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Press review: BRICS losing weight and India rattled by Russia's ties with Pakistan

October 14, 2016, 13:00 UTC+3 MOSCOW

Top stories in the Russian press on Friday, October 14

1 pages in this article
Russian President Vladimir Putin standing next to national flags of Russia, China and South Africa - three of the five BRICS countries (archive)

Russian President Vladimir Putin standing next to national flags of Russia, China and South Africa - three of the five BRICS countries (archive)



Nezavisimaya Gazeta: Moscow and Washington returning to the negotiating table

Diplomatic contacts between Russia and the US over Syria carry on despite the recent friction in bilateral relations. At the very least this is evident from Saturday’s ministerial meeting on Syria in Lausanne, which, according to the Russian Foreign Ministry, is a result of diplomatic efforts hammered out between the two countries. Nezavisimaya Gazeta quotes a source in the Russian Foreign Ministry that it does not rule out bilateral meetings between Sergey Lavrov and his US counterpart John Kerry. The United Nations Special Envoy for Syria Staffan de Mistura will also attend the general meeting.

According to Western experts, the resumption of the US-Russian dialogue after the contacts on Syria had been frozen could have been easily predicted, although it does not promise any real results due to disagreements between the parties. "I am skeptical on the matter, as the problem lies not in diplomacy but in fundamentally different aspirations of the parties in the negotiations," Michael Kofman, Fellow at the Kennan Institute of the Wilson Center told Nezavisimaya Gazeta. "Russia will not be able to agree to a ceasefire before the opposition in Aleppo falls. This is an informal agreement between the allies (meaning Moscow and official Damascus). The goal of the US in the negotiations is to put a stop to the fighting around Aleppo and to prevent a humanitarian catastrophe. Russia is conducting the dialogue mainly to buy time for the Syrian government forces to let them take Aleppo," he added.

According to the expert, this rules out any possibility of an agreement. "It is a matter of time. The Obama administration will soon leave, and it wants to clinch a deal on Syria quickly. However, since Assad has not yet taken Aleppo, Moscow has nothing to offer," Kofman added.

The ability of Russia and the United States to comply with agreements remains the main issue. "It was not possible to implement the bilateral format, which was perfectly evident after the meeting between Lavrov and Kerry," Senior Lecturer, Department for Political Science of the National Research University Higher School of Economics Leonid Isaev told the newspaper. "This is because neither Russia, nor the US can properly influence their allies in the region. In additional to the US, there are several countries that support the Syrian opposition. It is necessary to find a compromise to minimize the possibility of the opposition balancing the interests of its allies," he added. According to the analyst, getting as many parties together is justified, since it would help achieve results.


Kommersant: BRICS becomes excessively multipolar, losing weight

The annual BRICS summit is scheduled to kick off on October 14 on the Indian resort of Goa tomorrow. The 8th BRICS summit, which will be attended by the leaders of Russia, China, India, Brazil and South Africa, held under the chairmanship of India, will be the most difficult one in its history. According to Kommersant, a draft joint declaration of the summit had not even been introduced until recently.

"Despite the task of creating a "new world order", BRICS is losing its role of a counterweight to Western institutions, becoming a union of states, whose interests move further apart," the newspaper writes. Domestic problems in Brazil and South Africa, India’s rapprochement with the West and the contradictions between Beijing and New Delhi are increasingly muddying BRICS’ prospects.

"It no longer makes sense to talk about the major role of BRICS in Brazil and South Africa. In this regard, we must admit that this association is experiencing serious problems," Professor Yuri Tavrovsky of the Peoples' Friendship University of Russia (PFUR) told Kommersant. According to the expert, along with Russia, China is highly interested in maintaining BRICS. For Moscow and Beijing this alliance has turned into a tool for implementing large-scale integration projects in Eurasia.

"BRICS has practically become two-wheeled, moving forward only according to efforts by Moscow and Beijing, while New Delhi is gradually flirting with the West," a Chinese diplomatic source told Kommersant.

Experts interviewed by the newspaper said India had to consider Washington’s position, since the US has become India’s largest supplier of arms and military equipment and one of its most important trade and economic partners. In turn, China continues to support Pakistan as their ally, at a time when friction between India and Pakistan has exacerbated. "In this situation, the question arises: Can Delhi and Beijing cooperate fully in the forthcoming BRICS forum?," asked Brian Yen, a Hong Kong-based columnist.

"We need to get rid of illusions that BRICS is a machine that is moving forward, crushing Western institutions," Director of the Russian International Affairs Council Andrey Kortunov told Kommersant. "Of course, BRICS will not collapse, and might even expand its ranks, but its global sway at creating an alternative to the Western world order will come to naught. This was more than evident in the run-up to the summit in Goa more than two or three years ago," the expert added.


Nezavisimaya Gazeta: India rattled by Russian ties with Pakistan, China

Russia and India are expected to sign key agreements on military-technical and nuclear energy at the upcoming BRICS summit in Goa. However, recent developments in international diplomacy cast a shadow on Russian-Indian relations, particularly as New Delhi expressed dissatisfaction with Moscow over joint exercises with the Pakistani military. Nezavisimaya Gazeta interviewed two prominent Indian experts - Nandan Unnikrishnan, Vice President of the Observer Research Foundation and India’s Former Ambassador to Russia and Director at ONGC, Ajai Malhotra about the present and future state of Russian-Indian relations that span roughly 70 years.

Unnikrishnan believes that relations between Moscow and New Delhi are languishing. In the last 2-3 years, ties between Russia and the West have worsened, whereas Russian-Chinese relations have improved. Moscow is developing relations with Pakistan, while India is fostering ties with the United States.

"Yes, India is moving closer to the United States. For us, China is the biggest problem of external security. And we want to get the support of not only Russia, but also of all countries that are willing to help us." The expert emphasized that India must put its interests first when dealing with both superpowers, but it does not like double-dealing by its counterparts. Selling arms is one thing. Mutual maneuvers is quite another. "How would Russia have reacted if India had said it would conduct exercises with Ukraine somewhere near the coast of the Crimea?" he stressed.

On the contrary, Ajai Malhotra said the prospects of relations between the two countries are quite optimistic. Russia is India’s leading partner in the fields of defense, nuclear energy, aerospace, oil and gas. "India is a huge and growing consumer of oil and gas. Thus, it is quite natural that we expand cooperation in this sector," he said.

Regarding India’s policy on the Syrian issue, Malhotra said that the positions of the two countries are similar in many ways, which is reflected in the BRICS statements. "In my opinion, clarity and consistency in the approach of Russian diplomacy to resolve the Syrian crisis is to be commended," he concluded.


Vedomosti: Government ready to sell VTB below market price

The Russian government wants to receive 95 bln rubles ($1.5 bln) from the privatization of 10.9% of the voting shares of VTB, according to the explanatory note to the 2017-2019 draft budget, available to Vedomosti. Based on the price quotations at the close of Thursday’s trading on the Moscow Exchange, the package is worth 97 bln rubles ($1.54 bln), based on the weighted average price in 2016 - 100.7 bln rubles ($1.6 bln). Thus VTB could be sold at a discount to the market price of 2.1 or 5.6%.

"A 5% discount to the weighted average price is a normal market practice when you want to sell a large package quickly. The state thus shows that there is an urgent need to do that," CEO at Sputnik Asset Management Alexander Losev told Vedomosti. BCS analyst Olga Naydenova believes, "This is an understandable solution for tradable securities. However, even at this price it will be difficult to privatize VTB."

Economic Development Minister Alexei Ulyukayev said earlier that the bank might be privatized in 2017. Different options were considered - issuing convertible bonds, selling shares to strategic investors on a public market. "The last two options would be severely hampered by the sanctions," Vedomosti wrote.

"Sanctions could be the main cause for problems with selling the asset," Naydenova also noted. However, that it is not the only difficulty. According to experts, the current market price of VTB shares is above fair and the return on equity is low - only 2.8% over the first 8 months of 2016, or about 5% only on the ordinary shares, For example, for Sberbank the figure reaches about 20%. "The consensus recommendation on VTB is to sell it, in contrast to Sberbank," Naydenova said, adding it is highly unlikely that VTB will be sold in the near future.


Izvestia: Russian artificial intelligence to replace Sberbank call center employees

The Laboratory of Neural Systems and Deep Learning of the Moscow Institute of Physics and Technology presented an artificial intelligence project, which in the future will be able to completely replace call center employees. The project has been approved by the Agency for Strategic Initiatives. According to Izvestia, Sberbank is already interested in the technology.

The iPavlov project wants to create artificial intelligence that would be able to communicate with users and answer questions like a human being. According to scientists, by 2019 the network will have sufficient intelligence to communicate with people both in text and in audio format.

Sberbank’s press service told Izvestia it is indeed interested in the iPavlov project and in machine learning technologies, in general. "We are eyeing several projects in the field of artificial intelligence, as we understand that the products based on this technology have great market potential. We are very interested in everything that is connected with deep machine learning techniques, neural networks, and pattern recognition. We are ready to consider any investment in technology, and we are interested in the team in order to improve services and the bank’s infrastructure," the press service told the newspaper.

From 2016 to 2019 the project will apply for 347 mln rubles ($5.5 mln) from the budget and 158 mln rubles ($2.5 mln) from private investors. Sberbank will also act as the project’s curator.


TASS is not responsible for the material quoted in the press reviews

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