UK Could Block Trade Deal for Russia After British Council Row

Britain warned Russia yesterday it would find it harder to strike a free trade deal with the EU or join international organizations as a result of its "blatant intimidation" of British Council staff.

The foreign secretary, David Miliband, described Russian actions as "not worthy of a great country".

British officials in Moscow said the Kremlin had used "classic KGB-style tactics" to intimidate British Council staff - and said the council had had no choice but to suspend operations in St Petersburg and Yekaterinburg.

The FSB - the successor agency to the KGB - had made numerous "threats" against the council's Russian staff, officials said. They included inquiring about the health of elderly relatives and warning that family pets might meet with an unfortunate accident. Tax officials had informed several staff they had a problem.

Miliband indicated there would be no tit-for-tat moves against Russian cultural bodies in the UK, but made it clear that Russia would pay a price in other ways. "This can only make the international community more cautious in its dealings with Russia in international negotiations," Miliband said.

British diplomats were yesterday talking to European and US allies to explore a range of punitive options. Britain could join Lithuania and Poland in holding up a new EU partnership agreement that would create a free trade zone with Russia.

Other options could include putting the brakes on Russian membership of the Paris-based "rich countries club", the Organization for Economic Cooperation and Development, pursuing a tough EU line putting strict conditions on Russian energy investments in Europe, and calling for a review of Europe's support for Russian membership of the World Trade Organization.

Yesterday, the EU came to Britain's aid, rhetorically at least, by demanding that Russian authorities allow the British Council to "operate freely and effectively".

By last night, Moscow had issued no formal response to Miliband's broadside, but one Kremlin-connected analyst said Russian officials were baffled by his attack.

Sergei Markov, who is also an MP in the pro-Kremlin United Russia party, said the British foreign secretary's "choice of language is very unprofessional".

The British Council opened its offices in St Petersburg and Yekaterinburg this week in defiance of a Russian order to keep them closed, but yesterday conceded it could no longer keep them running.

Council staff had been subjected to two days of interrogation by FSB officials - with the council's four Russian employees in Yekaterinburg recalled for a third day of questioning yesterday, officials said. "This is like punching a librarian," one official said.