strauss did not, however, consider the legal consequences of his change of plans, which ended up costing him dearly. 
The Russian railroad authorities sued him in court for breech of contract. Though Strauss came back to Russia in 1869, 1872 and 1886, Strauss would never again play at Pavlovsk. 

Fall and Rise
The Russian composer Mikhail Glinka took over the reins from Strauss and the Musical Station lived on until 1917, when, like so many things in Russia, the music stopped.
During Soviet times, Strauss was still popular but slowly lost influence as his genre of music died out. 
In 1999, however, a year declared by the Austrian goverment as the Year of Johann Strauss, the Musical Olympus foundation hosted a revival in St. Petersburg called “Remembering Johann Strauss.” 
“The economic situation at the time was difficult,” said Executive Secretary Marina Balakina, “but we felt that despite the difficulties of everyday life, people should recall old traditions like this one.” 
The balls were held for only four years but were replaced by the annual Grand Waltz Festival which this year celebrated Johann Strauss’ 180th birthday (see box). 
This interest in Strauss’ music in St. Petersburg is itself a sign of the great influence the Austrain composer had on the cultural and musical life of Russia. 
Those 11 musical seasons facilitated a sentimental and cultural link between Vienna and St. Petersburg at a time when Russia was searching for European influence.

TITLE: Virtuoso Violinist’s Instrument To Be Auctioned
AUTHOR: By Jeremy Lovell
PUBLISHER: Reuters
TEXT: LONDON — A violin created by one of the world’s leading makers and once owned by Italian maestro Nicolo Paganini goes to auction next week with an asking price of $887,000. 
Not only is it the first time one of Paganini’s instruments has been auctioned, it is one of only 50 surviving violins by master craftsman Carlo Bergonzi.
“As a Carlo Bergonzi it is already rare. Add the Paganini factor and it becomes exotic,” Tim Ingles, head of musical instruments at auction house Sotheby’s, said on Wednesday.
The violin dates from around 1720 when Bergonzi was a powerful name in his own right, ranking third behind  Josef Guarneri and Antonio Stradivari.
It is not known when Paganini — whose virtuoso playing made people believe he had struck a deal with the devil — acquired the instrument.
But it is known to have been among the 20 violins, including 10 Stradivaris, passed to his son Achille on Paganini’s death in 1840 and certified as a Bergonzi in 1870 by French dealer and violin-maker Jean-Baptiste Vuillaume.
It changed hands several times over the ensuing 80 years before ending up with John Corrigliano, who was concert master of the New York Philharmonic orchestra from 1943 to 1966.
In 1957 he sold it to an amateur violinist whose daughter is offering it for sale on November 1 — the first time a Bergonzi has come to auction since 1984 when another of his instruments fetched 120,000 pounds.
Ingles said the current example was not in perfect condition because it had been played, which could detract from its sale price potential.
“It is a players’ instrument, and I would expect it to be played by or on behalf of whoever acquires it next Tuesday,” he said.

TITLE: IN BRIEF
TEXT: Gazprom Eyes Sibneft 
MOSCOW (Bloomberg) —Gazprom may buy the 20 percent of Sibneft owned by Yukos, Gazprom Deputy Chief Executive Alexander Ryazanov said Monday, Interfax news service reported.
Ryazanov, who is also acting Chief Executive of Sibneft, said Gazprom will pay back all of the $13 billion it borrowed to buy Sibneft by the end of next year, Interfax said. No other details were reported.
Gazprom bought 73 percent of Sibneft, last month for $13.1 billion from a group of investors led by billionaire Roman Abramovich, the country’s richest man.

Bashneft Trims Output
MOSCOW (Reuters) — Oil firm Bashneft plans to trim 2006 oil output to 11.7 million tons (235,000 barrels per day) from a previous forecast of 11.9 million tons, the company’s general director said on Monday. 
“Production is falling because the company is using old deposits,” Gimran Gabitov told reporters. 
He added that Bashneft, a mid-sized oil firm based in the Muslim republic of Bashkortostan near the Ural mountains, would bid in auctions for new deposits as soon as December to solve the problem. 

Mair Takes Less Scrap 
MOSCOW (Bloomberg) — Industrial Group, Russia’s biggest ferrous scrap network, will collect 20 percent less scrap than planned this year because of falling prices and the costs of cutting processing yards into a smaller number of larger units.
The company will produce 2.4 million metric tons of scrap this year, compared with the 3 million tons planned at the start of the year, Mair President Viktor Makushin said in an interview Monday. 
The company probably will produce 3 million tons next year, he said. It collected 2.97 million tons in 2004.
“We won’t have a sweet life next year,’’ Makushin said.
“There could be difficult conditions although we expect prices for both steel and scrap to stabilize.’’ 

Amtel IPO Price Range
LONDON (Reuters) — Russian-Dutch tire maker Amtel-Vredestein said on Monday it had set an indicative price range for its forthcoming initial public offering in London between $13 and $16 per global depository receipt. 
Earlier in October, Amtel said it would raise $300 million as part of the listing on the London Stock Exchange, which it said would take place before the end of November and give the firm a value of about $1.2 billion. 
Amtel-Vredestein is one of Russia’s leading tire producers, with three plants in Russia and one in Ukraine. Its tire business began in 1997 and it bought Dutch tire maker Vredestein Banden in April 2005. 

St.Pete TV to be Sold
ST.PETERSBURG (Bloomberg) — Petersburg plans to sell its controlling stake in the local television station, allowing President Vladimir Putin’s allies to control it, Kommersant reported Monday, without saying where it obtained the information.
The city plans to sell its 68.2 percent stake in Petersburg Television for at least 62.4 million rubles ($2.2 million) in 2006, the newspaper reported, citing the local government’s asset sales program for next year.
The administration also plans to let the station offer $25 million of new shares, which will probably be bought by steelmaker Severstal, local bank Rossiya, and media company Priboi. 
Rossiya is run by Yuri Kovalchuk and Priboi belongs to Oleg Rudnov, both of whom are Putin allies, the newspaper reported. 

Norilsk Dividend Talk
MOSCOW (Reuters) — The board of directors of metals giant Norilsk Nickel has recommended the company pay a 9-month dividend of 43 rubles per ordinary share, a source in the company said on Monday. 
By comparison, Norilsk paid a dividend of 41.4 rubles per share for the first nine months of last year. 
The source said Norilsk shareholders would converge on Dec. 30 to decide on the recommendation. 

MDM With Goldman
MOSCOW (Reuters)— MDM Bank has mandated Goldman Sachs to lead manage a benchmark size U.S.-dollar denominated Eurobond before the end of the year, a market source familiar with the details said on Monday. 
No maturity has been determined on the Reg. S deal, the source said. Benchmark size typically means $500 million or more in market parlance. 
MDM is rated ‘B’ by Standard & Poor’s and ‘BB-’ by Fitch Ratings. 

Judge Rules on Alfa Deal
ISTANBUL (Bloomberg) -— Cukurova said a Swiss judge told the company to halt transferring shares of Turkcell to a third party before an arbitration process on the issue is concluded.
Cukurova has agreed to sell a 13 percent stake in Turkish mobile-phone company Turkcell to Alfa Group.
Nordic phone company TeliaSonera, the second largest shareholder in Turkcell, has sued to stop the sale in courts in Switzerland and Turkey.
Cukurova is investigating whether Michael Schneider, the chief judge in Switzerland coordinating the arbitration process between TeliaSonera and Cukurova, has the authority to make such a request, the group said in a filing with the stock exchange Friday. 

Harvest Almost Done
MOSCOW (Reuters)—Russian farms have threshed a total of 84.3 million tons of grain, 1.6 million tons more than by the same 2004 period, the agriculture ministry said on Monday. 
“As of Oct. 31 2005, farms ... have threshed grain from 99 percent of the sown area,” the ministry said in a statement. 
Russia officially estimates this year’s grain crop to be no lower than last year’s 78 million tons by clean weight. 
Bunker weight is normally about eight percent higher than clean weight, obtained after grain has been cleaned and dried. 
The statement said farms had threshed 50.8 million tons of wheat - a 2.9 million ton increase year-on-year.  

KazakhGold Flotation
LONDON (Reuters) — KazakhGold is aiming to raise about 100 million pounds ($178 million) by floating around a quarter of the company, a source close to the situation said on Monday, as the firm said it was seeking a London listing. 
KazakhGold, the parent company of Kazakh-based gold miner Kazkhaltyn, said on Monday it intended to launch a public offering of global depository receipts on the London Stock Exchange. 
The source told Reuters the company expected to float in late November after a month-long roadshow. 

Seventh Continent Profit
MOSCOW (Reuters)  — Moscow’s top grocery chain Seventh Continent on Monday reported a rise in net profit to 808.7 million rubles ($28.4 million) for January-September, to Russian Accounting Standards, from 504.8 million a year ago. 
It reported on its website that net profit for the third quarter was 258.6 million rubles, down from 310.1 million in the previous quarter. 
Seventh Continent, which raised $80 million in an initial public offering on the dollar-denominated Russian Trading System last November, owns 81 outlets and has contracts for 17 new shops to be opened this year. 

Evraz Bond Guidance
LONDON (Reuters) — Steelmaker Evraz put initial yield guidance on a 10-year U.S. dollar denominated Eurobond in the midswaps plus low to mid 300 basis points area, a market source said on Monday. 
The deal size has not been set yet said the market source who is familiar with the details of the deal. The deal is said to be benchmark in size, typically referred to as $500 million or more in market parlance. 
Pricing for the deal is expected late in the week, the source said. Midswaps is the measure of interest between floating and fixed rates. 
Lead managers and bookrunners are ING and UBS. (Reuters)

TITLE: Advice From a Former Political Prisoner
AUTHOR: By Richard Lourie
TEXT: Image control has been a high priority for the Kremlin lately. This was especially clear when President Vladimir Putin came to New York in September for UN week. Aside from his purely presidential duties, he also ventured into two fields, religion and art, where the level of symbolism is even higher than in politics. He traveled to Bayonne, New Jersey, the only place that would accept the latest vulgar monstrosity from the workshop of Zurab Tsereteli — a gigantic tower cracked by a gigantic teardrop commemorating the tragedy of 9/11. Since the Mafia made New Jersey famous for waste management, it’s the appropriate venue. 
Putin’s speech at the unveiling of the design for the project concluded with a phrase that was enthusiastically applauded: “Together we defeated fascism, together we will defeat terrorism.” 
What a great line! Perhaps instead of sending bad art to New Jersey, Russia should send artful speech writers to Washington to help the Democratic Party, which hasn’t been able to think of any slogans as concise and rousing as Putin’s line. And the historical sweep and savvy! It connects World War II, the last good, unambiguous war, with the war on terrorism, in which all the victims are innocent. Perhaps even more importantly, Putin’s line reminds amnesiac Americans of the time when Soviet Russia and the United States put enmity aside to become allies. And buried deep in this message is yet another signal — you Americans had no problem overlooking Stalin’s faults, even ordering your propaganda machine to turn him from a bloodthirsty monster into pipe-smoking Uncle Joe. The implication would seem to be — if Stalin can be forgiven a few million executions in the name of defeating fascism, then in this age of fighting terrorism why worry about a little muzzling of ill-mannered journalists and the arrest of billionaires for their ill-gotten gains? 
The message of the Russia! show at the Guggenheim Museum, whose opening Putin also attended, seems to be: Look, we’re the same as you, with a few differences that only make us more interesting. The Russian tradition is presented as passing from religious origins through secular portraiture and landscape to the exciting experiments of modernism and the questionable goofiness of postmodern conceptualism. Artistically, the problem with Russian art is that between the golden age of the icons and modernism almost everything was second-rate. There is no Turgenev of landscape, no Tolstoy of the big historical canvas. There’s a good portrait of Dostoevsky, but no Dostoevsky of portraiture.
Nevertheless, public and critical reaction to the show has been strong and mostly positive. It’s outdrawing the Aztec show. New York Times art critic Roberta Smith was swept away by the show’s “humbling breadth of ... vision and profundity,” gushing that the one exclamation mark in the show’s title should be replaced by three. New York magazine critic Mark Stevens was not quite so breathless. Noting that the show was backed by Vladimir Potanin, who “helped create the infamous ‘loans for shares’ program,” and had a general official, groupthink feel to it, Stevens remarked: “Yuck.” The show was also backed by the oil company Sintezneftegaz, whose founder, Leonid Lebedev, a member of the Federation Council, stated quite baldly that “if Americans got acquainted with real Russian art and the real Russian soul, they would be more comfortable doing business with Russia.”
Diane von Furstenburg, the clothes designer whose latest line has a Russian-inspired look, seemed the perfect recipient for the message. “New Yorkers love Russians because they’re just like us. They have so much energy and thirst and the desire to make things happen,” she was quoted saying in a front-page article in The New York Times’ Sunday Styles section for Oct. 2 under the headline “New Slavs of New York: All Bling and No Borscht.” What’s happening is that Russia, meaning the Russian elite, is joining the world of superstar athletes, supermodels, the super rich. The message is that we’re just like you politically — fighting terrorism — and just like you socially and economically, sharing the same worship of wealth and celebrity. 
Image control of a different sort took place at a church of the Russian Orthodox Church Outside of Russia located in an old mansion at the corner of Park Avenue and 93rd Street. Putin paid a call to “venerate” (the word used in the e-mail invitation I received) the 700-year-old Kursk icon. Security was disappointingly porous — I arrived early and was already inside the church when the Secret Service cordoned it off. No one asked me for identification or checked the contents of my tote bag. The scene itself was a very postmodern mix of icons and Nikons, beads and earpieces, candlelight and flash bulbs. Putin handled himself well, crossing himself with the practiced ease of a communicant. 
Putin’s visit had a fence-mending aspect, one greatly appreciated by the priests with whom I spoke. He was there to help heal the rift between the Russian Orthodox Church at home and the breakaway institutions outside the country. The church is part of the new state and the new nationalism. There may be retrograde Soviet-type elements in Putin’s administration but persecution of religion is not one of them.
As Putin left, priests, politicos and press seemed equally impressed by his Mercedes limousine flown over from Russia, the Moscow plates eliciting exclamations of awe at the near magical powers that could send a car flying from Moscow to New York (a possible subject for palekh boxes of the future.) 
Reconciliation of a different sort occurred in early October right after Putin’s New York visit when the bones of White Army General Anton Denikin were returned to Russia for burial, their arrival at Vnukovo Airport met by a military honor guard. The embrace of imperial splendor and nationalism makes Putin’s Russia attractive to New York style-setters, priests of an exiled church and aristocratic emigres.
If Denikin can be received with honors, isn’t it time to deal with Lenin’s remains? The issue flared up again this month, with the usual impasse being reached. On the one hand, it’s simply impossible to bury Lenin beside his mother in St. Petersburg because the removal of his mausoleum would entail such a denial of past history. On the other hand, Russia somehow can’t move forward as long as that necropolis squats on Red Square. But wait, there is an answer! The mausoleum can just be moved inside the Kremlin’s walls, the obvious place for it beside the Tsar Cannon and the Tsar Bell, other reminders of all that is grandiose and futile. 

Richard Lourie is the author of the novel “The Autobiography of Joseph Stalin” and “Sakharov: A Biography.” He contributed this comment to The St. Petersburg Times.

TITLE: The Last Resort of Scoundrels
AUTHOR: By Vladimir Gryaznevich
TEXT: In recent times, we’ve been assailed by new waves of patriotism, and as we march forward to a glorious future, they’ve been coming in ever thicker and ever faster. In the summer, we saw an attempt to assemble the nation around the flag following “provocation” from Estonia in negotiations concerning its border with Russia. And in the last few days, we had two events which occurred almost simultaneously serving much the same purpose. 
First came our fishing adventures. We began with the Elektron trawler imbroglio which was quickly followed by another two Russian trawlers caught poaching in Norwegian waters. The second event to get our nationalists champing at the bit was the court case in Switzerland against Vitaly Kaloyev, who murdered the traffic controller he believed responsible for the death of his wife and two children in a plane crash (the investigation into the traffic controller’s culpability continues).
In one sense, these events are nothing out of the ordinary. Poaching has long since been the preferred modus operandi of Russian fishermen, and vengeance killing is a daily occurrence in the Caucasus. True, the guilty are rarely caught. And they’re caught abroad even more rarely. This, it seems, is the main issue — they’re coming after us!
The reaction in Russia can only be described as a wave of patriotic fervor, not only in the usual mediums of state propaganda — our television channels — but even in certain newspapers and on radio stations. 
In many countries, giving support to citizens who have come a cropper abroad is common practice. Not all, however, give blind support to their criminals. Americans sometimes do it, but their patriotic outbursts are usually reserved for major undertakings such as war in Iraq. Even there, however, they only sacrifice common sense to brute nationalism where their leaders, such as the president and his advisers are concerned. Your average criminal — a soldier humiliating and torturing prisoners, say — is still treated appropriately. 
In Russia, it’s humble citizens that have set the patriotic wave rolling. In both cases the guilt of our countrymen is beyond the shadow of a doubt. Nevertheless, patriotic public opinion not only sympathizes with them, which would at least be understandable, it actively supports them. The general view is that the vindictiveness with which they are treated is not in proportion to their levels of guilt. In Kaloyev’s case, it is even being argued that this is a protest against the callousness of democracy, which has failed to punish those guilty of bringing about the death of dozens of people in the air crash. 
Last Wednesday, all the television channels brought us images of Kaloyev’s relatives and other supporters. All, including the television hosts, criticized the severity of his sentence (Kaloyev got eight years), spoke of its injustice and plans to appeal to the European Court of Human Rights. The murder of the traffic controller barely got a mention. The suffering of the family he left behind didn’t get a mention at all. It was as if they didn’t exist.
The same patriotic point of view could be seen in the response to the fishing trawlers. First we all watched with bated breath as the Elektron fled the Norwegian officials. Then we heard indignant reports from the boat’s captain, Valery Yarantsev, who alleged he was about to be bombarded at any moment. Then the trawler was given a triumphant welcome when it finally made it into port in Murmansk. It was as if national heroes had returned from a dangerous mission.
The only conflicting tones came from the head of the Murmansk border department of the Russian FSB, Major-General Viktor Gubenko, who deemed the actions of the Elektron’s captain illegal, and reported that the trawler had in the past been stopped repeatedly by Russian border patrols for breaking fishing rules. Perhaps it was as a result of Gubenko’s comments that the Elektron’s captain hastily took to his hospital bed and the owners of the ship went missing. 
These “unpatriotic” comments from the border service, however, could do little to detract from the general patriotic euphoria. When the Norwegians arrested another two trawlers, also for poaching, the Russian Ministry for Foreign Affairs went as far as claiming that the Scandinavians were tearing through the fabric of international relations that link the two countries. 
Television shows during this period, perhaps unsurprisingly, focused on patriotic themes. On Alexander Gordon’s talk show there was much discussion of “backstage politicking” to break up Russia. Gleb Pavlovsky on his show also spoke about the plots of western enemies, although at the end of the 1980s, in an article in 20th Century and the World magazine he pointed out the absurdity of such arguments. Now, it appears, he has a different task in hand … Shows running along the same lines could be seen on NTV and other channels. 
All this is a perfect illustration of Samuel Johnson’s aphorism: “Patriotism is the last resort of scoundrels.” The reason why Russians had to whip up this dubious patriotic storm is unclear. Maybe it means there are more reforms on the way, or they are about to put up the tariffs for communal services. We can only hope that few will fall for this trick.  But it seems that when patriotic hysteria is cooked up on piffling grounds, it means somebody’s up to no good. 

Vladimir Gryaznevich is a political analyst with Expert Severo-Zapad magazine. His comment was first broadcast on Ekho Moskvy in St. Petersburg on Friday.

TITLE: Lessons From Scandals Past
AUTHOR: By Lou Cannon
TEXT: Presidents and their staffs resemble the families described by Tolstoy: All happy ones are alike while each unhappy one is unhappy in its own way. Scandals have a particular capacity for focusing this unhappiness. Richard Nixon’s White House during the Watergate scandal was invested with the conspiratorial attitude that was an attribute of this distrustful president. Ronald Reagan’s White House, more trusting, was bewildered by the Iran-contra scandal. Bill Clinton’s aides were embarrassed by their president’s insistence that his affair with Monica Lewinsky had nothing to do with the conduct of his presidency, but nearly all of them adopted this argument as their own.
George W. Bush and his team, reeling from the miscalculations and hubris that so often attend second-term presidencies, have reason to be unhappy. Neither the Iraq war nor the president’s domestic agenda command widespread support. Bush’s approval rating is lower than Reagan’s or Clinton’s at the depth of their scandals. Roughly two-thirds of Americans say the nation is on the wrong track.
Administration defenders searching for a silver lining in the White House gloom have observed that Bush — unlike Nixon, Reagan or Clinton — is not a suspect in the scandal that resulted in the indictment of his vice president’s chief of staff. Assuming this is true, it’s not entirely an advantage. Yes, Nixon’s central role in the Watergate coverup forced him from office, but only because he persistently lied about it. Reagan created the Iran-contra scandal, in which several of his national security aides participated, by authorizing secret arms sales to Iran in defiance of his public policy and the counsel of his secretaries of state and defense. Clinton’s involvement with Lewinsky was the scandal.
But the very centrality of Reagan and Clinton to their predicaments enabled them to do what Bush cannot: acknowledge responsibility and seek forgiveness. In Reagan’s case, it took some prodding, much of it from his wife. Nancy Reagan brought into the White House a diverse array of people, including Democratic power Robert Strauss, whose message was to level with the American people. Reagan did. “A few months ago I told the American people I did not trade arms for hostages,” Reagan said in a nationally televised address on March 4, 1987. “My heart and my best intentions still tell me that’s true, but the facts and the evidence tell me it is not.”
That wasn’t all. Again under prodding from his wife, he replaced Donald Regan, his besieged chief of staff, with former Republican Senate leader Howard Baker and named Frank Carlucci to replace a disgraced national security adviser as part of a general housecleaning. Baker and his successor, Kenneth Duberstein, ran the White House smoothly for the rest of the presidency.
Mindful that President Bush has tried to model his presidency after Reagan’s, some Republicans have urged him to broaden a circle of advisers that has not notably widened in his second term. Relying exclusively on a small cadre of loyalists can be a problem in any line of work, but it is particularly a recipe for disaster in the White House. During the years I covered the presidency for The Washington Post, I knew many capable White House aides who found their jobs exhilarating but who burned out under the heavy workload and unrelenting pressure. The strain of working in the hothouse environment of the White House is especially acute during a scandal. Bringing in new people in such circumstances can be an act of kindness as well as a political necessity.
Whether Bush can easily dispense with his embattled political adviser, Karl Rove, and other loyalists isn’t clear. Bush is more devoted to the advisers who have been with him since Texas than Reagan was to his core group of Californians, and more dependent on them, too. Reagan had been used to new directors and cast members since his Hollywood acting days, and he did not regard anyone except his wife as indispensable. Martin Anderson, an observant economic adviser, once described his boss as “warmly ruthless.” Although Reagan had stubbornly defended Don Regan, he didn’t miss him when he was gone. Soon he acted as if Howard Baker had been his chief of staff all along. Reagan’s example could be a useful guidepost for Bush.

Lou Cannon covered the White House for The Washington Post, where this comment first appeared in a longer form, during the Nixon, Ford and Reagan presidencies and is the author of “Ronald Reagan: A Life in Politics.”

TITLE: Future Perfect
AUTHOR: By Chris Floyd
TEXT: WASHINGTON, March 12, 2007 — Calvin J. Hooper was sworn in today as the 49th President of the United States in a quiet ceremony that many hope will put an end to a tumultuous period that has seen the inauguration and resignation of five chief executives in the 12 months since former president George W. Bush fled the country for exile in Saudi Arabia.
Hooper’s ascent to the presidency has been meteoric, to say the least. Two weeks ago, he was a part-time city councilman in Salt Lick, Tennessee (population 1,300). But following the indictment of most recent president Ken Mehlman on racketeering charges for his alleged involvement in the Jack Abramoff-Tom DeLay crime ring, a frantic search of computer records found that Hooper was the only elected Republican official in the United States who had neither been paid off by the ring nor was complicit in the so-called “Nurembergate Scandal,” the wide-ranging government conspiracy to launch a war of aggression against Iraq on false pretenses. More than 1,427 Republican officials have been convicted in the two ongoing investigations, and a further 927 are now under indictment, including former presidents Dennis Hastert, Colin Powell, Karen Hughes and Scott McClellan.
Once located, Hooper was quickly named to fill the congressional seat vacated by Tennessee Representative Zach Wamp, who was forced to resign after being indicted in the Abramoff-DeLay probe. Hooper was then immediately elected Speaker of the House, which made him second in line to the presidency, as the vice presidency has been left vacant since the conviction of former veep Dick Cheney in one of the first Nurembergate trials in early 2006. Upon Mehlman’s resignation, Hooper became president.
He was sworn in by Chief Justice John Roberts, in what is likely to be the judge’s last official act. Roberts has been indicted for conspiracy to facilitate torture and perverting the course of justice, and is expected to resign after his arraignment hearing next week. The charges stem from a ruling Roberts made as an appeals judge in 2005, when he approved Bush’s “military tribunal” system, an illegal, unconstitutional scheme that gave the president the arbitrary power to dispose of captives in the War on Terror — and every U.S. citizen as well — as he saw fit, outside all existing legal norms and protections. Roberts was actively negotiating with the Bush team for a slot on the Supreme Court at the time of the ruling. It is now alleged that his elevation to the court was a political payoff for his dubious decision on the now-discredited and outlawed tribunal system.

TITLE: Old Ways of Life Are Fading As the Arctic Thaws
AUTHOR: By Steven Lee Myers, Andrew C. Revkin, Simon Romero and Clifford Krauss
TEXT: New York Times Service
TIKSI, Sakha Republic — Freed by warming, waters once locked beneath ice are gnawing at coastal settlements around the Arctic Circle.
In Bykovsky, a village of 457 people on Russia’s northeast coast, the shoreline is collapsing, creeping closer and closer to houses and tanks of heating oil, at a rate of five to six meters a year. Eventually, homes will be lost, and maybe all of Bykovsky, too, under ever-longer periods of assault by open water. 
“It is eating up the land,” said Innokenty Koryakin, a member of the Evenk tribe and the captain of a fishing boat. “You cannot do anything about it.”
To the east, Fyodor Sellyakhov scours a barren island with 16 hired men. Mammoths lived here tens of thousands of years ago, and their carcasses eventually sank deep into sediment that is now offering up a trove of tusks and bones nearly as valuable as elephant ivory.
Sellyakhov, a native Yakut, hauls the fossils to a warehouse here and sells them for $50 to $100 a kilogram. This summer he collected two tons, making him a wealthy man, for Tiksi. “The sea washes down the coast every year,” he said. “It is practically all ice — permafrost — and it is thawing.”
For the 4 million people who live north of the Arctic Circle in remote outposts and the improbable industrial centers built by Soviet decree, a changing climate presents new opportunities. But it also threatens their environment, their homes and, for those whose traditions rely on the ice-bound wilderness, the preservation of their culture.
A push to develop the North, quickened by the melting of the Arctic seas, carries its own rewards and dangers for people in the region. The discovery of vast petroleum fields in the Barents and Kara seas has raised fears of catastrophic accidents as ships loaded with oil and, soon, liquefied gas churn through the fisheries off Scandinavia, headed to markets in Europe and North America. Land that was untouched could be tainted by pollution as generators, smokestacks and large vehicles sprout to support the growing energy industry.
But the thaw itself is already causing widespread anxiety. In Russia, 20 percent of which lies above the Arctic Circle, the melting of the permafrost threatens the foundations of homes, factories and pipelines. While the primary causes are debated, the effect is an engineering nightmare no one anticipated when the towns were built in Stalin’s time.
Coastal erosion is a problem in Alaska as well, forcing the United States to prepare to relocate several Inuit villages at a projected cost of $100 million or more for each one.
Across the Arctic, indigenous tribes with traditions shaped by centuries of living in extremes of cold and ice are noticing changes in weather and wildlife. They are trying to adapt, but it can be confounding.
Take the Inuit word for June, qiqsuqqaqtuq. It refers to snow conditions — a strong crust at night. Only those traits now appear in May. Shari Gearheard, a climate researcher from Harvard University, recalled the appeal of an Inuit hunter, James Qillaq, for a new word at a recent meeting in Canada. One sentence stayed in her mind: “June isn’t really June any more.”

Changing Traditions
In Finnmark, Norway’s northernmost province, the Arctic landscape unfolds in late winter as an endless snowy plateau, silent but for the cries of the reindeer and the occasional whine of a snowmobile.
A changing Arctic is felt there, too. “The reindeer are becoming unhappy,” said Issat Heandarat Eira, a 31-year-old reindeer herder and one of 80,000 Samis, or Laplanders, who live in the northern reaches of Scandinavia and Russia.
Few countries rival Norway when it comes to protecting the environment and preserving indigenous customs. The state has lavished its oil wealth on the region, and Sami culture has enjoyed something of a renaissance. There is a Nordic Sami Institute, a Sami College, a state-sponsored film festival and a drive-in theater where moviegoers watch from snowmobiles.
And yet no amount of government support can convince Eira that his livelihood, intractably entwined with the reindeer, is not about to change. He keeps the size of his herd secret. But he said warmer temperatures in fall and spring were melting the top layers of snow, which then refreeze as ice, making it harder for his reindeer to dig through to the lichen they eat. He worries, too, about the encroachment of highways and industrial activity on his once isolated grazing lands.
“The people who are making the decisions, they are living in the south and they are living in towns,” said Eira, sitting inside his home made of reindeer hides. “They don’t mark the change of weather. It is only people who live in nature and get resources from nature who mark it.”
Other Arctic cultures that rely on nature report similar disruptions. For 5,000 years, the Inuit have lived on the fringe of the Arctic Ocean, using sea ice as a highway, building material and hunting platform. In recent decades, their old ways have been fading under forced relocations, the erosion of language and lore and the lure of modern conveniences, steady jobs and a cash economy.
Now, the accelerating retreat of the sea ice is making it even harder to preserve their connections to “country food” and tradition. In Canada, Inuit hunters report that an increasing number of polar bears look emaciated because the shrinking ice cover has curtailed their ability to fatten up on seals. In Alaska, whale hunters working in unusually open seas have seen walruses try to climb onto their white boats, mistaking them for ice floes.
Hank Rogers, a 54-year-old Inuvialuit who helps patrol Canada’s Far North, said the pelts of fox, marten and other game he trapped were thinning. As for the flesh of fish caught in coastal estuaries of the Yukon, “they’re too mushy,” he said. Slushy snow and weaker ice has made traveling by snowmobile impossible in places.
“The next generation coming up is not going to experience what we did,” he said. “We can’t pass the traditions on as our ancestors passed on to us.”
Even seasoned hunters have been betrayed by the thaw, stepping in snow that should be covering ice but instead falling into water. And on Shingle Point, a sandy strip inhabited by Inuvialuit at the tip of the Yukon in Canada, Danny Gordon, 70, said it was troubling that fewer icebergs were reaching the bay. It has become windier, too, for reasons people here cannot explain.
“In the summer 40 years ago, we had lots of icebergs, and you could land your boat on them and climb on them even in summer,” Gordon said. “Now in the winter they are tiny. The weather has changed. Everyone knows it. It’s global warming.”

Sinking Cities
Vorkuta, a coal-mining city of 130,000, is crumbling.
Many of the city’s homes and factories were built not on hard rock, but on permafrost, a layer of perpetually frozen earth that covers 65 percent of Russia’s territory. If the permafrost underneath melts, the ground turns to mush.
“Everything is falling apart,” said Lyubov Denisova, who lives in a cramped apartment on Lokomotivnaya Ulitsa. The ceiling has warped, the walls cracked, the window frames splintered. Some buildings have been declared unsafe and abandoned.
Vorkuta lies on the edge of Russia’s permafrost boundary, and some scientists predict that continued warming could advance that border hundreds of kilometers northward, weakening the earth beneath the vast infrastructure built during the days of the Soviet Union’s industrialization of the Arctic. According to the Permafrost Institute in Yakutsk, the average temperature of the permafrost has already increased a degree or two.
While most Arctic climate experts say the warming trend is driven by heat-trapping emissions and is unlikely to reverse, many scientists and officials in Russia predict the warming of the last 30 years will give way to a new period of cold. Vorkuta’s mayor, Igor Shpektor, hews to that line. He said the damage in the city — 80 percent of all buildings show signs of it, one study found — resulted from faulty construction or maintenance, not a general thaw.
Still, Shpektor acknowledged, “the permafrost is unforgiving.”
Any significant warming, said Anatoly Chumashov, the city’s chief engineer, would leave officials like him scrambling to save the city. “It is an example of how fragile it is and how careful we should be,” he said. But he added: “If the permafrost melts, this city will not collapse overnight. There is time to adjust, but it requires very serious investments in labor and money.”

Spills and Depredation
“One oil spill would be the end of us,” said Borge Iversen, a fisherman on the Lofoten Islands, a striking archipelago north of the Arctic Circle in the Norwegian Sea.
As recently as 2000, Russian tankers were rarely spotted passing the jagged peaks and sheltered inlets, surrounded by seas with the world’s largest stocks of cod and herring, as well as killer and sperm whales. So far, there has not been a major accident, but more and more ships are appearing, a harbinger of Russia’s expanding efforts to extract oil and, increasingly, gas in the Arctic.
As much as a quarter of the world’s remaining oil and gas resources are believed to be found in the Arctic. And as technology improves, oil prices rise and the seasonal ice cap retreats, countries like Norway and Russia are acting with startling speed.
Oil shipments from the White Sea and the coast of the Barents Sea have soared, said Mikhail Kalenchenko, director of the World Wildlife Fund’s branch in the port of Murmansk.
“It was supposed to increase over the next 10 years, up to 20 million tons of oil,” he said. “It’s 20 million this year,” or 146 million barrels. At this rate, he said, “we can expect up to 100 million tons, over 10 to 20 years, to be transported through our area.”
Russia’s history of environmental protection is a poor one. The Soviet drive for industrial development paid little heed to the natural spaces around its mines, factories and ports. Its disregard is evident in the poisoned wasteland around the nickel smelter in Monchegorsk, south of Murmansk, where hundreds of square kilometers of what was once forest is now almost entirely devoid of life.
Western countries have paid millions to help Russia dismantle its aging fleet of nuclear submarines in the area and safely store the nuclear material aboard them, but Kalenchenko said far less attention had been paid to the environmental risks of expanding oil shipments in the same area, most in single-hull tankers.
“What has never happened before is a big accident in the high seas in the Arctic,” he said. 
For the entire Barents region, he said, Russia has only two bases with the equipment necessary to fight an oil spill. “In Norway, they have at least 50 bases of this kind,” he said.
David Dickins, an engineer from San Diego who has spent 30 years studying how to clean up oil spills in icy waters, said that while the ice impeded the use of tools like booms that hold a slick in place, the ice also naturally contained the oil, giving response teams more time to act before environmental damage occurred.
“People shouldn’t paint the Arctic in some sort of raving sense where a spill is somehow going to be catastrophic,” he said.
But he added: “A spill is always serious. In the Arctic it will naturally take longer to clean up because there is less wave action, and breakdown is slower in colder temperatures.”
That is what worries Iversen, who sails each morning from the village of Ballstad into the coastal waters around the Lofoten Islands. The village’s history, islanders say, dates back to the Vikings, and fishing is central to the region’s social and economic life.
“We’ve fished these waters for centuries, and while it’s a hard life, we’ve survived in doing so,” he said.
Although the fishing industry accounts for less than 1 percent of Norway’s gross domestic product, as against the nearly 18 percent brought in by oil and gas, the fisheries are Norway’s second-largest earner of foreign exchange and are viewed as a more sustainable resource.
“We need a policy for the Arctic that considers the next 100 years, not just the next 10 years,” Iversen said.
Such sentiment goes far in Norway, where fishing is still part of the oil-rich nation’s soul. On Oct. 13, a new leftist coalition upheld a ban on drilling in the waters around the Lofoten Islands until 2009, while allowing exploration to proceed further north in the Barents Sea. As for the tanker traffic, Oslo is looking at other ways of advancing its concerns.
Norway and the seven other Arctic nations have started to discuss ways to protect the environment in a forum called the Arctic Council, established nine years ago. In 2002, the council issued guidelines for offshore oil drilling, calling for drilling projects to be preceded by studies on environmental effects and the availability of cleanup equipment.
The guidelines come with no enforcement powers, but several experts say they think they will have some effect, particularly because Russia is preparing for entry into the World Trade Organization and seeking closer ties with the European Union.

A Less Wild Future
One day last summer, the 1200 residents of Pangnirtung, a windswept outpost on a fjord in Nunavut, Canada’s Inuit-administered Arctic territory, were startled to see a 133-meter European cruise ship drop anchor unannounced and send several hundred tourists ashore in small boats.
While small ships have stopped visiting the Canadian Arctic, visits from large liners are increasing as interest grows in the opening Northwest Passage, said Maureen Bundgaard, chief executive of Nunavut Tourism, a trade association.
Bundgaard has been training villagers how to stage cultural shows, conduct day tours and sell crafts and traditional fare — without being overrun. “We’re not prepared to deal with the huge ships, emotionally or in other ways,” she said. Inuit leaders say they are trying to balance tradition with the inevitable changes that are sweeping their lands. The Inuit Circumpolar Conference, which represents 155,000 Inuit scattered across Canada, Greenland, Russia and the United States, has enlisted lawyers and movie stars like Jake Gyllenhaal and Salma Hayek to draw attention to its imperiled traditions.
The group’s leaders hope to submit a petition to the Inter-American Commission on Human Rights in December, claiming that the United States, by rejecting a treaty requiring other industrialized countries to cut emissions linked to warming, is willfully threatening the Inuit’s right to exist.
The commission, an investigative arm of the Organization of American States, has no enforcement powers. But legal analysts say that a declaration that the United States has violated the Inuit’s rights could create the foundation for a lawsuit either against the United States in international court or American companies in federal courts.
In a report on Arctic development, the United Nations Environment Program estimated that 15 percent of the region’s lands were affected in 2001 by mining, oil and gas exploration, ports or other industrial incursions. But that figure is likely to reach 80 percent in 2050, it said. The Arctic, then, is probably making the same transition that swept the coastal plains of the North Slope of Alaska starting 38 years ago when the first oil was struck in Prudhoe Bay, said Charles Wohlforth, an Alaskan and author of “The Whale and the Supercomputer,” describing Arctic climate change.
Since then, a network of pipelines and wells has steadily spread west and east ending from that central field, the sweeping sense of emptiness that defined the Arctic landscape through the ages.
“Even if you support oil development and think it makes sense, there’s a point at which it becomes West Texas or the Gulf of Mexico and is not really the Arctic any more,” Wohlforth said.

Craig Duff contributed to this article.

TITLE: Bush Picks Conservative Judge For Supreme Court
AUTHOR: The Associated Press
TEXT: WASHINGTON — President Bush, stung by the collapse of his previous choice, nominated veteran judge Samuel Alito on Monday in a bid to reshape the Supreme Court and mollify his conservative allies. Ready-to-rumble Democrats warned that Alito may be an extremist who would curb abortion rights. 
“Judge Alito ... has more prior judicial experience than any Supreme Court nominee in more than 70 years,” Bush said, drawing an unspoken contrast to his recent choice, Harriet Miers.
Senate Judiciary Committee Chairman Arlen Specter, a supporter of abortion rights, said that Alito’s views “will be among one of the first items Judge Alito and I will discuss.”
Unlike Miers’ nomination, which was derailed Thursday by Bush’s conservative allies, Alito faces vocal opposition from Democrats.
“The Senate needs to find out if the man replacing Miers is too radical for the American people,” said Senate Minority Leader Harry Reid. He chided Bush for not nominating the first Hispanic to the court.
“President Bush would leave the Supreme Court looking less like America and more like an old boys club,” Reid said.
So consistently conservative, Alito has been dubbed “Scalito” or “Scalia-lite” by some lawyers because his judicial philosophy invites comparisons to conservative Supreme Court Justice Antonin Scalia. But while Scalia is outspoken and is known to badger lawyers, Alito is polite, reserved and even-tempered.
Given solid Republican support in the Senate — where the GOP controls 55 of the 100 seats — Democrats would have to filibuster to block Alito’s confirmation, a tactic that comes with political risks. Conservatives who denounced Miers as an unqualified crony quickly praised Alito. The nomination of Alito, a judge on the 3rd U.S. Circuit Court of Appeals since 1990, is one step in Bush’s political recovery plan as he tries to regain his footing after a cascade of troubles rocked his presidency.
Bush’s approval rating in the polls has tumbled to the lowest point of his presidency and Americans are unhappy about high energy prices, the costly war in Iraq and economic doubts. Bush also has been hit by a criminal investigation that reached into the office of Vice President Dick Cheney and led to the indictment of Lewis Libby, the vice president’s chief of staff, on perjury and other charges in the CIA leak investigation.
“The Supreme Court is an institution I have long held in reverence,” said the bespectacled judge, a former prosecutor and government attorney who has argued 12 cases before the Supreme Court. “During my 29 years as a public servant, I’ve had an opportunity to view the Supreme Court from a variety of perspectives.”
Miers had never been a judge.
Praised by Democrats when confirmed for the appeals court 15 years ago, Alito has staked out positions supporting restrictions on abortion, such as parental and spousal notification. If confirmed by the Senate, Alito would replace retiring justice Sandra Day O’Connor, a decisive swing vote in a host of affirmative action, abortion, campaign finance, discrimination and death penalty cases.
Alito favors more restrictions on abortion rights than either the Supreme Court has allowed or O’Connor has supported, based on a 1992 case in which he supported spousal notification.
Bush called for confirmation by year’s end. Frist signaled uncertainty on that, saying, “If it’s possible to act,” he would call for a vote.
Wasting no time, Alito went to the Capitol shortly after the announcement to meet Senate leaders. Accompanied by two of his children and Senate Majority Leader Bill Frist, Alito paused first to pay his respects at the coffin of the late civil rights pioneer Rosa Parks in the Capitol rotunda.
Frist, a fellow Princeton graduate, read from a school publication a prediction that Alito would eventually “warm a seat” on the Supreme Court. “That was a college joke,” Alito said with a grin. “I think my real ambition at the time was to be commissioner of baseball. Of course, I never dreamed that this day would arrive.”
Specter said he would not ask Alito directly about whether he would overturn Roe v. Wade, the landmark abortion rights ruling. 
“There is a lot more to do with a woman’s right to choose than how you feel about it personally,” he said. Specter cited adherence to legal precedent in view of a series of rulings over 30 years upholding abortion rights. 
Conservatives welcomed the pick. 
“At least now the president is having a battle with his political opponents and not with his friends,” said Gary Bauer, a conservative activist who challenged Miers’ nomination. 
Alito signaled his alliance with Daly and other conservatives, speaking of the “limited role the courts play in our constitutional system.” 
Abortion-rights activists denounced the pick. “Now, the gauntlet has been, I think, thrown down,” said Kat Michelman, past president of NARAL-Pro-Choice American. 
Miers bowed out last Thursday after three weeks of bruising criticism from members of Bush’s own party who argued that the Texas lawyer and loyal Bush confidant had thin credentials on constitutional law and no proven record as a judicial conservative. 
Senior administration officials, speaking on condition of anonymity because they were not authorized to discuss the deliberations, said Alito was virtually certain from the start to get the nod from the moment Miers backed out. The 55-year-old Italian-American jurist was Bush’s favorite choice of the judges in the last set of deliberations but he settled instead on someone outside what he calls the “judicial monastery,” the officials said. 
Alito, a jurist from New Jersey, has been a strong conservative voice on the 3rd U.S. Circuit Court of Appeals since Bush’s father, former President George H.W. Bush, seated him there in 1990. 
In the early 1990s, Alito was the lone dissenter in Planned Parenthood v. Casey, a case in which the 3rd Circuit struck down a Pennsylvania law that included a provision requiring women seeking abortions to notify their spouses. 
“The Pennsylvania legislature could have rationally believed that some married women are initially inclined to obtain an abortion without their husbands’ knowledge because of perceived problems — such as economic constraints, future plans or the husbands’ previously expressed opposition — that may be obviated by discussion prior to the abortion,” Alito wrote.

TITLE: Dems Call For Rove’s Head
AUTHOR: The Associated Press
TEXT: WASHINGTON — The indictment of a top White House aide is a sign of deeper problems within the administration, say Democrats who are criticizing President Bush for lauding Lewis Libby rather than apologizing for his alleged actions. 
The Senate Democratic leader, Harry Reid, also said Sunday that another key insider, presidential adviser Karl Rove, should resign because of his role in exposing an undercover CIA officer.
A veteran Republican senator added that Bush needs to bring “new blood” into his White House.
Rove has not been charged, but he continues to be investigated in the CIA leaks case that brought the indictment and resignation on Friday of Libby, an adviser to Bush and the top aide to Vice President Dick Cheney.
Prosecutor Patrick Fitzgerald has not made a decision on whether Rove gave false testimony during his four grand jury appearances. Rove is Bush’s most trusted adviser.
Reid said he is disappointed that Bush and Cheney responded to the indictment by praising Libby — known around Washington as “Scooter” — and suggested they should apologize for the leak that revealed the identity of covert CIA officer Valerie Plame.
“First of all, the vice president issues this very terse statement praising Libby for all the great things he’s done,” Reid said. “Then we have the president come on camera a few minutes later calling him Scooter and what a great patriot he is. There has not been an apology to the American people for this obvious problem in the White House,” Reid, told ABC’s “This Week.”
Meanwhile, Senator Chris Dodd, said Cheney should “come clean” about his involvement and why he discussed Plame with Libby before Libby spoke to reporters about her.
“What did the vice president know? What were his intentions?” Dodd asked on “Fox News Sunday.”
“Now, there’s no suggestion the vice president is guilty of any crime here whatsoever. But if our standard is just criminality, then we’re never going to get to the bottom of this,” Dodd said.
Democrats appearing on Sunday talk shows portrayed Libby’s indictment as one of many serious problems surrounding the White House and one of several allegations raising questions about Republican ethics. Republicans repeatedly said the charges have been made against only one individual and that Libby should be presumed innocent until proven guilty.
Public opinion appears to be running against Bush. Almost half the public, 46 percent, say the level of ethics and honesty in the federal government has fallen with Bush as president, according to an ABC News-Washington Post poll. That’s three times the number who say ethics and honesty have risen during that time.

TITLE: Rosa Parks Lies In State in Capitol
AUTHOR: The Associated Press
TEXT: WASHINGTON — Thousands of Americans paid tribute to Rosa Parks under the dome of the Capitol Rotunda, waiting in line for hours to see the closed casket of the woman whose defiant act on a city bus inspired the modern civil rights movement. 
Bathed in a spotlight, it stood in the center of a Rotunda that includes a bronze bust of the Rev. Martin Luther King Jr., who led the 381-day boycott of the Montgomery bus system that helped initiate the modern civil rights movement.
Parks, a former seamstress, became the first woman to lie in honor in the Rotunda, sharing the tribute bestowed upon Abraham Lincoln, John F. Kennedy and other national leaders. President Bush and congressional leaders gathered for a brief ceremony Sunday night, listening as members of Baltimore’s Morgan State University choir sang “The Battle Hymn of the Republic.”
Parks, who died last Monday at 92, was arrested in 1955 for refusing to give up her bus seat to a white man, an incident that inspired King and helped touch off the civil rights movement.
Representative John Conyers said the ceremony and public viewing showed “the legacy of Rosa Parks is more than just a success for the civil rights movement or for African-Americans. It means it’s a national honor.”

TITLE: Detente Holds Amid Delhi Terror Attacks
PUBLISHER: Reuters
TEXT: NEW DELHI — Just a few hours after three bombs ripped through the heart of New Delhi on Saturday, India and Pakistan announced a deal to open their contested and militarized frontline in Kashmir for earthquake survivors and relief. 
Pakistan swiftly condemned the bomb attacks as acts of terrorism. India refused to blame its neighbor and habitual foe — at least not until investigations were complete.
The message was clear. For now at least, South Asia’s heavyweights do not want the Delhi bomb attacks to derail two years of delicate peace talks.
But, if as many here suspect, the bombs which killed 59 people were planted by members of a Pakistan-based militant group, some impact is unavoidable, and some tough issues will have to be tackled.
“It is certainly going to affect the peace talks going on,” said New Delhi-based South Asia expert Kalim Bahadur. “It will be a setback, but it will not mean a breakdown.”
The toughest question on the agenda is, in Delhi’s eyes, Pakistan’s support for Islamic militants who cross the frontline to fight Indian rule in the disputed Himalayan region of Kashmir.
Indian Prime Minister Manmohan Singh has warned that there will be no realistic progress in peace talks until Pakistan severs those links. Many Pakistanis feel India is using that as an excuse to drag its feet in peace talks.
Lashkar-e-Taiba, the No.1 suspect in Saturday’s bomb attack, was formed and nurtured by Pakistan’s military Inter Services Intelligence (ISI), experts in both countries agree.
What is less clear is the extent to which the ISI and Lashkar are linked now. Indian hawks like Brahma Chellaney of the Center for Policy Research say there is a growing feeling that Musharraf’s battle against militancy is a “sham.”
Others say the Pakistani general is trying to crack down on militants but is struggling to control “rogue elements” within his own military and ISI.
Indian columnist Prem Shankar Jha says the attack should strengthen the coalition in both countries, where people want peace.
“It means Lashkar and Lashkar-linked people have become renegades in both countries,” he said. “But this does put pressure on Pakistan to stop being soft on Lashkar.”
In Pakistan, retired general Talat Masood agreed.
“This kind of incident will always cast a shadow,” he said. “The best way to counter it is to expedite the peace process. That will be the best way to beat them.”
The devil is, as ever, in the detail. Pakistan has been pressing India to reduce the number of troops it has stationed in Indian Kashmir. If Saturday’s attacks are linked to Kashmir, that sort of concession would seem to be firmly off the agenda.
Nor will Pakistan find it easy to crack down on Lashkar in the way India would like, especially after the earthquake.
Lashkar’s sister organization, Islamist charity Jamaat-ud-Dawa, has played a high profile role in bringing relief to victims in Pakistani Kashmir, and probably won a few hearts and minds in the process. 
Flashback to December 2001, when militants stormed New Delhi’s parliament building and India’s relations with Pakistan spiraled dangerously out of control — and close to war. 
Saturday’s bomb attacks on markets packed with families shopping for presents ahead of major Hindu and Muslim festivals this week, were scarcely less of a shock. But a new maturity has crept into relations on the subcontinent, analysts say. 
No one is expecting much in the way of progress in the next six months. Nor is everyone impressed by what has been agreed in two years of peace talks so far. 
But the fact the two sides are talking, and did not stop talking on Saturday, is something in itself. How long this will last remains to be seen. 
“Everybody is very angry just now, but emotions should not deflect the framework,” said Uday Bhaskar of New Delhi’s Institute for Defense Studies and Analyses. “If anything, this is all the more reason we have to keep at it.”

TITLE: Pakistan Opens ‘Line of Control’
PUBLISHER: Reuters
TEXT: MUZAFFARABAD, Pakistan — Pakistan said on Monday it would make special arrangements to give earthquake survivors easy access to Indian Kashmir over concerns bureaucracy would hamper the efforts of thousands to cross the border. 
Pakistan and India agreed at the weekend that five points along their military border in Kashmir, known as the Line of Control, would be opened from Nov. 7 to allow earthquake relief and people from both sides to cross to see family and friends.
They agreed that those wishing to travel would follow the same procedures as people who have used a cross-border bus service launched in March.
But that process, which involves six applications forms, exchanges of lists of applicants from the two sides and then laborious checks, can take up to a month.
The two countries said they would try to process applications within 10 days but there are doubts that can be done.
“Bureaucracy is slow, they’re going to have to evolve a new system,” said an official in Pakistani Kashmir, who did not want to be identified.
“They couldn’t cater for the demand from bus passengers — thousands applied but only 500 went. If they’re going to go for the same system they’re not going to deliver and I think they’re going to go for the same system.”
However, Minister of Social Affairs Zubaida Jalal said there would be special arrangements for earthquake survivors.
“There will be specific arrangements, keeping the situation in mind, arrangements on both sides to facilitate that, so I think they’ll be able to cope with it,” she told a news conference in Muzaffarabad, capital of Pakistani Kashmir.
She did not elaborate, but said the opening of the Line of Control would be a big boost for divided families.
“Once it really opens up, psychologically and otherwise, it will make a big difference for the people on both sides.”
Ordinary Kashmiris welcomed the news that they may soon be able to cross the line that has separated Kashmir since India and Pakistan fought their first war over the region shortly after their independence in 1947.
“The opening would be a great help,” said Nasir Butt, who lives in the Neelum valley, northeast of Muzaffarabad.
The valley was hit hard by the Oct. 8 quake, which left 55,000 people dead in Pakistan and 1,300 in Indian Kashmir. More than three million others were left homeless or needing shelter.
The road linking the Neelum valley to Muzaffarabad has been swept away and blocked by landslides and it will not be opened before winter arrives in a few weeks.
“Our village is only separated from India by the river,” Butt said. “My relatives are over there. Winter is coming and we could easily get food and tents from there.”
He did not know how he would have to apply for permission to cross the border, but officials say he would have to apply at the district capital — several hours walk away. 
Another valley resident said he did not mind waiting a bit longer. “We’ve already waited three weeks, we can wait another couple,” said Ali Share. “We want aid before the snow starts.” 
Relief officials say the opening of the line will help some cut-off communities but it is not going to come anywhere near to solving all of their problems, as they race to get shelter and food to hundreds of thousands of survivors before winter. 
Aid workers fear hunger and exposure could kill as many as the quake killed unless help reaches them quickly. 
The border agreement was reached despite bomb attacks on Saturday in the Indian capital New Delhi, that killed at least 59 people and were claimed by a Muslim group linked to banned Pakistan-based terror outfit Lashkar-e-Taiba. 
A charity linked to Lashkar called Jamaat-ud-Dawa has been at the forefront of quake relief work in Muzaffarabad, working alongside international relief agencies and Western troops. 
Jamaat-ud-Dawa operates with impunity, running religious schools and hospitals, although it draws its cadre from Lashkar, a group banned by President Pervez Musharraf in January 2002. 
Musharraf banned Lashkar after it was blamed for an attack on India’s parliament that brought nuclear-armed India and Pakistan close to their fourth war.

TITLE: Beta Clobbers Central America
PUBLISHER: The Associated Press
TEXT: MANAGUA, Nicaragua — The remnants of Hurricane Beta dropped heavy rain over parts of Central America on Monday, prompting forecasters to warn of deadly landslides and flooding as the storm began to dissipate. 
No injuries or deaths were reported a day after the storm crashed ashore in Nicaragua, uprooting trees and ripping the roofs off houses.
Though the storm’s remnants were expected to drop an additional 4 to 8 inches on already saturated ground, President Enrique Bolanos said his country had escaped a major catastrophe from Beta. He pledged to quickly get aid to remote towns cut off by flooding and landslides.
“No one was injured, no one was killed, thank God,” he said. He added, however, that “it’s not over. Now we have to reconstruct the houses it destroyed.”
While powerful at times, Beta was a small storm, with its initial hurricane-force winds extending outward only about 15 miles, said the National Hurricane Center in Miami. The record 13th hurricane of this year’s Atlantic storm season hit land Sunday near the remote town of Sandy Bay Sirpi, 200 miles northeast of the capital, Managua, as a Category 2 hurricane with 105 mph winds, the hurricane center said. It then weakened to a tropical storm and eventually became a depression.
Nicaragua’s army chief, Gen. Omar Halleslevens, said Beta had destroyed or damaged some houses, ripped roofs off buildings, knocked down trees and caused some flooding. He said it also damaged at least one pier.
Thousands of people had been evacuated from the far northeastern region of Nicaragua on the Honduras border, where the hurricane was expected to hit land before it turned to the south.
Jack Howard, mayor of the central coastal town of Laguna de Perlas, told local television that 700 people were trapped in Tasbapauni, a town separated from the mainland by a lagoon.
In Honduras, authorities evacuated more than 7,800 people Sunday from 50 communities north of the Nicaraguan border after four rivers overflowed from rain brought by Beta.

TITLE: Dope Law Shadows Olympics
AUTHOR: By Victor L. Simpson
PUBLISHER: The Associated Press
TEXT: TURIN, Italy — A downhill skier is led off in handcuffs after crossing the finish line for a gold medal. Paramilitary Carabinieri jump onto the ice and take away a bruising hockey defenseman or chase down a pair of ice dancers. 
It may sound like a goofy film script, but the International Olympic Committee is worried about just such scenes at the Winter Olympics in Turin — and that has led to a standoff with Italian authorities over the country’s hardline anti-doping law. 
The impasse over the law, which calls for criminal penalties and possible prison sentences ranging from three months to three years for athletes and others, has cast a cloud over final preparations for the Feb. 10-26 Turin Games. 
The IOC backs suspensions, not jail time, for athletes who cheat. IOC officials said last week they will conduct 1,200 doping tests in Turin, a 45 percent increase over the number in Salt Lake City for the 2002 Winter Olympics. 
Yet Italian authorities have refused to agree to a moratorium during the Olympics. With the 100-day countdown to the Turin Games starting Wednesday, the doping debate has overshadowed other preparations. 
“We can’t accept the principle that Italian laws are not valid, because there are athletes from somewhere in the world who want to be free to take doping substances,” Italian Health Minister Francesco Storace said during a visit to Turin last week. 
Turin is home to one of Italy’s top anti-doping prosecutors, Raffaele Guariniello, and Italy has been a pioneer in the fight against doping. 
A court in Turin on Thursday began considering the appeal of the club physician of Italy’s most high-profile soccer team, Juventus, who received a 22-month suspended sentence for administering banned substances to players. 
While no prominent athlete has gone to jail in Italy, three bicyclists received six-month suspended sentences for doping during the Giro d’Italia. And Libyan leader Moammar Gadhafi’s son, who plays in Italy’s top soccer league, was banned for three months for a positive steroids test and faces trial in November on charges of sporting fraud. 
The government supervisor of the Turin Games, Mario Pescante, who is also an IOC member, has lobbied for parliament to approve a moratorium during the Olympics — but acknowledges opposition from Italy’s foreign minister and other government officials is overwhelming. 
“The majority of public opinion sees this [moratorium] as a sign of weakness against doping,” Pescante said. “I did my duty as an IOC member to respect the Olympic charter, but my main duty as undersecretary of state is to respect” national laws. 
IOC and World Anti-Doping Agency officials support a moratorium. 
“It’s always been our view that sports should settle its own problems,” WADA president Dick Pound. “Doping in sports is a serious problem and will be dealt with seriously, but it is not criminal.”

TITLE: Europe’s Big Teams Eye Knockout Phase
PUBLISHER: Reuters
TEXT: LONDON — The first pieces in the Champions League jigsaw should fit into place this week with Bayern Munich, Arsenal, Barcelona and Chelsea guaranteed a passage from the group stage with victories. 
European champions Liverpool, Olympique Lyon and Real Madrid could also advance to the knockout phase depending on other results. 
Bayern, who along with Arsenal and Lyon boast a perfect record, have a stranglehold on Group A and can seal their passage with a win over their main rivals Juventus at the Della Alpi on Wednesday. 
The German champions, who would also advance with a draw providing Bruges do not beat Rapid in the other game, beat the Italians 2-1 in the reverse fixture but lost in Turin last season. 
Bayern suffered a blow on Saturday after in-form Paraguay striker Roque Santa Cruz was ruled out for around six months after sustaining a cruciate knee ligament injury. 
Juve, second on six points, will be smarting after their record nine-match winning start to the season was ended by AC Milan at the weekend. 
Arsenal talisman Thierry Henry could be recalled by manager Arsene Wenger as the north London side seek a victory at home over Sparta Prague that will put them through from Group B. 
The France striker, who scored twice against Sparta in Prague to overhaul Ian Wright as Arsenal’s record goalscorer, missed the weekend draw with Tottenham after aggravating a groin injury. Midfielder Freddie Ljungberg should recover from cramp that forced him off against Spurs. 
Barcelona welcome Panathinaikos to the Nou Camp on Wednesday on the verge of the knockout stages. 
Barca, top of Group C with seven points, are without Portugal midfielder Deco and Brazilian defender Juliano Belletti through injury. 
Werder Bremen, who host Udinese, prop up the group with one point and must start to translate their brilliant domestic form to the European stage to stand a chance of going through. 
Jose Mourinho’s Chelsea have no problems scoring at home or abroad and on Tuesday face a Real Betis side in disarray. Betis, thumped 4-0 at Stamford Bridge, lost at home to Real Madrid at the weekend and are in desperate need of a win to keep their qualifying hopes in Group G alive.

TITLE: Johansson Wins 2nd St. Petersburg Title
AUTHOR: By David Nowak
PUBLISHER: Staff Writer
TEXT: Second-seeded Thomas Johansson of Sweden swept aside Nicolas Kiefer of Germany to take the St. Petersburg Open title in Sunday afternoon’s final.
With a gritty and consistent display, the Swedish world No. 15 wrapped up the 1 1/2-hour final with a booming ace to win 6-4 6-2 and take his first title of the season at the city’s Sportivno-Kontsertny Complex (SKK).
“I really enjoy playing in St. Petersburg — the [hard] courts really suit my game,” Johansson said in the post-match news conference after taking his ninth career title and second in St. Petersburg.
Fifth-seeded Kiefer, playing in fits and starts, showed only flashes of his brilliance in the quarterfinals, where he dispatched Russian top seed and world No. 8 Nikolai Davydenko 6-1 6-1.
“I didn’t play my game. I could step up my level of play,” Kiefer said after the match.
The first crack’s in Kiefer’s game appeared with the score 2-2 in the first set. A rally ended with the German missing an easy smash at the net, but he held his nerve to win the game and keep the set on serve.
The respite, however, was short-lived as Johansson began to take the game from the erratic Kiefer. The Swede took the German to break point at 3-3, and duly converted after Kiefer again missed at the net. An enraged Kiefer smashed the ball into the upper stands and was cited for a code violation by the umpire.
The German world No. 29 worked himself into position to break back in the final game of the set at 5-4 with two break points, but Johansson stepped it up a gear and produced a stunning backhand passing shot to take the set with Kiefer stuck at the net.
“I had many break points, but if you can’t take those chances, you can’t win,” Kiefer said.
Unhappy with his performance so far, Kiefer left the court to change his shirt. The break didn’t help.
Johansson broke Kiefer in the first game of the second set and battled to a 4-1 lead.
Kiefer rallied, gaining three break points as Johansson’s returns found the net. But three consecutive unforced errors, topped off with a Johansson ace, gave the game to the Swede.
Kiefer easily won his last service game to love, including two aces. For a moment, it seemed an unlikely comeback was in the cards, as Kiefer fought to stay in the match and gained a break point with a majestic passing shot.
But he failed to convert, instead thrusting the ball into the net. Another unforced error gave Johansson match point, and a pinpoint power serve — his 10th ace of the match — gave the Swede a deserved win.
Johansson, winner of the tournament in 1997, praised his opponent afterwards: “I don’t think the scores are right — we had a really tough match today. [Kiefer] is very talented and never gives up.”
Only Johansson and Russia’s Marat Safin, out with an injury that will keep him out of the season-ending Paris Masters, have won the $1 million event twice.