Russia has delivered $450 million in loans and grants to the cash-strapped government of Kyrgyzstan, a key component of an aid package that the Kremlin promised to the Central Asian country when Bishkek announced it was evicting U.S. troops from an air base earlier this year.
The arrival of the money could complicate U.S. efforts to persuade Kyrgyzstan to reverse its decision to kick U.S. troops out of the country. Russia has promised a total of $2.15 billion in aid to the Kyrgyz government, and, although Russia and Kyrgyzstan say the eviction and aid package aren't linked, U.S. officials believe that it is.
Russia's Finance Ministry confirmed Thursday that it transferred $300 million this week to Kyrgyzstan in the form of a low-interest loan that will be used "for support of the Kyrgyz economy."
Russia disbursed another $150 million grant to Kyrgyzstan's central bank several weeks ago, the Kyrgyz embassy in Moscow said.
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An official close to the situation said Kyrgyz officials had worried that Moscow was balking at delivery of the aid but that they had "calmed down" with the latest transfers. The Kyrgyz embassy said Bishkek was confident Moscow will fulfill its promises. Facing a sharp drop in budget revenue and declining reserves, the Kremlin is planning to cut back some domestic spending, but is continuing to offer financial aid to its former-Soviet neighbors.
The U.S., whose troops must leave by the end of August, has said it is still talking to the Kyrgyz government about prolonging its lease on the air base in Kyrgyzstan, which is the main hub for ferrying troops and equipment into Afghanistan.
The Kyrgyz government has said the eviction decision is final. Earlier this week, Kyrgyzstan's prime minister denied any official talks are underway.
The first tranches of the Russian aid package are important to Kyrgyz President Murtanbek Bakiyev, who faces an election contest in July.
While Bakiyev controls most of the media and his political opponents have been weakened by arrests and disappearances, his popularity has been hurt by the slackening of the country's economy. Kyrgyzstan, a land-locked mountainous republic, has few natural resources and has lately been plagued by high unemployment and power shortages.
The aid arriving from Russia in recent weeks comes with few strings attached, and most of it will likely be used for general support to the government budget.
Russia has also promised to invest $1.7 billion in a massive hydroelectric project that would make Kyrgyzstan a regional power exporter. Kyrgyz officials say it may take years for that project to come to fruition, however.