It is generally agreed by analysts that EU-Russia relations for the last ten years have been dominated by three conflicts of interests, often described as integration rivalry, sovereignty versus normativity and asymmetry. These factors have also moulded their responses.

In the context of integration rivalry, since the beginning of this decade, Brussels and Moscow have increasingly become rivals in their attempts to wield their respective influence over the Commonwealth of Independent States (CIS) -- the 11 former Soviet Republics. In this regard, the EU has preferred to exercise soft power and has tried to change the regional environment through bilateral, uncoordinated agreements with individual countries. Russia, on the other hand has striven for a realpolitik hegemony in which these countries are included and remain within its sphere of influence.

Similarly, on the issue of sovereignty versus normativity (i.e. behaviour based on certain norms or standards), it is now accepted that changes have taken place in principles of governance and that this is being reflected in the changes that Russia has undergone under President Vladimir Putin.

During the 1990s, a severely weakened Russia agreed to a Partnership and Cooperation Agreement (PCA) with the EU. It included calls for Moscow to promote democracy and human rights norms. However, now that Russia is a self-confident "energy power," it is insisting that it be treated equally with other major powers.

The country's conservative political elite now wants to shield Russia from external forces that have been pushing for promotion of democracy and human rights within its borders. At the same time however, these decision-makers do not want that Moscow should openly promote its own values to countries immediately beyond its borders. They are aware that such a step might lead to problems with the USA. This approach contrasts with EU foreign policy, which attempts to influence directly the CIS countries' political systems.

European analysts consider the existing asymmetry in the relationship as significant. They feel that increasing Russian power means that the PCA, with its value judgments about Russia's political system, does not now reflect new power relations. It is being construed to be so because Russia is no longer the EU's younger partner.

Accordingly, EU policy planners, ahead of the PCA's renewal later this year, think that the EU should now concentrate on functional operations with Russia through strategic partnerships. They believe that there should instead be reduction in the emphasis on normativity in official negotiations and greater efforts towards the influencing of Russia's political system through personal contacts. This, Brussels considers, could be through a more multilateral, coordinated approach.

In this context, the EU under the German Presidency is carefully monitoring the foreign policy of Russia towards its immediate neighbours (formerly part of the USSR) since the last EU-Russia Summit held in Volzhsky Utyos a few weeks ago. On this will depend the subsequent decision as to whether EU will try to strengthen links by opening a delegation office in Minsk.

Special focus is being cast on developments in Belarus and the possible impact on that eastern European country as a consequence of the Russia-Belarus 'Treaty on the Formation of a Union State' that was signed in 1999. Evolution of the political dynamics between these two states is expected to influence EU policies within the context of a renewed PCA.

It may be mentioned in this regard that Belarus has prospered economically over the last three years. The so-called "Belarusian tiger state" has benefited from cheap energy supplies from Russia and re-exports of energy products. This matrix has evoked special interest given President Putin's clear observations that market interests will dictate Russia's future foreign policy. Accordingly, the EU is waiting to see how Russia's 'near-abroad' policy and selective engagement will stand up to Russia's decision to raise export prices of its gas and also impose duties on the import of oil and other exports from Belarus to Moscow.

However, decision makers both in the EU and in Russia generally agree on one aspect -- the need to re-define certain contents of any forthcoming agreement. It is clear that Russia has become hypersensitive about having EU-defined values imposed on it. It now wants to "cherry pick" only parts of the accord that might be useful for its economy. Such a situation has however created latent difficulties because the European parliament in particular considers values to be at the core of any external relationships.

Both sides are also aware that they share overlapping spheres of influence in the ex-Soviet states and have raised their stakes in the pursuit of support. This has complicated matters somewhat. What has happened in Estonia in the recent past has been an interesting example.

Russia aims to be a key power-player in all the countries that were previously part of the USSR. It also knows that it now has few close friends in the region, as CIS countries tend to act less like a "unit", having diversified their trading partners. Russia is also aware that the EU has been actively encouraging such diversification with the support of the USA. To stem such erosion in linkages with Russia, Moscow is now attempting to enhance its sphere of influence through the providing of selective economic benefits in return for political loyalty.

The prospect of a downturn in relations between the EU and Russia have now led to serious examination of this issue of rivalry in different European think-tanks. Consequently, political analysts in Brussels, Berlin and Paris are now giving special emphasis to a EU approach that would identify common interests and help build "sustainable stability." As a result, the EU appears to have taken a go-slow policy with regard to issues associated with Moldova, Transnistria, Ukraine (which has emerged as the world's sixth biggest arms trader) and also questions of integrationalist rivalry. They are taking this line to maintain and continue a semblance of friendly regional relations. EU's involvement in helping to resolve the Nagorno-Karabakh conflict is being shown as an example of constructive engagement. EU is also emphasising that EU wants to build partnerships and see relations between Russia and CIS countries normalised.

This multi-track approach on the part of the EU, ahead of any renewal or re-wording of the PCA, is also being affected because of economic interests arising out of Foreign Direct Investment (FDI) in Russia. There is growing anxiety about the emerging political and economic risks for FDI in view of the current Russian government turning away from economic liberalisation. The EU leadership has commented that they are not worried, but that is not being totally shared by the business community. In view of that, pressure is being generated to identify minimum benchmarks that have to be taken into account during any future negotiations.

In any case, the EU-Russia scenario is being watched very carefully across the Atlantic. The USA wants a pliant Russia who will support their policies in the Middle East and in the Far East. For them, the EU's response and eventual results in their relationship with a more confident Russia will be vital in charting their own courses of action, both with regard to Russia as well as China.

Muhammad Zamir is a former Secretary and Ambassador who can be reached at mzamir@dhaka.net