December 1, 2013: China has been enthusiastically pushing the activities of the Shanghai Cooperation Organization (SCO). This is a regional security forum founded in Shanghai in 2001 by Kazakhstan, Kyrgyzstan, Tajikistan, Uzbekistan, Russia, and China. The main purpose of the SCO was originally fighting Islamic terrorism. Russia, however, hoped to build the SCO into a counterbalance against NATO. SCO members conduct joint military exercises, mostly for show. They also share intel on terrorists, which is often useful. Iran, India, Afghanistan, Pakistan, Mongolia, and Turkey also want to join the SCO. These nations are allowed to send observers to meetings. China has put more emphasis on economic cooperation because greater Chinese economic power means that China is replacing Russia as the principal investor and trading partner throughout the region. Russia does not like to dwell on this, because it means China is expanding its economic and political power. On paper China is now the dominant military power in Eurasia, a fact that Russia likes to downplay. Many Russians fear that the aggression China is demonstrating with India and everyone bordering the South China Sea will eventually be turned towards Russia.

Government economists are lowering growth prospects (from 4 percent between now and 2030 to 2.5 percent and similar reductions for near-term growth). That is largely the result of world oil and gas prices declining because of the American fraking revolution. This has eliminated the fear of declining oil and gas supplies. Since oil and gas are the principal Russian exports and source of foreign currency, that is very bad for Russia. Corruption and lack of a reliable legal system has scared off foreign investment and made it difficult for Russian entrepreneurs to create new businesses and expand existing ones. More painful is the comparison with Western Europe, which lacks much oil but has a much better business climate. Britain, for example, has half the population of Russia but a GDP that is 25 percent larger than Russia’s.

On the bright side, some of the previously declining Russian defense industries are making a comeback. The state owned helicopter company has outstanding orders for $5 billion worth of commercial and military helicopters to the Middle East and Africa alone. Rugged and cheaper (that Western models) Russian helicopters are making a comeback in many parts of the world.

Russian diplomacy is also doing well. Efforts to organize a peace conference for the Syrian civil war are not going well but overall Russian support for the Syrian government are a success so far. Iran and many rebel groups are not willing to show up for a peace conference but Russia has persuaded NATO to put pressure on the rebels to participate. The rebels and their Arab supporters are angry at the U.S. and Europe for not supplying air support and for accepting a Russian brokered deal to dismantle Syrian chemical weapons. Russia can also take some credit for the success of nuclear disarmament talks with Iran.

North Korea has been another Russian diplomatic success, North Korea’s neighbors have been trying to help the northerners fix their economic problems. Russia has managed to have it both ways, by negotiating trade deals with both Koreas and, in effect, getting South Korea to quietly invest in a Russian project to refurbish and expand long-dormant rail links between Russia and North Korea. Reviving rail links between the two Koreas is also a trade possibility which could lead to business for North Korea by allowing South Korean goods to move through North Korea to China, Russia, and (via the Trans-Siberian rail line) the rest of Eurasia. This is very concrete optimism for all three countries and is being backed by cash commitments from Russia and South Korea. It all depends on the northern leaders agreeing that economic reforms are the way to salvation. At the moment the northern elite fear any change because it might bring revolution. But the change is happening anyway, and the more affluent neighbors are trying to explain it all to the perplexed northern leadership.

Meanwhile, Russia still has some fundamental economic problems that resist every fix that is thrown at them. For example, Russia recently revealed that, although the Russian Air Force has 16 Tu-160 heavy bombers, few were flyable because spare parts were running out. That was the result of many of the Soviet era factories that produced key components going out of business in the 1990s and new sources for these parts have not yet been found. There is also a lack of special manufacturing equipment and people capable of doing the work. Thus the firm that was given a contract to refurbish 26 of the NK32 engines used by the Tu-160 has only been able to finish the work on four of those engines in two years. But that’s just the engines. Plans to refurbish all 16 Tu-160s depends on hundreds of suppliers being able to deliver and the list of those suppliers who are not able to do the work keeps increasing. Russia has been putting off this problem for over a decade because there were large stocks of spare parts for fewer major weapons systems. But now those parts are running out, and without the replacement suppliers the Cold War era systems will not be able to continue.

The Russian Defense Ministry has introduced some unexpected changes this year. For the first time the “Command Center” for the military will be physically separate (in a new building complex) from the Stavka (the General Staff which has long handled planning and administration of the military). This is part of a trend towards installing more Western style civilian control over the military high command. At the same time attention was made in placating military traditionalists. Thus the Defense Minister reversed the conversion of the two elite divisions stationed in Moscow (Kantemyrovskaya tank division and the Tamanskaya motor-rifle division) to the new brigade structure. The ministry also ordered the return of ideological training for troops and increased use of informants and opinion surveys to monitor morale and loyalty in the military. In effect, government has returned to using the communist era "Zampolit" (political officer). In Soviet times every unit commander had a deputy (Zampolit) who represented the communist party and could veto any of the commanders’ decisions. The Zampolit was responsible for troop loyalty and political correctness. Sort of a communist chaplain. Earlier (2010) the Russian Army reintroduced chaplains, something that the communists did away with in the 1920s. The new chaplains are, however, expected to report on the loyalty of the troops, to church and state. Now additional officers are being added to handle ideological training and monitoring morale. Not exactly the return of the Zampolit but a return of most of the Zampolits’ duties.

Japanese complaints about growing incidents of Russian warplanes flying close to Japanese air space have left Russian officials perplexed. The Russian aircraft are flying more training missions in the Pacific and there is a lot of Japanese airspace off the east coast of Eurasia, so Russian warplanes out there cannot avoid passing close to Japanese air defense radars. In the last six months Japanese fighters have been sent aloft an average of once a day to check out approaching Russian warplanes.

November 30, 2013: The Defense Ministry announced that each of the four military districts are acquiring land for a large training area. These training bases will be large enough for multiple divisions (over a dozen brigades) to realistically train. Barracks, transportation, and maintenance facilities for each of the new training areas are being built or upgraded (where existing training facilities are being expanded). The work is expected to be complete by 2015. This move indicates that Russia is committed to spending a lot more money on realistic training. As part of military reforms in 2008, Russia was divided into only four military districts (Southern, Western, Central, and Eastern). The Central district is basically Siberia while the Eastern district is the huge area on the Pacific and the Chinese border.

November 28, 2013: Results of a national opinion poll were released, showing that only nine percent of Russians approved of allowing any part of the country to declare itself an independent country. Such separatist attitudes were higher in areas where there are larger non-Slav populations. Thus in Siberia, 22 percent approved of separatism while in the Far East there was 16 percent approval. Some Russians want to allow the Moslem areas in the Caucasus to become independent but the poll indicates little popular support for such a move.

In Syria a mortar shell landed near the Russian embassy, killing a Syrian civilian and wounding nine others.

November 27, 2013: In Moscow police arrested 15 suspected Islamic terrorists and seized bombs and weapons the suspects had with them. All but one of the 15 were taken in one raid. The arrested included two ethnic Russians but the rest were from Uzbekistan, Turkmenistan, and the Russian areas of the Caucasus.

November 26, 2013: In the Caucasus (Dagestan) police cornered four Islamic terrorists in a house. Two were killed and the other two are being persuaded to surrender.

November 23, 2013: In the Caucasus (Dagestan) an Islamic terrorist (Suleiman Magomedov) died as he was building a bomb for an attack on a local police station. The dead man was believed to have made the bomb used in an October 21^st suicide bombing in Volgograd (formerly Stalingrad). Another Islamic terrorist who was with Magomedov was apparently wounded and eluded police.

November 19, 2013: In the Caucasus (Dagestan) another Islamic terrorist was shot dead during a siege. The dead man was believed to be involved in an October 21^st suicide bombing in Volgograd.

November 17, 2013: Outside the city of Kazan an American made B-737 airliner crashed, killing all 50 on board. It was later found that the cause was apparently pilot error, as the aircraft was mishandled and came almost straight down while going around for another landing attempt in bad weather. Russia has one of the worst airline safety records in Eurasia and the Russian parliament is considering passing a law banning the use of older (than 20 years) aircraft. While most Russian airlines now use Western aircraft, they often buy older aircraft cheap and refurbish them. The 737 that crashed in Kazan was built in 1990, and spent most of its time in Africa and Brazil before being bought and refurbished recently by a Russian regional airline. But the real cause of poor Russian flight safety is inadequate pilot training and inadequate management of training and flight safety. It’s more difficult to pass laws that will fix those problems, which are also present in military aviation.

November 16, 2013: In the Caucasus (Dagestan) five Islamic terrorists were cornered and killed after they refused to surrender. One of the dead men was the husband of the suicide bomber in an October 21^st suicide bomb attack in Volgograd that killed six people on a bus.

Five years late, the new Russian built Indian aircraft carrier INS Vikramaditya was turned over to its Indian crew. India was supposed to take possession of the Vikramaditya by late 2012, but that was delayed until early 2013, and earlier this year was delayed until late 2013. Some of the Indian crew have been working with the Vikramaditya for two years now, learning about all the ship's systems, and over 400 of them were aboard during the 2012 sea trials and even more for the 2013 trials. Vikramaditya will depart Russia on November 30^th, accompanied by an Indian frigate and a tanker carrying fuel for both ships. When the ships reach the Mediterranean they will be met by two more Indian warships (a destroyer and a frigate), and all five ships will proceed, via the Suez Canal, to a naval base outside Karwar. Vikramaditya will be fully operational by mid-2014.

India is seeking to lease another Russian nuclear submarine. This was prompted by the recent loss of a Russian made Kilo sub to an accidental explosion and continuing delays in building new diesel-electric and nuclear subs in India. India has offered to supply the cash to complete an Akula class nuclear sub that Russia halted work on in the 1990s because of money shortages. Once completed (in about four years), the sub would enter Indian service. All this would cost India about a billion dollars. This would be the third time India leased a Russian nuclear sub.

November 13, 2013: Three Russian Navy ships visited Burma, stopping at Yangon.