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Gaidar glimpses silver in the Russian clouds

DESPITE dire warnings that the ousting of Yegor Gaidar as prime minister by conservatives in Russia means the end of the great free-market experiment, the signs are that the opposite is true. So says a man who should know, Mr Gaidar himself, the 36-year-old economist whom President Boris Yeltsin was forced to let go last December.

On a trip to London and Paris last week - his first trip abroad since he was replaced - Mr Gaidar expressed support for his successor, Viktor Chernomyrdin, a former oil industry bureaucrat.

Although Mr Chernomyrdin's first moves had worsened Russia's 25 per cent a month inflation, 'the government was efficient enough to recognise its mistakes', he said. 'It abandoned the idea of price controls and has taken sensible measures on taxation while it has remained consistent on privatisation.'

In an interview in Paris, it was easy to see why Mr Gaidar, now head of an economic institute but still a Yeltsin adviser, inspired confidence in organisations such as the International Monetary Fund, which backed his policies.

Laughing frequently, he goes straight to the issues, in a simple and jargon-free conversational style that is especially easy on the ear after the self-important, substance-free incantations that were for decades the trademark of those who ran his country. His removal from office seemed to have left no bitterness. 'I am only 36 and life is long,' he said.

Looking back on a year in government after the collapse of the Soviet Union, and six months at its head, he said 40,000 privatisations had been carried through compared with about '120 shops' in the six years of Mikhail Gorbachev's perestroika. After privatisation, the main achievement was to 'demilitarise' the economy. 'The military had the best specialists, the best materials and the best equipment,' he said. Last year, Russia cut military purchases by 62 per cent to trigger 'a drastic structural change' and prompt the production of new goods.

As for agriculture, he was 'not terribly satisfied' but, even there, 200,000 new plots had been distributed to farmers and the total was rising at the rate of 9,000 plots a month. The priority over the next seven to nine months would be to slow the fall in industrial production after an 18.5 per cent drop last year, partly provoked by cutting military orders.

Mr Gaidar said he did not believe that a social explosion was on the horizon. Polls carried out for the government showed that 'the population understands something needs to be done and is cleverer than the intelligentsia thinks'. Hardliners could only get 5,000 demonstrators out on the streets of Moscow or St Petersburg and the number of strikes had been low over the past year, he said.

Mr Gorbachev 'constantly threatened a social explosion, which to a large degree made the union collapse and by which he showed himself to be politically bankrupt,' Mr Gaidar said.

'It is difficult to over-estimate what he did for freedom and democracy,' Mr Gaidar added, but his economic policies 'led the country to catastrophe'.

The autumn that followed the failed August 1991 coup against Mr Gorbachev was a time of 'a complete political vacuum with nobody managing the economy, there was no sensible policy'. Only the breakup of the Soviet Union in December of that year brought 'the restoration of some control' in Russia.

The greatest threat to the Russian government came from the nationalist hardliners. There were parallels between the hardline opposition faced by Mr Gorbachev and now by Mr Yeltsin, but 'in essence, they are very different. Gorbachev paid for being indecisive, Yeltsin is paying for being decisive'. While the hardliners were not dominant, Mr Gaidar said, it was important not to underestimate them.

Mr Gaidar said he sympathised with calls for early elections to choose a new parliament - currently a forum for vociferous hardliners. 'It is quite clear that the parliament and public opinion are far apart.'

As for foreign policy, Mr Gaidar played down differences with the West over Yugoslavia. 'The real problem is that the West has not created a strategy to deal with Yugoslavia. Once it is in place, I am sure that the Russian government will support it.'