UNCORRECTED TRANSCRIPT OF ORAL EVIDENCE To be published as HC 276-i

House of COMMONS

MINUTES OF EVIDENCE

TAKEN BEFORE

DEFENCE COMMITTEE

RUSSIA: A NEW CONFRONTATION?

Tuesday 24 February 2009

MR EDWARD LUCAS

PROFESSOR MARGOT LIGHT and MR JAMES SHERR

Evidence heard in Public Questions 1 - 95

USE OF THE TRANSCRIPT

Oral Evidence

Taken before the Defence Committee

on Tuesday 24 February 2009

Members present

Mr James Arbuthnot, in the Chair

Mr David S Borrow

Mr David Crausby

Linda Gilroy

Mr Mike Hancock

Mr Dai Havard

Mr Bernard Jenkin

Mr Brian Jenkins

Robert Key

________________

Memorandum submitted by Mr Edward Lucas

Examination of Witness

Witness: Mr Edward Lucas, Central and Eastern correspondent, The Economist, gave evidence.

Q1 Chairman: Good morning. Can I ask you to begin please by telling us the briefest bit about yourself and your experience of what you are just about to give evidence about, which is our first session on Russia.

Mr Lucas: Thank you very much both to you and to the Committee in general for inviting me; it is a great pleasure to be able to share my thoughts with you. I have been covering Eastern Europe since the early 1980s when I was involved in activities to help the Polish then-banned trade union Solidarity, and I have basically been dealing with Eastern Europe ever since. I was a student behind the Iron Curtain in the days when that was a pretty rare thing to do, I was a correspondent behind the Iron Curtain in the days when that was also quite a rare thing, I covered East Germany for the so-called German Democratic Republic and I covered Czechoslovakia and witnessed the Velvet Revolution in Czechoslovakia in which my friends went from being dissidents who were in and out of jail to being politicians who were in and out of office, and that was a very pleasant change. I then moved to the Soviet Union, as it was then, and saw the collapse of Soviet power in the Baltic Republics and stayed on there for four years editing an English-language newspaper until the last of the Russian occupation forces left the Baltics, and I then went on to run the Eastern Europe office of The Economist in Vienna, then moved to Berlin, then had four years in Moscow and then came back to London and now cover Eastern Europe out of London. Having been very optimistic at a time when others were pessimistic in that I thought that communism was bound to collapse and these countries would do quite well once they were freed of the shackles of communist captivity, I have now become rather pessimistic at the way in which the worst people from that side, which is the old KGB and their business cronies, are using our system against us, and that was what prompted me in the end to write my book, The New Cold War, which I believe is why you invited me here.

Q2 Chairman: As you know, our inquiry is entitled "Russia: a new confrontation?" I do not usually refer to the punctuation in these questions, but we are trying to decide whether our relations with Russia currently are leading towards a new confrontation or not, and we see from your book that you suggest that Russia is actually too weak to pose a direct military threat to the West and, if that is true, to what extent do you think it poses a military threat to others? Do you think it is a paper tiger or not?

Mr Lucas: The analogy I use in the book is that an aggressive man on crutches can be quite a threat to someone in a wheelchair, and I think there can be no doubt after the Georgian war that Russia is in a position to do serious military damage to small neighbouring countries, particularly if they do not have strong friends to back them up. That was something that would have seemed, I think, inconceivable during the Yeltsin era. You could see Russia using military force inside its borders against the Chechens principally, but nobody really thought that Russia was going to go to war with a neighbouring country and in Georgia it did, and we can debate the rights and wrongs of that war separately. I think that, if one is looking at it from a British point of view, we have the enormous luxury of still being a world military power, we have our nuclear deterrent, we are not really endangered by this, it is a nuisance for us if Russian planes buzz our airspace or Russian submarines surface unexpectedly off our waters, but nobody really thinks it is an existential threat. It looks jolly different if you are, say, Estonia, a country which has configured its armed forces entirely in the light of NATO's requirements overseas, and Estonians are very valued allies for the British Forces in Afghanistan. They have not paid very much attention to defending their own country because they believe that NATO is going to help them. Now, if, and it is a very big 'if' and I do not think it is a probability, not even a very big possibility, but, if there were some kind of security confrontation in the Baltic States and NATO, for one reason or another, was not willing or able to come to Estonia's aid, perhaps because of a German veto, to take a not completely hypothetical possibility, then Estonia would be very hard-pressed to defend itself, so that is the kind of spectrum, not really a problem for Britain, but a jolly big problem if you are a small country on Russia's borders.

Q3 Chairman: Why is it in the UK's national interests to be concerned about the threats that Russia might pose to its neighbouring states rather than to the West or to the UK?

Mr Lucas: Well, I think it depends on the neighbouring state and it clearly matters less from our point of view, if you want to take a kind of selfish realpolitik view. If Russia marched into Mongolia, for example, that is very different from if it marches into Norway, and I do not think either of those is particularly likely, but I am just stating that hypothetically. I do think that Britain's security does depend on NATO and a NATO guarantee absolutely matters. We have given that guarantee to the Baltic States and we should honour it. Again, I am not saying that this is a live danger, but we should make sure that it never becomes one. Georgia was not a NATO member, it was an American ally, which is rather different and, for one reason or another, the West was not willing or able to do very much to defend Georgia, but we can be, I think, quite clear that it is in Britain's interest to make sure that the NATO guarantee in Eastern Europe stays so strong that it is never tested.

Q4 Mr Borrow: You mentioned briefly the deployment of Russian aircraft or ships into NATO airspace or oceans where they were not expected to be. Why is Russia doing that and is there any reason why we in the UK should be concerned about it?

Mr Lucas: It is an excellent question with two answers. One, we should certainly find it troubling that Russia sees the need to go in for this kind of, what one might almost call, 'adolescent sabre-rattling'. Given that there was no chance of a serious military confrontation with Britain, why do they feel the need to provoke us by flying supersonic nuclear bombers at high speed towards our airspace and then turning away at the last minute? This is not the behaviour of a country that has got its priorities right, I would suggest. Now, the consequence of this for us is that we have to maintain a slightly higher, or even a much higher, level of readiness than we would if it were not Russia. If Russia, say, in 50 years had never come near our airspace and was a co-operative and friendly ally just as, say, Ukraine was, to take another country that is not in NATO, we probably would not need to spend so much money, but our pilots could do other things, our planes could be elsewhere and we would have those resources free. One of the effects of this kind of pinprick provocation is that it ties up our resources. Why they do it, I think, reflects this mentality of what I would refer to as the 'ex-KGB regime in the Kremlin' which has the old chauvinist reflexes, at least to some extent, of the Soviet Union and they say, "We do it because we can and we want you to take notice of us". Maybe, and I hope this is the case, the famous reset button that the Obama Administration is going to push on arms control and other issues may mean that they feel less need to do this, but they can always start it up again.

Q5 Mr Jenkins: Mr Lucas, I put it to you that, if we did not have a Russian threat in terms of exercising and getting our pilots into the area as fast as possible to offset it, we would have to provide one because that is the only way we can exercise and make sure that our country's defences are secure, so we should be maybe thankful on behalf of the taxpayer that the British taxpayer did not have to provide it, they did it.

Mr Lucas: Well, I think you have got a remarkable ability to see a silver lining in a cloud! The fact is that there is a danger of accident here and, when they did it in Norway, it was not just a welcome opportunity for the Norwegians to test their air defences, but very seriously they had a major naval and aviation exercise in the middle of the North Sea right around some Norwegian oilrigs, and that was a very serious and expensive business for the Norwegians and not funny at all. It is something that casts a question mark over the dependability of Russia as a country, and also there is the danger of an accident. These planes are perhaps even carrying nuclear warheads and, if one of them crashes, well, we do not want that, so I am glad you can look on the bright side, but I am afraid I cannot quite share your perspective.

Q6 Chairman: Do you think it is sabre-rattling as opposed to another concept that has been put to us, which is the idea of bringing back the level of training to levels where they were at before?

Mr Lucas: Well, I think we should be thoroughly in favour of the modernisation of the Russian Armed Forces. These are Armed Forces in which hundreds of conscripts die every year because of suicides and beatings, yet there is an enormous need and it would be tremendously in our interest if Russia would go down the road of modernisation adopted by, say, Ukraine. We can use Russia as a partner in all sorts of things. We could use Russia as a partner in Darfur, we could use Russia as a partner in Afghanistan. If Russia had a modern military and co-operated, that would be beneficial. It would also be beneficial from the point of view of stability and safety if they modernised and kept things in a good state, so it is in no one's interest for Russia to degrade, but I find the idea that they need to train to fight offensive military operations against us rather troubling. In whose interest is it that their nuclear bombers should be able to evade, in practice again and again, our interceptors. This is not something that we do. We do not probe their airspace and it is just not the behaviour of a country that wants to be friends.

Q7 Mr Hancock: That is a very interesting point, that Russia does have a permanently ready force, does it not, of some 300,000 men and all estimates are that they are pretty well equipped and readily deployable, so they have already a substantial force on the ground that is actually ready and could be used at any time and would not rely on hidden numbers of reserves or others being called up to back them up.

Mr Lucas: Well, I do not quite share that. The lesson of the Georgian war is that Russia found it quite difficult to beat Georgia which is a country of one-third its size. The movement control going through the rocky tunnel under the mountains was so bad that some of the Russian tank crews were coming off on stretchers because they were so nearly asphyxiated. They had to rush in the Pskov Parachute Division and the Moscow (?) who were not part of the original plan because the forces quite often were getting into trouble, or at least those are the media reports and I do not have first-hand knowledge of that. I think all the evidence points to the fact that military modernisation has been very slow so far in Russia and they have not managed to move away from a conscript army and they have not managed to introduce proper non-commissioned officers. They lack the kind of hi-tech battlefield equipment that we take for granted, everything from body armour through to night vision equipment, and they find it difficult to move around in a hurry, leaving aside of course the corruption, so I am not a huge specialist on the Russian military, but everything that I read suggests that modernisation is much talked about, but slow in coming.

Q8 Mr Hancock: On your question about why would they test the West's defences to see if they could get through, if you can get through the most sophisticated defences, then you would not have any problem getting through anybody else's, so, if the Russians believe they are penetrating Western airspace with no problems or, for some reason, can get as close to the coast of North America as they possibly can without being detected, they will not have a problem going anywhere else in the world, and I think that is the lesson they are seeking to learn. If they can evade the best technology offered, they will not have any trouble evading a-lot-less-effective defences.

Mr Lucas: I find it hard to see what security threat Russia faces that it needs to address with nuclear bombs. That is what I do not understand. The real problems they have are low-intensity warfare in the North Caucasus which is sort of bubbling away. If they were to do lots and lots of practice of anti-terrorism and counter-insurgency, I would say, "Fine, that's what you're dealing with", or if they said, "Theoretically, we might have to fight a war somewhere in central Asia, let's practise that", but what I think is odd is this kind of echo of the Soviet idea that they are a kind of global military power when they are so self-evidently not. I do not want to make a great big thing about this because in the end we can deal with it, but I am much more worried about the security threat to countries that cannot defend themselves than us who can.

Q9 Mr Jenkin: How much is this kind of activity about testing our responses and establishing where our boundaries are and how important is it for the West to establish firm boundaries to contain this kind of behaviour?

Mr Lucas: Well, I think that is absolutely right, if I may say so, and I think it is not just on this, it is on a whole range of things, that I think there has been quite a conscious series of tests of our resolve on everything from the harassment of the British Ambassador in Moscow, the closure of the British Council, the closure of the BBC Russian Service frequencies, just to take three little British examples, testing our air defences, and all sort of other things as well where they want to see how we respond. One thing which I think the members of the Committee might want to do is to press the MoD a bit on why they are not making more of a fuss about this, that the attitude within the MoD so far seems to be, "Don't let show the Russians that we mind, so we won't say anything", so this is very played down. The case of the supersonic bomber which came in on a hostile path towards a city in northern England was leaked to The Sun, I believe, by the RAF and then MoD subsequently rather reluctantly confirmed it, but I think we actually should be saying perhaps rather more bluntly on this and many other things, "Hang on, guys, we don't like this. This is not the behaviour of a friendly country". I think the danger is that our rather cautious reaction makes them think that we are not really serious.

Q10 Chairman: But you yourself have said that it is only a nuisance.

Mr Lucas: But it is unpleasant. If someone keeps on standing on your toe in a pub, it is only a nuisance, but in the end it is ----

Q11 Mr Hancock: Why do we go back then? Why have we reopened the British Council offices in Moscow?

Mr Lucas: Sorry, why?

Q12 Mr Hancock: Why do we go back then? Why does the British Government say, "Okay, you closed our offices down on the pretty spurious pretext of unpaid taxes", but then we have opened the offices again? Why do we do that?

Mr Lucas: Well, it is good to have them open. I am not sure we have yet -----

Q13 Mr Hancock: Yes, they are.

Mr Lucas: ---- in St Petersburg.

Q14 Mr Hancock: Then you go back to have your toes trodden on again, do you not?

Mr Lucas: The problem is that a lot of what we do is to engage with Russians, not with the regime, but with Russians, and the British Council is a benefit to that.

Q15 Mr Hancock: I agree.

Mr Lucas: So there is no point in punishing the people who like us in order that the people who do not like us then do not use an opportunity to provoke us, and I do not really see that as a huge problem. I think it is much more important that we object both more crisply and actually more collectively. One of the things I advocated at the time when the British Council was closed was that the other EU countries should say, "Okay, we will take on the tasks of the British Council as a kind of collective thing", so that the English lessons and all the other folk dancing and everything else they do would be put on jointly by the Goethe Institute and the Savantes Institute and so on, just to show the Russians that you cannot actually pick off one EU country like that. I think that kind of response, if one is talking about confrontation, would have been a rather effective one because they do not want to pick a fight with the whole EU, but what they do like doing ----

Q16 Chairman: You can see the French teaching English?

Mr Lucas: I am sure we would do it for that!

Q17 Mr Hancock: But it is nowhere near the truth, is it? The problem why the British Council could not operate and it could not be done as you suggest is that the Russian-employed staff at the British Council were prevented from working for them, so you cannot shift people to other embassies because it was the staff, it was the Russians.

Mr Lucas: Hang on, Mr Hancock, if you had had all the other European cultural institutions saying, "We are taking on the tasks of the British Council", it would have then been up to the Russians whether they wanted to intimidate all the staff of all these things rather than just the British, and it was serious intimidation. Do not forget, they were threatening that they were going to murder family pets, which seemed to be quite heavy stuff.

Q18 Mr Crausby: Back on the Russia-Georgia conflict, can you outline the main causes of the conflict last year and who bore the main responsibility, in your opinion? I have heard both sides, the Russian side and the Georgian side, and the consensus seems to be that the Georgians foolishly fired the first shot and the Russians eagerly over-reacted. Would you agree with that?

Mr Lucas: I think, as the Americans say, there is a back story. You had had a series of provocations from the Russian side and a series of peace initiatives from the Georgian side which had not been followed up. There is no doubt in my mind that the Georgian inner circle around President Saakashvili does not react to events in the way that one would hope and information leaks out and decisions are taken at short notice in the middle of the night, and this is undesirable, but I think that in the end this war happened because Russia wanted it. Georgia was not planning to reconquer Abkhazia and South Ossetia. They were going to try to do it by soft power and they had come quite a long way in that. You had some villages in South Ossetia which were changing sides because they said, "We're better off under the Georgians than we are under the South Ossetian kratocracy, and you had a bit of Abkhazia which had gone from being under an independent warlord's control to being under Georgian control and was also doing quite well, and Georgia itself was doing well, it was growing very fast at double-digit growth rates. There is no doubt in my mind that that was the path that the Georgian leadership wanted to take and it was one that was very threatening to the Russian leadership. They did not want to see Georgia succeed and becoming a kind of magnet which would show up the shortcomings of the Putin model. They very successfully provoked the Georgians into attacking, but I think one must not forget that the Georgians were under intolerable pressure. The villages that were under Georgian control in South Ossetia were being shelled by the Russians, and I do not know what President Saakashvili could do about that. He could either say, "Surrender", and just say, "Fair enough, our guys are going to get killed and we're not going to intervene to help them. There's nothing we can do, tough luck", or he could try and launch some kind of military counterattack. The third option would be to appeal to the international community to do something, and he had done that again and again and again and we were on holiday, we were not there.

Q19 Mr Crausby: Well, he clearly expected that the West would intervene in some way which seems to me a huge mistake and it set us back tremendously. Was he naïve in that expectation or was he let down?

Mr Lucas: I think he was both. To launch a war against a country that is 30 times or against something that is backed by a country 30 times bigger than you at a time when your best troops are in Iraq and your second-best troops have just come back from Iraq and are still recuperating is an odd thing to do. I agree, I think it was an impetuous and misguided decision. I think there were some elements in the American Administration which may have given him the feeling that he was going to get away with it, and in previous mistakes he had made, such as the crackdown on the opposition in November 2007, the Americans had covered up for him and they continued to back him even when, I felt and the economists felt, he had already stepped out of line, so we had been sending bad signals there as well, but I absolutely agree with you, it set us back a long way. I think it is miraculous that Georgia has survived the war as well as it has and what worries me very much is that there could be another confrontation soon.

Mr Hancock: I find it odd that the only two things which are certain about what happened is that the Georgians fired too quickly and the Russians stopped too slowly, but the interesting thing about the Russian intervention there is that, once George had started to bomb their own citizens and shell their own citizens, who was going to step in if the Russians did not? Who was going to stop the Georgians? I have asked the Georgians on many occasions, including the President himself, to explain when he intended to stop what he was doing and they have yet to give an answer, so, if the Russians had not stopped them, to all intents and purposes presumably the Georgians would have gone on bombing and shelling their own citizens.

Chairman: Cluster bombs.

Q20 Mr Hancock: Well, I think the use of cluster bombs is regrettable, to say the least, but it was completely, in my opinion, a war crime to do what the Georgians actually did, so I am interested to see what effect this has had on NATO and the EU and their influence, not just in Georgia, but in the area generally, in that Black Sea/Caspian region.

Mr Lucas: I think that the effect on both the EU and NATO of the war in Georgia both before, during and after has been very bad. We have been exposed as divided, irresolute and ineffective. I think it started with the NATO Summit in Bucharest in May where we gave a kind of blank cheque without the money to honour it by promising Georgia that it would become a member of NATO eventually, but not agreeing to any of the practical steps that might make that either possible or desirable. I think the EU's reaction after the war was deplorable. The Economist put a picture of a jelly on its cover with the caption, "Europe stands up to Russia". Yes, we can debate in detail, and I would not want to do it now, the rights and wrongs of the course of the war, but it seems to me there is no doubt that Russia went well beyond any kind of peacekeeping or war-ending mandate by pushing deep into Georgia and blowing up all sorts of infrastructure, threatening civilians, ethnic-cleansing and all the rest of it, and it failed. It was set some fairly light conditions by President Sarkozy, fairly vague conditions, and then did not meet them. The EU came out with the weakest possible sanction it possibly could which was to suspend partnership and co-operation agreement talks, which was something Russia had already said it did not really care about, and then was unable even to stick to that, so I think both NATO and the EU have been shown up quite badly and that sends quite a powerful message to the Kremlin or to the Russian authorities. It says, "These two main security organisations in Europe, one economic, security and political and one sort of military, do not really know what to do when they are confronted with a short, sharp threat, a whole series of provocations", and this is a bad message to send.

Q21 Mr Hancock: Do you think that part of the problem was that the EU in particular and NATO and the Bush regime were propping up a busted flush? Once Saakashvili had to call an election which he had to gerrymander to win, it made him a spent force and he was then desperate to do anything to instil some support for himself and his regime. Is that not part of the reason as well, that Saakashvili had to do something to show himself as being not just a busted flush?

Mr Lucas: The prospect of European and Atlantic integration is the best magnet for good government. The idea that you have to behave and you cannot do things that you might like to do because you want to join our clubs has been a great source of stability and prosperity across our continents and I think the real story with Georgia is that that magnet got switched off, that we no longer seem to be offering a real prospect that they were going to join our clubs with the result that the conditionality that those clubs involved did not seem to apply and Medvedev actually thought he could get away with things that he should not have been able to get away with.

Q22 Mr Hancock: Do you agree with me then that their chances of joining NATO now are pretty remote?

Mr Lucas: I think they have certainly gone backwards and I do not think they were that good to start with. I think what the thinking of the Obama Administration is, which is entirely right, is to focus on practicalities, so let us not worry about headlines, let us worry about real changes, so let us really get the Georgian Armed Forces sorted out, let us really get all the other things sorted out, the administration of justice, rule of law, anti-corruption, all the things that go to making a country into a fit member for NATO, and then, when we have done all that maybe in five years, maybe in ten years, then we will come back and revisit it and maybe by then Georgia will be the sort of country we want to have in NATO, but I think the Bush Administration had it the wrong way round. They said, "Let's bring them into NATO and then we'll clean them up", and of course that was the wrong way round.

Q23 Mr Hancock: But they have not succeeded in the others they have brought in either.

Mr Lucas: Hang on, how do mean they have not succeeded in the others?

Q24 Mr Hancock: Well, they have not succeeded in cleaning up the corruption and bringing the rule of law and democracy into some of the other countries that have already been agreed for entry into NATO and the EU. What are the consequences then for Russia and its immediate neighbours, particularly countries like Ukraine and Azerbaijan, for example, and the consequences for Georgia and Ukraine where the two presidents are very close to each other and Azerbaijan has a lot of wealth?

Mr Lucas: I think the whole context has changed since the oil price crashed. The Georgian war happened at a time when we had oil at $140 a barrel or something colossal, so Russia was bursting with money and it was very easy for the regime, the Kremlin, to have very grandiose ideas about what it could do, and that has changed. We are now in a situation where we do not have much money and they do not have much money which does not mean that they cannot still pursue their geopolitical agenda, but they cannot do it in quite the same way as they did before. It seems to me that we have got a tough tussle in Belarus and in Ukraine and in Kirghizia, the Kirghiz Republic, right now where Russia is using a mixture of energy and cash to try and squeeze these countries away from any Western orientation and they may have been pursuing them close towards Moscow, so we see the Americans being pushed out of the Manas airbase in Kirghizia, Russia pressing the Belarusians very hard to recognise South Ossetia and Abkhazia, and the offer of a bilateral loan to Ukraine if it tears up its IMF deal which was very much an American Bank/IMF deal, so I think the competition is still going on and I would not say that we are winning.

Q25 Mr Hancock: My final question on this round is about South Ossetia and Abkhazia and where they are. My personal view is that, if I were living in South Ossetia, I would not vote to go back to Georgia having been bombed by them, so what is your view?

Mr Lucas: Well, you have to remember that the population of South Ossetia and Abkhazia is not the same as the people who are living there now. You have a lot of people who have been bombed out in previous wars, so I think one would have to ask the entire population as it was at some point in the past rather than just asking the people who are living there now. I think that it remains the case that Georgia's only chance of getting these territories back ever is through soft power and, if Russia becomes less attractive and Georgia becomes more attractive and perhaps we have a different leader in Georgia, one who does not arouse the same negative emotions as Saakashvili does and if Georgia in 15 years' time were about to join the EU, I think you might well have Abkhazia and South Ossetia saying, "We would actually quite like to be in the EU and let's see if we can work out some kind of loose confederal arrangement with Georgia where we can get on to that bandwagon and we do not want to be stuck along with the rest of the North Caucasus". That is optimistic, but I do not think it is impossible.

Q26 Linda Gilroy: You said you started as an optimist, but you have turned into a pessimist. Are there any aspects of what is going on in Russia which we should look to build future optimism on partnership? What are the building blocks towards a more constructive relationship with both the UK and NATO?

Mr Lucas: There is one optimistic view which I do not share, but which is quite coherent, which says that economic pressure is going to make the regime back down in its most confrontational positions, so you get the theory that we are going to see a lot more of Mr Medvedev and a lot less of Mr Putin and they will be able to afford a lot of this stuff that we do not like and, therefore, this icy blast of economic reality is going to blow them into a different direction. I just do not think that is true.

Q27 Linda Gilroy: I think Robert Key is going to ask some questions in a moment on the economics of it, but in terms of shared values and the sort of work which the OSCE, for instance, was set up to promote, do you see any prospect there?

Mr Lucas: It is quite hard to see. In theory, we ought to be able to co-operate in Afghanistan because it is not in their interest to have a Taliban victory in Afghanistan, to put an extreme case, but maybe their interests are in seeing NATO in trouble, and there must be some room for co-operation there, but we are not seeing it. They are closing down effectively an airbase that is very useful to us, the American airbase in Kyrgystan. The main reason I see for any kind of optimism is that we do have a business class in Russia, I would not yet call it a middle class, but a business class of people who are living their lives fairly independently from the State and who are fairly fed up with it and, if you look at opinion polls and you ask people about corruption, the rule of law, good governance, infrastructure, public services, all these things, there is quite a chunk of people who are pretty fed up. At the same time, if you say, "Do you like Mr Putin?", they say yes, and that, I guess what the psychologists would call 'cognitive dissonance', is something that we can perhaps be optimistic about in the long run and it is not as if 'Putinomics' has been a fantastic success and everybody liked every aspect of it, and there are people who are rich enough to complain. The small- and medium-sized enterprises, of whom there are not very many for an economy the size of Russia, but they are there, they are people who have a voice and perhaps one day they will exercise it.

Q28 Linda Gilroy: One reading of what is going on in Russia is that they are posturing on the foreign policy near neighbourhood stage in order to distract from the very serious problems internally.

Mr Lucas: I totally agree. I think that is the danger. That is why I do not believe that optimistic scenario I sketched out because I think that, when the regime is in trouble, it needs to find enemies and it can find the enemies maybe by persecuting migrant workers, maybe it can claim it is the Ukrainians' fault for stealing the gas or it can just start another war in the North Caucasus, pick another fight with Georgia, whatever. The overwhelming lesson of the last two decades is that, when politics is going badly, you look for external scapegoats and pick a fight with them.

Q29 Robert Key: Russia is not immune from the global financial crisis. How will the state of the Russian economy, which is very bad now, impact on their foreign and defence policy or will it not at all, given that we are regularly told that the problem with Russia's foreign policy is that it is still stuck in the 19^th Century?

Mr Lucas: Well, I think the 19^th Century would be quite nice compared with what we have got now. I do not want to sound too nostalgic, but I think that this is actually a hybrid of 19^th- and 20^th-Century thinking which is perhaps even less appealing. They do have less money to play with. Even when they had a lot of money, they spent it very effectively, so, in a way, the difference is not so great, there is less to be spent. The idea that they are going to carry on expanding defence spending at 30 per cent a year or whatever and eventually become a real military power, I guess, is even more fanciful than it was before, although we should still pay attention to the advanced weapons that they are developing and also to the advanced weapons that they are selling, and it is possible that, because of a shortage of money, they may sell more sensitive weapons than they have sold in the past, and we should particularly look there at air defence systems, such as the S-400 and who they sell that to. I think there is still enough money for them to do the sort of geopolitical mischief-making that should cause us trouble, and I have mentioned the Ukraine, Kirghizia and Belarus already, but there are examples closer to home. I think the way in which they bought the Serbian energy company, NIS, at what seems to be a remarkably low price for a company of that size is quite troubling. The whole pipeline politics of South Stream and North Stream is troubling. They have successfully kyboshed the European Union's plan, which is putting it rather grandly to call it a 'plan', a line on a map to build the Nabucco pipeline, which would be the only way that Europe could get gas from central Asia and the Caucasus going through Turkey and the Balkans, this would be the only east-west gas pipeline not controlled by Russia. We have been faffing around, I suppose one could say, for years on this and it is still no nearer, I think, getting built and in the meantime they are pushing ahead with their pipeline plans and making ours look less likely, so I think that the scale of the problem changes slightly because of less money, but I do not think that the nature of it does.

Q30 Robert Key: In your very forthright memorandum, you make it pretty clear that the West is at fault for having colluded in the corruption endemic in the Russian system, and you actually say that the West's biggest weakness is our greed and you say, "It is not surprising that Russians have become cynical about our talk of 'values' when they see our financial and professional elite at work turning stolen property into respectable assets, and laundering the ill-gotten gains of the ex-KGB officers who now rule Russia", and, "We need a sharp confrontation with dodgy financiers and their clients". That is pretty strong meat. Do you think that the professional elite in this country and other Western countries, whom you describe as doing this, are aware that we are playing into Russia's hands?

Mr Lucas: Certainly some of them are because they come and talk to me about it, and they do not want their names mentioned because they do not want to endanger their careers, but I know lawyers, accountants and bankers who are disgusted by what their companies have got up to in, chiefly, Russia, but also in Ukraine and other countries. To take one very clear example, the listing of Rosneft on the London Stock Exchange, this was described by, I think, Andre Ilaryanov(?), a former Kremlin economic adviser, as a 'crime against the Russian people'. This is an oil company that existed only because another oil company had been expropriated and it had been expropriated with $8 billion of Western shareholders' money disappearing, so that is our pensions, public sector pensions maybe not, but it will be private sector pensions tied up in that, and yet the London Stock Exchange saw nothing wrong in taking a roadshow to Moscow to highlight what they described as their 'more flexible listing requirements' at a time when Rosneft was not able to list on the New York Stock Exchange. We are a bit of a bargain basement when it comes to foreign companies wanting to list and I think that is scandalous and it is not just the capital markets, it is the way we tolerate anonymous companies in the British Virgin Islands. Why is it that we tolerate the ability of the British Virgin Islands to shelter companies behind a brass plate when we have absolutely no idea who owns them? That is an absolute invitation to money-laundering, yet these companies, companies which are registered in the British Virgin Islands, where we know, maybe from gossip or maybe from intelligence or whatever, that behind them are rich and powerful Russians who are stealing the oil and gas flows and laundering through these companies, these companies are allowed to come and take up syndicated loans and open accounts with our banks and we do not see anything wrong with that.

Q31 Mr Crausby: Cyber attacks - I heard a presentation recently on cyber terrorism that started to make me really worried about Internet banking, so to what extent should we be concerned about this from a NATO point of view, particularly as state cyber attacks must be more serious than that, so how much should we worry about Russia's ability to conduct cyber attacks, as in the instance of Estonia, for instance, and, more importantly, how should we respond to that? Should we be prepared to respond in kind?

Mr Lucas: I strongly recommend that the Committee asks the MoD for a classified briefing on this because some of the stuff that is going on is really alarming, but I think the people who follow this do not want it talked about in public because they do not want to let the other side know how much we know about what they are doing, but there is a NATO cyber centre of excellence in Tallinn which is now being visited from all over the world by people who want to learn the lessons of the cyber attack on Estonia and to see what measures can be taken against them. We tend to have the wrong idea about cyber attacks. We think it is a kind of crude attack on a website which means the website does not work anymore, but it is much more subtle than that. There is one virus which is being investigated at the moment which lives on memory sticks. The memory stick can be dropped outside a building that the other side, whoever they are, want to get access to and people pick it up and think, "That's a nice memory stick", and they put it in their computer and see if there is anything on it, and there does not seem to be anything on it, it seems to be empty, but actually there is a virus which then goes on to the computer and it copies everything from the trash can and all the recently opened documents and then, the next time the memory stick is put into the computer, the virus takes that information, encrypts it and puts it invisibly on the memory stick. Then someone takes the memory stick away, maybe takes it home, puts it into their computer at home, and the information disappears and we do not know where. That sounds like science fiction, but it is not. That is a real, live virus and it is causing problems right now in NATO countries, and we are not really set up to deal with it.

Q32 Mr Crausby: Do not accept free memory sticks then!

Mr Lucas: Well, as we wrote in The Economist recently, some security-conscious banks have actually gone round every computer in the bank putting glue in the socket where you might put a memory stick, so you physically cannot put the memory stick into the computer, in order to try and keep the network secure, but the other side, whoever they are, and that may be cyber criminals, it may be China, it may be Russia, it may be all sorts of people, it is quite hard to tell, the other side are ahead of us at the moment. They are inventing viruses faster than we are inventing ways to deal with them, and stealing data is only one thing, but then there is the question of getting into the computer and modifying its contents.

Q33 Mr Jenkin: At the Bucharest Summit, we were all given a free memory stick!

Mr Lucas: That was one of ours!

Q34 Mr Jenkin: One hopes! How much is this cyber activity directly authorised by the Russian State and how much do you think it is people in the system just trying it on? It is sort of semi-official, even unofficial aggressive cyber activity, so how confident are we that it is all coming from Russia?

Mr Lucas: Well, it is certainly not all coming from Russia, but what we can say with great confidence is that the Russian authorities are not co-operating in the way we would like in dealing with it. We have companies, and there was one which we wrote about in The Economist under the headline "Baddest of the bad", called RBM, which is based in St Petersburg and seemed to have the enthusiastic support of some people in authority there, to put it no more strongly than that, and there was a major American investigation into this company and big attempts to close it down. You get individual Russian law enforcement officials who are very enthusiastic, but the Russian State does not seem to take this seriously and one has to ask why.

Q35 Linda Gilroy: You touched on energy politics in Russia just now. What are the implications of that for the EU countries and what are Britain's energy security interests arising from that?

Mr Lucas: I think, to be fair, we need another hour for that, but I will try and do it in a minute. What the European Union needs is an energy market which is robust enough that outsiders cannot manipulate it, but that means lots of different kinds of energy coming from lots of different places in lots of different ways. What we have at the moment is not that. We have much too much of our dependence particularly in Germany and countries further east because of gas and almost all that gas coming from, not from Germany, but from further east and an awful lot of that gas coming from this Russian east-west pipeline monopoly. The one thing we could do about this very straightforwardly is to treat Gasprom the way we treated Microsoft. Microsoft did not take the EU seriously and then the fines started ratcheting up because of their monopolistic practices and after a bit they did take the EU seriously, and now all the American companies take the EU Competition Directorate very seriously. Why can we not apply the same competition law to Gasprom that we did to Microsoft? They probably would not take it seriously at the beginning, they would probably get the Germans to complain on their behalf, but we can do it, the legal framework is there.

Chairman: Mr Lucas, thank you very much indeed. That was a fascinating evidence session as our first public session in this inquiry.

Memoranda submitted by Professor Margot Light and Mr James Sherr

Examination of Witnesses

Witnesses: Professor Margot Light, London School of Economics, and Mr James Sherr, Head, Russia and Eurasia Programme, The Royal Institute of International Affairs, Chatham House, gave evidence.

Q36 Chairman: I wonder if I could ask you, please, to introduce yourselves.

Professor Light: My name is Margot Light. I am Emeritus Professor of International Relations at the London School of Economics. I have been studying the Soviet Union and Russia for the last 35 years. I am really an old Soviet hand. I was a student in the Soviet Union in 1969/70 and I caught that disease from which one never gets cured, which is studying the Soviet Union. I have been teaching and writing about it ever since.

Mr Sherr: My name is James Sherr. I am Head of the Russia and Eurasia Programme at Chatham House. At one level my interest in Russia, for family reasons, began at the age of two. I have been professionally engaged in the subject since the early 1980s, initially with what is now the Advanced Research Assessment Group of the Defence Academy, focusing on the Armed Forces and Security Services, not their capabilities but their thinking and the culture behind their thinking, and eventually two-thirds of the time very assiduously on Ukraine, its security problems, its defence security sector reform. From the mid 1990s to the present I have been a consultant to NATO, both on Russia and the Ukraine, and I took up my present post last June.

Q37 Chairman: Do you believe that Russia poses a military threat to other countries, including, say, the Ukraine?

Mr Sherr: To be honest, it is a term, for reasons and twitchy reasons, that I do not use and tend not to like. I do not think there is an intention within the Russian political or military leadership to pose what we call a military threat to any NATO country. There has been nevertheless - and Georgia bears this out - over the past ten years, since Vladimir Putin became President, a very focused effort to make the Russian armed forces fit for a wide range of regional contingencies, projecting power on a regional scale, including developing the nuclear means designed to deter others from intervening in regional conflicts. Despite the military establishment's evident unhappiness with the fact that, to this day, by a NATO standard, for reasons you have heard in part in the last session, Russia's armed forces have some striking deficiencies, when it comes to their core task, they have done very well. There are two other areas I think we need to be concerned about. The first is the less conventional side of military activity, and, just as important, the activity of military formations that are not subordinated to the Russian Ministry of Defence, that are part of the Federal Security Service, that are part of military intelligence or part of foreign intelligence. The relationship between some of those forces and operations and the type of events we saw in Estonia in 2006 is a cause of concern, and there are some interesting enigmas there. I am even more concerned by the fact that President Putin, as he then was, in October last year assigned the Russian Navy a high priority in performing energy-related tasks. He said specifically that the Baltic Fleet will construct and provide security for the projected North Stream pipeline and deal with its environmental security. This raises a whole range of questions, particularly now, when we are looking at juridical ambiguity about waters in the Barents Sea, the Arctic new energy discoveries and so on, and bearing in mind how crowded the Baltic Sea is. That in itself is the subject of a very great concern.

Q38 Chairman: Thank you. Professor Light, would you like to add anything to that or disagree with it?

Professor Light: I do not think that Russia poses a military threat to NATO and nor do I think that it poses a military threat to its immediate neighbours. I do not think that there will be an attack of the kind that occurred during the Georgian war against any other countries. The country that is most often suggested as a possible scenario is Ukraine, particularly because of the large Russian population in the Crimea, but I think that the situation is very different there. Russia has other means of influencing what happens in Ukraine and I do not believe that there will be a military attack.

Q39 Chairman: Do you think that any of that poses any threat to the UK as such?

Professor Light: No. Well, in the sense that if there were to be an attack, NATO would have to respond and Britain, as part of NATO, would have to respond, it is clearly going to affect British foreign policy, but I do not think that British security is affected.

Q40 Mr Borrow: Do you think that NATO should be resuming contact with Russia through the NATO-Russia Council? Would that be in our interests to do so?

Professor Light: I think that any forum in which we engage the Russians, particularly those forums in which we have practical discussions on practical issues and attempt to get practical co-operation, is useful, and that is partly what the NATO-Russia Council was meant to do. So, yes, I think we should resume talking to them there.

Mr Sherr: I agree with that answer, but I think we need to be very sober in our expectations about what that forum and this dialogue will achieve. One reason, in my view, there was a lot of complacency in NATO about the expected Russian reaction to the US missile defence programme is that it was thoroughly discussed inside the NATO-Russia Council with Russian military specialists, a common language was developed, none of the Russian representatives showed any misunderstanding of the programme or any apprehension of threat, but there was a complete cut-out between those people and that level of person and the people making political decisions.

Q41 Mr Borrow: What message do you think it sends to Russia in the sequence of events of cutting the tie and then re-establishing relations through the Russia-NATO Council? Does that show from the NATO point of view a position of strength or is it simply a reasonable thing to do?

Professor Light: I think there is no purpose to be served by going on refusing to deal with them in the NATO-Russia Council. It was not a very effective response in the first instance and one might argue that it should not have taken place, that we should rather have used the NATO-Russia Council in which to criticise Russia rather than to stop talking to them. I think that the wrong message, if you like, has already been said and I do not think it is really going to matter if we start talking to them again there.

Mr Sherr: I agree with that answer. I would add, though, that the risk of misunderstanding would have been considerably diminished had on the morrow of the beginning of the Georgian war the entire NATO Council been convened. But I would have never suspended meetings. It is absurd for members of NATO, in my view, to call for cutting dialogue, when it is perfectly obvious to the Russians and ourselves that other members of NATO will not agree and that any such step will only be temporary in nature.

Q42 Chairman: So the NATO Council would have been convened. And what would it have said?

Mr Sherr: In view of the enormous investment that NATO has made in Georgia, the issues that we have identified there as being important, the mere convening of the NATO Council would have sent a message that we regard this as an extremely serious matter. Whatever was decided at the level of foreign ministers who did convene a few weeks later, that message could never have been as strong as that simple gesture which was not taken.

Q43 Mr Hancock: Will further NATO enlargement, if that is to happen, act as a detriment to international security and stability, particularly around Russia itself?

Mr Sherr: I might well hold a minority position. Yes, of course, there are dangers, and we have seen them, in premature enlargement or giving the impression, misleadingly, of hasty enlargement, because it has never been NATO's policy to push enlargement. This has been from the beginning a demand-driven process. The principal brake on the process has been NATO. But I fear that we do not consider adequately what the consequences would be in the region if we said, "Here we are, and no further." What would the consequence be in Russia if by that step we appeared to endorse their claim that these countries, that we have deemed important to us in the past, to which we even have some treaty commitments, are in their privileged sphere of influence? What are the consequences in dealing with the Russians or anyone else by suggesting that bullying and truculence works? What would be the consequence in countries like Ukraine and Georgia? They will not accept this quietly. We are dealing with countries, as we have seen in the recent Georgian crisis, which are not only greatly apprehensive but which have a capacity for behaving very intemperately. Issues that we long ago thought had been resolved, such as Ukraine's nuclear disarmament, are now once again being discussed in Ukraine by ostensibly very reasonable people. I myself think the surest way to create major conflict in that region would be for us to close the door and accept Russia's claims to it.

Professor Light: I take a very different view. I would argue that it depends what you mean by enlargement. If you mean Croatia, then probably there will not be very serious consequences. I think if you mean Georgia and Ukraine, there will be very serious consequences. Neither Georgia nor Ukraine fulfil the criteria for membership of NATO. Ukraine, because it has a dysfunctional political system and until it gets more political stability and until there is a popular opinion in favour of NATO membership (at the present it is 60% opposed), I cannot see Ukraine as being eligible for membership. Similarly with Georgia. Georgia has two territorial disputes, and it seems to me that that by itself would render it ineligible for membership. I get very anxious about the argument that we have to expand NATO because Russia is opposed to NATO expansion and we cannot let Russia tell us what to do. I think that we really need to sit inside NATO and ask ourselves questions about what the consequences would be, not just for division in NATO but for the effectiveness of NATO if it were to be enlarged to include those countries.

Q44 Mr Hancock: I was very interested in your comment about the disfunctionality of the political structure of NATO. That is mainly caused, is it not, by the anti-Russian feeling that was brought into NATO, mainly from the former Soviet bloc countries who are now members of NATO? They insist on punishing Russia at every step for the crimes and the misdeeds of the Soviet administration, and they will use every step and every possible way to connive together to undermine any negotiations and any real agreements with Russia between Russia and NATO.

Professor Light: That is certainly one of the Russian fears.

Q45 Mr Hancock: It happens. It is a reality, is it not?

Professor Light: Certainly if one charts the attitudes of Russia, not to NATO but to the European Union, then it is absolutely clear that Russia was very favourably inclined towards the enlargement of the European Union until that moment when the Eastern European and Baltic States became Members, because they believed that the East Europeans, particularly the Poles and the Baltic states, would affect the EU's attitudes to Russia. That has in fact happened, so Russian attitudes to the EU are much less favourable now than they were. Since NATO in itself is a far more emotive subject for Russians, most Russians still see NATO as a Cold War Alliance that should have been put to bed at the end of the Cold War, like the Warsaw Pact, and they find it very difficult to see former allies now inside NATO.

Q46 Mr Hancock: In your opinion, is the unity of the Alliance sustainable, in the light of the divisions there are between Member States, particularly their attitude towards Russia?

Professor Light: I think what would really pull the Alliance apart would be the possibility of Russia attacking a NATO member and Article 5 being invoked. I think that that really would split NATO completely.

Q47 Chairman: That is intended to be what is holding it together.

Professor Light: A Bulgarian diplomat once told me that the only countries that will ever get into NATO are countries that will not require NATO's defence. I sometimes think: would it had remained like that.

Q48 Chairman: Mr Sherr, I noticed you nodding through much of Professor Light's answer.

Mr Sherr: I was, but I wanted to make a distinction. There is no reasonable person I know in the Alliance, it was certainly the case for myself, who would conceivably entertain inviting Ukraine or Georgia into membership, even in the conditions that existed before August. I myself wrote a memo to NATO before the Bucharest Summit saying, "This is not the time for offering either a membership action plan." The issue is simply: If and when those countries meet the criteria, should the decision be made with regard to their merits or with regard to Russia's declared interests? That is where I think there is a disagreement within the mainstream part of the spectrum of argument. Secondly, I have worked very closely with NATO over the years. I think it would be a great mistake to understate the extent to which NATO's thinking about Russia has been transformed. One of the reasons why NATO was ill-prepared for what happened in Georgia is that thinking inside the Alliance had been so transformed. So many steps that we have seen of late have been completely ruled out, that at a time when we should have been very concerned and very much more engaged we were essentially napping, and in Washington they were napping as well. I just must add that, even a week before all this began in Georgia, when it was clear to every expert that this was a profoundly dangerous situation, high level co‑ordination in Washington existed on only two subjects: Afghanistan and Iraq. Everything else was at the level of the bureaucracy and there was a complete cut-out between what they were discussing and what the decision-makers were thinking about. If we were all still in a Cold War mindset, our hapless performance would have been inconceivable over the past couple of years.

Q49 Mr Jenkin: In the question of NATO expansion, are there any issues of principle which should concern us, or is it just about practicality and ifs and buts? Surely there is a founding issue of principle, which is that NATO seeks to advance democracy, rule of law and fundamental freedoms, and in the fullness of time it is in our interests, in our long-term interests, that these should all be extended to as many countries as possible. The rest is timing, but there is an issue of principle involved, is there not?

Professor Light: I think it is a matter for debate whether NATO is primarily a defence alliance or an institution for advancing democracy. I would have said that it is first and foremost a defence alliance. That is the first thing. The second thing is that it is all very well to say it is a matter of principle, but I do think that from time to time we might try and put ourselves in the seat of someone who would be a neighbour to this enlargement. You only have to ask yourself how would the United States feel if Mexico were to join an alliance perceived to be hostile, though the alliance itself declared itself not to be hostile, to understand a little bit of what the thinking is in the Kremlin. And it does not seem to me to be such shocking thinking.

Mr Sherr: I would express it in the following terms: NATO stands or falls on the basis of collective capacity, shared interest and common values - all three. Principle is an essential part of the answer; it cannot be the whole answer. Countries do not have a right to join NATO. They must contribute to what makes NATO NATO, both in terms of values and interests and also in terms of capacity. I have argued for a long time that the time for Ukraine to join NATO is the time at which its membership will strengthen both the security of Ukraine and the security of NATO. I fully agree with Professor Light that we are very far from that point at the moment. But when we reach that point where we decide such a step with regard to a particular country is in its security interests and our own, then principle would be part of that calculation. I also think that if we turn our back on our principles, the divisions we face in the Alliance today, which does now contain, since the Cold War, nine new members, would be nothing compared to what we faced then and it would be questionable whether NATO could continue.

Q50 Mr Jenkin: Perhaps I could ask the concomitant question: Should we recognise that Russia has legitimate spheres of influence?

Mr Sherr: No.

Q51 Mr Jenkin: Should we desist from antagonising Russia by interfering with their spheres of influence?

Mr Sherr: We should recognise that Russia has interests, just as we have interests. NATO, for example, has never expressed a view about whether the Russian Black Sea Fleet should stay in Sevastopol. When we have discussed this with Ukrainians, we have said, "As long as you are happy with it, as long as it is there on a transparent basis, as long as it does not threaten security, from NATO's point of view it could stay there until 2050 as far as we are concerned." Yes, Russia has interests as far as where forces might be based. We need to have a concrete discussion with the Russians, which we have not had, about: "What are you exactly afraid of? What would threaten you and why?" We have done this before. We did this between Bush Snr and Gorbachev when Germany was being reunited, when the Cold War system ended. But to recognise spheres of influence, to go back to this pre-1940 concept, is something which would not only be unprincipled, it would have very serious and I think very swift practical consequences, both in that part of the world and in our part of the world.

Q52 Chairman: Professor Light, do you want to add anything?

Professor Light: I think recognising a sphere of influence is not what one should or would do but understanding that there is an area in which a country feels that its security or its interests are at stake. It is a different thing, and, yes, I think we should understand why Ukraine is a more sensitive country for Russia than Mongolia.

Q53 Chairman: That is interesting because both Ukraine and Mongolia are surely integral to Russia's future. Possibly Mongolia will be of greater interest in 20 or 30 years time than Ukraine will be.

Professor Light: It does not have the historical baggage that Ukraine has and that the eastern border has.

Mr Sherr: There is an old expression in Russia: St Petersburg is the brain, Moscow is the heart, Kyiv is the mother of Russia.

Q54 Chairman: Where does Mongolia come into this?

Mr Sherr: It does not.

Professor Light: It is the stepsister.

Mr Sherr: There are areas of the former Soviet Union which are important simply for geopolitical reasons. Where I think Professor Light and I agree is that Ukraine is of vital importance to Russia for reasons of identity and for reasons of sentiment; nevertheless, Ukraine is also important to Ukraine for reasons of identity and sentiment, and so there is an extremely serious problem. I have sat in a room where a senior Russian said to a number of Ukrainians, "You must understand that for me, as a Russian, Ukraine is part of my identity." I think you can imagine what the reaction was. Neither of us would pretend this is a simple matter to deal with, because there are different identities and readings of history involved here.

Q55 Chairman: Is Russia really concerned about ballistic missile defence? If so, why?

Mr Sherr: Yes. The answer depends upon whom you speak to. Forgive me if you have not seen what I have written about this. May I just say that I apologise to the Committee for the fact that my submission was very late. I hope the fact that it is comprehensive will compensate for that. As I did state in the submission, the Russian military is, even by our standards, a worst-case thinking military, and it also attaches enormous weight to deception. Therefore, the fact that a system is not apparently designed to achieve something means nothing. Their concern is that these systems, however inappropriate the capabilities for threatening Russia, are the precursors to something that will threaten Russia. Secondly this is an emotional issue for many in the political leadership because we are talking about advanced military systems being positioned in an area that until recently had been the Warsaw Pact. There is a manipulative issue involved here as well because the Czechs and the Poles have expended real political capital in agreeing to this decision, and if the Russians could persuade the Americans over the heads of their allies to get rid of it, it undermines their confidence even further, and this is something I would suggest they would wish to do.

Professor Light: I completely agree. As I wrote in my submission, I think it is not so much intention that militaries think about but capability. The belief that these two deployments are the first in a whole series of deployments which will in the end encircle Russia and will require of Russia that it begins to build up the number of missiles it has so that it can overwhelm the ballistic missile defence - the belief therefore that this is a trigger for an arms race - is quite seriously held, even by people who do not think that these initial deployments do threaten Russian security. If you remember the Star Wars, the effect of SDI, I think there is in Russia also this fear that there is a technology gap, and that the working on this anti ballistic missile defence is likely to increase the technology gap that already exists between Russia and Western defence systems and that it is going to grow at exponential rates. My real fear is that by the time we know whether BMD works or not, it will already have undermined European security so that it will not serve as anything that will bolster European security.

Q56 Chairman: You believe that rather than contribute to European security it will undermine it.

Professor Light: Yes.

Q57 Chairman: Why exactly?

Professor Light: Because I think that by the time we know whether it works or not it has the potential of already having undermined Russian-Western relations, contributing, once the economy starts improving, to an arms build-up in Russia, and getting us back into a spiralling arms race.

Q58 Chairman: Mr Sherr?

Mr Sherr: The culpability of the Americans, in my view, over this is not that anyone for a second thought of this in an anti Russian context; it is that they did not think about Russia at all. This is a fundamental problem we have, because the Russians assume that we are central to their calculations even when we are not thinking about them at all. This is where I think our deepest problems lie. The senior Russian military have been deaf to argument about this issue as to many others. For them NATO is by definition an anti Russian alliance. To say that it has changed is like saying that a lion has become a vegetarian. They absolutely cannot take it seriously. There is a whole range of issues that matter to us profoundly where we find that it is simply not possible to have a discussion because they already know.

Q59 Mr Borrow: Are you saying that this is a US problem rather than a NATO problem, that US foreign policy and military focus is so much away from the European context that Russia just is not in the frame at all, whereas perhaps the rest of NATO that is European based does take a greater recognition of the Russian position?

Mr Sherr: I was not intending to say that. This originated as a US decision and it is part of a US global system. In the whole diversity of states that belong to NATO, obviously amongst many - not all - there is much more sensitivity and understanding of the Russian dimension. Within the United States there are departments of government and experts who are also deeply sensitive to that dimension, but they were not making the decision. Donald Rumsfeld's defence budget was making this decision.

Q60 Chairman: If BMD were to be abandoned, what message would that send to Russia?

Professor Light: I think it depends what you mean by abandoned. If you mean the particular deployments in Poland and the Czech Republic, then I think the message that might be sent was: "We understand your security fears and we take them very seriously." If you mean the abandonment of BMD development altogether, I do not believe that that would necessarily happen. In terms of ways in which we can co‑operate in the future perhaps, one of the ways forward might be that we develop BMD not on our own or not just in the United States but as a combined effort, a co‑operative effort.

Q61 Chairman: Mr Sherr, would it reinforce the view that you refer to in your paper, "the Soviet era belief that if you pound the table long enough, it will give way"?

Mr Sherr: Yes, there is a serious risk of this, but, again, we have put ourselves in a position where there are now no clean solutions and no good answers. I think the less bad answer would be if after proper consultation with the Czechs and the Poles President Obama deferred the decision and then launched the type of discussion at a serious level that Professor Light has alluded to. There have been such efforts up to now, but they have been sporadic. General Baluyesky, the former Chief of the General Staff, had been invited by the Americans to see the entire system, because they were convinced once he saw it he would realise there was no problem, and the political leadership in the Kremlin said no. But there has not been the kind of systematic effort needed to discuss with the Russians a joint system. That might produce some results, it might not. I think it is a matter of lesser evils.

Q62 Chairman: What would be the point of such a discussion if, as you suggest, the Russians already know what the answer is?

Professor Light: It would call the Russians' bluff, if that is what they are doing. That would be no bad thing, because if we had called their bluff they would have to modify what it is they say about it.

Q63 Chairman: Offering them the technology does not do that?

Professor Light: They keep arguing - and we heard this at Chatham House just last week - that to co‑operate with a radar station in Azerbaijan, for example, is closer to Iran, if BMD is meant to be against Iran. What I would like to see is taking them up on this offer and just seeing how far it goes.

Mr Sherr: There were sound military reasons, in my understanding, for the Americans and our own specialists to conclude that that would not have been sufficient, but I think your experts from the MoD will be able to answer that better than I can. I would say that it is questionable whether a joint system, a joint network, would require complete sharing of technology. It does not necessarily follow. We have Russian aircraft in our airspace that use avionics that are different from our own. But, again - and I think we are on the same page here - I have a sense of nostalgia, before we began any kind of arms talks, about simple fear of discussion and we found that only by having the discussion were we able to learn as much as we did and very often achieve our objectives far better than if we did not have it. I do not think we have any reason to fear negotiations and talking with the Russians about anything, if we are thoroughly prepared, we understand what we wish to achieve, we understand where they are coming from, what arguments they have, and what questions we need to pose to those arguments.

Q64 Mr Jenkin: Is not part of the way to resolve this for the Americans to offer the Russians a kind of "Superpower to Superpower" diplomacy that echoes the kind of Cold War summitry of yesteryear, respecting them as they want to be respected. But, secondly, in the final analysis, if Russia remains irrational about their opposition to BMD - and it is not a question of whether BMD works or does not work, it might not work very well now but it is going to work better as time goes on and will become more essential as more countries develop this kind of dangerous missile technology, it is going to become more essential to deploy it - what happens if it is eventually deployed against a kind of Russian, dare I say, paranoia that we are experiencing at the moment? What are the consequences for relations with the West at that point?

Mr Sherr: The one point I think I could answer with clarity is your first one. I think it would be very damaging on an issue involving Europe, and the potential stationing of military facilities in Europe, to have a discussion over Europe, say, that does not include NATO allies in Europe. You have correctly identified the Russian motivation in having such a discussion, but I question whether it is in our interests to have the discussion in that format.

Professor Light: I think the Russians would love it. I think the single most important Russian foreign policy aim is to be taken as seriously by the United States as Russia takes the United States. But I agree that this is not a precedent we should encourage, because Europe should be part of decisions that are made about Europe. On the question of what would be the consequences if it went ahead and deployed it, I would refer you back to the Cold War. After all, we did have missile defence during the Cold War, and the great breakthrough in arms control came with the ABM treaty and the agreement that each side would restrict the number of ballistic missile defence installations that it had so that each side would remain vulnerable to the other side, because that would create a kind of stability.

Q65 Mr Jenkin: That was before Iran, though, was it not?

Professor Light: If you foresee an Iran and several other Irans, I do not know what the answer is because I am not sure we could deploy enough anti ballistic missiles to deal with them all.

Q66 Chairman: I am interested that neither of you took Bernard Jenkin up on two words which he used: "irrational" and "paranoia".

Professor Light: I did not want to be rude.

Q67 Mr Crausby: You are allowed to be.

Professor Light: Since I have been explaining Russia to you, by definition you think I am irrational and paranoid as well. I do not think they are either. I think what they are is very old-fashioned ----

Mr Jenkin: BMD is not a threat to Russia. It cannot be a threat to Russia. This very limited number of inert warheads could not be a threat even to Russia's existing offensive military capability.

Q68 Chairman: What is your comment on that?

Mr Sherr: Chairman, in answer to your question, I prefer not to use emotive words when there is the possibility of expressing in concrete and specific terms what one means. I would say that, apart from the fact that the Russians do have what I have described elsewhere as a pre Cold War, pre-1940 view of things, what is disturbing is also the re-emergence of certain modes of thinking which from the time of Gorbachev until the late 1990s had been receding, at least at official level, and one is a conspiratorial view about absolutely everything. It is not confined there. I know very pro-NATO Ukrainians who also have a very conspiratorial view that whenever a US president gets into the room with Putin they are discussing matters at Ukraine's expense, and they do not even ask you, "Is it true?" but ask you "What do you think the terms were?" There are also issues of sentiment which are very strong. The Russians today have a very strong sense of what they call obida, of injury, humiliation or insult from the West, and now they have a feeling that they can do something about it and they want to show us: "We can do something about it.| I sat at a lunch at the Valdai Club with President Medvedev who, after Georgia, said in so many words: "We have shown you." He said in very specific terms - I have quoted what he said - "This is not your part of the world, you do not belong here. We are not going to tolerate it." If you go through these types of statements and the actions that go with it - many actions which surprised us, like the recognition of the two separatist entities in Georgia - it is up to you to decide how much of this is what one should call rational and how much is not. But I would also, to be the Devil's advocate, have to say that if one looked at the entire record of the last administration in the United States, every part of that analysis post 9/11 about the global war on terror and how one should proceed, is that the way someone without passion would look at that set of issues? I would not think so. Yes, irrational thought and sentiment very strongly influence Russia but they influence other players as well.

Professor Light: Perhaps I could add one thing about whether BMD does represent a threat or not. If you believe that something is being deployed which will reduce the efficacy of the missiles that you have to defend yourself or to launch an attack, then by definition this is going to be interpreted as something that affects your security. It is all very well to say they are only defensive, but even the defensive affects that level of readiness that the Russians felt that they had.

Mr Jenkin: They are too few to be effective.

Linda Gilroy: They see it as the thin end of the wedge.

Mr Jenkin: Yes.

Q69 Mr Havard: The question about what are the Russians and who are the Russians interests me. I have never dealt with them before and I am trying to understand. You say in your memo that they are harshly utilitarian about means and ends and yet at the same time they are highly sentimental and emotional. This might appear to produce an irrationality. That is a bit like the Welsh, so I understand that! But the point I am really trying to get at is who are these Russians. We are having a discussion and you say there are disconnects within their own system about whether their politicians are making decisions or their technocrats are making decisions. They appear a little like Iranians to me, in the sense that there is not necessarily one centre of power as to who you do this discussion with. Who are the Russians and with whom should we be having the various discussions about the various elements?

Professor Light: Who are the Russians? I see less of a disconnect, I think, than James does. Putin spent a log of time re-establishing what he called a power vertical, and he has taken part of that power vertical away with him from the Kremlin to the White House but there is absolutely no doubt in my mind that the decisions are made in the White House and in the Kremlin. Although there may be rogue elements elsewhere, almost by definition they are not going to be rogue elements that you will manage to talk to anyway. I really think that you have to concentrate on the authorities in Moscow, in the Kremlin and in the White House.

Mr Sherr: I fully agree with that answer. I am sorry if that confuses you. My example was very specific; namely that Russian technical experts in the NATO-Russia Council were on the same page with their NATO colleagues about ballistic missile defence, and many of them are at quite a junior level, colonel, one star and so on, so it is not surprising that there would be a disconnect. I was really faulting us, not faulting them, for not anticipating that at the political level and at the senior military level they would get a different answer. But I fully agree with Margot and I think the route of Putin's success has been not just the vertical but reconnecting the values and the persona of the state with the basic instincts and even impulses of ordinary people, and part of that means a very conscious effort, which I think has worked very effectively, to forge a synthesis between pre-Soviet, Soviet and post-Soviet values.

Q70 Mr Havard: If, as you say, it is possible to do a deal with a structure like that and come to an agreement, how do you incentivise the Russians to come to such an agreement?

Mr Sherr: That to me is the key question. With them, as with any relationship, it is impossible to do that unless both parties have respect for one another. When Russians today look at the divisions in the EU, when they look at what is clearly a disconnect here between, say, what the European Commission writes about energy policy and what it is done at a nation state level, I do not think they have respect for the European Union as a party they have to listen to when they see important interests at stake, as they did in Georgia, and I think with NATO increasingly that is becoming the same. That is very worrying. There is a pre-condition - it does not answer your question - that is restoring their sense that we are people who say real things and have the ability to do what we say and that today is missing.

Chairman: This is extremely interesting.

Q71 Mr Hancock: I am interested in this spire that Putin reconstructed. He did two things, did he not? He reconstructed the type of leadership that most Russians aspire to have; that is one person, very strong, leading their country. Historically it is what they have always had and what they feel they benefit from. He also reintroduced pride in Russia. He gave them self-esteem again. If missile defence is seen as a threat to Russia, should we not see Russia's rationalisation of Russian speaking peoples in these countries as a threat to us? A Russian in Latvia can get a Russian passport as easily as anything. Georgians, for example, who have a Russian background can get Russian citizenship immediately. Mr Putin and Mr Medvedev both said it, did they not, that they would defend Russian citizens anywhere they feel they are threatened?

Professor Light: Yes, not just Russian citizens but their defence goes further, to Russian speakers.

Q72 Mr Hancock: Yes.

Professor Light: Which is rather broader. Perhaps the most surprising thing in the whole of the disintegration of the Soviet Union was the fact that that issue played such a small role in the way in which everything disintegrated - after all, there are 25 million Russian speakers outside of Russia. I think, however, that what we should worry about is that Russia should not feel the need to defend them. If you like, if we want to be sure of those Russians living outside of Russia, we should be putting more effort into making sure that the life those Russians lead in the countries in which they live and the rights that they have in those countries are better than anything they might get if they ----

Q73 Chairman: Mr Sherr, then I want to bring in Brian Jenkins and then I want to move in because we are falling behind a bit.

Mr Sherr: Mr Hancock, there are really two aspects to your question. First, the implication is for the internal security of the newly independent states of this way of thinking, and I think Professor Light has characterised it perfectly as applying to Russian speakers rather than simply Russian citizens. For reasons of time I will simply say that there are large numbers of Russian speakers, because of the Soviet educational system, who in no way share the views or identify with the Russian state, and that is a very worrying distinction. The second issue which you raise, which is equally worrying - a large subject - is what are the implications for us in the UK of people who have been given Russian passports recently on a casual basis, residing in this country? - if I heard you correctly. That is a more complicated set of issues.

Q74 Mr Jenkins: On a few occasions now you have used phraseology and words that made me think about the difference of culture, the pride and the feelings of the Russian people, as against the feelings of the West, who used to have pride but now seem to have squandered it in pursuit of material goods and corruption. When we talk of these people, are we still using the same cultural values in debate and discussion, or are we slightly off the beam here? Are we not seeing the world through their eyes and they are never going to see the world through our eyes?

Professor Light: Edward had rather strong views about Western corruption and collusion. My views are not so strong. Yes, I think we are still talking to people like ourselves when we speak to Russians. I do not see this huge cultural divide. It is true that they have a new-found pride in their country but this seems to me to be perfectly natural, something, for example, that was not foreign in Britain, this sense of loss after the loss of an empire and a sense or regained pride. It does not seem to me in the Russian case to be that different.

Mr Sherr: Russia, in my view, is an integral and important part of our civilisation but there are differences in culture and there are now enormous differences in political culture. My way of characterising it would be to say that most Russians regard themselves as emphatically European but not liberal. The entire notion of Europe which has been developed, which is rights-based and based on the rights of the individual, is something that most Russians are agnostic about and, perhaps for good reason, sceptical about. And I will tell you why. In the 1990s, Western governments, with very little grasp of what was going on on the ground in Russia, were unequivocal in praising Yeltsin's system as a democracy and speaking about it in positive terms, whereas for the average Russian it was like going over a waterfall. It was a matter of economic anarchy. A Hobbesian reality existed there. When did the West begin, in discussions and publicly, to attack Russia for its retreat from democracy? Suddenly when people were at work and pensions were being paid and so on and so forth. I am not questioning our values at all, I am very rooted to them, but we need, as your question implies, to understand how others are hearing what we are saying. I think we have tended to be rather bad at this.

Q75 Linda Gilroy: You touched on energy security for a second time in relation to that "respect" word. What would an energy policy look like that would be the basis for a  respectful relationship between Russia and the EU?

Mr Sherr: I would agree with that word here and, funnily enough, I would say that the first targets of what needs to be an effort on our side to implement the laws and regulations that we have should not be Russian citizens but should be EU citizens in high places who it would seem would appear to have concluded a number of murky and untransparent deals in the energy sector. I think that, as long as they feel immune, as long as I can go to certain new Member States and sit at a table and be told by confidants of a prime minister or a deputy prime minister that X receives so much from this Russian company and Y receives that and nothing is done, and people express concern and they are afraid, we are not addressing that problem. I think the problem is becoming serious. When the Soviet Union was breaking up, a number of my Russian and Ukrainian friends said, "Watch it. You think you are going to be bringing your standards to us. What you are going to find is that the plumbing is going to go into reverse." If you spend time in a lot of eastern and south-eastern European countries, you will see the evidence of this.

Q76 Linda Gilroy: In fact the whole open, transparent, market-based approach of Europe on one very fundamental commodity is at risk through it.

Mr Sherr: It is very easy to erode that and it does have to be enforced. I personally do not think that Edward Lucas was exaggerating at all about the nature of the scale of the problem.

Q77 Mr Hancock: Countries are doing bilateral deals for themselves and ignoring what they have signed up to do in Brussels.

Mr Sherr: Exactly.

Q78 Mr Hancock: They do it themselves. The Italians, the Germans, the Poles, everyone has done it. The Russians know that the easiest way is to have a bilateral arrangement, and it seriously undermines the whole credibility.

Mr Sherr: We have done far less of it and a number of other states have done far less of it. I think we need, at a very professional level, across-Europe discussions about how we begin to turn this around. Until we do this, I think it is futile to talk about a sensible energy policy for Europe.

Q79 Mr Hancock: Absolutely.

Professor Light: I agree but discussion on energy security should begin at home. We should know what it is we want from one another within the EU or within NATO, as well as what we want from the Russians.

Q80 Linda Gilroy: You are referring to unresolved issues in relation to market liberalisation and energy in Europe.

Professor Light: Yes. Until we create some kind of European grid, which means that the Members of the EU are equally vulnerable or equally invulnerable, we will not get a unified policy on energy. Until we have that, we will have different interests.

Mr Jenkin: It might never happen.

Q81 Linda Gilroy: President Medvedev suggested the European Security Architecture last summer. What do you deem to be Russia's motives in proposing such architecture?

Professor Light: I think that it is going back to something that the Soviets first called for in the 1950s, which is a collective security agreement for Europe, which includes the United States perhaps but renders NATO redundant or superfluous. That I think is the prime motivation for suggesting it.

Q82 Linda Gilroy: It should be of concern to NATO for that reason?

Professor Light: This is one of the issues on which I think we ought to enter into negotiations with Russia in a very serious way. It is really only in the last few months that the EU has responded positively and President Sarkozy has responded positively. It seems to me that if Russia really is serious, then we ought to test them on it and see what they have in mind. What Medvedev suggested is still extremely vague. I have seen it described both as "Helsinki minus human rights" and as "Helsinki plus". I think we need to remind ourselves that ----

Q83 Mr Hancock: Plus what, though?

Professor Light: Plus more than human rights is the implication. I think we ought to remind ourselves that at the beginning of the Conference on Security and Co‑operation in Europe we did not know that there would be a basket of human rights that would be so influential in the way in which European security developed in the later years. I do not think we should dismiss it out of hand. I think we should run with it and see where it leads.

Q84 Linda Gilroy: Even if that allows for distraction from those very important economic and human rights, which are part of the comprehensive approach of the OSCE?

Professor Light: At the moment the OSCE is included in the invitation, so is NATO, as well as the CSTO, the United States. The last I saw, even China is invited. So, yes, I think we should run with it until we know it actually does derogate.

Chairman: Mr Sherr, you have some views on this, I think.

Q85 Linda Gilroy: Could I just ask Mr Sherr to embrace in that the reservations that are being expressed within the OSCE that this is posturing on the Russia's part, trying to get away with what it did in Georgia and to distract from the other very important work with which it is refusing to engage on election, the monitoring of their elections recently on human rights and so on?

Mr Sherr: The Russians have already established to their own satisfaction, whether we like it or not, that in overall security and foreign policy terms Georgia has been a success, that there has been no turning point in Western thinking, that it has simply reinforced the polarities and differences that exist inside the West. You originally asked about motivations. Apart from relativising NATO, as Professor Light indicated it is also about diminishing in practice the role of the OSCE, so part of this is to move us away from focusing on soft security issues which in the end is what the OSCE has done very effectively. It would surprise those in the 1970s, after CSCE was set up, to see how successful the organisation became in that area. Third, it is to find yet another forum that makes, as Mr Hancroft was saying earlier, the bilateral relationships more important than multilateral, because again the theme has come out that we want to see European countries come and negotiate as states not as part of the bloc. No one has said to them, "We in the UK have been investing a lot of energy in trying not to appear in negotiations simply as a state but as something called the EU and you are not acknowledging this." My last point is that I agree: I see no harm, with the provisos I have mentioned about being well prepared, in sitting down and testing their ideas, which are extremely vague. There is no contradiction between taking measures to strengthen NATO on the one hand and sitting down and testing their ideas and teasing these things out on the other.

Q86 Mr Jenkin: Is Russia really trying to help us in Afghanistan? If they are, why is Russia being so unhelpful with Kyrgyzstan and the base at Manas?

Mr Sherr: There is more than a Russian factor involved in Kyrgyzstan. There is a large rise of Islamist sentiment there, believe it or not. The climate has changed considerably. I think that from the Russian angle, to the extent they can manage this, it is something of a bargaining chip. It is a way of saying to an incoming administration: "You need us in Afghanistan and Iran but we have our interests, particularly in Ukraine. Are you willing to talk to us on what we regard as a level playing field?" - meaning, are you willing to do a big geopolitical deal. That discussion is also taking place in Russia. I think that what we are seeing is very well timed and that is the reason for it.

Q87 Mr Jenkin: Does Russia want to help us in Afghanistan or is it just a chip?

Mr Sherr: I have no doubt in my mind they do not want the Taliban to resume control of all of Afghanistan but that does not mean that they would like to see the Taliban defeated in a way which does credit to NATO. I think the situation where there is no victory and no defeat is one which suits them very well and the internal effects on NATO also suit them very well.

Q88 Mr Jenkin: You mentioned Iran, if I may draw you on that. At what stage does Russia begin to realise that they are creating a threat for themselves by giving so much support to Iran?

Mr Sherr: I think they look at it in a different way. Yes, they do not want the Iranians to have a nuclear weapon, but their biggest priority is for both economic reasons and geopolitical reasons to remain Iran's friend under almost any conditions, and their view is: "If Iran is to have a nuclear weapon we would rather have a good relationship with Iran than have a bad relationship with Iran."

Professor Light: I agree with that. I think they do not want Iran to have nuclear weapons, and they do not want to lose the deals that they do with Iran, and I think that the commercial relationship in fact is going to become more important, because of the poor economic climate in Russia at the moment, rather than less important.

Q89 Mr Borrow: It would be useful for the Committee to get your views on the effects on Russian foreign and defence policy of the economic problems that Russia is having now. Do you feel that it would make a difference or will Russia essentially remain in the same position?

Professor Light: I think it is likely to have a very severe effect on Russia. After the Georgian war, for example, Medvedev announced a series of very serious military reforms and modernisations that were absolutely essential for Russia within the next two to three years. I can see that it is more than likely that they will not be able to afford those programmes. Similarly the professionalisation and modernisation of the Army which has taken so long to even get started is enormously expensive, and I think that it is likely to suffer. The other thing is that the costs of North Stream and South Stream are rising, the need for the renewing of energy infrastructure in order to be able to provide the oil and gas pipelines with sufficient volume to make them commercially viable is very great, and I think that the economic climate is going to make it very difficult for them to keep up with any kind of programme.

Mr Sherr: I think the effects will be severe but will continue to be paradoxical. The implications for the defence budget are exactly, in my view, what Professor Light described, but the impetus and much of the animus in the whole recent gas crisis in Ukraine was also influenced by the financial crisis, because it also makes the Russians now much more concerned to press their comparative advantage where they have it. The impact of the economic crisis on Russia is deep; on Ukraine it is dire. They are going over the cliff. Russia wants the pipeline system taken out of Ukraine's hands. They would like Europe to understand: "Your only real source of getting these imports of gas is from us," and precisely because money is scarce for North Stream and South Stream, precisely because when they had the money they did very little to repair their energy infrastructure internally, they want us to understand that it is in our interest to come up with cash to help them and to provide political support for what they want to do, which they now describe as an energy union between Russia and Europe - no middleman, just Russia on one side and Europe on the other.

Q90 Mr Borrow: They are essentially saying they have a window of opportunity before Western Europe can develop alternative sources of energy and, therefore, during that period they are going to take maximum advantage despite the economic difficulty.

Mr Sherr: I think they will try to screw down everything they can, precisely because they are under pressure. That makes the timelines shorter than they would otherwise be.

Q91 Mr Hancock: That does not make them any different from anybody else in that position, does it?

Mr Sherr: But I do not know of any other country where it is impossible to distinguish the leading energy companies from the state itself.

Q92 Mr Hancock: What did the Arabs do to us in the 1970s then?

Mr Sherr: That is not different, but that was a very worrying situation ----

Q93 Mr Hancock: Yes.

Mr Sherr: -- and we all of course remember that even when President Carter came to power the first plan on his desk was a set of contingency plans for military operations against Saudi Arabia precisely because that was so serious. The fact that there have been other countries and there continue to be other countries that pose very serious problems to us in terms of energy does not diminish the seriousness of the problems posed by Russia.

Q94 Linda Gilroy: Is there any perception in Russia of the impact which thinking on climate change and energy is having in our country particularly, but in other European countries, and the time scale over which there will be a move to low or zero carbon economies?

Professor Light: Very little. There are words but very little understanding. Certainly it is not nearly so prominent a debate in Russia as it is here, so very little understanding.

Mr Sherr: I agree.

Q95 Chairman: I have found that an absolutely fascinating session. We are most grateful to all three of our witnesses, even though Edward Lucas has gone. Thank you both very much indeed. We have very much enjoyed it.

Professor Light: Thank you for inviting us.

Mr Sherr: Thank you.