The following report is based on a dispatch from our
correspondent, M.Tumennast, who is accompanying Prime Minister S. Batbold in
Russia, supplemented by inputs from Itar Tass.

Nine cooperation agreements, including those settling
Mongolia’s debts and laying down fundamentals of the Dornod Uranium joint
venture, were signed in Moscow on Tuesday, following negotiations between
Mongolian Prime Minister S. Batbold and his Russian counterpart, Vladimir
Putin.

There is also an intergovernmental agreement on training
Mongolian teenagers at Russian educational establishments, a communique on the
trade and economic cooperation program for 2011-2015, an action plan aimed to
create legal, economic and other conditions for further intensification of
trans-boundary and regional cooperation in 2011-2012, and a memorandum on
transit of Mongolian cargo through Russia.

The two sides signed three memoranda, concerning
cooperation in geological survey and mineral development, energy cooperation,
and mutual understanding between the Russian Business Council for Cooperation
with Mongolia and a similar Mongolian institution.

Putin
to visit Mongolia

“Mongolian Prime Minister Sukhbaatar Batbold thanked
[Russia] for the cordial welcome and invited Russian Prime Minister Vladimir
Putin to visit Mongolia at any convenient time,” the communique runs. “The
invitation was accepted with gratitude, and the time of the visit would be
coordinated by diplomats.” Next year Mongolia will celebrate the 90th
anniversary of independence and diplomatic relations with Russia and the 30th
anniversary of a joint space flight.

Mongolia supports the earliest Russian accession to the
World Trade Organization (WTO), the communique says. “The sides will consider
the expediency of a free trade agreement for liberalization and broadening of
bilateral trade,” the communique runs.

Transit
cargo, UB Railroad, Infrastructure  

The sides will soon sign an intergovernmental agreement
on transit of cargo from Mongolia across Russia and will coordinate the
enlargement of the charter capital of the Russian-Mongolian Ulaanbaatar
Railroad at equal shares, which will modernize the company and promote the
development of the Mongolian railroad infrastructure. Putin also said that
Russia would rapidly enlarge capitalization of the Ulan Bator Railroads Company,
without waiting for Mongolia to make its contribution.

In addition, the sides will coordinate terms of the
participation of the Russian-Mongolian joint venture Infrastructure Development
and its partners in the construction of new railroads to be linked to the Ulaanbaatar
Railroad and transit of mining products from Mongolia to the Russian Far
Eastern seaports, the communique says.

Russia pledged rapid consideration of the Mongolian offer
to continue the participation of Russian companies in the Mongolian
governmental program, 100,000 Apartments.

“Russian companies – several dozens of them are working
in Mongolia – actively invest in transport infrastructure, new railroad lines,
mineral survey and mining,” Putin said. “These projects build up the export potential
of Mongolia, in particular, through the use of Russian seaports in trade with
third countries. These are Far Eastern seaports, in the first turn,” he said.

International
scene

“The prime ministers affirm similar or close positions of
Russia and Mongolia on topical international and regional problems,” the
communique runs. Russia welcomed more active steps of Mongolia on the
international scene and reaffirmed its support to the Mongolian plans to join
APEC when the enlargement moratorium is lifted. Russia also welcomed the
Mongolian wish to play a weightier role in the Shanghai Cooperation
Organization (SCO) as an observer state.

The prime ministers expressed their concern about the
escalating inter-Korean tensions. They called on North and South Koreas to
resolve any problems with political and diplomatic methods and a dialog based
on the mutual account of interests and put the emphasis on the need to resume
the six-nation negotiations on the nuclear problem of the Korean Peninsula.

“Russia expressed the readiness to continue the dialog
with Mongolia on nuclear status guarantees in cooperation with other nuclear
powers,” the communique runs.

Russia and Mongolia said they would continue humanitarian
cooperation, including a larger number of Mongolian students in Russia.

Dornod
Uranium in 160 days

AtomRedMetZoloto Deputy General Director Tigran
Khachaturov said an agreement specifying general principles of Dornod Uranium
was supplemented with an action plan, which said that the joint venture would
start to function in 160 days, he said. Khachaturov estimated the Mongolian
uranium reserves at 30,000 tonnes. The new company “will survey, mine and
process uranium,” he said. “We did not discuss the possible turnout because we
needed to draft a feasibility study first,” he said.

Military
cooperation

Batbold said he had discussed the delivery of Russian air
defense systems to Mongolia with Putin. “Apart from modernization of the
Mongolian armed forces, we have discussed the delivery of air defense systems,”
he said. “Military- technical cooperation will continue.” The premier singled
out the training of Mongolian students at Russian military schools.

He also said he had discussed an enlargement of exports
of traditional Mongolian commodities with Putin, and congratulated Russia on
being chosen to host 2018 Soccer World Cup.

Debts
settled

An intergovernmental agreement has settled Mongolian
debts to Russia, which formed in the Soviet period, Putin said. The debts were
settled “on terms most preferential for Mongolian friends,” he remarked.

Russia wrote off 97.8% of the Mongolian debt of USD172
million, Deputy Prime Minister and Finance Minister Alexei Kudrin said. He said
that Mongolia would pay the remaining debt of USD3.8 million in one transfer.

Erdenet
and Mongolrostsvetmet may merge

Two Russian-Mongolian joint ventures, Erdenet and Mongolrostsvetmet,
may merge and market their stock, Putin said. “We have discussed the possible
merger of the two companies and an IPO,” he said. “Large-scale modernization of
Erdenet and Mongolrostsvetmet is in progress, and I am confident that this
process will considerably improve their competitiveness and have a positive
effect on the Mongolian economy, whose personnel, resources and technological
potential will grow,” Putin said.

The two companies produce almost 20% of Mongolian GDP,
while Erdenet provides nearly 40% of the Mongolian national budget.

“We will help inoculate Mongolian cattle in order to increase
its meat exports to Russia,” Putin said, adding, “In all, assistance will
amount to 375 million rubles.”