Azerbaijan

Country Profile
Submitted to

Dr Nawaz Qaisarani
Submitted by

Faryal Akhter Anum Hameed Aimen Majeed

BS Politics and IR 6th Semester

Introduction
Azerbaijan is one of the world's most ancient human settlements. Development periods of the history of all humanity lived in this land. Human settlements in Azerbaijan were the dawn of humanity of current culture and civilization, progress and dialectics of its own share. Azerbaijan is a beautiful country located in South Caucasian region, sitting at the crossroads of East and West. The country is not only rich in natural resources; it also has a rich and eventful history. From the pre-Islamic time to the present, Azerbaijan has seen various alterations in the region. Its name is thought to be derived from the Persian phrase "Land of Fire," referring both to its petroleum deposits, known since ancient times, and to its status as a former center of the Zoroastrian faith. National Name: Azarbaycan Respublikasi Capital: Baku Languages: Azerbaijani Turkic 89%, Russian 3%, Armenian 2%, other 6% (Most of the population is bilingual) Population: 9.077 million. Population growth rate: 1.1% Literacy rate: 99.5% Government Type: Republic Ethnic Groups: Azeri 90.6%, Dagestani 2.2%, Russian 1.8%, Armenian 1.5%, other 3.9% Religions: Islam 93%, Russian Orthodox 3%, Armenian Orthodox 2%, others 2%.

History
Azerbaijan combines the heritage of two venerable civilizations--the Seljuk Turks of the 11th century and the ancient Persians. Numerous empires fought for control, including those of Alexander the Great, the Romans, the Mongol conqueror Genghis Khan, and Peter the Great of Russia. Little is known about Azerbaijan's history until its conquest and conversion to Islam by the Arabs in 642 AD. Centuries of prosperity as a province of the Muslim caliphate followed. After the decline of the Arab Empire, Azerbaijan was ravaged during the Mongol invasions but regained prosperity in the 13th-15th centuries under the Mongol II-Khans, the native Shirvan Shahs, and under Persia's Safavid Dynasty. Due to its location on the shore of the Caspian Sea and astride the trade routes connecting Europe to Central Asia and the Near East, Azerbaijan was fought over by Russia, Persia, and the Ottomans. Finally, the Russians split Azerbaijan's territory with Persia in 1828 by the Treaty of Turkmenchay, establishing the present frontiers and extinguishing the last native dynasties of local Azerbaijani khans. The beginning of modern exploitation of the oil fields in the 1870s led to a period of extraordinary prosperity and growth in the years before World War I.

Following the collapse of the Russian Empire in 1917, an independent republic was proclaimed in 1918. The first democratic republic in the Muslim world, it gave equal rights to men and women regarding suffrage, in 1919. However, its independence ended with the arrival of the Red Army. Incorporated into the Transcaucasian Federated Soviet Socialist Republic in 1922, Azerbaijan became a union republic of the Soviet Union in 1936. The late 1980s were characterized by increasing unrest, eventually leading to a violent confrontation with Soviet Union. Azerbaijan declared its independence from the U.S.S.R. on August 30, 1991.

Physical Geography
Azerbaijan is a country in the shape that resembles a flying eagle with its wings spread out. Other than its larger area of Azerbaijan proper, it also has a small exclave Naxcivan that is surrounded by Armenia to the north and Iran to the south of it.

Location
Azerbaijan is located in Southwestern Asia, bordering the Caspian Sea, between Iran and Russia, with a small European portion north of the Caucasus range.

Area
Azerbaijan has a total land area of approximately 86,600 square kilometers, less than 1% of the land area of the former Soviet Union. Land: 82,629 sq km Water: 3,971 sq km Azerbaijan has the greatest land area of the three South Caucasian states. Area-wise, Azerbaijan is the 113th country of the world.

Land Boundaries
Total 2,013 km Shared with Border Countries Armenia: (with Azerbaijan-proper) 566 km, (with Azerbaijan-Naxcivan exclave) 221 km Georgia: 322 km Iran: (with Azerbaijan-proper) 432 km, (with Azerbaijan-Naxcivan exclave) 179 km Russia: 284 km Turkey: 9 km

Coastline & Maritime Claims

Azerbaijan is a landlocked country. However, it borders the Caspian Sea (a landlocked sea itself) sharing with it a border of 713 km.

Since it is landlocked, it has no maritime claims.

Climate
The climate is on the whole dry and semi-arid steppe. It is mostly dry and subtropical with hot summers and mild winters. Temperature The climate varies from subtropical and humid in the southeast to subtropical and dry in central and eastern Azerbaijan. Along the shores of the Caspian Sea it is temperate, while the higher mountain elevations are generally cold. Rainfall Most of Azerbaijan receives little rainfall, only 152 to 254 millimeters (5.98 to 10.00 in) annually on average. As a result, agricultural areas require irrigation. The greatest precipitation falls in the highest elevations of the Caucasus but also in the Lnkran Lowlands of the extreme southeast. The yearly average in these areas can exceed 1,000 millimeters.

Terrain
The terrain of Azerbaijan is generally seen as large, flat Kur-Araz Ovaligi (Kura-Araks Lowland) (much of it below sea level) with Great Caucasus Mountains to the north, Qarabag Yaylasi (Karabakh Upland) in west; Baku lies on Abseron Yasaqligi (Apsheron Peninsula) that juts into Caspian Sea.

Land
Land area Agricultural land Arable land Forest area 82,62 km2 47,565km2 18,54 km2 9360 km2

Natural Resources
Petroleum Natural gas Iron ore Nonferrous metals Bauxite Underground Water

Mountains Azerbaijan is nearly surrounded by mountains. The Greater Caucasus range, with the countrys highest elevations, lies in the north along the border with Russia and run southeast to the Abseron Peninsula on the Caspian Sea. The countrys highest peak, Bazardyuze Dagi, rises to 4,485 m in this range near the Azerbaijan-Russia border. The Lesser Caucasus range, with elevations up to 3,500 m, lies to the west along the border with Armenia. The Talish Mountains form part of the border with Iran at the southeast tip of the country.

Rivers Rivers form the principal part of the water systems of Azerbaijan. There are 8,359 rivers of various lengths within Azerbaijan. Only 24 of them are over 100 kilometers long. The rivers in Azerbaijan can be divided into three groups: a. The Kur basin rivers (Qanix, Qabirri, Turyan, Agstafa, Shekir, Terter, Khachin, etc.) b. The Araz basin rivers (Arpachay, Nakhchivan, Okhchu, Hekeri, Kondelenchay, etc.) c. Rivers, flowing directly into the Caspian Sea (Samur, Gudyal, Velvele, Vilesh, Lenkeran, etc.) The Kura and Aras are the largest and the most popular rivers in Azerbaijan. These rivers directly flow into the Caspian Sea,

Natural Hazards
Drought, due to shortage of rain, is the one hazard that the country is prone to. Other than that, some Lowland areas of the country are threatened by rising level of Caspian Sea.

Environment
Azerbaijan has some serious environmental challenges to deal with. Local scientists consider the Apsheron Peninsula (including Baku and Sumqayit) and the Caspian Sea to be the ecologically most devastated area in the world because of severe air, soil, and water pollution; Soil pollution results from oil spills, from the use of DDT pesticide, and from toxic defoliants used in the production of cotton during Soviet era. Caspian petroleum and petrochemicals industries also have contributed to present air and water pollution problems. Over-fishing by poachers is threatening the survival of Caspian sturgeon stocks, the source of most of the world's supply of caviar. The Convention on International Trade in Endangered Species (CITES) has listed as threatened all sturgeon species, including all commercial Caspian varieties. No measures have been taken for the protection of the endangered fish in the area. Also, the environment organization of Azerbaijan, due to lack of funding are not developed enough to have an effect on the issues.

Political Geography
The study of the interaction of geographical area and political process is called political geography. It is the formal study of territoriality.

Location:
Regional location Azerbaijan is in the Caucasus -- a mountainous and geopolitically strategic region that serves as a land bridge between Europe, the Middle East and Asia. Azerbaijan is, in many ways, defined less by its territory than by its neighbors -- Russia to the north, Iran to the south and Turkey to the west -- all of

which have controlled part or all of modern Azerbaijan throughout most of its history. All three powers retain substantial influence in Azerbaijan to this day, and the diverse geography of the Caucasus helps complicate the regional dynamics. To the east is the Caspian Sea, a landlocked body of water where Azerbaijan's energy resources are concentrated. To the west is Armenia, Azerbaijan's historic rival. Armenia and Azerbaijan dispute the Nagorno-Karabakh territory, even fighting a war over it from 1988 to 1994. Azerbaijan's economic, political, and demographic resources are concentrated in the Baku area. Azerbaijan also holds the exclave of Nakhchivan, which borders Armenia, Turkey and Iran. Azerbaijan has been able to use its energy resources and its location (as part of the Southern Corridor around Russia) to build leverage and balance regional powers - maintaining sovereignty in ways that are not available to other Caucasus countries like Georgia and Armenia. However, Azerbaijan will always face the difficulties inherent in being surrounded by larger powers and must maneuver carefully in order to preserve its sovereignty. Location regarding access to sea Azerbaijan has only access to Caspian Sea. The Caspian Sea is the largest inland body of water in the world and accounts for 40 to 44 percent of the total lacustrine waters of the world. The coastlines of the Caspian are shared by Azerbaijan, Iran, Kazakhstan, Russia, and Turkmenistan.

Size of country:
Territory Total territory is 86.6 thousand km2 (12% forests, 1.7% water, 54.9% lands, including pastures 31.1%, 31.4% other lands). the 44 and 52 east longitude, 38 and 42 north latitude Baku, on the 40 parallel. in the distance to the North Pole is 5550 km and 4440 km in distance from the equator to the Great Lakes, the largest lake in the world - the Caspian Sea area of 400000 km2, depth-1025 m. Azerbaijan neighbors to the south of the border with Iran and Turkey and 15 km to 765 km, 390 km north of Russia, north-west of Georgia 480 km, 1007 km west of Armenia. The width of the length of the Azerbaijan sector of the Caspian Sea is 456 km of the islands km2. Disputed Part Azerbaijan, Kazakhstan, and Russia ratified Caspian seabed delimitation treaties based on equidistance, while Iran continues to insist on a one-fifth slice of the lake; the dispute over the break-away NagornoKarabakh region and the Armenian military occupation of surrounding lands in Azerbaijan remains the primary focus of regional instability; residents have evacuated the former Soviet-era small ethnic enclaves in Armenia and Azerbaijan; local border forces struggle to control the illegal transit of goods and people across the porous, un demarcated Armenian, Azerbaijani, and Georgian borders; bilateral talks continue with Turkmenistan on dividing the seabed and contested oilfields in the middle of the Caspian

Shape of Country
Azerbaijan is a compact state. Compact states are those where distance from centre to the boundary do not vary greatly. They are also easier to defend than states of other shapes because.

Size of Population
From the total population of 9,165,000 people as of July 2011, nearly 52% was urban population; the remaining 48% was the rural population. 51% of the total population was female. The sex ratio for total population in that year was therefore 0.97 males per female. The 2011 population growth rate was 0.85%, compared to 1.09% worldwide. A significant factor restricting the population growth is rather a high level of migration. With 800,000 ethnic Azerbaijani refugees and IDPs, Azerbaijan has the largest internally displaced population in the region, and, as of 2006, had the highest per capita IDP population in the world. Around 95 percent of the population is Muslims, 85% of the Muslims are Shia Muslims and 15% Sunni Muslims, and the Republic of Azerbaijan has the Second highest Shia population percentage after Iran. There are some other faiths practiced among the different ethnic groups within the country. By article 48 of its Constitution, Azerbaijan is a secular state and ensures religious freedom.

Economic Geography
ECONOMICAL HISTORY: First industrial oil production in Azerbaijan started in 1847, 11 years prior to oil discovery in Pennsylvania, USA. A number of the worlds richest dynasties, including Rockefellers, Rothschilds and Nobels expanded their capitals in Azerbaijan. The Nobel Brothers Petroleum Company was an oil-producing company founded by Robert and Ludvig Nobel in Baku in 1876. 12% of Nobel Peace Prize money was drawn from the Nobel Brothers' Petroleum Company in Baku During the first year of the 20th century, in 1901 Azerbaijan produced half of the world production of oil. Hundred years later, in 2001 Azerbaijans share was 0, 44% vs. 0,8% in 2006 and about 1% in 2009 vs. Iran-5,4%, US8%, Russia12,3%, Saudi Arabia13,1% (BP SR 2007) During the World War II, Azerbaijan contributed to Allies victory by

producing most of the Soviet Unions oil Following the dismantling of the USSR and the creation of independent states on its territory, the geopolitical situation in the region has essentially changed. An independent state Azerbaijan has been able to use its energy resources and its location (as part of the Southern Corridor around Russia) to build leverage and balance regional powers -- maintaining sovereignty in ways that are not available to other Caucasus countries like Georgia and Armenia.

ENERGY RESOURES: Azerbaijan, though less developed country than other cacusaious states, but highly rich in energy resources that is gas and oil reserves, mainly concentrated in Baku in fact all Azerbaijan's economic, political, and demographic resources are concentrated in the Baku area. For many years these resources had been used by then soviet union, but now situation is changed At the present moment Azerbaijan, possessing prospected oil resources amounting to about 4 billion tons (80 per cent of which are sea deposits), together with Kazakhstan and Turkmenistan may create the third largest region of oil extraction in the world after Siberia and the Persian Gulf (the total sea reserves in the region of the Caspian Sea amount to 10 billion tons of oil and 6 billion cubic meters of gas). Azerbaijan energy resources based on Caspian Sea. The Caspian Sea, located on Iran's northern border, surrounded by Azerbaijan, Kazakhstan, and Turkmenistan, and sharing a border with the south-west corner of Russian territory, is the epicenter of a collision of regional, national and business issues. As long ago as the 1870s the Caspian Sea began to attract potential investors and geologists. At that time, geological finds in Baku drew such notables to the region as the Rockefellers, Nobels and Rothschilds. The tsars sent agents to the region as well, with Russia's involvement in the area stretching back over 300 years. For centuries, the area has formed a portion of the disputed frontiers between the Russian, Turkish and Persian empires. Now, still the Caspian Sea is the focus of many vital concerns with huge involvement of RUSSIA. Finally, there is the question of the status of the Sea itself. Is the Caspian Sea a lake or a sea? The Russian Ministry of Foreign Affairs (MFA) sought to prevent the Sea from being divided into national sectors as proscribed by the United Nations Law of the Sea Convention because some of the Sea's richest deposits did not lie in its sector. To achieve this end, the MFA initially argued that the Caspian is a lake and not a sea in order to gain access to the richer oil deposits (since the Caspian basin would be treated as common economic property to its littoral states if it was considered a lake and not a sea) still the debate is going on. So, by knowing the economical importance of its location Azerbaijan is running to achieve the aim of worlds largest exporters of oil and gas by diversifying the pipeline routes to many other countries and making the new energy resources. For that: Azerbaijan planned to produce about 50 million tons of oil in 2009 compared to 44.5 million tons in 2008.

 Azerbaijan's oil production can reach 60 million tons and gas production 35-40 billion cubic meters per year by 2015 Commercial talks are underway on production of Deep-lying gas in Azer-Chiraq-Gunashli. 400 billion Cubic meters of gas are estimated at gas reserves. Since November 2007 Azerbaijani gas from Shah Deniz field reached EU through the South Caucasus Pipeline and Turkey-Greece Interconnector Since 2007 Azerbaijan became not only oil but gas Export country. About 700 mcm of gas were exported via Baku-Tbilisi-Erzurum to Georgia from 2007 to May 1,2009 and 7,5 billion to Turkey More than 500 tankers with Azeri Light sailed away from Mediterranean Port of Ceyhan in Turkey

MINERAL RESOURCES: In addition to the well-known oil and gas deposits, Azerbaijan has rich deposits of natural minerals that are useful in chemistry, metallurgy, construction building and health therapy. These include ferrous and non-ferrous ores, rare and fine metals, semi-precious stones, as well as a wide variety of underground sources of thermal, mineral and natural spring water. In general, approximately 340 ore and non-ore deposits have been identified in Azerbaijan and about 100 of these are currently being developed. During the Soviet period, capital investment was centralized and, subsequently, the majority of mining complexes were built in Russia. Relatively few mountain mining and refining complexes have been built in Azerbaijan especially in relation to the wealth of mineral deposits that exist here. Now that they have gained their independence, it is time to begin undertaking more serious mining projects. Mineral waters: there are a large number of underground thermal, mineral, and spring water resources. Twentyeight significant mineral water springs could be further developed at existing spas (health

resorts),

sanatoria,

curative

centers.

The natural mineral spring water resources supply a great number of towns and villages of the Republic and there is a great demand for bottled water even within the country. All in all, Azerbaijan is blessed with many rich and varied mineral deposits that have already been discovered that are just waiting to be developed.

PRESENT ECONOMICAL SITUATION OF AZHERBAIJAN: . Azerbaijan's oil production increased dramatically in 1997, when Azerbaijan signed the first production-sharing arrangement (PSA) with the Azerbaijan International Operating Company. In 2011, economic growth slowed to 0.2%, although the impact of the global financial crisis was less severe than in many other countries in the region. The current global economic slowdown presents some challenges for the Azerbaijani economy as oil prices remain below their mid-2008 highs, highlighting Azerbaijan's reliance on energy exports and lackluster attempts to diversify its economy. Oil exports through the Baku-Tbilisi-Ceyhan Pipeline remain the main economic driver while efforts to boost Azerbaijan's gas production are underway. However, Azerbaijan has made only limited progress on instituting market-based economic reforms. Pervasive public and private sector corruption and structural economic inefficiencies remain a drag on long-term growth, particularly in non-energy sectors. Several other obstacles impede Azerbaijan's economic progress: the need for stepped up foreign investment in the non-energy sector and the continuing conflict with Armenia over the Nagorno-Karabakh region. Trade with Russia and the other former Soviet republics is declining in importance, while trade is building with Turkey and the nations of Europe. Long-term prospects will depend on world oil prices, the location of new oil and gas pipelines in the region, and Azerbaijan's ability to manage its energy wealth to promote sustainable growth in non-energy sectors of the economy and spur employment.

GDP (purchasing power parity): $93.02 billion (2011 est.) GDP - per capita (PPP): $10,200 (2011 est. GDP - composition by sector: agriculture: 5.5% industry: 62.7% services: 31.8% (2011 est. Unemployment rate: 1% (2011 est.) Population below poverty line:

11% (2009 est. Budget: revenues: $7.784 billion expenditures: $20.56 billion (2011 est. Inflation rate (consumer prices): 7.8% (2011 est.) Agriculture - products: cotton, grain, rice, grapes, fruit, vegetables, tea, tobacco; cattle, pi gs, sheep, goats Industries: petroleum and natural gas, petroleum products, oilfield equipment; steel, iron ore; cement; chemicals and petrochemicals; textiles Industrial production growth rate: -3% (2011 est.

Interest of Great powers United States

The United States and Azerbaijan have been involved in diplomatic relations since 1919. Azerbaijan is an active participant in NATOs Partnership for Peace program. It has made steadfast contributions to NATO and coalition efforts in Iraq, Afghanistan, and Kosovo. Azerbaijan also provides valuable overflight, refueling, and landing rights for U.S. and coalition aircraft bound for Afghanistan and Iraq. The first encounter of the United States-Azerbaijani inter-state relations was the meeting between President of the United States Woodrow Wilson and the delegation of Azerbaijan Democratic Republic to the 1919 Paris Peace Conference. Azerbaijani delegates were disappointed because instead of recognition, President Wilson advised them to develop a confederation with Transcaucasian neighbor. Upon the Bolshevik occupation in April 1920, no direct inter-state relations existed between Azerbaijan SSR and the United States. On October 18, 1991, the Azerbaijani parliament adopted a declaration of independence. Subsequently, on December 25, 1991, Soviet Union ceased its existence and the United States formally recognized Azerbaijan, as independent states. Withing a year. Both countries opened embassies in both countires.

US Interest in Azerbaijan
The U.S. views Azerbaijan as a strategic partner sitting at the crossroads of the Middle East, Europe, and

Asia regions whose future will shape American interests and foreign policy for many years to come. After gaining independence in 1991, Azerbaijan chose to open its rich oil and gas resources to Western markets and develop commercial partnerships with foreign investors, including U.S. companies. As a result, Azerbaijan has emerged as a key player for diversifying and securing global energy supply. Its pipelines have become main arteries connecting the Caspian Sea to the West. There are three main areas of interest for the United States in its bilateral relations with Azerbaijan: security cooperation, energy, and economic and democratic reform.

Nagorno-Karabakh Conflict
Modern US-Azerbaijani relations have been strongly influenced by the US official position on the Nagorno-Karabakh conflict between Armenia and Azerbaijan. The US was actively involved in the attempts to resolve the conflict since 1992. In 1992, the U.S. Congress adopted Section 907 of the Freedom Support Act, which banned any direct US aid to the government of Azerbaijan. Azerbaijanis consider this legislation to be unfair as, during the same period of time, Armenian forces took control of the fifth of Azerbaijani territory, including Nagorno-Karabakh. After the September 11 attacks in 2001, in view of Azerbaijan's contribution and support for the US military operations in Afghanistan, President George W. Bush waived the section in January 2002, and President Barack Obama further extended that waiver.

Security
Azerbaijan is an active participant in NATOs Partnership for Peace program. It has made steadfast contributions to NATO and coalition efforts in Iraq, Afghanistan, and Kosovo. Azerbaijan also provides valuable overflight, refueling, and landing rights for U.S. and coalition aircraft bound for Afghanistan and Iraq.

Economic Cooperation
U.S.Azerbaijani ties in economic sphere developed primarily in the context of Caspian energy resources and their transportation to Western markets. The U.S. companies are actively involved in the development of Caspian hydrocarbons in offshore Azerbaijani oilfields, and the U.S. government actively supported the BakuTbilisiCeyhan pipeline as the primary route of transportation for Caspian oil.[22] The United States has signed a bilateral trade agreement with Azerbaijan, granting it the status of a "most favored nation". The U.S. also supports Azerbaijan's application for accession to the World Trade Organization.

Russia
RUSSIAS INTEREST:
Following the downfall of the USSR and the creation of independent states on its territory, the geopolitical situation in the region has essentially changed. Azerbaijan turned out to be at the

centre of the geopolitical interests of the regional and super-powers: Russia, USA, Great Britain, Turkey and Iran and due to the energy power As a result the Republic can become a strong regional economic, and that means political, power. It is unlikely that such a prospect is in line with the interests of Russia, which link the oil extraction and transportation with the status of the Caspian Sea and its ecological problems. Preserving the monopoly on oil transportation could give Russia the possibility to control the resources of Azerbaijan, which guarantee its economic independence. In their turn the Western countries, the USA and the Great Britain in the first place (the main opponent of Russia in the Middle East during the last two centuries), have also announced their (mainly) economic and political interests in the region of the Caucasus and Central Asia adjoining the 'shat-ter belt' (the focus of conflict of interests of the superpowers for many years) from the North. Turkey, having its own regional interests, is also moving forward ecological demands concerning the control of shipping in the zone of the Black Sea straits. In this way the contradictions between these states, which externally look like a clash between the thermoenergy complex (TEC) of Russia and the Western oil companies for the energy resources of post-soviet Azerbaijan.

Geo-strategic interests: Russia wants to remain strong in the area and wield power within and control over the Commonwealth of Independent States (CIS), thereby ensuring the security of its southern flank. States of concern here are those CIS members plus Georgia and Armenia. Russia sees as its greatest danger the potential expansion of Chechen authority into Dagestan at Russia's expense, thereby severely restricting Russia's direct access to the Sea (only Astrakhan remains). Geo-political interests: the retention of Russian influence within the space of the former Soviet Union directly determines the future of Russian statehood, according to many analysts. Caspian oil, despite all its economic significance, is merely the external manifestation of the global political task of the present day-the restoration of Russia's might. Evolving problems in the North Caucasus among the autonomous Russian republics (not only Chechnya, but also Karachay-Cherkessia, Kabardino-Balkaria, North Ossetia, Ingushetia, etc.) and growing religious pressures (from the Wahhabis, among other groups) make this area as or perhaps more important to Russia than the CIS in terms of interests and stability. Economic interests: Russia wants to ensure that cash flows in the form of Western capital will continue from Central Asian and Siberian oil fields, and that cash flows are not be redirected out of Russia and into the Caspian region. Russia can compete on a level playing field with Kazakhstan and other Caspian oil investors with the proper Production Sharing Agreement (PSA) legislation in place. Another economic concern (which is also a geo-strategic, geo-political and ecological concern) is sovereignty rights to the body of water itself. The bottom and outer edges of the Caspian is divided one way, the column of water over these divisions in another. Ecological interests: developing safe ecological norms for the exploitation of both hydrocarbons and fishing resources (especially the protection of the Caspian sturgeon stock that produces 80-90 per cent of the world's finest caviar) are paramount concerns. This feeling is especially acute due to the severe meteorological conditions (extremely strong and unpredictable storms) that occur in the North Caspian Sea region.

CONCLUSION:

Today the majority of observers can clearly see that Russia desperately needs to find points of contact with these states, as well as with Turkey, Iran and the Western countries - otherwise she will have a relationship with permanently conflicting regions of the Caucasus, not obtaining stability and security in this central part of the 'Near Abroad'. The failure to consider alternatives for the foreign policy of Russia, following in the steps of the Russian Empire and the USSR, is a big mistake. Extremely straight forward, tactical steps of Russian diplomacy have no strategic perspective.

Iran
Azerbaijan-Iran Relations: One Nation Two States or Enemy Brothers
After the collapse of the Soviet Union, the former Soviet republics tried to search for their place in the new global structure. It was necessary to discover "new neighbors" who had been separated for many decades by the "Iron Curtain." It took time for the southern neighbors - Turkey, Iran, Afghanistan, Pakistan - of the defunct USSR to adjust to the new situation, and the changes that had occurred in the 150-200 years of formal separation had taken their toll. This statement applies to all of the neighbors of the southern former Soviet republics, but it is especially applicable to the relations between Azerbaijan and Iran. For Azerbaijan, the Islamic Republic of Iran is not just an ordinary country. First of all, Iran is the Azerbaijan Republic's southern neighbor. The 2 states share about 618 kilometers of land borders. These two countries border each other in the Caspian Sea as well. Both countries share values from their mutual past and some elements of a common culture. Azerbaijan has the second largest Shi'ite population in the world, after Iran. The membership of both countries in Muslim and regional organizations like the Organization of Islamic Conference and ECO, is an indicator of the countries' affinities in terms of geography and religion.

The Main Influential Factors

The divided Azerbaijan factor is the most influential factor in the relations between the two countries. The Republic of Azerbaijan encompasses only a portion of what we actually consider to be Azerbaijan: the second part of Azerbaijan is in North-West Iran. The Azerbaijani Turks in Iran constitute a significant part of the population of that country but are deprived of their national rights. This factor is central in understanding the relations between Azerbaijan and Iran. If part of Iran were not to be considered and called by the name "Azerbaijan," and if there were not millions of Azerbaijani Turks in Iran, the relations between Azerbaijan and Iran might have developed in a significantly different manner. Economic relations have also displayed a problematic picture between the two states. Despite the fact that both countries have big potential for economic cooperation, they seem to have been unable to exploit it. Azerbaijans trade volume with Iran has always stayed behind the one it has had with either Russia or Turkey or Europe since 2001.

The main contradiction between the Republic of Azerbaijan and the Islamic Republic of Iran has a fundamental character: to resolve the question of the modus vivendi between these two countries, either the Republic of Azerbaijan must enter into the political orbit of Iran and to form a pro-Iran Islamic regime, or Iran must change the character of its regime and to respect the ethnic rights of non-Persian peoples.

Conclusion
Azerbaijan is rich in cultural diversity, with over 70 ethnic groups settled here. Tourism is an important factor of Azerbaijan's economy, and the country is brimming with countless natural and cultural spots to explore