BACKGROUND: Azerbaijan and Iran have a long common history ended when Iran lost the Caucasus, including Azerbaijan, to Russia as a result of two series of long and devastating wars. The Turkmanchai Treaty of 1828 heralded the end of Iran’s influence in that region as the treaty formalized its annexation by Russia. The Soviet Union’s collapse and the emergence of Azerbaijan as an independent state created high hopes both in Iran and Azerbaijan for close and cordial relations justified by their common history as well as many other commonalities such as cultural, social and religious. However, Azerbaijan did not enjoy close, warm and expanding relations with Iran during the first few years of its independence because of erroneous polices taken by both sides. Their relations were especially troublesome during the term of the first Azerbaijani President Abulfez Elchibey, when hostility and not friendship became the defining characteristic of Baku-Tehran relations. However, the ascension to power in 1993 of the late President Heydar Aliyev helped change the course of their relations thanks to a more balanced foreign policy towards Iran and Russia compared to his predecessor. In the second half of the 1990s, the two neighbors sought to improve their relations damaged as a result of the legacy of the past and other issues, including Iran’s exclusion – under American pressure – from the major oil development projects. While especially the latter served as a factor to instigate tensions in their bilateral relations throughout the 1990s, political, economic and security realities inclined the two sides to improve their relations as neither side facing regional security challenges saw a merit in pushing a potentially friendly neighbor into the enemy camp. Large numbers of high-level official visits, including at the presidential levels, late in the 1990s and during the first three years of the 21st century indicated a significant improvement in Iranian-Azerbaijani relations. Yet, this period also witnessed serious deterioration of relations caused by a territorial dispute over the ownership of an off-shore oilfield in the Caspian Sea in late 2001. Although the incident, which showed a potential to escalate into military conflict, damaged their improving relations, both Baku and Tehran made an effort to stabilize their relations in its aftermath as reflected in President Heydar Aliyev’s visit to Iran in 2002. Those relations were on the track of improvement without experiencing new tensions when he passed away a year latter.

IMPLICATIONS: The election as president of Ilham Aliyev in October 2003 turned out to be a development with a positive impact of Azerbaijani-Iranian relations. Despite expectations to the contrary, he has since pursued a balanced foreign policy characterized by a clear effort to maintain reliable, predictable and tension-free relations with Iran and Russia, two of Azerbaijan’s neighbors sharing a concern over Baku’s expanding relations with the United States. Thanks to a constructive mood in Iran and Azerbaijan, apart from their growing economic relations, the two neighbors have embarked on cooperation on security-related issues, including anti-drug operations. The growing activities of drug-traffickers in their countries have been not only a source of health problems especially for their youth, but also a threat to their border security as a result of the illegal border crossing of traffickers. Iranian President Mohammad Khatami’s August 2004 visit to Baku resulted in the signing of a security agreement whose specifics are not fully known. A sign of good relations in itself, the visit was also significant for the success of signing the agreement, given expanding Baku-Washington ties in many fields, including military and security affairs. As acknowledged by both Baku and Tehran, the visit and its security agreement helped further consolidate Iranian-Azerbaijani relations, particularly in the struggle against narcotics, organized crime and terrorism. Security cooperation aside, Iran and Azerbaijan have since undertaken many small-scale joint projects, including those facilitating land transportation between the two countries. As a recent example, on 3 December 2004 the ministries of roads and transportation of Iran and Azerbaijan agreed to build two bridges between their countries for the total value of $11 million, namely Pole Dasht-Shah Takhti bridge between Iran and Azerbaijan’s Autonomous Republic of Nakhichevan and the Julfa bridge between Iran and Azerbaijan’s mainland. Within this context, apart from its diplomatic significance, the December meeting of the Azerbaijani minister of internal affairs with the Iranian ambassador to Azerbaijan demonstrated Baku’s interest in expanding and consolidating ties with Tehran, as evident in his calling on Iranian investors to invest more in his country, while maintaining good relations with Washington.

CONCLUSIONS: As two neighbors with many commonalities, Iran and Azerbaijan do have the ingredients to build warm, predictable and tension-free relations for the good of their own nations and the security of the Caucasus, which has had more than a fair share of conflict since the Soviet Union’s disintegration. There is a great potential for their extensive economic activities not limited to the oil industry in which the two countries have great stakes. Factors such as the growing American presence in Azerbaijan have been and will likely be a source of conflict between Azerbaijan and Iran. Nevertheless, long-term considerations should convince them as to the merit of making an extra effort to maintain close, friendly and constructive relations, which will certainly serve their national interests, added to their contribution to securing peace and stability in the Caucasus. As reciprocated by the Iranian government, the Ilham Aliyev administration has indicated an interest in that direction. One should hope that the two sides will continue to work towards that end despite their differences over issues such as ties with the United States and a legal regime for the Caspian Sea.

AUTHOR’S BIO: Dr Hooman Peimani works as a Senior Research Fellow for the Centre for International Cooperation and Security (CICS), Department of Peace Studies, University of Bradford, UK.