The Highway From the Soviet Past

The implementation of the Stalin project puzzled Washington

“Russian Railways” has approved an investment program of 100 billion rubles for the construction of a Northern Latitudinal Passage more than 700 kilometers long. The deadline for putting the highway into force has been confirmed – 2025.

The laying of the track officially started in 2012, but until mid-2018 there were more breaks than construction work. And yet by autumn 2019 about a third of this strategic highway from Salekhard to Korotchayev was built. However, more than half are restored sections of the Trans-Siberian Railway, built in 1948-1953.

The Northern Latitudinal Passage was mothballed two weeks after Stalin’s death since it was allegedly inopportune. This delayed for decades the complex socio-economic development of the Northern Trans Urals and Siberia, including the port infrastructure of the North Sea Route. The highway has obvious importance both for strengthening the military security of the country and for the development of various resources of the Russian Arctic, strengthening our geopolitical positions. In the future it is planned to extend the Northern Latitudinal Passage to the Sakhi (Yakutia), the ports of Taymyr and the Sea of Okhotsk, which were also laid down in the Stalin project.

The factor of the Northern Latitudinal Passage, which is significant, has seriously worried the Americans. They draw a parallel to Stalinist industrialisation, according to the Wall Street Journal: “Over the next five years, the government plans to spend huge sums to build dozens of bridges, ports, and transport facilities, including the Northern Latitudinal Passage, a revived railway first laid decades ago”. And further:… “the construction of the Northern Latitudinal Passage was started under the policy of forced industrialisation under Joseph Stalin. This highway, originally intended for polar military bases, was abandoned shortly after Stalin’s death. It is now being revived to serve including huge gas fields in these locations.”

How the United States is afraid of everything related to Stalin’s policies…

Why Far North?

The Fifth International Forum “Arctic – Territory of Dialogue” has completed its work [in late April 2019 – ed]. In two days 33 sessions were held in St. Petersburg on three main tracks: “Coastal territories”, “Open ocean”, and “Sustainable development”, as well as 11 events under the youth day program. According to preliminary data, the forum concluded 30 agreements for a total amount of about 70 billion rubles.

The Arctic is undergoing rapid change. This is primarily changing weather patterns, which, on the one hand, remains a serious common challenge and, on the other, provides new opportunities for the use of the Northern Sea Route (NSR) and the development of hydrocarbon and seafood technologies. All of this contributes to infrastructure modernisation and investment in the region.

According to Vladimir Putin, who spoke at the plenary session of the forum, a new strategy for the development of the Russian Arctic up to 2035 will be adopted in the near future, which should combine the activities of national projects and state programs, investment plans of infrastructure companies, and programs for the development of regions and cities. According to key socio-economic indicators, according to the quality of life of people this mega-region should reach a level no lower than the average Russian.

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The Ministry for the Development of the Far East and the Arctic has been given the functions of formulating and implementing state policy and legal regulation in the social and economic sphere on the entrusted territory.

Special attention was paid at the forum to the development of transport and other support infrastructure. This is the Northern Latitudinal Passage, which will allow to start effective development of natural riches of the Polar Ural and Yamal, and in the future the north of the Krasnoyarsk region.

Northeast Passage as a commodity

Several meeting sessions were dedicated to the development of a global transport corridor including the Northern Sea Route. The President has a strategic task to ensure its smooth year-round work. The development of the NSR began in 1932, when it was passed in one navigation by a Soviet expedition led by Otto Schmidt on the ice-breaker steamship “Aleksandr Sibiryakov”. The record of freight transportation in the USSR on the Northeast Passage was set in 1987 – 6.5 million tons. This figure was exceeded by Russia only after 19 years, and in 2018 it reached 20 million tons.

The new approach to the functioning of Northeast Passage consists of a significant increase in the volume of its cargo transportation with the parallel development of Russian Arctic territories as support zones. Presidential Decree No. 204 “On National Goals and Strategic Tasks for the Development of the Russian Federation for the Period up to 2024” requires that the cargo flow through the NSR be increased to 80 million tons. This requires a lot of work to be done in a short period of time. The state corporation “Rosatom” accepted the functionality of the unified infrastructure operator for NSR.

First of all, this is about the development of the ice-breaker fleet. Currently, there are eight linear ice breakers in the water area of the NSR: four nuclear (“Yamal”, “50 Years of Victory”, “Taymyr”, “Vaygach”) and the same amount of diesel-electric, which is clearly insufficient to ensure navigation.

The construction of a new super-powerful nuclear vehicle “Lider” is planned at the Far East “Zvezda” plant. Its purpose is year-round building of NSR ships with an ice thickness of more than four meters. It is the only ice breaker of its kind in the world. Ice class vessels for “Rosneft”, “Gazprom“, “Rosmorport”, “Sovkomflot”, and “Novatek” are also being built there. By 2035, Russia’s Arctic fleet will have at least 13 heavy linear ice breakers, including nine atomic ones. Measures are being taken to further improve navigation and hydrographic support, as well as the safety of navigation on NSR routes. Meteorological, hydraulic, and ice services, promising radio communication directions for rescue operations, and unmanned aerial vehicles for monitoring and ice exploration are being developed and introduced.

The aim is to make the Northern Sea Route safe and profitable for shippers, attractive in terms of both service quality and price. In particular, the payment for ice-breaker support for ships should be competitive and reasonable. The state invests in this sphere to minimise the tariff burden on carriers and businesses. In the long run, the Northern Sea Route should become part of a global transport corridor from Asia to Europe.

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In order to bring it to full capacity, significant efforts will need to be made in order to develop the entire coastal and communications infrastructure. It is planned to modernise the port facilities of northern Russian cities, ensuring the possibility of transporting cargo from them along the river-sea route. To date, from the 71 ports on the NSR route, 66 have a load of less than 100,000 tons or are not functioning at all. The berths of most Arctic ports require major repairs and deepening of the bottom in order to receive modern vessels.

The urgent problem for the Arctic is the removal of the garbage and waste that has accumulated here. Systematic clean-up work has been under way since 2012. Since then, it has been possible to remove and dispose of more than 80,000 tons of various wastes that have been accumulated in the Arctic during decades of previous industrial and economic activity in the region since the pre-war times. In the next few years, in the implementation of the federal project “Clean Environment” in the Arctic, it is planned to completely eliminate six major objects of accumulated environmental harm located on the territory of the Murmansk and Arkhangelsk regions, as well as in Kareliya, Yakutiya, and on the territory of the Nenets Autonomous District. In addition, the plans include the cleaning of the water area of the Kola Peninsula, where it is planned to clean up more than 200 square kilometers of the sea surface.

In order to increase investment in the Arctic region, Russia intends to use all investment support tools for launching new projects. First of all, we are talking about preferential income rates, a reduction in coefficients on mineral extraction tax and the application procedure for the reimbursement of value added tax, the simplification of the provision of land plots, and unchanged conditions for the implementation of investment projects. For this purpose, it is planned to draft and adopt a special federal law on a special system of preferences in the near future. According to the Ministry of Natural Resources, by the middle of the century about 13.5 trillion rubles will be invested in the Arctic, 5.5 of which are planned to be obtained before 2024. A significant part will be provided by extra-budgetary sources. The region accounts for about 10% of all investments in our country.

In the foreseeable future, the main incentive for Arctic development will be economic projects in northern Russia such as Yamal LNG or Arctic LNG-2. It is important to more actively involve our closest partners in the EAEU.

The Shelf is ours

Changing weather patterns draw the attention of the world community to the emerging new resource and logistics opportunities, which naturally led to the intensification of international contacts at various levels. Today, the Arctic is a territory of low political tension and the successful development of multilateral cooperation. The level of militarisation of the region does not go beyond reasonable sufficiency.

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Russian Foreign Minister Sergey Lavrov said at the forum that there is no potential for conflict in the Arctic; all issues arising here can and should be resolved politically, at the negotiating table. In order to strengthen mutual understanding and confidence, it is necessary to restore fully-fledged military-political dialogue. The annual meetings of the Chiefs of General Staff of the Armed Forces of the member states of the Arctic Council were an effective mechanism for maintaining regional stability. Unfortunately, since 2014 the practice of holding them has been frozen. In order to resume joint work at the forum, it was proposed to establish contacts at the level of military experts of Arctic states as a first step. This is especially true against the background of NATO military activities in the polar regions.

It should be noted that in the future international risks in the Arctic may increase if political tensions in Russia’s relations with the West continue.

One of the most important topics discussed at the forum is the recognition by the international community of the affiliation of part of the Arctic territories with the Russian continental shelf. So far, the decision has been interim. On April 3rd 2019 the UN Sub-commission recognised the geological affiliation of part of the Arctic territories with the continuation of the continental shelf of Russia. The final decision will be taken at the 49th session of the UN Sub-commission. So far, everything is heading towards the fact that the area of the Russian shelf will be able to increase by 1.2 million square kilometers. However, it should be borne in mind that in the event of a sharp deterioration in the international situation, a positive decision on this issue is unlikely to be fully possible, and it is necessary to prepare for such a possibility.

In the middle of the second decade of this century, the activities of states in the Arctic direction were limited by the sanctions of the United States and EU countries against Russia. This has a negative impact on the maintenance of stability in the region and, moreover, has led to a reduction in the number of promising economic projects, both Russian and European. Thus, the sanctions demand to stop providing services necessary for deep-sea oil exploration and production, work in the Arctic and shale oil fields, including drilling and testing wells, as well as their geophysical exploration. The list of equipment that will require prior approval includes up to 30 products for the oil and gas industry. However, sanctions open up opportunities for import substitution.

Minister of Natural Resources and Ecology Dmitry Kobylkin allowed the possibility of foreign companies working on the Arctic shelf. This should be perceived positively, albeit with reservations. Companies should have the appropriate experience, technology, and finance. Given the importance of the Arctic, such a decision should be enshrined in the form of a law.

Valery Zhuravel, Igor Leonidov

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