MOSCOW, September 1. /TASS/. Russian and Turkish foreign ministers meet in Moscow to discuss potential alternatives to now-defunct Black Sea grain deal; Xi Jinping and Vladimir Putin both likely to skip upcoming G20 summit in India; and Ukrainian armed forces increasingly relying on long-distance drones to target Russian territory. These stories topped Friday’s newspaper headlines across Russia.

 

Kommersant: Russian, Turkish foreign ministers discuss prospects for grain deal 2.0

Russian Foreign Minister Sergey Lavrov and his Turkish counterpart, Hakan Fidan, met in Moscow, where their discussions focused primarily on grain exports from both Ukraine and Russia. Both Moscow and Kiev made it clear before the talks that their respective viewpoints should be taken into account in any renewed Black Sea grain deal. At the same time, according to Fidan's statements, Ankara sees no alternative to reviving the Black Sea Grain Initiative, which was launched under the Istanbul agreements in July 2022 for ensuring safe passage for Ukrainian grain shipments and lifting restrictions to unblock Russian agricultural exports. It was terminated on July 17 when Russia withdrew from the deal, citing the failure to implement the provisions allowing for Russian agricultural exports. No solution has yet been found to the deadlock over renewing the deal. Thus, the matter will be taken up by the Russian and Turkish presidents, Vladimir Putin and Recep Tayyip Erdogan, at their meeting in Sochi later in September.

According to the Russian Foreign Ministry, the foreign ministers intend to focus their efforts on Putin's initiative to organize the supply of 1 mln tons of Russian grain to Turkey at a reduced price for processing and subsequent shipment to the neediest countries. "We regard this project as an optimal working alternative to the Black Sea deal," the ministry said. Fidan, on the other hand, was intent on resurrecting the previous format for Ukrainian grain exports. In any event, the ministerial talks demonstrated that the "grain negotiations" are far from over.

Andrey Sizov, director of the Sovecon analytical center, believes Turkey is banking on "grain diplomacy" to allow Ukraine’s Black Sea ports to reopen. According to the expert, Moscow's plan to deliver 1 mln tons of grain for processing in Turkey in the interests of needy countries involves a "very modest amount" when compared to what was exported under the original grain deal.

Another Kommersant grain market source believes there is not currently much hope for meeting all of Russia's criteria for restarting the grain deal. He believes that a return to an agreement is only feasible if Russia itself makes compromises, a step that the country's leadership currently appears unwilling to take.

 

Vedomosti: G20’s India summit to be held without attendance by China’s Xi, Russia’s Putin

Chinese President Xi Jinping will miss the G20 summit in India, which will be held in the Indian capital, New Delhi, on September 9-10, a diplomatic source confirmed to Vedomosti. In turn, Kremlin Spokesman Dmitry Peskov stated earlier that Russian President Vladimir Putin did not intend to visit India, citing his extremely busy schedule. Thus, for the first time ever, no final document may be adopted reflecting the results of the meeting, Vedomosti writes.

A number of sticking points between the G20 countries, especially on issues of global politics and climate, may also prevent the signing of such a joint final declaration. On August 31, Bloomberg reported on disputes between India and China on the proposed language regarding the conflict in Ukraine and the debt obligations of emerging market countries.

In 2022, coming to an agreement on a joint declaration was still possible upon the conclusion of the previous G20 summit in Bali, despite certain countries having diametrically opposed positions on the conflict in Ukraine. As Peskov noted at the time, the Russian delegation made great efforts toward crafting a balanced text.

Xi's declining the opportunity to go to India could stem from some internal political issues, which are difficult to judge from the outside, St. Petersburg State University professor Yana Leksyutina told Vedomosti. She believes that Beijing’s strained relations with New Delhi are unlikely to be of any great significance here. In recent years, the occasions when Xi has traveled abroad have become increasingly rare, with the Chinese leader doing so only on certain particularly significant occasions, such as state visits to Russia and South Africa, Higher School of Economics (HSE University) School of Asian Studies Director Andrey Karneev noted. In addition, Xi may not be expecting any breakthrough decisions from this year’s G20 summit, he added.

 

Nezavisimaya Gazeta: Ukrainian armed forces target Russia’s strategic airfields with drones

Having failed to make any significant dent in its attempts to punch through Russia's strategic defenses on the line of engagement, Kiev has stepped up sabotage and massive drone attacks on targets deep inside Russia. Strategic airfields, oil and lubricant storage bases, military research facilities and defense enterprises are the main targets of such attacks. The drone attacks may continue as Ukraine tries to increase its production and use of unmanned aerial vehicles (UAVs), Nezavisimaya Gazeta writes.

On the morning of August 31, three Ukrainian aircraft-type drones were shot down over Bryansk. Almost at the same time, another terrorist attack by an aircraft-type UAV was thwarted near Voskresensk, Moscow Region, according to the Russian Defense Ministry.

Such UAV flights toward Moscow have occurred almost daily in recent weeks, leading to periodic closures of the capital's airports. The threat to air traffic in central Russia may continue, as Kiev seeks not only to increase the number of drone strikes on Russian territory, but also to expand the geographical scope for deploying UAVs.

"You can't underestimate the enemy," retired Lieutenant General Yuri Netkachev, a defense analyst, told the newspaper. "It is a fact that Kiev has established the production of attack drones. Russia must be ready to defend itself not only in the zone of the special military operation, but all over Russia," he added. According to the expert, the Ukrainian government "financed the production of 22,000 attack drones in 2023, of which about 15,000 have already been transferred to the Ukrainian armed forces."

 

Izvestia: Russia kicks off pilot project to roll out Islamic banking in four regions

Russia will launch a pilot project to introduce Islamic banking on September 1. The State Duma (lower house of parliament) passed such a law about a month ago. Four traditionally Muslim regions of Russia will participate in the pilot project: Dagestan, Chechnya, Bashkiria and Tatarstan. Under the project parameters, partnership financing should be based on Islamic Sharia rules, which prohibit the charging of interest and also restrict investment in areas such as distilling of alcoholic beverages or the production of pork meat, Izvestia writes.

Islamic banking operates on Sharia principles, which state that accruing interest income is prohibited in all transactions. At the same time, remuneration is permitted, according to Maria Mishakova, director of Sovcombank's department for interacting with financial institutions and international funding.

Russian financial services giant Sberbank told the newspaper they intend to participate in the pilot project, while Sovcombank is also researching the legal options for investment products and examining methods for delivering such services.

"The initiative will be a good push for entering new market segments and creating a business environment, as well as for building strategic relationships with local [Islamic] religious authorities and educational institutions interested in developing partner financing in the country," Sberbank believes.

Experts believe that the pilot program could encourage credit institutions from Islamic nations to establish branches in Russia. "We can expect the opening of subsidiaries or even branches of banks from such countries in Russia after the expansion of the BRICS group, which will include rapidly developing Islamic countries such as Saudi Arabia, the UAE and Iran," analysts at Freedom Finance Global predicted.

 

Izvestia: Russia prepares for new cuts in oil supplies

Russia and the OPEC+ countries have reached another agreement on the issue of reducing Russian oil supplies to world markets, Deputy Prime Minister Alexander Novak said at a meeting chaired by President Vladimir Putin. The most important details will be announced next week, Novak added. The issue of mining and other minerals was raised at the meeting, and the president called for prioritizing more in-depth processing of raw materials and production of high-added-value goods, Izvestia writes.

Earlier, Russia announced a voluntary cut of 500,000 barrels per day (bpd) in supplies earmarked for world markets as of August 1. A further agreement called for reducing Russian output by 300,000 bpd for September. The reduction is based on the average level of exports in May and June.

Everything will depend on the final parameters of the reduction, Alexander Frolov, deputy head of the National Energy Institute and InfoTEK expert, told Izvestia.

"Russia has held meetings with China and India, its two largest oil consumers. China is actively increasing its demand. Further reductions may not be feasible at the current level of consumption. However, in Europe it is decreasing, while in the United States it is unlikely to increase and may even decrease. Total global oil consumption may grow at a slower pace than was forecast at the beginning of the year and is expected now," the expert said.

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