-Philip Roehrs-Weist

In March, an Azerbaijani delegation visited Tehran to discuss expanded economic cooperation opportunities with Iran. The visit comes at a time when Iran is trying to uphold its main foreign policy priorities.

Although historically speaking Iran has close ties to the Caucasus, the region is currently considered to be a second-thought in Iran's foreign policy considerations due to the current restraints which Tehran faces at the moment. Even after the collapse of the Soviet Union, Tehran has limited itself mainly to the spread of its influence in the Middle East. Many observers, however, saw the completion of the Joint Comprehensive Plan of Action (JCPOA) as a new opportunity for Iran to strengthen its foreign policy profile through an influx of capital and the opening up of international markets. The Caucasus, in particular, seemed to be an adapt region for re-integrating Iran as a significant regional economic player.

However, the optimism did not last long and the JCPOA was declared null and void in 2018 by succeeding US President Trump. A new containment strategy replaced the efforts of the Obama administration to bring Iran back into the international order. The pressure of renewed sanctions packages and public statements by senior US officials on the possibility of a regime change is forcing Tehran to further define its foreign policy priorities. Regarding Iran's oil and gas exports, the Süddeutsche Zeitung recently reported that since May 2, the US government has suspended all exemptions and wants to sanction states that are not in compliance with the oil embargo.

Iran's precarious economic situation

The current economic situation could be threatening for the Iranian regime, as the resulting social ills and economic hardship have already led to several protests specifically directed against the leadership of Khamenei. The long-awaited economic recovery brought about by the end of sanctions was stifled by a combination of low oil prices and the new sanction pressure. The discontinuation of the JCPOA led to the current recession with a negative economic growth of -1.5% in 2018 and an expected growth of -3.6% in 2019. At the end of 2018, the IMF forecasted a further increase in the already high inflation rate (March 2016- March 2018: 9% - 9.5%) due to sanctions. These circumstances ensure that Iran's capacity to expand its external influence will be severely limited in the future. 

The Middle East is still considered the main theater of Iranian activities. This is mainly because Tehran is trying to bog down American allies in the region by forming and deploying militant factions and deter them from direct military strikes against Iran. However, reports in recent weeks about the shortage of funds for groups such as Hezbollah, which are highly prioritized on Teheran's strategic agenda, have shown that the Iranian regime is increasingly being curtailed.

In addition, there were numerous protests within Iran in the second half of 2018 that threatened the security of the regime. It is in times like these that Tehran is particularly anxious to provide stability in minority-populated areas, as they are otherwise prone to drawing in external influence. Under these circumstances, it is evident that Iran is severely limited in its scope of action and pursues its fundamental security interests over all other secondary interests, such as its general economic and diplomatic aspirations in the Caucasus.

Still, good bilateral relations with Azerbaijan can still be counted among Iran's key security interests because of two essential factors that will be explained in the following. 

Regime security: Tug-of-war between nationalism and islamism

For one thing, Azeris are the largest minority in ethnically and religiously heterogeneous Iran and makeup about a quarter of the Iranian population. The Iranian Azeris are generally considered to be the most integrated minority in Iran, mainly because of their majority Shiite faith. In addition to numerous Iranian leaders are Azeris. Ayatollah Khamenei himself is an ethnic Azeri and likes to speak with delegates from Azerbaijan in their native language. Despite this, Iranian Azeris are often discriminated against by the Persian elites in Tehran because of their ethnicity, and the Iranian regime is concerned about recurring nationalist slogans and calls for the unification with Azerbaijan, especially during sporting events and other public gatherings. For example, there have been several incidents at games of the Tebrizer football club "Trakhtor". Pashinyan's visit to Iran also triggered protests on the part of the Iranian Azeris, after he had taken pictures there with the Armenian community in front of a poster with the slogan "Nagorno-Karabakh belongs to Armenia".

Such spontaneous outbursts in themselves do not pose an existential threat to the regime. However, in times of instability and economic worries, these could become a systematic problem, especially if Azerbaijan rhetorically or even logistically supports separatist movements. So far, however, such considerations have primarily met with support within the US establishment and in Israel. Baku itself has been cautious in this regard.

However, this risk is not too far-fetched for Iran. Baku and Tehran share a history of conflict. Both sides are concerned about the ambitions of each other. Baku fears that Iran may seek to claim Azerbaijan as part of its historical Shiite sphere of influence. Revanchist sentiments are particularly prevalent within Iran's ultra-conservative elite. Public statements such as that of former presidential candidate Ayatollah Said Muhammed Bokiri Harrosi and MP Nadir Gasipur on the reincorporation of Azerbaijan and the revision of the Gülistan and Turkmenjai agreements are fueling these fears. In addition, from time to time there is general public criticism of Azerbaijan's secular orientation by Iranian officials.

The support of Islamist movements, such as the Islamic Party of Azerbaijan and the pro-Iranian movement around the radical theologian Taleh Bagirzade, as well as proven covert operations in Azerbaijan also play into this narrative. The prevented attacks on the US and Israeli embassy in 2012 serve as an example of such Iranian operations in Azerbaijan.

On the other hand, Tehran is unlikely to have forgotten public statements on "reunification" with "Iranian Azerbaijan" from Baku under the Popular Front government in the 1990s. Critical media reports of the harsh treatment of Azeris by the Iranian security forces and the links Azerbaijan has with Azeri groups in Iran are also a source of concern for Tehran, although the government in Baku has been holding back on official comments on internal Iranian affairs for many years, and at least officially does not maintain any contact with the separatist forces among the Iranian Azerbaijanis.

Nevertheless, Tehran remains concerned about the heterogeneous nature of Iranian society and a possible weakening of the central power in Iran. For example, Nahawandi writes: "Iran is still nervous about the autonomist trends within the country. These trends have been exploited from time to time by political groups and even promoted by foreign powers. [...] Despite Azerbaijanis' participation in the country's economic and political life, Azerbaijanis may wish to secede as a result of social dissatisfaction or, as in the case during the post-war period, due to foreign support." [Rawandi-Fadai L.M., p.173]

However, under Rouhani's government, the bilateral relationship has steadily improved and economic relations have been strengthened. The relations have been publicly described as "friendly" by officials since 2015, and Iran's interest in being connected to the TANAP seems to be met with open minds in Baku's. Superficially, these developments resulted in a reduction of subversion attempts and led to a more stable situation in both countries.

National security: Azerbaijan as a part of the anti-Iran coalition?

On the other hand, Azerbaijan is relevant because of its strategic partnership with Israel and its good relations with the US. Baku has historically deep ties with Israel. Israel was one of the first states to recognize Azerbaijan's independence in 1991, and Azerbaijan has been recognized as one of the few Islamic countries with friendly diplomatic relations with Israel. Israel imports most of its energy from the Azerbaijani TBC-pipeline and supports Baku in modernizing and training its armed forces. In addition, there is an active exchange and cooperation agreement in the field of military technology, including a $ 1.6 billion export deal of various Israeli weapons systems made in 2012. In 2001, former president Heydar Aliyev supposedly said to Hasan Rouhani that Azerbaijan will definitely not revise its relations with the US and Israel. Thus, any pressure from Teheran in this regard would be inefficient and Azerbaijan will never become an Islamic republic along the lines of Iran.

In 2012, during the height of Israeli-Iranian tensions over the Iranian nuclear program, rumors of a secret agreement were circulating. The agreement supposedly allows Israel to use Azerbaijani facilities to carry out air strikes against Iranian targets. Although Baku has denied these rumors, officials in Tehran remain skeptical, especially against the backdrop of Wikileak's revelations in 2009, in which Ilham Aliyev compared the Azerbaijani-Israeli relations to an "iceberg that swims largely under the surface".

In the past, Azerbaijan has often been counted as a part of a trilateral alliance alongside the US and Israel with the aim to contain Iran, and during the 2016 US Middle East Conference in Warsaw, rumors of an unofficial approval by Baku for a renewed containment course against Iran's expansionist policy have surfaced. True or not, Tehran has an interest in undermining any possibility of Azerbaijan's active participation in future containment initiatives.

Outlook

Tehran will continue to see relations with Azerbaijan as a priority due to these two factors, as both Tehran's regime security and Iran's national security could be severely undermined by Baku. Good relations are therefore an imperative and Iran will try, despite limited resources, to further bind Azerbaijan economically and diplomatically. TANAP is only the most prominent project, if not necessarily the example with the highest chances of realization. There are promising infrastructure initiatives, such as the North-South Transport Corridor, which will allow Teheran to create a deeper  economic interdependence with Azerbaijan in the future. Recently, there has also been new cooperations in regards to the vehicle production and there was a sharp overall rise in bilateral trade over the recent years (73% increase in 2018, according to the Iranian ambassador). Thus, the statements of Iranian and Azerbaijani officials during Mammadyarov's recent visit to cooperate on comprehensive concepts such as the development of the International North-South Corridor may be seen as more than rhetoric. It can be expected that Iran will seek to establish itself as a key partner for Azerbaijan's economic integration within Eurasia. Whether this will succeed under the unfolding sanctions situation remains to be seen.