Azerbaijan’s Geopolitical Challenge: Improving Relations With Iran

Middle East Economic Survey
VOL. XLIX
No 49
4-Dec-2006
CASPIAN/IRAN
By Tamine Adeebfar

The following paper was written by Dr Adeebar for the Tehran-based Ravand Institute for Economic and International Studies, and is reprinted with the author’s permission.

In the post-cold war context, the geopolitics of the new state of Azerbaijan, with its economic and security concerns, has become an issue involving a range of complementary and competing factors. Since Azerbaijan’s independence, just over a decade ago, the country has been facing many challenges and opportunities, including: the landlocked nature of the country and Caspian pipeline politics; the unresolved issue of the legal status of the Caspian; the exploitation of its natural resources and the attraction of the FDI needed to bring hard currency into the country; the unresolved Nagorno-Karabakh conflict with Armenia; the impacts of the war in Chechnya; political volatilities in its two powerful neighbors, Russia and Iran; and the uncertainties in the Georgian territory. These and many more challenges need to be taken into consideration by analysts approaching Azerbaijan’s geopolitical issues.

In this broad context, the biggest challenge for Azerbaijan has been to balance the threats and opportunities by minimizing the former and maximizing the latter. This challenge has a clear political dimension. In that context, it seems that in determining its behavior as a newly independent state, Azerbaijan perceives two diverging external axes of power between which it tries to play a balancing game. These axes can be seen as US-Turkey-Israel on the one hand, and Russia-Iran-CIS on the other. In that respect, the following key parameters can be drawn:

Russia still has de facto influence over states close at hand and mediates in the conflicts in the troubled areas in the region. Russia’s interests in its ‘backyard’ neighbors have remained strong, given its long history and ties with the new republics. These interests may not necessarily be interpreted as confrontational, but rather as a reality of regional politics.

Iranian Influence

Another major parameter has been Iran ­– Azerbaijan’s southern Islamic neighbor – given the Muslim majority in Azerbaijan, the long border between the two states, and the large population of Iranian Azeris in Iran’s northern province. A key fear for Azerbaijan has been Iran’s perceived ability to exercise its ideological/political power to undermine Azerbaijan’s secular statehood.

Furthermore, since Azerbaijan’s independence, its primary foreign policy criteria with other states has been their position towards Nagorno-Karabakh and the territorial integrity of Azerbaijan. In that respect, Iran’s aid to Armenia has created some concerns for Azerbaijan in terms of its relations with Tehran. Yet, it is important to bear in mind that Iran’s aid to Armenia has never consisted of support for the territorial conflict between Azerbaijan and Armenia. Besides, Iran has continued its trade relations with Azerbaijan’s enclave of Nakhjavan, located in Armenian territory. Nonetheless, the pro-US approach has resulted in a tendency to put Iran and Russia in one basket, despite their different positions towards Armenia, and thus to encourage Azerbaijan’s tense relations with it two northern and southern neighbors. In line with that policy, Azerbaijan has been strengthening its ties with the US and the regional US ally, Turkey, and consequently it has supported US strategy in the region, such as neglecting the pipeline routes through Russia and Iran, and instead opting for the Baku-Tbilisi-Ceyhan (BTC) pipeline through Turkey, regardless of its lesser commercial viability.

Azerbaijan’s pro-Western approach has developed as a counterweight to its regional challenges and particularly its powerful neighbors. In that direction and particularly in the aftermath of the events of September 11th, which were followed by the US attacks on Afghanistan and then Iraq, Azerbaijan has seized the opportunity of mobilization of support for the US position to ally with the only world superpower, probably in the hope that it would secure its economic and security needs as a young state that is strongly dependent on energy resources. Hence, Azerbaijan participated in sending troops to Kosovo, Afghanistan and Iraq, and also provided an air corridor for the US military efforts.

Azerbaijan also began a closer relation with Israel through trade and cultural cooperation as well as security-oriented exchanges, regardless of the animosity between Iran and Israel. These attempts by Azerbaijan were to define its foreign policy based on its perceptions of geo-strategic interests rather than any other motivations such as merely economic needs and/or cultural/ideological motivations.

Iran/Russia Interests

The common interests of Iran and Russia in the region, their support for Armenia and particularly their shared wish to avoid Western influence have increasingly encouraged Azerbaijan to play the US card to act as a shield of security. Nevertheless, it needs to be kept in mind that the US strategy in the region is defined by three issues:

First, a security-related presence in the region; second, control over the energy-related issues in the economic context; and third, political influence through an “Americanized democracy” in the region to be exercised by pro-US governments. Obviously the latter approach did not appeal to the Azerbaijan government, given its preferred way of handling internal affairs. The ‘color revolutions’ in the region in recent years have clearly acted as a “wake-up call” to those in Azerbaijan favoring a pro-Western approach to modulate its interactions with both flanks, while trying not to be seen leaning too far in one direction.

A full alliance with the US, therefore, no longer seems to be a golden opportunity, nor does it guarantee their “strategic partnership”. Rather it could be seen as a possible threat to Azerbaijan’s stability. Given the US reputation of being an unreliable ally when its immediate interests and power position are at stake, Azerbaijan may need to take the following observations into consideration.

Given that Russia’s challenges vis-à-vis the US are usually based on grand bargaining, meaning that the short-term sacrifices can be made for long-term gains, to what extent would it matter to Russia to face instability in Azerbaijan, should a color revolution happen there? Would it really affect Turkey’s strategic ambitions and interests in the region if a pro-American government were to replace the present Azerbaijani administration? How would Israel react to such change?

US Sanctions

Despite Armenia occupying almost 20% of Azerbaijan’s territory and causing 1mn people to be displaced in Azerbaijan, the US-imposed Section 907 Act1 on Azerbaijan in favor of Armenia remains effective.

Despite years of Western involvement – through the Minsk Group2 – in mediating between Azerbaijan and Armenia to resolve the Nagorno-Karabakh conflict, there has been no success in addressing the conflict and assuring Azerbaijan’s territorial integrity, for various reasons – from Russian interests to the Minsk group’s failings.

Despite the possible perceived threat of a successful Azerbaijan as a role model for the more-than-20mn Azeri Iranians in Iran, the question needs to be posed: is Iran really worried about the success of any small country in its neighborhood? In the absence of a threat to Iranian security through the use of a neighbor as a base for potential attacks by a powerful state, Iran has shown no concern about the economic success of any neighboring country. Dubai is an example. Iran, historically, has tended to compete with more distant countries.

Also, Iranian Azeris play a leading role in Iranian society and the economy, especially in the state’s key systems. There is no reason for them to wish to create a troubled area within their own homeland. In that context, the famous American marketing principle of “If you advertise your wish often enough to make it believed, then your wish will come true”, makes one wonder if this overly repeated concept of “Azerbaijan’s threat to Iran in terms of awakening separatist ideas among Iranian Azeris” has ever had a genuine base. Could it be that it is rather the expression of another agenda – to undermine potential cooperation between the two countries?

Support For Azerbaijan

Despite the perceived threat of Iranian ideologically expansionist tendencies, the economic and political potential for Tehran to provide support for Azerbaijan is real and may be worth further examination by both neighbors. From the standpoint of Azerbaijan’s need for a balancing mechanism, Iran’s geopolitical importance in the context of US interests in the Gulf as well as in Iraq, the tension over the Iranian nuclear issue, the historical animosity in Iran-US relations, and the regional rivalry among Iran, Turkey and Russia – all these factors represent a strong card that could be played in Azerbaijan’s geopolitical balancing game to secure its stability.

Moreover, all the economic advantages and potentials – from the possibility of Iranian investments in Azerbaijan to inter-state cooperation on areas of interests such as a Nakhjavan trade agreements and/or gas pipelines to the neighboring markets – could bring more balance into Azerbaijan’s policies in terms of the perceived divergent interests of the two states.

Given the complex context in which it finds itself and the need to balance the interests of competing outside interests against its own national ones, Azerbaijan should reassess its real strategic geopolitical interests. As outlined above, that assessment should include consideration of a closer relationship with its southern neighbor, Iran. Such a move is likely to offer more opportunities and fewer threats than meet the eye.

1. Section 907 of the Freedom Support Act was passed by the United States Congress in 1992. The article bans direct aid to the Azeri government.

2. The OSCE Minsk Group was created in 1992 by the Conference on Security and Cooperation in Europe (CSCE, now Organization for Security and Co-operation in Europe (OSCE)) to encourage a peaceful, negotiated resolution to the conflict between Azerbaijan and Armenia over Nagorno-Karabakh.

Note: Above are excerpts from the article. The full article appears here. Clarifications and comments by me are contained in {}. Deletions are marked by [...]. The bold emphasis is mine.