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39 Introduction: Eastern Promises—Russian Energy for Asia Paul J. Saunders Paul J. Saunders is both Executive Director of The Nixon Center and Associate Publisher of The National Interest. He can be reached at . [This page intentionally left blank.] 41 saunders R ussia’s reemergence as a major power in the international system has prompted renewed attention to developments in the country as well as to Moscow’s foreign policy actions and goals. Because oil and natural gas resources drive much of Russia’s growing power, the Kremlin’s domestic and foreign energy policies have been of particular interest to U.S. policymakers and observers of the country. Growing global energy demand and rising energy prices provide essential context for Russia’s reemergence, simultaneously raising anxiety levels among the major consumer countries and raising confidence levels among the major producer countries. These tendencies have been especially apparent in Asia, a region that has seen sharp increases in energy consumption and is highly dependent on imported fuels. Yet, as has been the case in many other periods of rapid change, neither the anxieties nor the confidence will likely prove fully justified. Such is the unambiguous message of these two important articles by Mikhail Kroutikhin and Robert Legvold. A central reason for this caution lies in a key conclusion that each author reaches independently: Russia’s foreign energy policy in Asia and elsewhere is driven largely by domestic political factors rather than by a well-elaborated and comprehensive international strategy. For his part, Kroutikhin sees Russia’s foreign energy policy as an almost accidental outgrowth of competition between three political “clans”—the “St. Petersburg lawyers”—connected to a degree to Prime Minister Vladimir Putin and somewhat more to President Dmitry Medvedev—who seek control over Gazprom, and particularly the company’s money; the siloviki, current and former security agency officials with statist political and economic views who dominate the oil sector, especially Rosneft; and the “Family,” the remnants of Yeltsin-era economic elites who continue to control major financial and metallurgical firms as well as some smaller energy companies. In Kroutikhin’s view, Vladimir Putin led Russia in essence by serving as the balancer and referee in this intra-elite struggle over the country’s energy companies. Kroutikhin suggests, however, that although the ongoing instability ensured that Putin could remain in office, such a position also limited his authority; each group resisted— often effectively—decisions that threatened the group’s narrow interests. Thus any serious effort at developing a national energy policy was impossible. Legvold goes one step further, arguing that Russia’s foreign policy does not drive its energy policy; on the contrary, he argues that foreign policy is subordinate to the interests of Russia’s oil and gas complex and is consequently equally muddled. Despite eight years of political tightening under former President Vladimir Putin, Russia’s government remains fundamentally weak. Moscow has struggled to pursue national projects in housing, healthcare, agriculture, and education. Russia has also failed to lift many other major policy initiatives off the ground, and has at nbr analysis 42 times retreated from key goals in the face of public opposition. Moreover, although the Kremlin has effectively subjugated the regions, the oligarchs, and the media (none of which are prepared to confront the state), Kremlin officials remain unable to manage their own employees—the Russian federal government—effectively. This is a result not only of weak institutions, excessive bureaucracy, and poor inter-agency coordination, but also of Russia’s enduring corruption, which Kroutikhin addresses in detail. Government bureaucrats at all levels continue to have considerable power as a result of Russia’s high degree of regulation—and continue in many cases to exercise that power for personal gain in an environment where, as Kroutikhin notes, top officials often simultaneously lead or serve on the boards of directors of major energy firms and receive generous compensation separate from their official salaries. Whether ministers or clerks, government officials who use their personal power for private advantage undermine the very institutions that empower them. Thus, ironically and paradoxically, Russia’s powerful officials are precisely the ones who keep the state weak. The cycle is self-reinforcing: seeing the weakness of the system, officials face considerable pressure to look out for their own short-term interests, which only worsens the problem. Senior leaders try to strengthen the state by giving more power to bureaucrats, a response that only further undermines the government as a whole. Russia’scombinationofenergywealthandcorruptionleadsmanytodescribeRussia as a petro...


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