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The One Belt, One Road, Putin, and Khürelsükh: the main points and relevance of the conversation

Boris Kushhov, October 31

Putin and Khürelsükh

On October 17, 2023, Russian President Vladimir Putin met with Mongolian counterpart Ukhnaagiin Khürelsükh. The meeting took place on the sidelines of the 3rd Belt and Road Forum in Beijing. This meeting was attended by ministers from both nations, transportation ministers, the Vice-Premier of the Russian Federation, the head of the Russian Economic Development Ministry, and the CEOs of three significant Russian corporations: Russian Railways, Gazprom, and Rosneft.

The meeting resulted in joint statements by parties in which they were willing to build on the comprehensive strategic relationship they had established a few years prior (specifically, in 2019).

During this dialogue, the Mongolian side emphasized the topic of the two countries’ trade imbalance, which has been a source of concern for many years. This topic, one of many covered during the three-hour conversation, is referenced more than any other in Mongolian media and official portals.  Despite significant increase in the absolute level of bilateral trade – the two sides have acknowledged a close approach to the $3 billion figure predicted in prior forecasts – Russia’s exports to Mongolia continue to outnumber Mongolia’s exports to Russia. Because the Mongolian side aspires to fully utilize its northern neighbor’s vast and solvent market and diversify its external supplies, this circumstance drives the Mongolian leadership to seek opportunities to realize its foreign trade ambitions during bilateral discussions. Mongolia specifically hopes to accomplish these goals through advocating for initiatives to lower customs taxes and streamline phytosanitary and other requirements for exports from Mongolia to Russia.  The perspectives of the parties were noted by Vladimir Putin and Ukhnaagiin Khürelsükh during their bilateral meeting, and it is anticipated that the topic of equalization of trade turnover will be further developed at future sessions of the Russian-Mongolian Intergovernmental Commission.

During a regular discussion on the state of affairs at the Mongolian Russian joint stock company Ulaanbaatar Railway, which is a joint Russian-Mongolian venture, the Russian side presented the argument that every new project must be economically profitable. This thesis was presented in response to the Mongolian side’s proposals to take part in the financing of the Bogdkhan Railway project, which is a branch railroad that bypasses Ulaanbaatar. The Russian side estimates that the implementation of this project is extremely unlikely to result in financial gain for the enterprise. The plans for the western and eastern railroad corridors—which the Mongolian side has suggested—to link China and Russia through Mongolian territory were also discussed.

The president of Mongolia expressed gratitude to the Russian side represented by President Vladimir Putin for observing the promise to provide the nation with uninterrupted fuel supplies. Vyacheslav Volodin, Speaker of the State Duma, recently visited Mongolia, and his counterpart Gombojav Zandanshatar obtained guarantees that the fuel export limits would not affect Mongolia, as Mongolia is a friendly state with Russia.

The Mongolian project to build Egiin Gol hydropower plant on a large tributary of the Selenga River, which could exacerbate the environmental situation in the Baikal region, also received new attention. The parties agreed to carefully examine the project’s chances even if the Mongolian side did not pledge to quit it in the event that the project’s environmental risks were confirmed.

One should not ignore the broader regional context of the meeting between the leaders of Mongolia and Russia. The president of Mongolia also had discussions with Chinese President Xi Jinping, as it happened on the sidelines of the Belt and Road Forum in China. During their meetings with their Chinese counterparts, presidents Khürelsükh and Putin learned the Chinese side’s position on specific issues on the trilateral cooperation agenda. This is a key development in the bilateral negotiations. These include initiatives related to the China-Mongolia-Russia Economic Corridor, such as railroads and transit highways, as well as a gas pipeline that passes through Mongolia to connect China and Russia. Promising remarks were made about these initiatives during the Russian-Mongolian summit. According to the Russian president, the three parties have similar opinions about the gas pipeline project, and it is now up to the three nations to carry out the project. Concurrently, during their bilateral meeting, China and Mongolia signed an agreement for the construction of Shivehuren-Sehe railroad checkpoint, which is anticipated to be utilized in the trilateral transit routes of the corridor. A loan agreement was also signed for the construction of the Erdeneburen hydropower plant in Mongolia, which does not cause as much environmental concern on the part of Russia as the Egiin Gol project.

Following the discussion, President of Mongolia Ukhnaagiin Khürelsükh extended an invitation to his Russian counterpart to visit his country in 2024. There has been a pattern in bilateral relations in recent years. It has the potential to become a positive tradition – The Russian president pays a visit to Mongolia on the anniversaries of the two nations’ victories over Japanese militarists at Khalkhin Gol. Putin’s visits to Mongolia in 2014 and 2019 fell on the 75th and 80th anniversaries of this momentous win for both Russia and Mongolia. Let us hope that the 85th anniversary will be commemorated by a fresh visit, and that this pattern will have already turned into a good eternal tradition, becoming a new emblem of friendship between the two peoples—eternal neighbors.

The meeting was held in a best possible friendly atmosphere and concluded with a fruitful discussion of the broad front of interaction between Russia and Mongolia. All of the key remarks, however, imply that meaningful developments in the two countries’ relations should be anticipated later on. This includes the Intergovernmental Commission’s work and the now-likely upcoming visit of the Russian president to Mongolia in the upcoming year.  One other significant “meaning” of the meeting was that, on the sidelines of the Belt and Road Forum, China, Mongolia, and Russia consistently exchanged views about the prospects for the trilateral economic corridor’s projects to be implemented, albeit in bilateral formats. It used to take place on the sidelines of SCO summits, but the parties were unable to discuss cooperative projects in the context of a trilateral conference because of SCO summit 2023’s “long-distance” format. One may argue that this year’s trilateral leaders’ meeting on the sidelines of SCO Summit has been somewhat supplanted by the three bilateral discussions held during the Belt and Road Forum.

 

Boris Kushkhov, the Department for Korea and Mongolia at the Institute of Oriental Studies of the Russian Academy of Sciences, exclusively for the online magazine “New Eastern Outlook”.

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