AZERBAIJAN’S GEOPOLITICAL CHALLENGE: IMPROVING RELATIONS WITH IRAN
By Tamine Adeebfar

Middle East Economic Survey, Lebanon
Vol: XLIX, Number 49
Dec 4 2006

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-a-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.

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