It has been reported that Russia has demanded US $3.5 billion from India for the aircraft carrier, Gorshkov, which is currently undergoing repairs. This is the second time that Russia has sought a price increase from the original contracted amount of $1.5 billion. Given the hike in its price and the further delay in the date of delivery, the deal has naturally attracted comment, with some people even questioning the very wisdom of having gone for the ship.

President Bush will host the first ever financial summit of the G-20 on November 15, 2008 in Washington to discuss the current global financial crisis which threatens the economic and political stability through out the world. The crisis comes on the heels of an economic crisis in the global economy in the first half of 2008 which was characterised by a record level of oil prices, global food shortages, high inflation and rising inflation in most countries.

Georgia was a constituent republic of the former USSR. In 1991, the dissolution of the Soviet Union led to the independence of Georgia. In turn, the autonomous regions of Georgia, namely South Ossetia and Abkhazia, attempted to break away from Georgia, resulting in civil strife in the early Nineties. These conflicts were settled with Russian involvement with the United Nations Mission in Georgia deploying in a peacekeeping role in Abkhazia and a Russian peacekeeping force deploying under a Joint Control Commission in South Ossetia.

The Russian military blitzkrieg to counter the Georgian President Mikheil Saakashvili’s dispatch of his Israeli and US trained and equipped forces to retake the breakaway region of South Ossetia on August 7, 2008 took many by surprise. Moscow brazenly took the war straight into the Georgian heartland routing the Georgian forces in South Ossetia and expelling them from the other main Georgian separatist region of Abkhazia.

The Russia-Georgia conflict has caused several analysts to state that Moscow’s main goal was to ensure its energy dominance in the region. Though this may not be entirely correct – other Russian security interests were equally at play – energy issues did have a large role. Ever since Vladimir Putin took over the reins, he had time and again reiterated the importance of energy in Russia’s regional, and indeed its global, policy. It is well known that Moscow will not allow its supremacy to be compromised. Putin’s successor Dmitry Medvedev appears to be continuing with his mentor’s policy.

The August 28 SCO summit in Dushanbe will be viewed with keen concern by most international watchers. It comes on the heels of China’s successful conduct of the Olympics and Russia’s military assertion in Georgia. Both Russia and China have been keenly nurturing the Shanghai Co-operation Organisation as an exclusive nucleus to undercut the US strategic outreach.

Russian military operations in Georgia and the finalisation of agreement between the US and Poland on the stationing of missile interceptors in Poland are two developments that are likely to have far-reaching but adverse impact on Russia’s relations with the West.