Saudi Arabian Defense Min Prince Mohammad bin Salman will visit Russia this week.

Saudi Arabian Defense Min Prince Mohammad bin Salman will visit Russia this week. (RBTH).

Saudi Arabia’s defense minister is likely to meet Vladimir Putin on the sidelines of the St. Petersburg International Economic Forum. The energy giants look to revive bilateral ties that have been sagging since they began supporting opposing sides in the Syrian conflict.

Saudi Arabian Defense Minister Prince Mohammad bin Salman will visit Russia this week, sources told Kommersant. The visit should help unblock relations between the two countries, which have been frozen because of their opposing positions on Syria. Sources say that preparations are on for a meeting between the prince and Russian President Vladimir Putin on the sidelines of the St. Petersburg International Economic Forum.

Saudi Foreign Minister Adel Al Jubeir will most likely join Prince Mohammed at a Russia-Saudi Arabia business meeting held within the framework of the St Petersburg forum.
 
Prince Mohammed and the Saudi delegation's visit had been shrouded in silence until the very last moment, with officials in Moscow refusing to comment on any speculation. Meanwhile, foreign journalists accredited in Moscow went to St. Petersburg in advance to report on the Saudi delegation's visit, which promises to be one of the forum's main talking points.

Moscow has been one of the main backers of the ruling regime in Damascus, while Riyadh has been trying to topple Bashar Al-Assad. “This led to the freezing of relations. However, today, it seems, the ice has been broken,” Dudarev says.

Prince Mohammed bin Salman and the officials accompanying him are not the only delegates from Riyadh visiting Russia this week. Saudi military officials participated in the Army 2015 International Military Technical Forum that is taking place in Kubinka. Citing a source in the Saudi delegation, TASS wrote that the Saudi military wishes to discuss the purchase of the Russian Iskander-E tactical ballistic missile systems. Hmmm.....And then of course there's 'Money...money...money'. Read the full story here.

Russia looks to replace Western loans with Islamic finance.

Russia looks to replace Western loans with Islamic finance. (RBTH).

Islamic finance will help Russian companies make up for their credit shortage, which was in large part caused by the cooling of relations between Russia and the West. Russian banks are already showing interest in this alternative form of credit.

Islamic finance could help Russian companies hit by Western sanctions to gain access to credit, Rustam Minnikhanov, President of the predominantly Muslim-populated Russian republic of Tatarstan, said at the Kazan Summit Forum.

“Muslim countries did not join attempts to isolate our country on the international arena, and the latest events in the world economy have shown that Islamic banks help counter world crises and supplement the world financial system,” Minnikhanov said.

He added that this Islamic finance could not completely substitute Western credit, but instead could provide Russian companies with an important financial instrument. According to IMF's latest calculations, by the end of 2015 the volume of Islamic finance around the world will amount to $3.4 trillion.

 An alternative scheme

 “Against the backdrop of world crises, the importance of Islamic finance only increases, because all the operations in this scheme are backed up by real money, while investments become secure and do not carry any risks,” said Qatar’s Undersecretary of Economy and Commerce Sultan Al-Khater.

According to the requirements of Islamic banking, it is prohibited to charge interest while lending, while receiving credit essentially implies exchanging one commodity for another.

Ahmad Mohamed Ali Al-Madani, President of the Islamic Development Bank, said, “Islamic finance is by nature tied to real economic activity, which is why such a scheme allows the optimization of the internal resources.” He added, “The concept of dividing risk in Islamic banking stimulates healthy financial practices. In Islamic finance, the transactions are tied to real investments, which helps avoid speculation and the instability related to it.”

Al-Madani suggested that Tatarstan could be promoted as “an Islamic finance hub in Russia.” Hmmm.........Qatar and Turkey? I wonder where those unexplained Billions of $  in Turkey come from? Read the full story here.

Related? 

Russia May Enter Foreign Loans Markets in 2016 Despite Sanctions.