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Russian Jets on the Prowl as MH17 Probe Pushes On

By Daria Marchak, Volodymyr Verbyany and Milda Seputyte
August 01, 2014 2:06 PM EDT 285 Comments
Russian President Vladimir Putin speaks during a government meeting in Moscow, on July 30, 2014. in Moscow.
Photographer: Sasha Mordovets/Getty Images
Russian President Vladimir Putin speaks during a government meeting in Moscow, on July 30, 2014. in Moscow.

Former Soviet states from Ukraine to the Baltics said they were menaced by jets from neighboring Russia as fighting continued near the site where investigators arrived to probe the downing of Malaysian Air (MAS) Flight MH17.

NATO jets were scrambled from a Lithuanian air base at about 9 a.m. today to “identify” Russian aircraft “flying without a pre-agreed schedule” in neutral waters near Estonia, according to a spokeswoman for Lithuania’s Defense Ministry, Viktorija Cieminyte. The Defense Ministry in Kiev said it downed a Russian drone on Ukrainian territory, one of several aircraft to violate the country’s airspace since yesterday.

Ukrainian officials said more than 100 experts, mainly from the Netherlands and Australia, finally arrived at the site where MH17 was blown out of the sky in rebel-held territory more than two weeks ago, killing all 298 people on board. The U.S. and Ukraine say the Boeing Co. (BA) 777 was most likely brought down by a missile fired by pro-Russian insurgents, which both Russia and the rebels deny. U.S. officials said today Russia has about 10,000 troops on the Ukrainian border.

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“During the last 24 hours, terrorists fired on the checkpoints and positions of Ukrainian forces in a number of cities and villages,” Andriy Lysenko, a spokesman for the Ukrainian military, told reporters in Kiev. “Part of the shelling came from Russian territory.”

Human Remains

The team of experts arrived at the heart of the disaster site at 11:30 a.m. local time, four hours after they left the regional capital Donetsk, Pieter-Jaap Aalbersberg, head of the recovery mission, said in a statement.

Standoff in Ukraine

“A number of human remains were found” near a chicken farm in the village of Grabovo, where the bulk of the fuselage came down, Aalbersberg said. Those will be refigerated and sent to the evacuation center in Kharkiv, from where they’ll be flown to Amsterdam. Some personal belongings of the victims were also recovered, according to the statement.

The recovery effort will include four teams of about 20 experts each over the weekend, with a fifth team joining the search on Sunday or Monday, when divers and specially trained dogs may be deployed, Aalbersberg said. It will take weeks to complete the search.

Russian Missiles

Russia is deploying Grad rocket systems and continues to build up artillery positions near the border, according to Lysenko. The Defense Ministry in Moscow declined to comment. The Interfax news service cited unidentified officials as saying Russia plans to call up military reservists for training at least through October. Scheduled maneuvers that began near Ukraine today included about 30 helicopters and 300 pilots, according to Zvezda, an army website.

Presidents Barack Obama and Vladimir Putin spoke by phone about the deepening crisis today.

Obama “reiterated his deep concerns about Russia’s increased support for the separatists,” the White House said in a statement. The Defense Department is proposing to allocate $19 million to train Ukrainian troops starting next year, Rear Admiral John Kirby told reporters today.

Putin said the sanctions imposed against Russia by the U.S. and its European Union allies have done “serious damage” to international relations, the Kremlin said in a statement. Both sides stressed the importance of establishing an “immediate, sustainable cease-fire” to begin peace talks, according to the Kremlin.

The leaders spoke as skirmishes between pro-Russian separatists and troops from the central government continued in the mainly Russian-speaking regions in east Ukraine. An assault by 150 rebels backed by three tanks near the city of Shakhtarsk left 10 government troops dead and 13 wounded, Lysenko said.

More Deaths

In the city of Luhansk, one of the main population centers of the rebel-held areas, five civilians were killed and nine wounded in the past 24 hours, according to the local council. The city of more than 400,000 people is on the verge of a humanitarian catastrophe because it has no electricity, water supply or mobile phone coverage, it said on its website.

Ukrainian President Petro Poroshenko, who was elected after his Russian-backed predecessor, Viktor Yanukovych, was deposed after months of protests in February, gave interviews today to five Ukrainian television stations, which are being broadcast at intervals this evenin.

Putin, speaking at the opening of a monument to the soldiers of World War I in Moscow, said earlier today that tragedies worldwide are caused by the ambitions of leaders and called for peace.

Russia has repeatedly denied any involvement in the conflict. The U.S. and its European Union allies, though, blame Putin for failing to rein in the insurgency and stop the war, which has already claimed more than 1,000 lives.

‘Substantial Problems’

The EU yesterday blacklisted state-run Russian banks OAO Sberbank, VTB Bank (VTBR), Gazprombank, Vnesheconombank and Rosselkhozbank, barring them from selling shares or bonds in Europe as punishment for Putin’s policies in Ukraine. That’s part of the 28-nation bloc’s deepest sanctions yet, announced July 29, that includes restrictions on the exports of equipment for Russia’s oil industry and curbs on arm sales.

While the measures create “substantial problems” for Russian banks, they are “unlikely to significantly alter,” the Kremlin’s policy in Ukraine, Mujtaba Rahman, an analyst at Eurasia Group in London, said by e-mail.

“The likelihood of continued Russian actions in support of the separatists make additional level 3 sanctions probable this fall,” Rahman said.

G-7 Penalties

Group of Seven countries will vote against approving new World Bank projects in Russia as punishment over Ukraine, according to three government officials with knowledge of the agreement. The action, which puts at least $1.5 billion of possible projects at risk, was decided by deputy finance ministers from the G-7 during a conference call last week, according to two of the officials, who spoke on the condition of anonymity because the call wasn’t public.

The World Bank will have trouble getting approval for projects in the face of opposition from the G-7, which has more than 40 percent of votes on the bank’s board, said Scott Morris, a former deputy assistant secretary for development finance and debt at the U.S. Treasury Department.

“It will be very difficult for management to contemplate proceeding with anything that requires board approval,” said Morris, a senior associate at the Center for Global Development, an aid research group in Washington.

To contact the reporters on this story: Daria Marchak in Kiev at dmarchak@bloomberg.net; Volodymyr Verbyany in Kiev at vverbyany1@bloomberg.net; Milda Seputyte in Vilnius at mseputyte@bloomberg.net

To contact the editors responsible for this story: Balazs Penz at bpenz@bloomberg.net Brad Cook, Paul Abelsky

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