As the rouble plunges, Central Asia feels the pain «The Economist»

EVEN in the fat years, when Russia's oil-fuelled economy guaranteed her son a job, Enjegul Kadyraliyeva struggled to survive on the dollars he sent home to her in Kyrgyzstan. Now she fears she will have to feed her grandson on the loose change she earns selling dried yogurt balls and lollipops on the pitted streets of Bishkek, Kyrgyzstan's capital.

Russia's economic crunch and a falling rouble-a consequence, exacerbated by economic mismanagement, of sharply lower global oil prices-worry millions of Central Asians who depend on relatives working in the former imperial power to send money home. According to the World Bank, remittances are equivalent to a third of GDP in Kyrgyzstan and almost half in Tajikistan. As the Russian currency sinks, the amount guest workers are able to remit, usually in dollars, falls too. Remittances to Uzbekistan fell by 9% in the third quarter of 2014 compared with a year earlier, according to central-bank statistics in Russia. One analyst believes remittances to Tajikistan are a fifth lower than a year earlier.

In this section

Regional growth has been revised downwards again and again in recent months. Central Asian currencies have also fallen. On January 1st Turkmenistan, a secretive state that is rich in gas, devalued the manat by 19%. Thanks partly to weak exchange rates, Kyrgyzstan and Tajikistan, the two poorest post-Soviet countries, face double-digit inflation. The rouble, admittedly, has fallen much further-by half in the past year. That makes Central Asian goods uncompetitive in Russia, the largest market for most of the region's five economies. Uzbekistan's car exports to Russia are 35% lower than a year ago. A Tajik selling imported nuts and dried fruit in Moscow says his profit margins have gone.

As for Central Asian labourers in Russia, some of their leaders expect about a quarter to return home. The prospect of hundreds of thousands of unemployed young men flooding these weak states should terrify Central Asia's graft-prone governments, which do little to create jobs and rely on emigration to ease social pressures. In 2009, in the previous financial crisis, remittances to Kyrgyzstan fell by 28% and men returned home. That set the scene a few months later for the violent overthrow of the country's elected president-turned-dictator, Kurmanbek Bakiyev.

Yet despite the obvious risks of being yoked to the Russian economy, Kyrgyzstan is rushing to strengthen ties with Russia by joining the Eurasian Economic Union (EEU), an intended counterweight to the European Union. Dominated by Russia, the EEU is a customs union of former Soviet states whose rules came into effect on January 1st. Even Kyrgyzstani officials expect the country's membership-to be finalised by May-to double unemployment. Aktilek Tungatarov, head of the International Business Council, a business lobby in Bishkek, says: "People are very anxious about the upcoming integration. Our leaders cannot explain what the benefits are." Central Asian businesses say it will continue to be hard to break into the Russian market, while many Central Asians think the union is an attempt by President Vladimir Putin of Russia to reinstate the Soviet Union, in effect. Kazakhstan is a co-founder of the EEU and its only Central Asian member. But the union got off to a bumpy start. Trade with Russia fell by a fifth last year (by contrast, trade with China is growing fast). The two countries bicker over Russia's meddling in Ukraine.

Kyrgyzstan's prime minister, Djoomart Otorbaev, says there is "no alternative" to the country joining the EEU. For almost two decades, traders in Kyrgyzstan took advantage of WTO membership to import cheap Chinese goods and re-export them to other post-Soviet countries, including Russia. The EEU's barriers put an end to that. "The old model does not work any more," says Talant Sultanov, director of Kyrgyzstan's National Institute for Strategic Studies, a government think-tank. He says Kyrgyzstan has to learn how to manufacture, which will be hard.

Meanwhile, Russia wants to expand the EEU and set its stamp on it. Roughly half of Tajikistan's working-age males labour in Russia, along with as many as 6m Uzbekistanis. On January 1st Russia began requiring migrants from non-EEU members to sit Russian history and language tests. Moscow's city government has tripled the amount foreign workers from outside the EEU must pay for work permits. These are not-so-subtle hints.

http://www.economist.com/news/asia/21639564-rouble-plunges-central-asia-feels-pain-contagion

Kabul Arrests Militants Suspected of Role in Pakistan School Attack

KABUL—Afghan authorities said they arrested several militants suspected of being accomplices in the massacre of school children in the Pakistani city of Peshawar amid a push to mend strained ties between Kabul and Islamabad.

The arrests of five Pakistani Taliban members in an Afghan operation come a month after the militant group attacked a military-run school in Peshawar last month, killing 150 people—most of them children. The tragedy prompted Pakistan’s military and intelligence chiefs to go to Kabul the next day for closer cooperation in crushing insurgents that have found a haven along the porous 1,500-mile-long border between the two countries.

Afghan and foreign officials say the arrest of the five men on Afghan soil is evidence of those closer ties. An Afghan official said the arrests were part of a unilateral Afghan operation targeting men believed to have assisted the perpetrators of the Peshawar assault.

Afghan officials didn’t disclose the exact time and place of the operation, but Pakistani Taliban have long used lawless and remote areas of eastern Afghanistan as a haven, Pakistani and Western officials say. Pakistani intelligence had earlier traced the organizers of the Peshawar attackers to the eastern Afghan provinces of Kunar and Nangahar.

The arrests also build on a monthslong effort by Afghan President Ashraf Ghani to reset ties with his country’s powerful, nuclear-armed neighbor.

Mr. Ghani, who took office in September, traveled to Pakistan in November, meeting Prime Minister Nawaz Sharif in Islamabad and holding talks with military officials in Rawalpindi, the headquarters of the country’s security establishment.

Pakistan’s army chief, Gen. Raheel Sharif, traveled to Kabul twice recently. The country’s powerful intelligence chief, Lt. Gen. Rizwan Akhtar, has paid three recent visits. All told, there have been at least a dozen cross-border visits by politicians, military and intelligence officials as well as businessmen since Mr. Ghani came to office—an unusual level of interaction between the often wary neighbors.

“There is a window of opportunity for another kind of relationship between Afghanistan and Pakistan,” said Franz-Michael Mellbin, the European Union’s ambassador to Afghanistan. “For the first time there seems to be a real exchange of views between the military and the intelligence side on substantive issues.”

Bilateral relations were especially strained under President Ghani’s predecessor, Hamid Karzai, who repeatedly went public with his accusations that Pakistan fueled the Taliban insurgency as an instrument of policy.

Mr. Ghani has avoided directing strident rhetoric toward Islamabad in public. But in private conversations with his Pakistani counterparts, Mr. Ghani has spoken candidly, describing the status of the bilateral relationship as one of “undeclared hostility” in recent years, according to an Afghan official with knowledge of the meetings.

ENLARGE

Pakistani school children leave the military-run school in Peshawar after it opened earlier this week. Hundreds of children returned to the school nearly a month after massacre. EUROPEAN PRESSPHOTO AGENCY

At stake for Mr. Ghani is Afghanistan’s long-term security. The Afghan Taliban have long used Pakistani territory as headquarters, and U.S. and Afghan officials say that Pakistan, which recognized the Taliban government, continued to tacitly support the movement after it was toppled by the U.S.-led invasion in 2001. Islamabad has repeatedly denied this, although it acknowledges it has some influence over the group.

The Afghan Taliban are led by Mullah Mohammad Omar, who hasn’t appeared publicly since 2001. The Pakistani Taliban, who are allied with al Qaeda, operate separately from the Afghan Taliban, although they acknowledge Mullah Omar as a spiritual leader.

Washington has also become involved in encouraging Afghan-Pakistan dialogue. Earlier this week, U.S. Secretary of State John Kerry traveled to Islamabad, where he met with the Pakistani prime minister. Mr. Kerry’s stopover coincided with a visit by Gen. Lloyd Austin, the head of U.S. Central Command, the U.S. military headquarters that oversees the region.

“The timing’s important in the wake of Peshawar, as President Ghani’s trying to really put emphasis and priority on his reconciliation program, which clearly looks to Pakistan as playing a very prominent role,” a senior State Department official said following Mr. Kerry’s meetings on Monday.

The Afghan Taliban still present a formidable threat to the Western-backed Afghan government. The U.S.-led combat mission formally ended in 2014, leaving Afghan forces largely alone in their fight against a strong insurgency.

Afghan and foreign officials say they are cautiously optimistic that Pakistan’s policy will change, but they are yet to see concrete action.

A key test will be this year’s fighting season, which starts annually after the snow thaws and mountain passes open. Afghan and foreign officials say the Taliban are preparing to launch an especially violent offensive.

The Afghan government will be watching for signs that Pakistan is taking steps to help stem the flow of fighters and weapons into the country. And officials on both sides say cooperation in border areas will be key.

Less clear, however, is whether a fragmented Taliban leadership can be encouraged to talk peace, particularly as radical groups such as Islamic State attempt to gain a foothold in the region. While Islamic State’s presence in Afghanistan is limited, observers say the group offers a rebranding opportunity for some militant commanders.

“Many mid-rank commanders have joined IS, they are challenging their leadership,” said Muhammad Amir Rana, director of the Islamabad-based Pak Institute for Peace Studies. “Will they be ready for the reconciliation or the compromise with Kabul, or with Washington? This is the problem.”

—Habib Khan Totakhil contributed to this article.

http://www.wsj.com/articles/kabul-arrests-militants-suspected-of-role-in-pakistan-school-attack-1421353059

US Urges India-Pakistan Dialogue to Reduce Kashmir Tensions

ISLAMABAD — Jan 13, 2015, 2:34 AM ET

By MATTHEW LEE AP Diplomatic Writer

U.S. Secretary of State John Kerry Tuesday urged India and Pakistan to move their relationship forward through dialogue, saying the U.S. was concerned about recent violence along their disputed border.

Kerry's comments came during a press conference in Islamabad Tuesday with the Pakistani prime minister's foreign policy adviser, Sartaj Aziz.

The disputed Kashmir region has been a source of sharp tension between Pakistan and India since they both became independent in 1947. Two of the three wars they have fought have been about Kashmir, a region they both claim. Tensions spiked in late December and early January with both sides accusing the other of firing across the de-facto border that separates the two sides of Kashmir.

Thousands of villagers in the Indian-controlled portion of Kashmir fled their homes, and at least a dozen people were killed.

"We continue to be deeply concerned by the recent spate of increased violence," Kerry said. "It is profoundly in the interests of Pakistan and India to move this relationship forward."

But Aziz appeared in no mood for such a step.

He accused India of wanting to have talks only on its own terms and asked the U.S. to push the Indian side on the matter.

India and Pakistan agreed to resume talks on improved relations in May when Pakistan Prime Minister Nawaz Sharif attended the inauguration of Indian Prime Minister Narendra Modi. But an announcement by Pakistan's ambassador to India to meet with Kashmiri separatists in New Delhi angered India and it called off the talks.

Aziz said Tuesday that India's cancellation of the talks and recent incidents of "unprovoked" firing by India "are a source of serious concern to us" and "a signal that India wants to de-emphasize a serious discussion on Kashmir."

"We hope that the United States ... can prevail upon India to work with Pakistan on regional peace and economic prosperity," he said.

http://abcnews.go.com/Politics/wireStory/us-urges-india-pakistan-dialogue-reduce-kashmir-tensions-28184254

The High-Stakes Battle for Sri Lanka’s Presidency

Mahinda Rajapaksa’s plans to return to power as Sri Lanka’s president for a third successive term has run into trouble. With less than a month to go before the vote, Rajapaksa is ahead of his rivals but joint opposition candidate Maithripala Sirisena is closing in and could unseat him in a free and fair election.

China, Kazakhstan to sign $10 bln in deals including oil, infrastructure-Xinhua

Dec 14 (Reuters) - China is expected to sign 30 cooperative agreements worth $10 billion with Kazakhstan as Premier Li Keqiang begins his first official visit to the country, the official Xinhua news agency said on Sunday.

Xinhua did not give details, but quoted Chinese Vice Foreign Minister Cheng Guoping as highlighting a joint-venture logistics base and urging interconnectivity with highways, railways, ports, air routes, oil and gas pipelines.

"The Sino-Kazakh cooperation is developing rapidly. The volume of trade between the two countries is increasing annually by 20 percent," Xinhua quoted Li as saying in an article.

Kazakhstan has become China's second largest trade partner in the Commonwealth of the Independent States, while China is the second largest trade partner and the largest export market of Kazakhstan, Li was quoted as saying.

Li will also visit Serbia and Thailand, but some of the most touchy topics he could encounter are off the agenda, including the fate of Muslims from western China who have fled to Southeast Asia.

Li's trip, from Dec. 14 to 20, also takes in summits with Eastern European, Central Asian and Southeast Asian leaders. (Reporting by Kevin Yao)

http://www.reuters.com/article/2014/12/14/china-kazakhstan-idUSL3N0TY05320141214

Ruble Drops to Critical New Low, Plunge Felt Across Central Asia

The Russian ruble crossed a psychological barrier in Kyrgyzstan on December 12, becoming worth less than the som for the first time. Across Central Asia, the ruble’s slide is pushing local currencies to new lows. But they can’t seem to fall fast enough to keep a competitive advantage.

Iranian jets strike Islamic State targets in Iraq, U.S. official says

Iranian aircraft conducted strikes against Islamic State positions in eastern Iraq last weekend, expanding Tehran’s role as a close ally of Iraq’s Shiite-led government.

Iran hackers targeted airlines, energy firms: report

(Reuters) - Iranian hackers have infiltrated some of the world's top energy, transport and infrastructure companies over the past two years in a campaign that could allow them to eventually cause physical damage, according to U.S. cyber security firm Cylance.

Aerospace firms, airports and airlines, universities, energy firms, hospitals, and telecommunications operators based in the United States, Israel, China, Saudi Arabia, India, Germany, France, England have been hit by the campaign, the research firm said, without naming individual companies.

Pakistani jets, ground forces kill 24 militants

 Dec. 2, 2014 5:38 AM EST


ISLAMABAD (AP) — Pakistan army's jets and ground forces killed 24 militants as part of ongoing operations in the country's troubled tribal regions bordering Afghanistan, the military and a government official said Tuesday.

Seventeen local and foreign "terrorists" were killed in airstrikes on Tuesday in the North Waziristan tribal region, where the military has been carrying out a major operation since June, a military statement said.

Iran Says It Has Responded to Obama's Letters

A top security official in Iran said Wednesday the Islamic Republic has written back in response to letters sent by U.S. President Barack Obama, the first acknowledgement of such correspondence. However, it's not clear whether Supreme Leader Ayatollah Ali Khamenei wrote the letters himself.

The letter writing is part of a recent thaw in relations between the two countries since the 1979 Islamic Revolution that toppled the U.S.-backed shah and the storming of the U.S. Embassy in Tehran, where 52 Americans were held hostage for more than a year. It also comes as a U.S.-led coalition battles the Islamic State group in neighboring Iraq and as Iran and world powers negotiate a permanent deal regarding the country's contested nuclear program.

"This is not the first time that such a thing has taken place," said Ali Shamkhani, the secretary of Iran's Supreme National Security Council, during an appearance on state television Wednesday night. "It had previously taken place and necessary response was given to some of them."

Obama's recent letter to Khamenei described a shared interest between the U.S. and Iran in fighting Islamic State militants and stressed that any cooperation on that would be largely contingent on Iran agreeing to the nuclear deal, according to the Wall Street Journal. Shamkhani said the letter "mainly focused on nuclear issues."

We responded "that we can't accept at all to have a decorative, caricaturistic nuclear industry," Shamkhani said.

There was no immediate response in Washington to Shamkhani's comments.

Iran and six world powers — the five permanent members of the U.N. Security Council plus Germany — are negotiating a final nuclear accord now. The stakes are high as the two sides face a Nov. 24 deadline. A deal is supposed to put in place measures that would prevent Iran from making an atomic weapon in exchange for the lifting of economic sanctions. Iran has said its program is for peaceful purposes.

The talks reportedly remain stuck over the size and output of Iran's uranium enrichment program, a technology that can be used to produce nuclear fuel or nuclear weapons and how the sanctions must be lifted.

U.S. and Iranian officials held a series of secret meetings last year that ultimately paved the way for the historic interim nuclear deal in Geneva. Obama and Iranian President Rouhani also held a historic phone call last fall, the first direct communication between their nation's leaders since the Islamic Revolution.

http://abcnews.go.com/International/wireStory/iran-responded-obamas-letters-26864226

Russia offers to let Kazakhstan oil exports via Ukraine to Europe to hedge risks

AKTAU Kazakhstan (Reuters) - Russia has offered to let Kazakhstan ship its oil to Eastern Europe via the Druzhba pipeline's spur in Ukraine, Russia's Energy Ministry said on Wednesday, in a move seen as Moscow's attempts to hedge transportation risks.

"Russia has offered Kazakhstan to study the possibility of carrying out Kazakh oil transit via the Russian Federation through the Druzhba oil pipeline to Eastern and Southern Europe," the Energy Ministry said in an email to Reuters.

It added that the offer was made during talks on Sept. 9 in the Kazakh capital Astana.

Subsequently, Kazakh oil pipeline monopoly KazTransOil , offered Kazakh oil companies to consider shipping its oil via the Soviet-built Druzhba pipeline to Eastern and Southern Europe, in a letter seen by Reuters.

"I see only one reason behind it - it's not very easy (for the Russian companies) to go via Ukraine," a trader in a Russian oil company said.

The volume of oil, which would be shipped from Kazakhstan to Slovakia and Hungary, was not stipulated in the letter.

Moscow has been trying to cut exports of oil and gas via Ukraine, a key transit route to Europe. It has yet to restart gas supplies to Ukraine, which is battling pro-Moscow insurgency in the east of the country, despite an agreement struck last month.

"I think this is aimed at cutting risks of oil supplies in this direction, there are no other reasons. Why give up the 'sweet' route?" another trading source said.

Oil supplies via the southern spur of the Druzhba pipeline totaled 11.36 million tonnes in January-September, including 7.95 million tonnes shipped to Slovakia and Hungary, according to the Russian Energy Ministry data.

Kazakhstan's total oil transit via Russian oil pipeline monopoly Transneft - from the Baltic port of Ust Luga and the Black Sea port of Novorossiisk - stood at 12.53 million tonnes for the same period.

Sources in Kazakh oil companies have been skeptical about switching their supplies to Druzhba from the ports, while political risks have also weighted on this option.

"The economics (of supply) to Hungary and Slovakia is $5 per barrel worse than in Ust Luga," a source said.

http://news.yahoo.com/russia-offers-let-kazakhstan-oil-exports-via-ukraine-134326717--finance.html

Amnesty International demands justice for Hamidkariev

Speaking out against the use of torture in Uzbekistan, Amnesty International is calling for international support for Mirsobir Hamidkariev, who was abducted in Moscow and later “found” in prison in Tashkent. Hamidkariev is currently standing trial in Uzbekistan. 

The international human rights watchdog has called on the international community to act on behalf of Uzbek producer Mirsobir Hamidkariev who is currently facing a potential 15-year prison sentence. 

In its November 6 press release Amnesty International makes the following demands from the Uzbek government: 

First, carry out a prompt, impartial, and effective investigation into allegations that Mirsobir Hamidkariev was tortured and ill treated in custody. Second, bring every police officer and other state official found responsible for torturing and ill-treating Mirsobir Hamidkariev to justice. Finally, have Uzbek authorities make sure that the trial is henceforth conducted according to international fair trial standards, as specified by the International Covenant on Civil and Political Rights, to which Uzbekistan is a state party. 

Spoke out against the persecution of Muslims 
Hamidkariev was abducted from the city center of Moscow on June 9. He was only three days from receiving political asylum from Russia at the time of his kidnapping. 

His family members have been unable to meet with him since his kidnapping. His court hearing began on September 22 with Hamidkariev’s family not even being notified of the start of proceedings. 

He has been charged with violating two articles of the Uzbek criminal code: Article 216, on the unlawful organizing of public gatherings or religious organizations, and Article 244, on preparing or distributing materials that contain threats to public safety and order. 

Hamidkariev’s lawyer, Larry Vasiliev, says his client has only admitted to discussing with friends the persecutions of Muslims in Uzbekistan, as well as expressing support for women wishing to wear headscarves out of religious conviction. 

Tortured and missing seven teeth

The defendant is currently inside Tashtyurma, a Tashkent prison notorious its particularly brutal use of torture. 

According to Amnesty International Hamidkariev has been tortured by being tied to a bar attached to the wall with his head facing down and then being beaten repeatedly. He has had seven of his teeth knocked out and two of his ribs have been broken.

“He is at risk of being subjected to further torture and other ill-treatment,” reads the statement by Amnesty International. 

Hearings have been postponed several times with the next one currently set for November 13. 

In its statement Amnesty International asks members of the public to write letters to the Prosecutor General of Uzbekistan, Rashidzhon Kodirov, the Minister of Internal Affairs of Uzbekistan, Adham Ahmedbaev, and to send copies of these letters to Sayora Rashidova, the Olij Mazhlis Human Rights Ombudswoman. 

http://www.uznews.net/en/human-rights/28195-amnesty-international-demands-justice-for-hamidkariev