#9
From: Ben Aris <benaris@online.ru>
Date: Wed, 15 May 2002 15:34:33 +0500
Subject: [RusBizList] RBL318 -- May 11 - 13

Russia Business List
#318
Saturday, May 11, 2002

7. Tom on Military reform
Tom Adshead
Troika
Tuesday, May 14, 2002

May 9 was Victory Day in Russia,which is marked as though Nazi Germany was defeated much more recently than 57 years ago.Even Russian MTV was showing films about the war .Since precious little happens in the first half of May because of the holidays,this seems like a good time to think about the military. President Putin has made some changes in the military .We have a new defense minister,who does not come from the military,and we have had the first corruption trial of a senior general.We are also seeing some steps toward the abolition of conscription.All of this has been encouraging,although we have some questions about how much of it is hype and how much is actually going to change.

We do not see the major changes which were expected when Sergei Ivanov replaced Ivan Sergeev as defense minister.There do not seem to have been any major shifts in military doctrine indicating a shift from the missile and tank based tactics of the Soviet Army.Of course,this move takes time,but there has not even been a roadmap published.It seems likely that the military has asked for more time to think and will take at least a couple of years actually to produce any kind of position,which will probably be that nothing needs reforming.

The trial of General Oleinik,who was involved in a complex scheme involving transfers of material to Ukraine and payments to Gazprom,looked more like a show trial designed to demonstrate that something was being done about corruption in the military.It looks as though Oleinik was the one who signed the documents on behalf of his superiors and was made to take the fall .

The new law on the draft has gone through and although it does provide for alternative services,it requires individuals to prove their conscientious objections to military service.It also gives the draft board (made up of army officers)the decision as to whether or not these objections are real.Of course,the militaryís suggestion that alternative service should be as far from the objectorís hometown as possible,and served within military camps,was rejected,which is scant comfort.There is talk about reducing the period of military service from two years to one and a half,which is a step in the right direction.

As for the creation of a professional army,there is some movement .A pilot project will start later this year and is due to end in mid 2003.This will give an idea of how much money is needed to do this. Again,the Defense Ministry has been obstructive,hugely inflating the cost of moving to a contract army and demanding for instance that such a move also require a huge house building and rearmament program. Marshal Sergeev,who now acts as an advisor to Putin,said a month ago that the transition to a contract army needed to happen at the same time as a program to modernize the army,especially communications,intelligence,strategic nuclear forces and the development of a space army.The first two are fair enough,given how bad they are at the moment,but the latter two are emphatically not a strategic priority.In fact,it was insistence on diverting resources to these projects which led to Sergeev being fired.

The military brass wants more spending,because this will give it greater opportunities to steal .In late April,Ivanov said that the number one task for the leadership of the Defense Ministry was to stop theft in the army.Most of the problems of the army have their origins in this one issue,according to Ivanov. This is quite a statement,given the other problems which the ministry has to deal with,like Chechnya and more general reform in the face of completely new strategic tasks.

Normally,ictory Day is a chance for the countryís leadership to reassure the military that it is still loved and can still count on getting a large share of GDP.We did not see this .Putinís major meeting was with a group of veterans,where he reassured them that their pensions would be increased.No major meetings with generals and no ceremony giving them patriotic honors.

Putinís speech emphasized that victory over fascism was achieved by an alliance.Today,a new alliance has been formed to combat terrorism.This is different rhetoric and underlines the fact that Putin is leaning towards the West.Previous Russian leaders were not so outward looking and talked about victory as a purely Russian thing.The Russian military is not happy with Putinís West leaning foreign policy,but he took the opportunity of the military parade to reiterate that he is not going to weaken in his resolve.

The military had it easy under Yeltsin because he owed them for support in 1991 and 1993.Also,he was brought up in the Soviet tradition which idolized the army for its role in defeating Hitler.So there was not much hope that he would initiate any reform in the army.He promised to create alternative service when he ran for president in 1996,and never delivered,under pressure from the army. Putin has no such agenda .Even if he did,he has shown himself capable of turning his back on those who brought him to power.But the fact is that his efforts to force the military to reform itself have not met with any success.You would have thought that finding corrupt generals would be like shooting fish in a barrel,but Ivanov has found only one,so far.

So the military sits there,useless and unreformed,like Putinís other failed reform projects.Of course, reform has not actually stopped,but has just got bogged down in review committees and document preparation.But if its opponents can make this process indefinite (and they think that they can),then the reform is as good as over,without actually having been killed. None of this really matters,of course,because the Bush circus will roll into town next week and gloss over these problems.We will get a strategic arms treaty,which is meaningless in the post September 11 world.The US government may grudgingly admit what the market worked out years ago,that Russia is a market economy.If you are looking for real progress,then keep an eye on the oilmen around Bush,who may be fooled by the pretense long enough to open their checkbooks and invest in the Russian economy,while the unreformed bureaucracy looks for ways to deprive them of their investment.

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