BACKGROUND: As the only two Caspian states, the Soviet Union and Iran were the only military powers in the Caspian region in the Soviet era. Although the Iranians had a significant military presence, including a small Caspian Sea fleet, the Soviets were unquestionably the dominant military force with a very impressive Caspian Sea fleet. The disintegration of the Soviet Union increased the number of Caspian littoral states from two to five. Of the four ex-Soviet republics, Russia inherited the largest chunk of the Soviet military assets, including almost the entire Caspian naval force, leaving the remaining countries in a very disadvantageous military position. Like other sovereign states, efforts on the part of Azerbaijan, Kazakhstan and Turkmenistan to form their military forces was quite natural in the early 1990s when they were trying to consolidate their independence. Yet, especially in the second half of the 1990s, disagreements over the division of the energy-rich Caspian Sea, in the absence of a legal regime acceptable to all the littoral states, led to territorial disputes between and among them, including multiple ownership claims to a number of oilfields. Apart from political and security considerations, fear of losing those potentially revenue-generating fields to their neighbors created strong economic incentives for all the Caspian states to boost their military power. The stakes were highest for the militarily weakest, Kazakhstan, Azerbaijan and Turkmenistan. In particular, in the late 1990s, Turkmenistan found itself in dispute with Azerbaijan over a few major operating and non-operating oilfields under Azerbaijani control such as Azeri, Chiraq and Guneshli. Not only did those disputes damage their diplomatic relations, they triggered an arms race when Turkmenistan reacted to Azerbaijan\'s acquisition of two American military boats by purchasing several Ukrainian military boats. In 2001, disputes between Iran and Azerbaijan over an undeveloped oilfield called Alborz or Alov, respectively, resulted in an Iranian show of force. The three mentioned countries, along with Russia and Kazakhstan, have since sought to increase their military power, including with the assistance of non-regional countries, e.g., the United States (Azerbaijan) and Ukraine (Turkmenistan)

IMPLICATIONS: In this context, President Niyazov\'s statements on January 12 echoed Turkmenistan\'s security concerns and its efforts to address them. Speaking on the occasion of “Remembrance Day” to mark the anniversary of the Turkmens\' bloody defeat at the hands of the tsarist army in 1881 in the battle of Gokdepe, the president took the opportunity to point out the necessity of his country\'s military preparedness. While emphasizing the importance of having good ties with both Russia and the United States as a major component of the Turkmen policy of neutrality in foreign relations, he stressed Turkmenistan\'s need to increase and modernize its military power. Accordingly, failure in that regard resulted in its loss of sovereignty to Russia in the 19th century, a \"mistake\" which he stressed should not be repeated. Hence he described as crucial investing in Turkmenistan\'s defense and that the Turkmen forces should be able to operate the \"most sophisticated military hardware and equipment.\" Since the 1990s, Ashgabad has relied mainly on CIS countries, and first and foremost Ukraine, to supply its military needs, apart from unknown amounts of purchases of military hardware from Iran with which it signed military agreements in January 1994. Undoubtedly, Kiev has become Turkmenistan\'s main supplier of advanced weaponry, including state-of-the-art air defense systems. As reported in early January 2004, Turkmenistan in 2003 invested about $200 million to maintain the \"tactical efficiency\" of its military forces. The amount included the cost of purchasing of \"a number\" of Ukrainian military boats (Kalkan-M patrol boats) and \"several sets\" of air defense detecting systems (Kolchuga passive radio electronic surveillance equipment). Reports suggests Turkmenistan\'s future receipt of ten \"Grif (Kondor) multi-purpose boats\" and ten \"eight-ton Kalkan boats\" presumably in 2004, while it is unknown whether they are part of the 200-million-dollar \"investment\". Turkmenistan\'s military purchases from Ukraine will likely continue as suggested in reports on its allocation of $80 million for the \"reinforcement of the maintenance and purchase of arms and equipment.\" The value of its arms purchases in general, and those from Ukraine in particular, could well increase in the near future at least partly in response to other littoral countries beefing up their military strength – especially Azerbaijan, with which its ties are unfriendly. Moreover, Turkmenistan\'s arms purchases from Ukraine could further expand if the two sides sign a new 25-year agreement to provide Ukraine with Turkmen natural gas, as planned for February. Since the early 1990s, Ukraine\'s chronic shortage of hard currency has forced it to pay a significant portion of its financial commitments in industrial products.

CONCLUSIONS: Like any other sovereign state, Turkmenistan has a right to defend itself and thus make steps towards improving its military power. In itself, the amount of its current military expenditure is not significant for a country with the smallest military force in the Caspian region. Nor is it significant enough to suddenly change the regional balance of military power in its favor. However, Ashgabad\'s significant arms purchases compared to its limited annual revenues in hard currency (about $1-2 billion) could encourage, if not provoke, especially Iran, Azerbaijan and Kazakhstan to accelerate and expand their military build-up. In this respect, the contributing factors include Turkmenistan\'s serious territorial disputes with Azerbaijan over certain Caspian oilfields and an undeclared arms race between and among the Caspian littoral states. The resulting accelerated arms race could function as a provocative factor to complicate the peaceful settlement of current territorial disputes.

AUTHOR’S BIO: Dr. Hooman Peimani works as an independent consultant with international organizations in Geneva and does research in International Relations.