Andrei Kruglov, Gazprom’s deputy CEO, discussed his company’s interest in boosting its stake in the company. This comes a few years after the company purchased 50 percent of Beltrangaz’s shares in 2007 indicating Gazproms’s intention to increase their control over the Belarusian pipeline.

“As for Gazprom’s corporate policy in the investment area, we are striving to obtain control,” he said to local media in Minsk.

According to Kruglov, the company would “correct its business plan based on inter governmental relations.”

“Gazprom’s investment in Beltransgaz is part of an agreement at the inter-governmental level and is fully compliant with internal corporate investment policy for the development of transport infrastructure.”

He added that the company would look carefully at possible investment yields. “We will be making sure that in the future out input corresponds with the yield standards.”

The company could also seek the Belarussian government’s minority stake in Belgazprombank, the second largest bank in Belarus outside the state sector.

“That depends on the government of Belarus. It could decide to hold onto its stake in Belgazprombank, and if it does, we’ll support that. It those shares are put up for sale, of course the shareholders will think about the proposal,” said Kruglov while also adding that Gazprom is satisfied with their current level of involvement in Belgazprombank.

The mid-annual price for the Russian gas was established for Belarus in 2010 at $171.5 for one thousand cubic meters.

Kruglov has also pointed out that Belarusian debts for supplied gas now reach $94.5 million. He has declared that Gazprom expects to obtain repayment of Belarusian debts this year.

As the New York Times reports, currently, “the inmates are divided into barracks housing a hundred or so men without regard to the severity of their crimes. At night, a guard locks the door and walks away, leaving first-time offenders and people convicted of nonviolent crimes to fend for themselves in a crowd of gang members, hit men and other career criminals.”

The new plan calls for a three-stage dismantling of the barracks housing system and the abolition of all 755 penal colonies – the remains of Stalin’s gulag – by 2020.

By Edith Balazs

Feb. 24 (Bloomberg) — Hungarian Prime Minister Gordon Bajnai said countries in central and eastern Europe should join together and create a “triangle” of supply points for natural gas to reduce dependence on fuel from Russia.

“I’m proposing that countries in the region set up a gas supply triangle to boost the diversity and security,” Bajnai said at an energy summit in Budapest today, which was attended by heads of government from countries in the region. “We need to increase the number of independent suppliers.”

Countries in the region, dependent on Russian gas, have repeatedly suffered from fuel shortages because of pricing disputes between Russia and Ukraine, a transit country. Hungary gets about 80 percent of its gas from Russia and supports the European Union-backed Nabucco pipeline aimed at bringing Caspian gas to Europe.

Nabucco would be the eastern tip of a triangle, which would include a planned liquefied natural-gas terminal in Poland in the north and an LNG terminal in Krk, Croatia, in the south, Bajnai said. The plan would secure supply of gas transported in the Baltic and Adriatic seas, he said.

“Our aim is to create a critical mass that can represent its interest more efficiently, a critical mass that simply can’t be passed by or overlooked,” Bajnai said.

McDonald’s opened its first outlet in Russia 20 years ago this past Sunday, on January 31, 1990, while thousands of Moscoviets braved the cold in Pushkin Square.

To celebrate the milestone, as well as a 23 percent year on year profit increase last quarter, McDonalds’ CEO Jim Skinner announced that they would be expanding their business in Russia by 45 outlets in 2010.

“Russia is doing so well, we have chosen Russia as one of the top countries for reinvestment of capital in 2010,” Mr. Skinner said.

The expansion would bring the total number of McDonald’s restaurants in Russia to 290 as Burger King, their chief rival, arrives on the scene.

“Every new competitor and opportunity to serve the Russian customers is a challenge for us to do a better job, to be more relevant,” Mr. Skinner told reporters regarding the entry of Burger King into the Russian market.

McDonald’s remains the world’s number one fast-food restaurant with more than 32,000 restaurants in 120 countries.

The aforementioned McDonald’s in Pushkin Square reviewed 27,000 applications for 600 jobs before it opened in 1990.

Today, it is the busiest McDonald’s restaurant in the world.

In Moscow yesterday, police detained as many as 100 protesters at an unauthorized anti-Kremlin demonstration in downtown Triumfalnaya Square.

Among those arrested were several prominent opposition leaders, including Eduard Limonov, leader of The Other Russia; Boris Newtsov, former Russian deputy prime minister; and Oleg Orlov, head of the Memorial human rights group. “After repeated requests to stop the rally, police detained about 100 people, including Boris Newtsov, Eduart Limonov, and Oleg Orlov,” said Moscow police spokesman Viktor Biryukov.

In a controversial move, Russia’s state-run arms exporter, Rosoboronexport, said yesterday that there were no international agreements preventing the sale of arms to Iran.

This news comes as Russia continues to expand their role as one of the world’s largest arms manufacturers and exporters. That’s all nice, but what peeves some other players on the world stage (namely the U.S. and Israel) is their willingness to deal with so-called ‘pariah regimes.’ i.e. countries that the U.S. doesn’t have under their heel.

Russia lists China, India, Syria, Venezuela, Libya, Saudi Arabia, and Algeria among their foreign clientele. So, in short, business is booming.

Russia reported a recession defying growth of 10 percent in their weapons sales for the 2009 fiscal year, up to US$7.4 billion.

“This is a figure that allows us to look with optimism into the future,” said Rosoboronexport head Anatoly Isaikin. “The numbers speak for themselves.”

Here’s some further reading on the Iranian arms deal:

MOSCOW (AP) — Russia still considers Iran a valuable customer for its weapons, a top arms trade official said Thursday, issuing a reassuring message to Tehran despite recent indications of Moscow’s support for tougher Western sanctions.

Anatoly Isaikin, the head of the state arms trader Rosoboronexport, said no international agreements bar Russia from selling weapons to Tehran. The statement marked another step in a delicate diplomatic game Moscow has been playing in a hope of maintaining good ties with Tehran without angering the West.

Russia signed a 2007 contract to sell the powerful S-300 air defense missiles to Tehran, but so far has not delivered any. No reason has been given for the delay, but Israel and the United States strongly objected to Iran obtaining the long-range missiles, which would significantly boost the country’sair defense capability.

Isaikin dodged a question if and when Russia could fulfill the contract, but he emphasized Russia’s right to provide Iran with weapons.

“There are no formal bans which would bar the delivery of any types of weapons to Iran,” he said at a news conference, adding that Russia’s arms trade with Iran isn’t covered under current U.N. sanctions.

The Obama administration is preparing to circulate proposed tougher new sanctions against Iran, which would target elements of the Iranian Revolutionary Guards Corps as well financial institutions under existing U.N. sanctions resolutions, U.S. officials said.

Isaikin’s comments followed Wednesday’s statement by Russian Foreign Minister Sergey Lavrov who showed a cautious support for possible new sanctions against Tehran after talks with U.S. Secretary of State Hillary Rodham Clinton.

Lavrov’s comments differed from previous Russian statements opposing any new sanctions against its important economic partner, Iran. Russia has been building Iran’s first nuclear power plant. Its launch has been repeatedly delayed and is now scheduled for some unspecified time early this year.

Russia has also provided Iran with some weapons and spare parts for Soviet-built military hardware, although none of them were as powerful as the S-300.

Russia has walked a fine line on Iran for years. It is one of the six powers leading efforts to ensure Iran does not develop an atomic bomb. But it also has tried to maintain friendly ties with Iran, a regional power close to Russia’s vulnerable southern flank.

Moscow has particularly appreciated Tehran’s refusal to support Islamic insurgents in Chechnya and other Russian provinces in the volatile North Caucasus region.

It is becoming a New Year’s tradition in Europe to wake up on January 1 with a big Russian headache. At the beginning of 2006 and 2009, Russia cut off energy supplies to Ukraine after a disagreement over natural gas prices, which subsequently caused fuel shortages in the European Union in the dead of winter. This January, all eyes are trained on Belarus, which has been having its own quarrel with Moscow over oil prices, threatening European energy supplies once again. But three weeks into the current standoff, there’s been a twist: Kazakhstan, another ex-Soviet republic, stepped in last week to offer Belarus its own oil. Now the Kremlin’s most reliable tool for controlling its neighbors — energy blackmail — is at risk of blowing up in its face.

The quarrel began typically enough. Belarus, like many ex-Soviet countries, has enjoyed subsidized oil and gas supplies from Russia for two decades, in part to ensure its loyalty after the collapse of the Soviet Union. It has even been allowed to buy Russian crude oil on the cheap, refine it at home and sell it on to Europe at a huge profit. But in the past three years, Belarussian President Alexander Lukahsenko has started to assert his independence in subtle ways. Following the 2008 Russia-Georgia war, Lukashenko declined to recognize the breakaway Georgian republics of South Ossetia and Abkhazia, despite pressure from Russia to do so. Lukashenko also joined the E.U.’s Eastern Partnership initiative, created in 2008 to strengthen ties between Europe and the ex-Soviet bloc, much to Moscow’s dismay. And last June, Belarus refused to attend a key security summit in Moscow after Russia slapped a ban on Belarussian dairy products. (See pictures of Russia celebrating Victory Day.)

Then late last year, the spat escalated when Russia decided that Belarus no longer deserved its energy subsidies. When the two countries’ existing oil contract expired on Dec. 31, Russia demanded additional payments of a whopping $2.5 billion, which amounts to about 5% of Belarus’ entire economy. The Russian government also hinted that in order to keep oil prices down, Belarus should give Moscow stakes in its energy infrastructure, namely the oil refineries it uses to process oil for re-sale to Europe. This would play into Russia’s larger aim of controlling the energy supply chain from the oil fields of Siberia to the gas stations of Western Europe.

But for weeks Belarus has refused to accept Russia’s conditions, putting relations between the countries on ice and threatening to leave swaths of Europe in the cold. Talks between the two sides eventually dissolved into an exchange of letters with competing demands. But despite the tough position Lukashenko staked out, analysts believed that Russia would get its way in the end — Belarus’ economy and security are still deeply dependent on Russia despite improved relations with the West. Lukashenko admitted as much last month when he said that severing ties with the Kremlin — as Ukrainian President Viktor Yushchenko has done — would bring about his “political death.” (See pictures of Vladimir Putin’s patriotic youth camp.)

Then, on Jan. 19, three weeks into the dispute, Kazakhstan stepped in with a game-changing offer. It said that if Russia refuses to provide oil to the Belarussian refineries, it would be happy to take Moscow’s place. The Kazakhs also said they would be willing to buy a stake in Belarus’ Naftan refinery, which Russia’s largest oil companies have coveted. “The demands of Belarussian refineries will be filled by Kazakh oil,” said Anatoly Smirnov, Kazakhstan’s ambassador to Belarus, adding that the two nations’ presidents had already discussed the idea and “no one has refused.”

In most parts of the world, this would seem like a completely normal arrangement for two countries to make. But this is Russia’s backyard. And Moscow, which has yet to react to the Kazakh offer, may not take too kindly to two of its former republics striking an energy deal behind its back. The offer demonstrates, however, that many ex-Soviet states might not care anymore if they anger their former benefactor. A sense of defiance has grown in the region since the Russia-Georgia war, which proved that Moscow would not stop at economic bullying in its efforts to maintain influence over its neighbors. (Read “Russia’s Gazprom Diplomacy: Turning Off Europe’s Heat.”)

“This [conflict] totally changed the defense paradigm. It became clear that having both true independence and national security was impossible in Russia’s sphere of influence,” says Anatoly Gritsenko who served as Ukraine’s Defense Minister from 2005 to 2007, when relations between Russia and Ukraine worsened considerably. One method of surviving in this environment, Gritsenko says, is to build closer security ties with other ex-Soviet states, as Georgia and Ukraine did after pro-Western leaders came to power in the two countries in 2004 and 2005, respectively.

If it does come to pass, a partnership between Belarus and Kazakhstan, two of Russia’s most loyal allies, could further weaken Russia’s influence in the region. But considering the dependence of both countries on trade with Russia, this still seems like a distant prospect, and some analysts say that Kazakhstan’s offer to Belarus is most likely a bluff. It would be costly and difficult for Kazakhstan to ship oil to Belarus, and Belarus could not afford to pay fair market prices anyway, says Denis Borisov, an analyst at Bank Moskvy, one of Russia’s largest banks. Kazakh companies could, however, undercut Russian bids for the Naftan refinery, he says, which would be a major blow to Russia’s energy strategy in Eastern Europe. (See pictures of the Russia vs. Georgia war.)

One thing is for certain — Russia is now watching both countries carefully. If Belarus and Kazakhstan go ahead with a deal, Moscow may need to find new ways to contain the rumblings of mutiny in its neighborhood.

“Everything in negotiations is going fine, 95 percent of the new deal’s issues have been agreed upon,” said Russian President Dmitry Medvedev, according to Russian news agencies on Sunday.

U.S. President Barrack Obama and President Medvedev have been in discussions since July concerning the establishment of a successor to the Strategic Arms Reduction Treaty (START-1); which was signed in 1991, just before the breakup of the U.S.S.R., and expired on December 5 of last year.

Russia’s Foreign Minister Sergei Lavrov said on Friday that he expects an agreement to be reached soon once negotiations resume at the beginning of February.

Despite the progress being made between the former Cold War foes, President Medvedev made it clear yesterday that U.S. plans for a missile defense system in Eastern Europe still remains an unresolved issue.

Riding a wave of widespread discontent with the Orange Revolution, recent polls show Yanukovich leading in the presidential polls ahead of current Ukrainian Prime Minister Yulia Tymoshenko going into the first round of voting this Sunday.

“Together, we have suffered through this Orange nightmare,” Mr. Yanukovich said at a recent rally in Dneprodzerzhinsk. “Let us consign this history to the black pages of our lives.”

Recent opinion polls have Mr. Yanukovich between 25 to 33 percent, Ms. Tymoshenko between 15 to 18 percent, and incumbent President Viktor Yushchenko at a mere three percent.

Yanukovich, whose image as a Kremlin lackey cost him votes in 2006, hopes to repair relations with Russia if elected, which have been strained of late as a result of President Yushchenko’s attempt to gain NATO membership.

“We do not want to join any military bloc,” Mr. Yanukovich has said regarding NATO membership.

“Relations should be natural, as they are between the Ukrainian people and the Russian people. They must be friendly, they must be pragmatic, they must be strategic.”

As of Monday morning, there have been 26 confirmed deaths and more than 50 people are still hospitalized.

The explosion, which is reported to have been roughly the equivalent of 7kg of TNT, is currently under investigation by Russian officials as a terrorist attack.