rose to ask Her Majesty's Government what is their assessment of the current situation in Georgia.

My Lords, I have tabled this debate today in order to raise issues that have been thrust into the limelight by this weekend's EU summit in Samara. I thank the three noble Lords and the Minister who will be contributing.

As distant and remote as Georgia may seem to be, there is growing realisation among individual European Union states that unilateral decisions are not necessarily the best way to resolve differences with states close to current EU borders. A hasty decision with one country, no matter how justified it appears to be, from a narrow perspective, can have unfortunate consequences on another country's affairs. I hope the House will forgive me if my comments sometimes appear to go beyond the boundaries suggested by the debate, but it is only in the wider context that relationships within and without Georgia can be understood.

The unfortunate failure of Germany to secure its ambitious agreements with Russia this weekend is a clear reminder that the recent expansion of the EU has given us new responsibilities as well as new markets. We cannot choose to ignore tensions between the new members and Russia, or between Russia and other former Soviet states, whenever it is convenient for us to do so. Nor can we fall into the trap of viewing these tensions only through a Cold War perspective. Instead, I hope the Minister will be able to reassure us that we are taking all steps necessary to improve the current dichotomy of a Cold War energy infrastructure imposed on a 21st-century political reality. What steps are the Government taking to break dependence on Russian energy supplies—not only Georgian dependence, but also Europe's as a whole? Recent events last winter show how vulnerable we all can be. Such insecurity must be harder for a state such as Georgia to respond to calmly and effectively. The Baku-Tbilisi-Ceyhan pipeline is certainly a step in the right direction but the proportion of oil provided from Russia is continuing to rise, and the recent expansion of Russian control over Kazakhstan and Turkmenistan's gas and oil exports will not help.

In addition to growing uncertainty about its energy supply, Georgia continues to face internal instability in South Ossetia and Abkhazia. Where do Her Majesty's Government stand on the request by Georgia to replace the Russian-led peacekeeping force with a multinational force? The Sochi agreement has been a success in preventing all-out warfare between the different factions, but it cannot be seen as a long-term solution. How do the Government hope to see further progress in that area, and what steps are being taken to prevent Russia meddling in Georgia's attempts to find a way forward in South Ossetia? These steps are never going to be effective if EU countries continue to disregard each other's concerns over policy approaches. What progress has been made on developing a unified and consistent EU approach to questions of self-determination?

The EU may not be the only international body that we should be working with to resolve Georgia's difficulties. That country has frequently expressed how important it is for it to join Nato, and talks have been continuing. What stage has that dialogue reached, and what implications will eventual succession have for the already tense relationship with Russia?

It is most encouraging to see how Georgia has continued to make great progress in both the political and economic arenas. The rose revolution was a beacon of hope for Georgia and similar countries in the region. It showed the enormous desire for democratic prosperity and the political will to make it happen. Although some optimism may have faded slightly since the beginning of this decade, I do not believe it is entirely extinguished. We welcome DfID's intention to focus UK aid more closely on good governance in future. Will the Minister reassure the House that she will make certain that the Government do not let Georgia down but will continue to support its efforts?

My Lords, we may be rather few in number as speakers, but I know we are all grateful to the noble Baroness, Lady Rawlings, for initiating this short debate. We put down our names because we have huge admiration for Georgia and its people.

I first had the privilege of visiting Georgia during the height of the Cold War, and I think all of us who visited it at that time were hugely impressed by the way the characteristic ingenuity and creativity of the Georgian people enabled them to survive rather better than some other satellite countries under the iron rule of communist dictatorship.

The second time I had the opportunity to visit was not long after Mr Shevardnadze had taken over, and we literally went to sleep at night in Tbilisi to the sound of gunfire. We can all be profoundly thankful that most of the country is now more stable and has some real democratic rule.

The third time I visited, about two or three years later, I was left with an extraordinary series of contrasts. There was clearly a huge amount of corruption which enabled the black economy to flourish so that some people could afford to pay £50 or £100 for tickets to hear the Moscow orchestra in Tbilisi, but people who were on fixed incomes, particularly pensioners, were literally starving. I am still haunted by the story of a university professor in Tbilisi who apparently starved to death because he simply could not get enough to eat on his basic salary. That, thank goodness, has begun to change. Some of us had the huge privilege a few weeks ago to listen to the new president of Georgia painting a very encouraging picture of what is happening there. He emphasised two points: first, he has got on top of the corruption; secondly, the country's economic prosperity is at last beginning to show some kind of development.

I do not feel qualified to assess whether that is a true picture of what is happening in Georgia or whether it is over-optimistic. Can the Government give us their estimate of whether the terrible corruption which was once very much part of the scene in Georgia is truly being tackled and whether the economy really is developing as the president believes it is, or as he told us it is?

I would like to focus my remarks on three areas. The first is against the background of the huge warmth in Georgia for the British embassy in Tbilisi. On all my three visits, it has been quite clear that the president of Georgia has worked very closely with the ambassador in Tbilisi and there are very warm relationships with this country. Are the Government satisfied that DfID in particular is doing what is best for the Georgian people to help their development? I had an e-mail from a friend who expressed some disappointment about DfID's change of direction. It would be good to know from the Minister what DfID is doing and whether she feels that that is enough or whether this country should be doing more.

Secondly, what are we doing with our European allies? Although there is now a democracy in Georgia as a result of the rose revolution and what took place before that, we are all aware that democracy is not simply built by having elections. It is necessary to have a range of flourishing institutions to safeguard human rights—an independent judiciary, a free press, freedom to worship, and so on. Although Georgia has a very long and honourable tradition of religious tolerance—Jews, Christians and Muslims have lived together in peace for well over a thousand years—it was not many years ago that certain renegade Orthodox priests inflicted violence on non-Orthodox communities, and the Government were extremely slow in tackling this. Democracy is not just a matter of elections but of building up institutions so that human rights, in all their aspects, are fully protected.

Thirdly, I reiterate what the noble Baroness, Lady Rawlings, said about the role of Russia in relation to Georgia. I have huge admiration, as I know do your Lordships, for the Russian people and a great sense of how they have suffered and survived over the years. However, in the vacuum provided by the demise of communism, the Russian people are finding a new identity through reverting to some of their earlier traditions such as the supremacy of the Orthodox Church in Russia and Russia being the big player in that region. As I think we are all aware, Russia is not just being a big player but is bullying some of the satellite countries—we think tonight particularly of Georgia. I therefore underline what the noble Baroness said and ask the Government to consider how we are working with our European allies in ensuring that the independence of Georgia is truly safeguarded, without being in any way a threat to Russia. We clearly need to be careful to ensure that Russia does not see our relationship with Georgia and its potential accession to NATO as a threat, but we nevertheless need to ensure that Georgia's independence is fully safeguarded. We must not allow Russia to bully it in any way.

As the noble Baroness emphasised, Europe has a major responsibility to act in concert in relation to Georgia and the other countries. I am afraid that one of the main reasons for the terrible wars after the break-up of Yugoslavia was that Europe did not have a unified, agreed policy in relation to the countries which have since emerged—Croatia, Serbia and so on. I hope that the Government will be able to assure the House that we are working with our European allies to have total agreement in a policy towards Georgia and other countries that are in a similar situation.

I emphasise that Georgia, which is a great friend of this country, has a wonderful future. I hope that the Government, working by themselves and with their European allies, are doing all that they can to help it at a time when there is so much potential for good but also so much potential for danger, not least in its relationship with Russia.

My Lords, I am honoured to be part of a small group of friends of Georgia assembled in this House this evening. I am grateful to the noble Baroness, Lady Rawlings, for giving us this opportunity for debate. She may be surprised to see me here when we normally discuss development issues further afield. The reason is that, during a visit to the Caucasus back in the 1960s, I met a Georgian family who have remained close friends ever since. I have strong memories of a proud nation, which is now finally escaping from the Russian bear hug and attempting to join the European family of nations.

Not so long ago, as my noble friend said, it was quite different. I remember my friends, some of them in Paris, telling me of acute food shortages in Georgia. There was no meat in Tbilisi, for example, because no trader could afford the petrol to transport it. The country under the crumbling Soviet system seemed to be sliding into anarchy, and our own churches and charities were actively helping to provide food for the most destitute.

Now it seems that everything is changing under a gifted and popular Prime Minister who has pulled round the economy and attracted new investors. Perhaps he has been forced by the Russians and their embargo to seek alternatives. He is a graduate of Kiev University and two American law schools, and he immediately drew attention as Justice Minister when he initiated major reforms to the Georgian criminal justice system. In Parliament, he also tried to reform the very messy electoral system and has promised to tackle corruption, which however remains the scourge of good governance and the elixir of the powerful mafia, who are both Georgian and Russian.

The country is still volatile, with South Ossetia and Abkhazia asserting their independence and the region of Ajara on the Turkish border remaining semi-autonomous. Tension continues in South Ossetia in spite of Russian efforts towards dialogue, and I am told that there are 300,000 refugees from Abkhazia alone. The UN mission there since 1993, UNOMIG, has been extended until October. Since there is British participation there, I am sure that the Minister will confirm that that small force is keeping the peace but can do little more than that.

There was a time when Britain really mattered to Georgia. It was the British head of mission, the great Sir Harry Luke, who rescued the royal family and other emigrés from the Red Army in 1921. The story is still being told. I am glad that Britain is reviving a mature relationship with this ancient country, whose language long precedes our own. We now encourage Georgians to learn English, but the new president, among others, already speaks English and six other languages. The UK is becoming an important trading partner, with BP one of Georgia's largest investors because of the new pipeline, which the noble Baroness mentioned. Georgia is rightly striving to look towards Europe—and I believe that it will be a test case of EU enlargement. The Minister will update us on the European neighbourhood policy action plan. If we cannot devise a form of Europe to which Georgia belongs, Europe is in my view not worth having.

Georgia has participated in international peacekeeping operations such as KFOR and ISAF in Afghanistan. Entering NATO is a major priority and Georgia has been admitted to the intensified dialogue that could lead from partnership to membership. That would certainly strengthen the stability and security of the country and might help to balance the enormous and continuing influence and interference of Russia in Georgian affairs. Would the Minister agree with Richard Holbrooke, the former US ambassador to the UN, that Russia successfully manages to keep Georgia off the UN agenda? Does she believe that NATO membership, defence apart, would also secure more democratic values in the country?

After what has happened in the Middle East, one sees a danger of hypocrisy in proclaiming western values too often in countries where we may be able to gain economic advantage, especially in the energy sector. But if the word "democracy" applies, we should mention again the signs of democratic reform. There is an active judiciary. The justice ministry has just filed a law suit against Moscow at the European Court of Human Rights over Russia's mass deportations of Georgians last autumn. More Georgians are travelling abroad; the service and tourism sectors are booming, and churches are coming back to life—and I hoped to hear more from my noble friend on that, because the churches are very important in Georgia. There is a revival in the arts and music teaching; there are computers in schools and the press is very active. The British Council must be commended for running a series of training events in investigative journalism throughout the country. Even closer to home, for many male Georgians at least, has come a new emphasis on women's rights, with the country's first ever law on domestic violence, adopted last May by the Georgian Parliament, following extensive consultation with the NGOs. This has been welcomed by human rights agencies such as Amnesty.

These are encouraging signs—but on the negative side, the economy is still fragile and there is high unemployment in Tbilisi. Many feel that they have been left out of the privatisation process, which is monopolised by a new elite. One of my Georgian friends says that her concern is the continuing Soviet hangover, the "soft totalitarianism" which still pervades the state, with many senior positions in culture, sport, education and other sectors dominated by the ruling party. I understand that even the details of Georgia's representative in the Eurovision Song Contest were directly handled by the Administration, down to her costume and hairstyle.

But there is a deeper concern. Half the population live in rural areas and many are below the poverty line. My friends in Paris tell me that roads outside the capital are in a very poor condition and that some children even lack shoes to go to school in, let alone school materials.

I know that DfID has a small programme in Georgia, which was mentioned by my noble friend, and that the embassy supports small projects. As the noble Baroness said in her opening remarks, much of our aid is directed at good governance and conflict resolution through such channels as the global opportunities fund. Are we also addressing poverty directly through microcredit or small enterprise schemes?

The IMF and World Bank have been pressing Georgia hard and there is now a poverty reduction programme in place so that millennium development goals can also become a focus of assistance. Does the Minister believe that the country is any nearer these goals, which affect the majority of the population?

Georgia still evokes a romantic image of the past, of mountains, vineyards and the writings of Lermontov. But under new leadership and with a bit of help, will it be able to free itself from its past and Russia and embrace the values which represent the true interests not of East or West but of the Georgian people?

My Lords, considerable knowledge of Georgia has been evinced by previous speakers. I add my thanks to the noble Baroness for initiating the debate. I think that I am the only speaker in this debate who has not been to the country; none the less, there is always that ancient principle that one can comment on countries even if one has not been there. I have studied Georgia in depth in recent years. As speakers would have mentioned if they had had more time, Georgia is a small country with a population of about 4 million. Some 1.5 million live in the capital—the usual concentration that you get in small countries in that stage of development. The capital acts as a magnet for people trying to find work.

Even before the fall of the Soviet empire, there were fierce clashes against Soviet rule well before the Second World War. The huge vote for independence in the 1991 referendum was very exciting and was followed by the reign of Eduard Shevardnadze until the rose revolution, which has already been mentioned. President Saakashvili's Government are grappling with many problems, including the continuing tensions in relations with the Russian authorities and local nationalists and with irredentism and separatism.

Ajara has now been fully included with the demise of Abashidze but Abkhazia is an uneasy muddle despite the 1994 Moscow agreement. As other speakers said, the situation in Ossetia remains extremely unsatisfactory and worrying. But on the economic front things have been much more encouraging, despite the problems already mentioned. Rather like Moldova, Georgia had to find new export markets. It has started to do so and there are some encouraging signs. However, it has the continuing problem of energy supply security.

Georgia is actively pursuing a series of policies to develop its Euro-Atlantic links, even supporting the coalition forces in Iraq. We have now had nearly eight years of the PCA with the European Union, covering economic and trade relations, and a slowly developing range of social, scientific and cultural initiatives plus considerable EU donor support. As I believe the Minister will confirm, if she has time, the ENP is a formal part of Georgia's links to the EU, and, as we know, the Government in Tbilisi are anxious for Georgia to become an EU member.

The action plan of November 2006, mentioned by several noble Lords, obliges Georgia to proceed with a number of important EU-oriented reforms. The amazing BTC pipeline, with BP as the project leader, opened a year ago and now transports some 10 per cent of the world's tradable oil along the second longest pipeline in the world. The West as a whole and the EU are happy to see Georgia reduce its dependence on Russian energy sources and join in fully in the Transport Corridor Europe-Caucasus-Asia initiative for transport integration, to enhance the roles of Poti, Batumi and Supsa with the west route oil pipeline project.

During a press conference with Tony Blair on 25 April, the day of President Yeltsin's funeral—an interesting coincidence—President Saakashvili referred proudly to the country's economic successes in the past three years, reminding us that the World Bank praised the country in its recent reports, and that the UK had become the main investor among European and other countries. Perhaps the Minister would confirm that we are the chief supporter of Georgia's future NATO membership.

There is no indication that the personal and psychological problems of the tricky relationship between the western-educated President of Georgia and the KGB-educated power-hungry President Putin will be solved in the future. It is a fact of life that we have to live with, and we should keep out a sharp eye for Putin's relentless attempts to assume exclusive and excessive power in the Kremlin to the detriment of Russian democracy and Russian journalists.

The West's support for Georgia is essential to ensure that this small country is not bullied into submission by the Russians, but has its own international framework of friends to help, to observe and to keep an eye, as the noble and right reverend Lord, Lord Harries, inferred. At the same time, the US has to keep on the right side of Russia in the wider geopolitical sense in this delicate Asian sub-region. Meanwhile the Government have rehabilitated the late President Gamsakhurdia, who wrested the country from the Russians' grip in the early 1990s, and have also launched an action at the European Court of Human Rights, as has been mentioned. The deportation of hundreds of its citizens was a distressing spectacle and I am sure that the British Government are concerned about that and its aftermath.

Potential sparks are there all the time between the giant former superpower and the tiny, proud, nationalistic, sometimes bloody-minded, but always impressive country, Georgia, to the south-east. Opposition members have recently been put on trial in Tbilisi, accused of plotting coups against the Government because of their pro-western stance. Is Russia behind these activities or not? That is the question on everybody's lips locally and overseas.

In a way, one can understand why Russia is very annoyed at the foolish Georgian decision to more than double its military contingent in Iraq. It would be better for Tbilisi to reduce its leaning towards the USA. The unending series of catastrophic blunders from the Government in Washington in everywhere from Israel to Palestine to Iraq to Iran is unmatched in recent decades of US history. That is painful to say, but that is certainly the case since the Vietnam debacle and the previous US humiliation with Iran. Is it wise for this vulnerable country, Georgia, to consider hosting part of a future US missile defence shield on its small territory?

The Georgian president recently denounced the election results in the irredentist Abkhazia, despite approval for them by the election commission. Only Russia supports this breakaway province and keeps troops there as peacekeepers. That is another difficult problem. Georgia is benefiting from its links with Azerbaijan, not only because of oil and gas supplies, once again led by BP, which helps the country to withstand the irritations of the Russian blockade and sanctions and the recent doubling of the price of natural gas. Moreover, the Russians know that Georgia has increased its links with Turkey to offset the negative effects of the Russian behaviour.

However, at least the Russians sent back their ambassador to this defiant little country and Putin has repeatedly alluded to returning to friendly links with Georgia. The jury is out on these complicated questions. Mr Putin still seems to resent the fact that Georgia was the first former Soviet state to break away after the collapse of the USSR. Naturally the Russians think that Georgian defiance will influence the Chechen rebels, but Russia has mishandled that matter—as badly as the Americans have mishandled Iraq—so disastrously from the beginning that no solution will be available short of at least a high degree of autonomy for that tragic and much-damaged country.

The situation in South Ossetia, with two regimes side by side—one pro-West and the other pro-Russian—is absurd, as we all know. We wonder whether the British Government have any useful suggestions to make about these complicated matters.

The complaints in Europe about Georgia's often hot-headed antics vis-à-vis Russia should be heeded by the Saakashvili regime. To be fair to the president, he has often repeated that he does not wish to be an anti-Russian bastion or, indeed, a bastion for or against any geopolitical interests or areas. He wants equilibrium for this country, which is emerging from a difficult past into what we hope will be a bright future. However, he needs to create the impression of a more equilibrated posture to reconcile conflicting pressures in a more rational and less excitable way.

The Czech Prime Minister, in his mid-May visit to his Georgian counterpart Zurab Noghaideli, expressed strong support for the country's future adhesion to both the EU and NATO. This needs to be achieved in a way that does not alienate the Russian authorities, with their echoes of old Cold War encirclement arguments against so-called US and allied plans to increase their quasi-military involvements and equipment in the area. Even with a strong rate of growth in the last few years, can Georgia really make sense out of the large increases to military spending budgets that it has made recently, as I have mentioned?

The overall picture remains complex, muddled and highly confusing. At the end of last month, the Russian foreign ministry spokesman Mikhail Kamynin warned against the stance taken in the capital to counter the two breakaway entities. Both Bagapsh and Kokoity warned at the same time that they would break off the talks with the Georgian Government aimed at reconciliation if the latter did not cease forthwith their attempts to legitimise the puppet Governments that they have installed in both provinces. This would also impede indirectly Georgia's efforts to join the EU and NATO. In effect, Georgia cannot pursue these objectives, the Russians assert, until the breakaway situation in both territories is resolved by mutual agreement. Kamynin specifically described the approach to NATO as very rushed.

The recent UN Security Council resolutions on the matter have tried to be balanced between Russian interests and the West, as reflected in the composition of the "Group of Friends" component in UNSC membership. The UNOMIG mandate has been extended, and I add my request to the Minister for details of how the Government feel that that is going.

The overall atmosphere remains very tense. There is an apprehensive fear that some unforeseen incident could spark off an outbreak of some kind of military action. Kofi Annan must be glad that he has finished his term of office, but the UN needs to watch the situation closely. I hope that the Minister will have time to respond to some of these points.

My Lords, I congratulate the noble Baroness, Lady Rawlings, on securing this timely debate on Georgia so soon after the visit in April of President Saakashvili to the UK. I, too, regret the fact that there are not more noble Lords present this evening, as this has been an interesting and informative debate.

The invitation to the president was made to offer support and encouragement to Georgia for the path that it has chosen, so I trust that noble Lords will not be surprised or disappointed to hear me echo many of the positive statements that have been made in this debate. Like the noble Baroness, we recognise and celebrate Georgia's strong desire for democratic prosperity.

Georgia has travelled a remarkable distance since the rose revolution that brought President Saakashvili to power in 2003. Then, Georgia was a country beset by internal strife and economic problems, as the noble and right reverend Lord, Lord Harries of Pentregarth, graphically illustrated. Despite formidable challenges, it has developed into an important regional actor and increasingly an international player. Georgia's leadership can rightly be proud of her achievements so far, especially her strong economic growth and democratic reform. Economic growth was 9.4 per cent in 2006 and a staggering 13 per cent in the first quarter of this year. That is quite remarkable.

Serious efforts have been made to tackle corruption and crime, but these must continue. We are very conscious of the huge amount of work that Georgia has put into her reform efforts and we encourage her to continue along this path. It is vital that the Georgian Government ensure that reforms made in legislative terms are implemented properly and that their sustainability can be demonstrated.

The noble Baroness and other noble Lords rightly mentioned the conflict in South Ossetia. It is of the utmost importance that the internal conflicts over the separatist regions of Abkhazia and South Ossetia are resolved peacefully. This is crucial for the stability, security and long-term development of Georgia and the wider Caucasus region. The ongoing conflicts in these two regions hinder Georgia's development to some extent and complicate its relations with its neighbours. We fully support the efforts of the UN and the OSCE to find lasting political settlements in Abkhazia and South Ossetia that respect Georgia's territorial integrity within its internationally recognised borders. We urge patience and confidence-building dialogue with all parties. Long-lasting and sustainable solutions to these conflicts can be obtained only through peaceful negotiations between the sides. We also fully support UN efforts in working to remedy the deplorable situation with regard to internally displaced persons.

We attach great importance to this issue. On 1 October 2002, Sir Brian Fall was appointed as the UK's special representative for Georgia—an appointment later expanded to cover the whole of the South Caucasus. Sir Brian is a senior UK representative on the Group of Friends of the UN Secretary-General, which aims to help the Georgians and Abkhaz to find a peaceful solution to the dispute. He regularly discusses the conflicts and other issues with senior members of the Georgian Government. We hope that the reforms that Georgia is currently undertaking will help it to move closer to resolving the conflicts. Stronger links with the outside world and greater prosperity will make Georgia the most attractive option for the would-be separatists.

The UK provides support to Georgia on conflict prevention programmes funded through the Global Conflict Prevention Pool. Our approach to civil-society building in Georgia has largely concentrated on encouraging dialogue across the various conflict divides and on developing the capacity of NGOs, journalists and other key groups to better address conflict-related issues. We consider the work of NGOs to be hugely important and commend their effective work across the conflict divide.

The noble Earl, Lord Sandwich, mentioned UNOMIG, the UN observer mission in Georgia. The UK is one of 28 nations contributing military personnel—we provide five. I will gladly write with further information about what we believe the mission is achieving at present.

Noble Lords will have gathered from my remarks so far that Georgia and the situation in and around Georgia are of interest and importance to the UK. This is exemplified by the high-level dialogue that we have with Georgia, most recently during the president's visit last month. The UK stands ready to help Georgia in her desire to become a stable, prosperous, democratic and well governed state. We welcome Georgia's aspirations to Euro-Atlantic values, and we support her sovereignty and territorial integrity, which we see as vital factors in maintaining stability in the whole region.

I am grateful for the warm support of the noble and right reverend Lord, Lord Harries of Pentregarth, for the work of our embassy in Tbilisi. He asked about DfID and other assistance. The Department for International Development has been providing support to the Georgian Government since 1992 and expects to spend around £3.5 million this year on a range of projects, including in the areas of public financial management, health, regional development and good governance. We also expect to provide assistance to the Georgian Minister for Euro-Atlantic Integration to help to support the implementation, monitoring and reporting requirements of work arising from its new EU action plan.

The UK share of overseas development assistance to Georgia in 2005 was £8 million. The two largest chunks of this came from the European Commission and the World Bank's International Development Association. Following Georgia's good economic growth and arrival at lower-middle income status, DfID will close its bilateral programme to Georgia at the end of 2008. However, the UK will continue its contribution to Georgia's development agenda through multilateral channels.

At the end of last year, Georgia took two welcome steps in deepening its relationship with Europe. In September, the NATO alliance agreed to open an intensified dialogue with Georgia and, in November, Georgia and the European Union signed a European Neighbourhood Policy action plan. This policy holds out the prospect of a closer relationship with, and greater assistance from, the European Union in return for progress on internal reforms. We encourage Georgia to embrace the European Neighbourhood Policy as a tool to help it to move closer to EU standards. In answer to the noble Earl, Lord Sandwich, the European Neighbourhood Policy does not prejudice future applications for EU membership by eligible countries. We hope that the processes involved and the active support of her partners in both the EU and NATO will encourage Georgia to do what is necessary to move closer to embodying the Euro-Atlantic values that we share with her.

The noble Earl, Lord Sandwich, asked about the alleviation of poverty and the millennium development goals. I do not have an answer this evening, but I shall certainly write to him. Georgia has preferential market access to the EU under the generalised system of preferences, and we are encouraging it to make full use of it. The European Commission has begun a process to look at the feasibility of a free-trade agreement with Georgia. I do not have a reply about microcredit and small enterprises, but I will gladly write about that.

It is clear, as the noble and right reverend Lord, Lord Harries, said, that democracy is a matter not just of elections but strong institutions and respect for human rights. There are a number of human rights issues in Georgia that our embassy in Tbilisi continues to monitor

We regularly raise these issues in our bilateral discussions with the Georgian Government and support our European partners, the OSCE and the Council of Europe. We have particular concerns over the situation in prisons. The justice sector as a whole needs serious attention, and places of detention are perhaps the most public illustration of the reforms needed. We believe that there is more work to be done on reform of the judiciary to ensure that its independence is fully protected and demonstrated. There is an apparent willingness at the highest level of the Georgian Government to reform the judiciary. This has been supported by the standards set under the EU action plan and in Georgia's progress towards NATO membership, and the acknowledgement that external foreign investment needs the support of a strong and independent judiciary. The UK has, through our high-level visitors, used these political and economic levers to highlight the need to drive forward the pace of reform in the justice sector, particularly in improvements in prisons.

Many noble Lords have understandably raised the question of NATO. We, of course, welcome Georgia's developing relationship with NATO. Georgia has participated through an individual partnership action plan in 2004 and, on the basis of progress made, was granted an intensified dialogue with NATO in September 2006. We have been pleased to see these steps forward in Georgia's relations with the alliance, particularly as they will help nourish not only military and defence reforms but the wider reforms that will help Georgia to develop sustainably.

The processes are designed to support and stimulate modernisation and reform, promoting Georgia's development as a secure, stable and successful country, including with a view to conflict resolution. The responsibility lies with Georgia to prove to allies that she can be a stable partner. We are sure that that is what the Government of Georgia are committed to doing. We support NATO's open-door policy, based on the principles of performance and commitment to NATO values, and Georgia's aspirations for eventual membership.

We are grateful for Georgia's significant support to international operations. I note the views expressed by the noble Lord, Lord Dykes, but I warmly welcome President Saakashvili's pledge of support to the ongoing missions in Kosovo, Iraq and Afghanistan. From this summer, we anticipate that Georgia will become the third largest troop-contributing nation in Iraq, after the US and UK.

As noble Lords have said, Georgia is experiencing a difficult period in its relations with Russia; but Russia and Georgia need to develop a constructive neighbourly relationship, and our aim is to support them in producing the conditions for that. We have urged both sides to show restraint towards each other, and welcome the fact that the rhetoric has calmed over the past few months. However, Russian transport restrictions as well as economic restrictions against Georgian produce remain in place. We have urged the Russian authorities, both bilaterally and through the EU, to lift these measures and will continue to do so. We also encourage Russia to use its significant influence with the de facto regimes in South Ossetia and Abkhazia to work towards sustainable solutions to these conflicts.

The noble Baroness, Lady Rawlings, understandably raised the summit at Samara. Despite difficulties in the UK and EU relationships with Russia it is important that we continue to engage. The EU and Russia are serious international players with a number of shared interests. The recent summit was part of that engagement process, in which a substantial range of issues were discussed. The EU also raised human rights. Chancellor Merkel was clear at the summit, in private and public, about the importance of protecting peaceful freedom of assembly in Russia. We fully align ourselves with those sentiments.

The noble and right reverend Lord, Lord Harries, asked for an assurance that member states of the European Union were working together. The reported statement of Mr Barroso, president of the European Commission, that a difficulty with one member state was a difficulty with the European Union, says it all.

Georgia is a key energy transit state and has positioned itself strategically to help Europe meet its energy needs. It hosts the significant Baku-Tbilisi-Cheyhan oil pipeline, opened in 2006, and the Baku-Tbilisi-Erzerum gas pipeline, which opened in 2007. These are both important arteries, enabling Caspian gas and particularly oil to reach western markets. The noble Baroness, Lady Rawlings, asked whether the Russians were not just using energy as a form of political and diplomatic power. The energy relationship with Russia must be seen firmly within a G8 context, in which context we will continue to engage with Russia.

In conclusion, Georgia has made the most enormous strides but still has some way to travel on the road to becoming a stable, secure and democratic modern European state. This evening's debate has been about the current situation in Georgia, but we should not forget that Georgian reforms are a work in progress. We recognise Georgia as a partner in our international agenda, in the promotion of sustainable development and reduction of poverty underpinned by human rights, in energy security and in building an effective EU in a secure neighbourhood. The Government will continue to support Georgia towards the goals that it has set itself.

House adjourned at 7.36 pm.