RUSSIAN POWER PLAY CLOUDS STATUS OF US AID

RUSSIAN POWER PLAY CLOUDS STATUS OF US AID

Feuding Russian leaders made competing efforts Tuesday to grab power, casting a large shadow over the status of Russia's loans and foreign-aid grants from the United States and several international lending agencies, including pending food-aid shipments.

U.S. officials scrambled late in the afternoon to learn details of the apparent coup attempt against President Boris Yeltsin by Vice President Alexander Rutskoi and members of Parliament.Mr. Rutskoi and other legislative leaders, however, said Mr. Yeltsin was attempting a coup by illegally claiming he had dissolved Parliament and was going to call new elections.

The U.S. dollar rallied sharply Tuesday in a burst of safe-haven buying on news of the political turmoil in Russia. (Story, Page 2A.)

The price of gold, historically another safe haven for investors during

uncertain times, zoomed Tuesday on reports Mr. Yeltsin had been ousted. Gold prices in London and New York rose over $10 an ounce to some $363.

White House officials acknowledged they were caught off guard by Mr. Yeltsin's decision to dissolve Parliament and order new elections for

December, and by Mr. Rutskoi's declaration that he had assumed the presidency and now was in charge.

"We are just learning of the events unfolding in Russia ourselves at this time," said Mark Gearan, White House communications director.

President Clinton said Tuesday the power struggle in Russia shows the former Communist nation was "coming to grips" with what it means to be a democracy.

Peter J. Pettibone, a partner with the New York law firm of Lord, Day & Lord, Barrett Smith, with extensive experience in Russia, described Mr. Rutskoi as a popular ex-general who served in the Afghan war and who favors the gradual approach to economic reforms advocated by most Russian industrialists.

Officials at other U.S. agencies said they would have to take their direction from the White House on how or whether to proceed with aid programs.

"My guess would be that we would proceed with any shipments where the Russians have already signed contracts," said an official at the Department of Agriculture.

The USDA currently has two main aid programs with Russia: one a $194 million grant of food supplies announced by Mr. Clinton in Vancouver, British Columbia, early this year;, the other a $600 million subsidized loan program finalized this summer.

The $600 million includes long-term, low-interest loans for the purchase of $433 million worth of food, $66.5 million in donated foods and up to $100 million in transportation costs related to the use of more expensive U.S.-flag ocean vessels.

Russia agreed to use U.S.-flag ships for up to 75 percent of the shipments, but will pay only the foreign-flag equivalent cost to ship the food.

In the past two weeks, Russia has sought bids for about 1.9 million tons of corn and about 300,000 tons of soybean meal - virtually all the corn and about half the soymeal it agreed to buy as part of the $600 million package.

Russia has not shown any interest in the remainder of the commodities, which include butter, wheat, vegetable oil, peanuts, poultry, rice and sugar.

The first shipments of corn and soymeal should be loading in the first week of October, which would give U.S. shipowners time to access the situation, industry sources said.

The shipping contracts signed by the Russian government with the vessel owners assures them of payment up front at U.S. ports.

If those payments were not made first, it would be up to the vessel owners to decide whether to proceed with the shipments, the USDA official said.

One shipping company representative said the coup would not necessarily cancel the contract.

"You can usually tell what's going on within 24 hours," the industry representative said. "In the first day you get a good idea of the banking direction a revolution will take. A responsible revolutionary will reassure the banking community that debts will be honored."

The International Monetary Fund has loaned $2.5 billion to Russia within the last year.

A spokesman for the World Bank said that institution has committed about $1.3 billion to Russia in stabilization program loans and has disbursed about $300 million of the amount.

None of the $610 million energy rehabilitation loan signed several weeks ago has been disbursed, he said.

"A change in government in itself doesn't affect a loan," the spokesman said.

Among other issues that could be affected by the outcome of Moscow's power struggle is a Clinton administration request for $2.5 billion in aid for the former Soviet Union - primarily Russia - now pending in Congress and a longstanding U.S. Export-Import Bank proposal to finance as much as $2 billion in U.S. oil and gas equipment and services to Russia.

The New York law firm's Mr. Pettibone, who said he has visited Russia six times this year alone, said economic reforms under way in Russia probably would slow as a result of a coup rather than shift direction.

"The die was cast a long time ago - several years ago - to adopt a market economy," said Mr. Pettibone.

The coup will favor traditionalists who oppose privatization of state industries, he said, but "I think there is strong enough support within the Russian industrial community to move forward on economic reforms."

To foreigners doing business in Russia, "If you've made a commitment to be there, this is not the time to close up shop," Mr. Pettibone said. "This is the time to go with the flow."

The scene for Tuesday's power struggle may have been set 10 days ago when Jeffrey D. Sachs, a Harvard University economist and Mr. Yeltsin's top foreign adviser on reform, delivered a grim assessment of Russia's prospects and bemoaned Mr. Yeltsin's absence from the public eye.

U.S. officials also speculated that the Russian president may be battling health problems.

Within days of reports of Mr. Sachs' pronouncements, Mr. Yeltsin moved boldly to rehire his dismissed reform leader, Yegor Gaidar, as deputy premier.

But despite the feint toward reform, the move seemed balanced by the naming of Oleg Lobov, the conservative economics minister, to head the Russian national security council.

Tension was further raised by Mr. Yeltsin's dilemma between approving a Parliament-approved budget with a huge inflationary deficit or going outside the bounds of the constitution to set the budget aside.