IMF deal means trouble in store for Yeltsin: The President is caught up in a dispute between conservatives who want Gaidar's head and the West which says he must stay, writes Peter Pringle

ANOTHER furious argument is about to break out between Boris Yeltsin and his conservative opponents over the deal Russia made last month with the International Monetary Fund.

The Russian industrialists do not know it yet, because it has not been announced officially, but many of the Russian enterprises on the verge of bankruptcy, who thought they were going to be bailed out by the government, are going to be allowed to go under - as a result of the agreement with the IMF. With Mr Yeltsin delicately balancing conservatives and reformers in his cabinet, this is bound to result in more fierce criticism from the old hardliners - neo-communists and the new Russian nationalists - that Boris Yeltsin and his democrats are selling out to the West.

There will be more attacks on Yegor Gaidar, Mr Yeltsin's 36- year-old Prime Minister who leads the Russian economic team, but there is also a danger that the conservatives, rebuffed again by Mr Yeltsin, might try something more drastic. Some government insiders fear a more serious eruption of anti-Yeltsinism.

President Yeltsin's free market economics wizards explain the opposition's apathy so far by Mr Gaidar's international immunity to criticism. Mr Gaidar only gains from international events such as the Group of Seven meeting, at which the leading industrial nations agreed with the IMF that credits should start to flow to Moscow, and from the Bush- Yeltsin summit.

One of the team in Munich said: 'The G7 made it clear, as has the IMF, that the success of economic reforms in Russia is dependent on the continuing presence of Mr Gaidar.'

Political images are fine but Mr Gaidar's Teflon shield may last only as long as the government's opponents do not know the details of the recently struck IMF deal - and they are about to find out.

To reach agreement with the fund on Russian economic reforms, and thus unlock the first billion dollars of credits, Mr Yeltsin and Mr Gaidar promised two things that may turn out to be impossible without the help of the opposition.

The first, and most important as far as the IMF is concerned, is the government's pledge to cut back promised investments of 500bn roubles ( pounds 3bn) to bail out heavily indebted firms.

The pounds 3bn bail-out was announced last month by first deputy prime minister Vladimir Shumeiko. A former industrialist with close ties to Russia's military complex, Mr Shumeiko was brought into the cabinet in May, and had been pushing for extra credits to industry to help firms.

Most of Mr Gaidar's team of young economists were opposed to the bail-out, arguing that it simply prolonged the life of firms that had become inefficient and unprofitable under communism. But Mr Yeltsin, facing increasing pressure from the right and the threat of many bankruptices, gave the go-ahead in advance of the final negotiations with IMF.

During those negotiations, however, compromises were made by both sides and the Russian agreed to a reduction. It will probably be about half the original sum, according to a government official. Cabinet officials such as Mr Shumeiko have important followers in the conservative opposition, not least Mr Yeltsin's conservative vice-president, Alexander Rutskoi. There is no telling how far the shock wave of the IMF deal will travel.

The deal was not only a government compromise about investments in ailing industries. Under the IMF agreement, Russia has also agreed to cut budgetary expenditures up to 10 per cent of the gross domestic product. It has also promised to reduce annual inflation, estimated to be running at 1,000 per cent, to around 180 per cent by the end of the year.

The Gaidar team is putting a brave face on its difficulties, which somehow must be prevented from bursting into the open until at least the IMF board has approved the new Gaidar programme. The key date is the last week in August when fund members go on holiday. Opponents in the Russian parliament could try to impose tax cuts or press for new Russian central bank credits for the ailing firms. In theory, this is not a problem for Mr Yeltsin, because he can always exercise a veto, but it could create a return to an atmosphere of uncertainty about his ability to carry out radical reform.

The Gaidar team has emerged from this tricky period with Mr Yeltsin as its strongest backer. When the negotiations with the IMF got tough, it was Mr Yeltsin who moved in and eased the way to a compromise with the IMF. Once a reluctant supporter of Mr Gaidar, the president is now fully behind his economics team - at least in the wake of the international meetings. But the rest of the summer is still ahead - a perilous period when Russians will inevitably be remembering the failed coup against Mikhail Gorbachev and wondering if such a thing could happen against Mr Yeltsin.

If there is no investment in the enterprises that now owe between them more than a trillion roubles, the dole queues will grow, aggravating social tensions irrespective of the ones that already exist. The Gaidar team will continue, correctly, to point to the Munich G7 meeting and the dollars 1.5bn ( pounds 750m) - pounds 500m from the IMF and a pledge by Britain of a pounds 250m export cover package - as just the beginning of the unlocking of other credits. But the average citizen will see no early benefit.

On returning from Munich, Mr Yeltsin said the dollars 1bn would go to help Russia's ailing food industry. On television yesterday, Mr Gaidar was more candid. In Orwellian terms, he admitted the dollars 1bn would actually go to the 'problem of currency resources supplement', which is another way of saying it will go to prop up the depleted foreign exchange reserves. This means the money is not meant to be spent at all.

For the average Russian citizen to benefit from the Gaidar programme, it will take a long, long time. The question for Mr Yeltsin today is basically the same as it was when the reforms began last January: how long are Russians willing to wait for improvements?

(Photograph omitted)