Armenia suspends electricity price increases after weeks of protests

YEREVAN, Armenia, June 28 (UPI) -- The Armenian government will suspend electricity price increases by covering the cost pending a review but protesters in Yerevan, the country's capital, have not backed down.

The government's move comes as Russia agreed to loan Armenia $200 million for military upgrades.

President Serzh Sargsyan announced the move after meeting with Russian Transport Minister Maxim Sokolov.

Protesters have blocked the main avenue in Yerevan for six days. Demonstrations began June 17 shortly after the Armenian government announced a more than 16 percent increase in electricity tariffs.

Hundreds of people, including journalists, have been detained. Protest organizers will announce if they will continue to hold protests Sunday evening as the demand of a complete reversal of price increases has not been met.

Armenia, a former Soviet republic, declared its independence in 1991 but retains close economic ties to sanctions-impeded Russia. It declined to seek ties with the European Union (EU), choosing instead to join a trade bloc, the Eurasian Union, which includes Russia, Belarus and Kazakhstan.

Remittances from Russia, a crucial part of the Armenian economy, have fallen by 50 percent in 2015, and the submission of a proposed bid by the Electric Networks of Armenia (ENA) to raise electricity tariffs was seen by many as unnecessary and a ploy to enrich the ENA. The tariff was approved by the Armenian parliament.

The ENA is owned by Russia's Inter-RAO energy company, whose chairman is a close friend of Russian President Vladimir Putin.