As Putin's visit to Japan and his possible surrender of (some of) the Kuril Islands to Japan during the visit (most likely already finalized in September, if not before) is approaching, part of the setup is to present the surrender as a victory for "peace" or a peace treaty. In this respect, there is no doubt that Japan can easily almost immediately increase the living standards for the relatively small number of the Russians living on the islands 5-10 times of what it is now. However, everyone knows how precarious this possible or looming maneuver is for Putin and the Kremlin. Even a small short offensive in Donbass would not be able to neutralize the potentially negative impact (not to mention the fact that against the now much better trained and equipped Ukrainian army such an offensive does not have now a good, reasonable prospect of success--well, unless it would have been conceived and tried as a show from the beginning).
Till the denouement through the visit and its results, the main thing to watch now is the fate of the Kuril Islands, and the unconcealed eagerness of the Kremlin to placate the Cold War winners, yet somewhat checked by the fear of their own people. In this situation, Putin's and the Kremlin's greatest hope is still the tight control over the media and the Russian TV programming.
Moreover, in negotiating with Japan a possible "peace treaty" clearly apart and separately from China (as well as Koreas), Russia is also apparently effectively as well as blindly cutting a good deal of the branch it is sitting on with respect to China, respectively, de facto setting up herself for a similar separate treatment by China in the (near) future. (On the 1951 San Francisco separate peace treaty with Japan see here)
Putin's "historical visit" to Japan is scheduled for December 15-16, 2016. Symbolically, he is going to Japan--to Japan's seat of power, and he is not coming as a victor. At best, as a haggler.
"Expectations for a breakthrough rose considerably after Abe put a "new approach" to the issue on the table while meeting with Putin in Sochi, Russia, in May, 2016. He did not elaborate on the details at the time. There has, however, been speculation that the proposal was modeled on the so-called "two islands plus alpha" template. The proposal: Japan would take possession of the two smaller islands of Shikotan and Habomai, as well as receiving a further concession from Russia. Thereafter a peace treaty would be signed. The "alpha" could be a common economic zone for the islands, or eventual shared possession of the two larger islands Kunashir and Etorofu. Japan is prepared to offer Russia generous economic help as an incentive. Nevertheless, few experts expect that a compromise will be reached at the upcoming summit. "The subject is far too complicated," stressed a former Japanese diplomat." ... In 1992, Russia made a secret proposal for negotiations on the incremental return of the four islands. The proposal was turned down by the Japanese. Meeting in Irkutsk, Russia, in March, 2001, Putin - then in his first term as Russian President - and Prime Minister Yoshiro Mori said that the 1956 declaration was in fact the valid basis for peace negotiations. At the time, two Japanese diplomats, along with politician Muneo Suzuki, negotiated a solution to the crisis on the basis of a "two plus alpha" formula. However, they were unable to gain the support of hardliners in the Japanese Foreign Ministry. ...
Japanese Prime Minister Shinzo Abe has sought better relations with Russia since he took office in 2012, in order to strengthen Japan's position in its rivalry with China. If that is to happen, the dispute over the Kuril Islands must finally come to an end. In March, 2012, Putin repeated his desire to end the dispute with Japan with a "Hikiwake" (the term for "draw" in judo), and move on to improving economic relations. Putin is looking to the development of the Russian Far East. But official negotiations were put on hold when Japan placed sanctions on Russia over its military intervention in Ukraine.
Unexpectedly, Russia resumed talks at the beginning of this year although sanctions remain in place. It is likely that Putin is meeting with Abe in an attempt to break the unity of those countries currently imposing sanctions on Russia. ...
Nevertheless, there will be time for Japan and Russia to come to an agreement as both Putin and Abe will remain in office for the time being. "As long as Abe and Putin are in office the chance for a peace agreement exists," says Russia's former assistant foreign secretary, Alexander Panov. He was involved in coming up with the "two plus alpha" formula while he served as Russian ambassador in Tokyo, in 2001. Yet Panov predicts that nothing will happen at the December summit: "Neither country is yet prepared to take the radical steps that are needed.""
Japan wants to bribe Russia to return four Kuril Islands at once- See more at: http://www.pravdareport.com/russia/politics/21-11-2016/136213-japan_russia-0/#sthash.CERZtGdi.dpuf