But U.S. officials insisted that they would find new ways to promote democracy and civil society without a USAID office here.
U.S. Secretary of State Hillary Clinton notified the Foreign Ministry on Tuesday that the USAID office would be shut down, a senior U.S. administration official said.
The Russians had told Clinton that they wanted the office closed during her visit to Vladivostok for the APEC summit at the beginning of this month, and the Foreign Ministry followed up on the request with a diplomatic note on Sept. 12, the official said, speaking on condition of anonymity because of the sensitivity of the issue.
USAID has been given a deadline of Oct. 1.
"The Russian government has decided that they want the activities of USAID to cease in Russia, and that's their decision, and we have responded to that decision today," the U.S. official said.
"But that doesn't mean that we have changed our policy of supporting the kinds of activities that USAID has been supporting, both in the sphere of health and the environment and support for civil society," the official said. "So over the coming weeks and months the Obama administration will be looking for ways to advance our old foreign policy objectives using new means."
The Kremlin, reeling from unprecedented protests among the middle class since disputed State Duma elections in December, has accused the U.S. State Department of fomenting the unrest and tightened the screws on nongovernmental organizations like Golos, the country's only independent elections watchdog, which exposed fraud during the Duma vote and subsequent March presidential election. A major portion of Golos' budget comes from USAID.
Losing USAID financing would deal "a serious blow, because the money is significant for the nongovernmental sector, especially for human rights organizations," said Lilia Shibanova, executive director of Golos.
"If the financing is halted, none of those organizations would be able to survive. The losses would be very serious," she said by telephone.
The executive director of For Human Rights, Lev Ponomaryov, said that while his organization doesn't receive assistance from USAID, he knows of many that do. Ponomaryov, who founded his nationwide group in 1997 after serving as a State Duma deputy, called the authorities' decision to go after USAID part of "a dangerous trend" and linked it to President Vladimir Putin's reaction to slipping middle-class support. Putin views Russia as "surrounded by enemies," Ponomaryov said by phone.
USAID, which has a mandate to support U.S. foreign policy, has spent more than $2.6 billion over the past 20 years in Russia, encouraging economic and democratic reforms, backing health and environmental initiatives, and promoting stability in the Caucasus.
The Russia office is staffed by 13 Americans and 60 Russians, according to a U.S. government official. It currently works with 57 Russian partners.
"We feel this is a difficult day for USAID," the U.S. administration official said. "We have a 20-year record of work in Russia. … We're proud of that work, and we saw no reason to disrupt it."
News of the closure broke late Tuesday night in Moscow, and Russian officials made no immediate comment.
What the development might mean for U.S. President Barack Obama's efforts to "reset" U.S.-Russian relations is unclear. The reset has led to improved economic ties in the form of significant investments by ExxonMobil and Cisco Systems and security cooperation on issues like Afghanistan. It also yielded an eased visa regime between the two countries this month. But Putin and Obama have not seen eye-to-eye on values like democracy and human rights.
In Washington, USAID's closure is certain to draw a sharp response from U.S. lawmakers seeking to pass the Magnitsky Act to punish Russian officials accused of human rights abuses. It also threatens to complicate Obama's efforts to convince lawmakers to scrap Soviet-era trade restrictions known as the Jackson-Vanik amendment, although the law is only hurting U.S. companies now that Russia has joined the World Trade Organization. If a vote on Jackson-Vanik is not held by the end of next week, the issue will likely be postponed until after the U.S. presidential election in November.
Freedom House, a Washington-based group that promotes freedom around the world, lashed out at Obama on Tuesday, accusing him of being soft on the Kremlin and urging him to rethink the closure of the USAID office.
"For USAID to up and leave Russia simply because Vladimir Putin asked us to do so is a betrayal of our decades-long support not only for grassroots human rights defenders, civil society, and development of the rule of law in Russia but also for assistance in areas like improving public health and the environment," David Kramer, president of Freedom House, said in a statement. "This decision sets a dangerous precedent and suggests that U.S. support for civil society ends when repressive governments apply pressure."
But the administration official insisted that the United States was not abandoning Russia or its partners here.
"We are committed to working closely with our partners in Russia, to continue the work that we've done," the official said. "Obviously, with this new development, we're going to have to look for news ways of achieving those ends, but we are committed to doing so.
"We've already in the past explored some options. This development will now compel us to explore those options more — on a faster timeline — and will compel us to explore new kinds of ways to achieve the same ends."
U.S. State Department spokeswoman Victoria Nuland echoed that sentiment, saying in a statement: "While USAID's physical presence in Russia will come to an end, we remain committed to supporting democracy, human rights, and the development of a more robust civil society in Russia and look forward to continuing our cooperation with Russian nongovernmental organizations."
Curiously, the Kremlin-friendly newspaper Izvestia published a report on Aug. 2 with the headline "USAID Agency Is Leaving Russia." The report, however, said the reason for the departure was a lack of interest in Russia and noted that Congress-endorsed expenditures for USAID have been declining in recent years.
The last time the Russian government pushed out a U.S. government program also occurred on Putin's watch. In 2002, Peace Corps volunteers were declared unwelcome after the Federal Security Service accused them of snooping on Russian officials instead of fulfilling their self-stated mission of promoting world peace and friendship through volunteerism.
Staff writer Nikolaus von Twickel contributed to this report.