Newspaper article The Christian Science Monitor

Russia's Newest Tie to Iraq ; Moscow Is Set to Sign a $40 Billion Economic Pact with Baghdad Next Month

Newspaper article The Christian Science Monitor

Russia's Newest Tie to Iraq ; Moscow Is Set to Sign a $40 Billion Economic Pact with Baghdad Next Month

Article excerpt

Amid uncertainty about US war plans toward Iraq, Russia is poised to sign a $40 billion economic cooperation deal with the regime of Saddam Hussein that could complicate the White House's military strategy, while boosting Kremlin influence.

On its face, the five-year agreement - confirmed by Russian officials over the weekend - might appear a risky move for President Vladimir Putin, who has forced Russia down a pro-West path, and is considered an ally in Washington's "war on terror."

Moscow has made it clear that it does not support Washington's policy of "regime change" for longtime Russian ally Iraq. The Kremlin also has recently deepened financial and political ties with two other nations which Mr. Bush has included with Iraq as part of an "axis of evil" - Iran and North Korea.

But analysts say Putin is betting that his pursuit of an independent policy will result in a winning hand for Russia - without dealing a blow to the developing friendship between Russia and the US, analysts say.

The logic is that if America holds its fire, Moscow will be able to claim that it helped prevent war. This claim could help fulfill Putin's goal of restoring some of Russia's former status as a superpower. And if the US does strike Iraq, Russia's reputation would still grow in most Arab countries and in many others that oppose any US war in Iraq.

"Deep down, Putin doesn't think it will spoil his relations with Bush, and [hopes] that Bush will not see this as an anti-American gesture, but as a gesture of goodwill to Arabs and the Third World," says Georgy Mirsky, a senior researcher at the Russian Academy of Science's Institute of International Economics and Relations.

Iraqi and Russian officials insist that the latest deal, which would give Russia a stake in developing Iraqi oil fields, and also includes electricity and infrastructure projects, will not violate United Nations sanctions imposed on Iraq after its August 1990 invasion of Kuwait.

But that doesn't mean that Washington is happy about it. Sen. Richard Lugar (R) of Indiana, a senior member of the Foreign Relations Committee, told NBC's "Meet the Press" on Sunday that Russia and the US "have a coincidence of interests in Iraq" and "it's not very nice to express it in this way, with a symbolic gesture, even if it doesn't mean very much."

Russia has been a top contender for business prospects in Iraq, with more than $15 billion in current Russian-Iraqi deals, some of it in debt owed by Iraq from Soviet times. The Kremlin has stood up for Iraq in the UN Security Council in almost every confrontation since the 1991 Gulf War.

"America insists on its right for one-sided actions, but at the same time it doesn't suppose that other countries might also have this right," says Gleb Pavlovsky, a former Kremlin insider who is now chief editor of Russkiy Zhurnal, a daily Internet magazine.

Even as Washington seeks to isolate Iraq, accusing it of secretly pursuing weapons of mass destruction, Russian businessmen and arms experts are reported to be active in Baghdad.

Ambassador Abbas Khalaf, a ranking Iraqi Foreign Ministry official who has served as a translator to Saddam Hussein and was sent to Moscow in the past month, says he expects Russian Prime Minister Mikhail Kasyanov to sign the latest deal, which has been in the works for more than a year, in the first half of September. …

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