This week's invited contributor is my former deputy at the Tokyo-based Asian Development Bank Institute, Turdakun Tashbolotov.  He has an interesting story to share with us about Russia and the East.

Russia had a presidential election and as expected by many, Vladimir Putin was elected as President of the Russian Federation for the third time in its history. What Russia should expect from him as president, Putin tried to explain in his seven publications in local newspapers written before the election that looked like his presidential program for next six years.  Putin talked a lot about Russia’s future as a great country with highly educated people, balanced social system, strong democracy, technically advanced army, and diversified and sustainable economy. In his last article which was published a week before the elections, Putin shared his views on Russia’s role and place in the world and how his country should build its foreign policy. Although he mainly focused on relations with the United States, Europe, and problems around Syria and Iran, Putin also described his views on the relationship of his country with the East.

While it is quite clear that the development of the Russian-Japanese economic relations depends on how well these two countries can resolve territorial disputes around the Kuril Islands, the Russian President is very optimistic in building strong ties with two emerging giants in Asia, China and India, and further advancing an economic cooperation with the dynamically growing Southeast Asian “tigers” through the Asia-Pacific Economic Cooperation (APEC).

Russian President believes that rising power and role of China in the world is not a threat for his country but a great opportunity, bringing enormous potential for cooperation. As he said: “Russia should catch a “Chinese wind” to advance its own economy” through cooperation in more advanced areas like R&D and technological production. Indeed, the Russian Government recently has been facing strong criticism for becoming China’s raw material supplier. Almost all big joint projects between these two counties in the last years were in energy sector building oil and gas pipelines from Siberia to China’s borders. This type of cooperation, according to some Russian experts, will result in Russia being China’s “little partner” in the future, similar to what the Gulf countries are for the United States and Europe. This is ideologically unacceptable and a blow to national pride as Russia is still seen as a successor of the USSR which was a “mentor and big brother” of Communist China in the not so distant past.

Russia is still a military superpower with sophisticated army, strong navy, modern air force, and new type of military unit – aerospace defense forces. This factor surely supports Russia’s claim to be one of the leading powers in the Asia-Pacific region. However, achieving this status depends not only on its military supremacy but also Russia’s success in the economic development of its Far East--once a prosperous region, now representing only a bleak shadow of its past. Economic difficulties and unemployment after the collapse of the USSR led to massive internal migration of the population especially the younger generation to more economically advanced regions in the western part of the country. For instance, now the total population of the region including nine administrative subjects with a territory almost equivalent to the size of the whole of Europe is just about 6 million, while the population of just the Heilongjiang province in neighboring China is about 40 million and it is on a continuously increasing trend. Therefore, catching the right “Chinese wind” is a very important challenge for Russia in developing its Far East region by attracting and wisely using Chinese investment and at the same time, trying to minimize an excessive Chinese demographic expansion to the region.

Putin’s intentions as President according to what he wrote, is to bring the cooperation with China to a new level through employing the potentials of international and regional organizations in which both countries are members: G20, BRICS, and of course, the Shanghai Cooperation Organization (SCO) which also include four other Central Asian republics – Kazakhstan, Kyrgyz Republic, Tajikistan, and Uzbekistan. However, while Russian-Chinese relations can be very trustful on the intergovernmental level, when it comes to third countries, China and Russia have own interests that do not always coincide. As an example, the Chinese economy’s growing demands for energy resources is pushing the government to make its presence more prominent in Central Asia, a region that is traditionally considered Russia’s area of influence, thus causing strong concerns in Moscow.

Russia sees India as close and strategic partner in the region with a long history of cooperation in various fields. India is also the second biggest importer of Russia’s military industry. These two countries are making ambitious steps to expand their cooperation beyond the traditional areas of interest. Russia inherited a huge technological and intellectual potential from the USSR which is now somewhat outdated, on the other hand, India is slowly but solidly developing its technological potential through the booming IT industry. To explore these potentials the governments of these two countries established the India-Russia Inter-Governmental Commission on Trade, Economic, Scientific, Technological and Cultural Cooperation and India-Russia Forum on Trade and Investment. The long negotiations in these formats resulted in the signing of an Agreement on Cooperation in the Outer Space for Peaceful Purposes and the Inter Space Agency Agreement in cooperation with the Russian satellite navigation system. Another big umbrella of agreements was achieved in the Integrated Long-Term Program of Cooperation in Science and Technology, with a special focus on such areas as laser science and technology, software & IT, super computers, semiconductor products, high-purity materials, pharmaceuticals, and development and production of aircrafts.

In this dynamic world with shifting balance of power, building a strong political alignment with India is becoming one of the key components of Russian diplomacy. In one of the recent meetings of the SCO, Russian then-President Dmitry Medvedev proposed further enlargement of the organization, inviting India as a member country. In his article Putin wrote that growing political partnership with India will strengthen the newly formed polycentric system of the world (saying “the world” meaning “the Asian region”, bearing in mind a looming Chinese factor). It is obvious that a careful dancing with two “Asian elephants” will become a cornerstone element in Russia’s foreign policy in Asia for the next decades or even centuries.

This year Russia is hosting the 24^th APEC Summit in Vladivostok in the regional center of its Far East region. As host country Russia has big hopes about this high-level and well represented meeting. The APEC zone could open a new market for Russian products, and more importantly, it could create a strong base in which Russian companies could join the technological supply chain process along with Asian companies in the future. It would create good incentives for big Russian enterprises concentrated in the western part of the country to shift their production to the Far East, creating new jobs and accelerating business activities there.

At one point, Russia showed interest and enthusiasm to join the Asian Development Bank (ADB) as donor member country. In 2006, it even participated as an observer in the 4th Ministerial Meeting of the Central Asian Regional Economic Cooperation (CAREC), one of the ADB’s regional initiatives. However talks on this matter did not have further continuation as two of the biggest shareholders of ADB, the United States and Japan, did not support Russia’s accession, making it clear that Russian membership in this organization will depend on its relationship with these two countries, and at this point it is quite chilly rather than warm.

Recently Russia has activated talks with ASEAN on various aspects of economic cooperation and political and security issues. Russia’s goals here are similar to what in the APEC - to open new markets, and try to link its Far East region to the fast growing Asian economy. ASEAN is interested in, along with economic cooperation, building a secure buffer zone. And presence of two other superpowers, the United States and Russia, would definitely balance the growing influence of China and India in that region. For Russia the Southeast Asia is not a new area, as it is an APEC member and has traditionally close ties with three ASEAN member countries - Vietnam, Laos, and Cambodia.

It is clear that growing power of Asia will eventually makes Russia to increase its alliance with its eastern partners and get involve more actively in Pan Asian relations. If Russians take right economic and political steps it might become a key country in Eurasia bridging west and east in one vast free economic zone in the future.