It was the moment that British spycraft became the laughing stock of Russia. The decision by MI6 to place a fake rock rigged with a hidden transmitter to communicate with agents in Moscow was more Johnny English than James Bond, with Russian state-run television airing a programme dissecting the rock with x-rays and showing grainy footage of British diplomats giving it a gentle kick when it seemed to be out of order.
Thursday's admission by Jonathan Powell, former chief of staff to the then prime minister, Tony Blair, that the rock was indeed the work of British intelligence might seem like a small footnote in history to a forgotten scandal. But inside Russia there was a bigger game at play.
"The spy rock was embarrassing … they had us bang to rights," Powell told BBC2 in its new documentary series Putin, Russia and the West. The Kremlin had known about the rock "for some time, and had been saving it up for a political purpose", he added.
That political purpose emerged two days after the scandal came to light when Vladimir Putin, then president, said: "It has now become clear to many why Russia passed a law regulating NGO activities."
Less than two weeks earlier Putin had quietly signed a new law tightening state control over non-governmental organisations, including clauses that gave the government power to shut them down and force greater monitoring of foreign funding. The new regulations followed pro-democracy revolutions in neighbouring Georgia and Ukraine, which Russia argued were orchestrated by the west via foreign-funded NGOs.
The new law, Putin explained, was "designed to block foreign governments from interfering in the internal politics of the Russian Federation". Critics said it was the latest step in Putin's growing authoritarianism, a further crackdown on Russia's struggling civil society. International organisations loudly condemned the law.
That's when the rock dropped into the narrative. According to the Kremlin, a British diplomat used communications technology in the fake rock to send and receive information and had dealings with Russian NGOs; ergo, went the Kremlin's argument, the west was funding NGOs to cause the downfall of the Putin regime. A justification for Putin's new law had been found. Since the law was implemented thousands of NGOs have been harassed, denied registration or shut down, according to Human Rights Watch. The climate of suspicion has only intensified, particularly in the past month as Putin battles a growing movement against his rule as he seeks to return to the presidency in March.
In the lead-up to Russia's parliamentary election on 4 December, Putin said again outside powers were seeking to use NGOs to subvert the country. Within days of his remarks an all-out campaign had been launched against Golos, an independent election-monitoring group that receives foreign funding – bureaucratic investigations, a smear campaign in the press, the hacking of employees' email accounts. When tens of thousands of Russians began taking to the streets in the wake of the vote – spurred on by widespread allegations of fraud of the type Golos was designed to monitor – Putin promptly accused them of being agents of the west.
That's what for some Russians makes the timing of Powell's revelation so precarious. "I would not be surprised if Putin and his team actually used it again to assert their old platitudes discrediting leading human rights activists," said Tanya Lokshina, of Human Rights Watch Russia.