Financial Meltdown Is no Deterrent to Russian Navy

Moscow had its own special way of handling the financial crisis which struck its stock market.

Starting Tuesday, Sept. 30, Russia’s Federal Financial Markets Service (FFMS) announced stock exchanges would suspend trading in shares, bonds and investment units for at least one hour if the opening value of the respective technical index went up or down by more than 10 percent of its closing value the previous day. (A $130 billion financial package was also announced to shore up liquidity and loans injected to Russia’s three largest banks.)

And indeed, after a two-hour freeze on trading, the ruble-denominated Micex stock index gained 0.8 percent and the dollar-linked RTS stock index rose 1.5 percent to end at 1,211 points.

DEBKA-Net-Weekly‘s Moscow sources report that, at this time, the Kremlin refuses to waste much effort on such irrelevancies to its main goal as the financial jitters on the Russian markets.

The crude measure of suspension was applied to whip trading into line.

This freed president Dmitry Medvedev and prime minister Vladimir Putin for their most compelling pursuit, named by DEBKA-Net-Weekly’s Moscow sources as the exploitation of the financial distress overtaking the US, West Europe and the Far East – and especially America’s vulnerabilities – to expand Russia’s military foothold and influence on the global stage.


Karl Marx’s comeback – in the West?


Russia’s rulers fiercely deny embarking on a Cold War against America or resorting to its tools.

At the same time, while Western and Asian economies are struggling to mend the crippled financial world order, Moscow is busy influence-plugging, muscle-flexing and parading its naval strength in India, Venezuela and its Latin American neighbors, such as Bolivia, as well as Syria.

In Moscow, Russian economic and military thinkers and intelligentsia are lapping up comments rife in the Western media eulogizing the free market global economy, in such works as: “Refuting the dogmas of the Free Market – the Predator State: How American conservatives abandoned the free market, by James K. Galbraith, reviewed by Roger Lowenstein in the New York Times of Sept. 27).

They have avidly picked out references to Marxism in the Western press. On Sept. 29, one commentator claimed that the Bush administration’s bail-out plan was based on an article of Karl Marx’s Communist Manifesto. (Bailout marks Karl Marx’s comeback, by Jeff White).

Moscow draws ideological and moral legitimacy for its bid for an enhanced place in the world from such comments and encouragement for aggressively competitive steps which many Western strategists regard as the opening moves of Cold War 2.

Although the men who govern Russia determine their external and economic policies by pragmatic power-driven rules, having discarded the Soviet Union’s (communist) ideological fundamentals, yet they are not above gloating over capitalism’s apparent comeuppance. Indeed they use it as a starting point to condone Russia’s imperial ambitions.

But because of the Russian inborn predilection, brutally manifested by the Soviet rulers, to underpin their most self-serving policies with a doctrinal rationale, the contemporary Kremlin is happily harking back to the ideology of its former occupants for its national and moral right to pursue the challenge to American superpowerdom.


Anything you can do, I can do better


Sunday, Sept. 28, Medvedev announced plans to upgrade Russia’s nuclear deterrent by 2020. He said it was part of a full upgrade of the Russian armed forces with more nuclear-powered subs, better bombs and a made-in-Russia “air and space defense network.”

US Secretary of State Condoleezza Rice shot back that America possesses an “extremely capable, robust, broad and indeed varied nuclear deterrent.” That no doubt includes not only the hit-or-miss missile defense effort, she pointed out, but also planned new nuclear weapons and the industrial complex for developing and fabricating them.

Moscow countered on Sept. 29 with the announcement that a Russian Delta-III class submarine had successfully sailed from a naval base in northern Russia to the Pacific under the Arctic ice floe.

“The Ryazan strategic nuclear submarine arrived at a naval base on the Kamchatka Peninsula after a more than 30-day underwater voyage: said Capt. 1st rank Igor Dygalo, Russian navy spokesman.

Military experts describe the Ryazan as a Project 667BDR Delta III class strategic nuclear submarine with a crew of 130 which can travel under water for up to 90 days without surfacing. It is armed with sixteen R-29RM (SS-N-23 Skiff) ballistic missiles with a range of 8,000 km.

Russian Navy Commander Adm. Vladimir Vysotsky said it had reaffirmed the Russian submarine fleet’s ability to conduct strategic missions in the Arctic, adding: “The navy continues to play an important role in safeguarding Russia’s maritime economic and research activity throughout the world, including in the Arctic.”


A US-Indian nuclear deal rushed through


While this stunt drew little comment from Washington, DEBKA-Net-Weekly’s sources in the US capital report that more vocal concern greeted the surge in Russian arms sales and influence-peddling to New Delhi. Military experts estimate that 40 percent of Moscow’s military exports were now funneled to India.

President Medvedev is planning state visit in December to seal a $2 billion contract for another 29 MiG-29K strike fighters rounding off an estimated $15 billion trade with India and offering serious competition to the US market for multi-role combat aircraft.

Russia has also contracted to upgrade and modernize India’s aircraft carrier-cruiser Vikramaditya.

In need urgent need of damage control, the US Congress rushed through a controversial deal Wednesday, Oct. 2, that ended the thirty-year ban on America’s nuclear trade with India, freeing up billions of dollars of investment capital. The vote of 86 to 13 to ratify the deal awarded President George W. Bush one of his few foreign policy victories. It will assure Condoleezza Rice a warm welcome by Indian prime minister Manmohan Singh when she visits New Delhi over the weekend.

She arrives on the heels of the Sept. 28-30 visit by Russia’s defense minister Anatoly Serdyukov.

On another continent, the same Russian Navy spokesman announced on Sept. 28, during an unprecedented media visit aboard the Russian carrier the Moskva, on the Black Sea:

“The military budget will be revisited so that we can exploit these ships better and build new ships.” He added: “The international situation has changed, of course. We understand quite well that Russia came under pressure [in the Georgian conflict].”

The only response to the gauntlet flung down by Moscow occurred not far from there in the usually pro-Russian Armenia, where NATO this week announced that an interoperability exercise involving 900 troops from 21 countries would take place through October 21.

Taking part will be seven alliance members and 14 nations co-opted to its Partnership for Peace and Istanbul Cooperation Initiative programs. They will drill the evacuation of civilians, counter-terror operations and stabilization measures.


Seaborne nuclear missiles on America’s doorstep – no joke


But then, Russian pride was stung hard by a putdown from the US state department spokesman Sean McCormack, who dismissed the joint Russia-Venezuela joint naval exercise due to take place close to America’s territorial waters as “a joke.”

Pouring more contempt, McCormack added: “I once said that the old Russian ships could not make it that far down to Venezuela. And I have seen reports where I think they were actually being accompanied by tugboats.”

Moscow furiously riposted with some “basic information about those old Russian warships” being “tugboated” to the Caribbean,” citing the Russian Navy Defense Industries website.

The four-ship squadron heading for Venezuela consists of the Northern Fleet’s flagship Peter the Great, the anti-submarine warship Admiral Chabanenko and two auxiliary vessels. Peter the Great is designed to sink large surface vessels such as aircraft carriers. With the help of its four nuclear reactors delivering 28,000 hp, its propulsion system provides a top speed of 31 knots. The ship’s Granit (Nato designated SS-N-19 Shipwreck) anti-ship cruise missiles (20 missile launchers) can destroy vessels up to 500 km distant in ripple-fire mode.

An S-300F defense missile complex is installed on Peter the Great, with 12 launchers and 96 vertical launch air defense missiles.

The sting came in the tail of this “basic information:”

Russian authorities do not comment on the fact that Peter the Great‘s Granit missiles have nuclear warheads for political reasons. “But there’s little doubt whether a warship will travel halfway across the globe stripped of its main firepower.”

Moscow’s message here was that the Russian ships deployed to the Caribbean shore on its doorstep were nuclear-armed. Some joke.

Medvedev and Putin are deadly serious. They are investing heavily to make sure that when the world wakes up from its financial woes it will find Russia riding high as never before as a world-class military-nuclear power.

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