Azerbaijan Caught in the Middle

Economic News

22 Jul 2010
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As a former member of the Soviet Union, Azerbaijan remains in what Russia would regard its sphere of influence, but culturally Azeris are far closer to the NATO-member Turks. In recent weeks this pull in both directions has taken on a more serious nature, especially after President Haydar Aliyev's visit to Moscow in January and his agreement to lease to Russia a radar station in Azerbaijan, signed on the 25th of the month. Turkey has meanwhile tried to bear influence in the region and would like to have military bases in Azerbaijan, with the speaker of the Turkish parliament Omer Izgi saying on February 8th that the Nagorno-Karabakh conflict should not be solved without Turkey.

The Azeri press covered Aliyev's three-day visit to Moscow extensively. The most important development from the visit was the agreement covering Russia's use of the Gabala missile-tracking and radar station in Azerbaijan. Although Russia has been using the station for the last ten years, the position has never been formalised, although efforts have been on-going since 1992. Under the terms of the agreement Russia agreed that the base remained Azeri property, that it would lease it initially for a ten-year period at a cost of $10bn per year, and that it would pay retroactive fees worth $31m for the period from July 1997 to December 2001, bringing Azerbaijan a total of $161m over the next ten years. Russian sources had always said that Moscow would not pay more than $2bn per year for use of the station, but analysts believe that the US campaign in Afghanistan has spurred Russian interest in its use. The station overlooks most of the Indian the sub-continent, including Afghanistan, and as far as the Arabian Gulf. According to some analysts western countries had offered better fees for use of it, but Baku has gone with Moscow.

Although the agreement marks an important step in Russian-Azeri relations as the issue of the base had always added to tensions, difficulties still remain. The two countries have been at odds over the status of Nagorno-Karabakh, an ethnic Armenian enclave that broke away from Azerbaijan in 1988. Russia still has troops in Armenia, prompting Azeri claims that it is sympathetic to the Armenian cause.

A further important development emerging from Aliyev's visit to Moscow was an agreement on the political status and division of the Caspian Sea, am issue that has also been in limbo since the end of the Soviet Union. The Azeri president told the Russian news agency ITAR-TASS on January 26th that his country, Russia and Kazakhstan had agreed on a delimitation line on the bottom of the sea. This solution sees the waters and the surface still open, a compromise Iran and Turkmenistan are against.

The generally warming relations between Russia and Azerbaijan indicated by the official visit have caused some concern in Turkey. Azerbaijan has closer ethnic, cultural and religious ties with Turkey, the other major power in the region. Naturally Ankara was concerned with the developments regarding the Russian radar station, although on January 29th a former Azeri Defence Minister Dadas Rzayev tried to reassure Turkey that it would not be used against the Turks.

The speaker of the Turkish parliament Omer Izgi was in Baku in early February on an official visit to bolster the Turkish cause. Just days before, on January 31st Azerbaijan and Turkey signed an economic co-operation agreement in an effort to triple bilateral trade from the current $250m per year, but Izgi's visit generated more interest.

In a speech to the Azeri parliament on February 8th he denounced the deal on the radar station saying that Russia would use it to watch Turkey. In the same speech he said that Turkey should be involved in finding a solution to the Nagorno-Karabakh problem and that Ankara would side with Baku, whom he praised for protecting western values and turning to the west. His Azeri counterpart Murtuz Aleskerov also used the opportunity to fan the flames by claiming that Turkey may in the future be able to make use of the Gabala station, jointly with Russia.

This did not go down well in Moscow, where the official reaction was muted, with some observers noting that this would bring NATO infrastructure still closer to Russia, and some officials said they hoped that the comments did not reflect Baku's official position. Later comments from Azeri officials proposing a possible Turkish military base in Azerbaijan were also received with dismay in Moscow, where the deputy speaker of the Duma Vladimir Lukin said that although he appreciated Baku's desire to be friends with both Russia and Turkey, he wished that Baku would choose "other forms of strengthening its contacts with Ankara".

In an interview with the official Azeri news agency ANS also on February 8th Izgi said that he believed that Azerbaijan, not Russia should be the south-Caucasus region leader and that Turkish aid to Baku would increase as Turkey's economy recovered. In the days after his visit to Baku other commentators also brought their opinions on Turkish military co-operation to the public attention. The leader of the main Azeri opposition Musavat Party, Isa Kamber said on February 12th that a Turkish base in Azerbaijan was an "absolute necessity" and a former Turkish state minister Ahad Andijan commented that Ankara should help Baku boost its security. He did also note that jointly using the radar station with the Russians was problematic and probably not feasible, although he welcomed Russian-Turkish co-operation in other regional projects, such as the Baku-Ceyhan pipeline.

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