As Turkmenistan and Iran continue to trade accusations in their unfolding dispute over natural gas debts, Turkmenistan has suffered a dismal defeat in the information war.
In the middle of December, some media outlets began reporting that Turkmenistan was officially demanding $2 billion for unpaid gas bills accruing since Iran was slapped with sanctions in 2012. Outlets predominantly cited Radio Free Europe’s Turkmen service, which in turn, in a report on December 20, quoted what appeared to be official sources. That same $2 billion figure also cropped up in an English-language analytical piece on Baku-based Trend news agency on December 19 prophetically titled “Odd gas debt dispute between Iran, Turkmenistan.”
The problem with all this is that the Turkmen government never has made any public statement about the size of the alleged debt and has, until recently, avoided mentioning the disagreement at all.
Indeed, all public pronouncements in Turkmenistan about the state of ties with Iran has been cast in highly effusive and optimistic terms. When Iranian President Hassan Rouhani visited Ashgabat in March 2015, Turkmen state media declared an imminent surge of economic activity among the two nations.
“If last year , trade turnover between our countries was $3.7 billion, then today we have declared our goal of taking this figure to $60 billion within the next 10 years,” the government website stated at the time.
Considering Iran had by this stage failed to make payments to Turkmenistan for best part of three years, this was a generous prediction to say the least.
Turkmenistan has managed to avert the loss of one of its only two buyers of natural gas with some desperate, last-gasp negotiations.
Iran’s Mehr news agency reported on December 30 that Turkmenistan has signed a new gas deal despite demands from Ashgabat for Tehran to pay $1.8 billion in alleged unpaid arrears for historic gas deliveries.
Negotiations went right down to the wire, as Mehr news agency revealed.
“Due to Turkmens’ persistence on [threatening] to cut gas exports to Iran over claims of a $2 billion debt, the Iranian delegation left the negotiating table to return home. At the airport, Turkmenistan’s officials persuaded the Iranian delegation to come back to the negotiating table in hopes for reaching an agreement on gas delivery to Iran,” the news agency reported.
In the run-up to the agreement, a senior official with the National Iranian Gas Company (NIGC) signaled that Tehran was willing to adopt an intransigent position over the matter, leaving Turkmenistan with few options ahead of a Saturday deadline.
ILNA news agency cited senior NIGC representative Saeed Momeni as saying that Turkmenistan only provides three percent of Iran’s gas needs and that the shortfall could be addressed by drawing in internal resources if necessary. Iran has substantial gas reserves of its own, but has relied on Turkmenistan to supply areas in the north not connected to the national pipeline grid.
Azerbaijani President Ilham Aliyev hosts his Russian counterpart Vladimir Putin for tea at his house. (photo: president.az)
The presidents of Russia, Iran, and Azerbaijan met in Baku this week, for the first time in this trilateral format, part of a week of heavy diplomatic activity that highlighted the shifting international relations around the South Caucasus.
The Baku meeting took place on Monday, and was taken on the initiative of Azerbaijan. The top agenda item was a railroad project that could connect Russia and Eastern Europe to the Persian Gulf.
That project would bring not only economic benefits to the three countries, but could be a geostrategic boon for Azerbaijan, as well, said Zaur Shiriyev, a Baku-based political analyst. He noted that this project would compete with another Russia-initiated North-South railroad project, that would go from Russia through Abkhazia, Georgia, and Armenia.
"This transport corridor bypasses Armenia, thereby eliminating the possibility of reopening the Russian-Georgian railway though Abkhazia, or any kind of discussion that was used a threat [against] Baku," Shiriyev said in an email interview with The Bug Pit. He noted that that Armenia project also could have competed with another Azerbaijani rail priority, the currently under-construction Baku-Tbilisi-Kars railway that will connect Azerbaijan to Turkey and Europe.
Foreign ministers of the Caspian littoral states meet in Astana on July 13, 2016. (photo: MFA Russia)
Are the five states around the Caspian Sea finally going to resolve their dispute about how to divide the body of water between themselves?
A number of unusually positive statements from diplomats from the littoral states have suggested that the seemingly intractible dispute is on the verge of being resolved. But if any of the Caspian countries have softened their negotiating positions -- the intransigence of which has resulted in this long dispute -- they aren't telling.
The foreign ministers of the five states -- Azerbaijan, Iran, Kazakhstan, Russia, and Turkmenistan -- met last week in Astana, and Russian Foreign Minister Sergey Lavrov said the sides could reach an agreement in a year.
"I believe it is absolutely realistic to aim for signing the Convention on the Legal Status of the Caspian Sea in 2017. I think this can be done even in the first half of the year," he said. That enthusiasm was shared by Kazakhstan, whose prime minister, Karim Massimov, tweeted: "Met with foreign ministers of Caspian littoral states. There's hope for prompt completion of talks over Caspian Sea Legal Status Convention."
Gone is the fear of betrayal, and bilateral love, once again, is in the air. Georgia, the strategic crossroads for energy alternatives to Russia, finally announced on March 4 its pick for a supplier of extra gas, and the choice is longtime partner, Azerbaijan. The decision appears to knock both Iran and Russia’s state-run Gazprom out of the running, but still leaves the door open to collaboration between all four countries in other energy spheres.
“We’re glad that the talks ended with success and that we’ve made it to a decision that will deepen our strategic partnership [with Azerbaijan] even more, about which not a single doubt ever existed,” a contented Georgian Prime Minister Giorgi Kvirikashvili declared at a meeting in Tbilisi with Rovnag Abdualayev, president of the State Oil Company of the Azerbaijani Republic (SOCAR).
Abdullayev, in turn, underlined that SOCAR “will continue its support for Georgia’s government;” in particular, by shelling out “various forms of investment” into the country.
The total amount of this “investment” — conceivably, a deal sweetener — is not known, but Georgia did manage to squeeze Azerbaijan’s commercial gas prices down a notch, from $318 to approximately $278-$283 per 1,000 cubic meters. It will receive an additional 500 million cubic meters of gas per year, an amount which Energy Minister Kakha Kaladze now claims “satisfies the market” demand.
Less than a month after Tajikistan’s top government-sanctioned Islamic cleric condemned Iran as a haven for terrorists, Dushanbe has turned to Tehran with its desperate pleas for money.
Tajik media reported on February 18 that the head of the National Bank of Tajikistan met with the Iranian ambassador this week to discuss cooperation in banking and prospects for a renewed wave of inward investment.
Dushanbe appears to believe the lifting of sanctions on Iran have presented it with a timely opportunity. Iran’s banking system is yet to come out fully from under the rubble of the sanctions regime, and setting up shop in Tajikistan could be a way to get things moving again in their financial system.
Reality is a tough master, however, and there will be a lot of bad air to clear before anything materializes.
Relations between the two countries have historically veered erratically between warmth and antipathy. They are brought closer by linguistic and historic kinship. But Tajikistan also holds fast to resentments over what they say was Iran’s support of the armed opposition in the civil war of the 1990s.
And yet, Iran was the first country to establish diplomatic ties with Tajikistan’s after the collapse of the Soviet Union. And Tehran was one of the guarantors of the now-shredded postwar 1997 peace agreement, which assured a portion of government jobs to the opposition.
The Sangtuda-2 hydropower plant, which began operating in 2011, was constructed in part with $180 million of Iranian money. Iran also built, if that’s the word, the comically appalling Istiqlol tunnel, which links the center and north of Tajikistan.
A cargo train carrying a test shipment along the recently completed China-Kazakhstan-Turkmenistan-Iran railway is bearing in on its final destination in a landmark event for Eurasian trade.
State media in Turkmenistan reported that the train, which departed from the Chinese city of Yiwu, just south of Shanghai, at the end of January covered 7,908 kilometers over nine days, and crossed the border into Iran on February 10.
The entire railroad extends around 10,000 kilometers and requires two weeks to cover, which is estimated to be around twice as fast as the sea route.
“The cargo, loaded with all kinds of consumer goods, traversed the Turkmen section in 28 hours, instead of two days, as had been expected. This significant reduction in travel time translates into substantial savings on transportation costs and makes the route more cost-effective,” state news agency TDH reported.
The overall route could, as its proponents argue, radically increase the efficiency in the transportation of goods from China’s eastern seaboard to markets in the Persian Gulf.
A final link in the mammoth railroad was put into place in December 2014 when the presidents of Kazakhstan, Turkmenistan and Iran officially inaugurated a 930-kilometer line running from Ozen in western Kazakhstan through Turkmenistan to Gorgan in northwestern Iran. That sped up cargo transit between the countries by cutting 600 kilometers off the journey on the previously existing route from Beyneu in western Kazakhstan to Mashhad in northern Iran.
The ending of international sanctions against Iran could soon send Iranian gas flowing across and through the South Caucasus, amping up the region’s strategic significance and possibly changing the dynamics of its energy trade.
For Azerbaijan, getting Iran on board with TANAP, the Trans-Anatolian Natural Gas Export Pipeline, could bolster Baku’s largest energy-export undertaking, the Southern Gas Corridor, a chain of three big pipelines, stretching across more than 3,400 kilometers and seven countries from the Caspian Sea into Europe. TANAP is the largest and costliest section of the Corridor.
As a transit country, Georgia would get a share of any Iranian gas flowing through the Southern Gas Corridor. But with more Iranian gas in the region, Tbilisi fears losing that share of gas it receives from another pipeline — run by Russian energy behemoth Gazprom for shipments to Armenia from Russia.
With international sanctions lifted, Iran is ready to become a full member of the Shanghai Cooperation Organization, senior Iranian officials said Monday.
Iran applied for full membership in the SCO in 2008, but has been blocked by rules in the organization's charter that forbid membership for any country under United Nations sanctions. Those sanctions were lifted on Saturday as a result of Tehran's compliance with its nuclear deal with world powers including the United States, China, and Russia.
The organization has been eager to get Iran on board. "The organization wishes success to Iran in the finalization of efforts related to the nuclear program so that the essential legal procedures leading up to the lifting of sanctions were implemented as soon as possible," said SCO Secretary General Dmitry Mezentsev last month. "I'd like to believe the SCO will take up Iran's request for the status of a full member immediately after that."
And with the sanctions lifted, Iranian officials said that among their priorities would be gaining full SCO membership.
"The lifting of sanctions opens for Iran the opportunity to become a member of the Shanghai Cooperation Organisation and eliminates other limitations, which the Islamic Republic has been facing in the regional foreign policy," Iranian Foreign Ministry spokesman Hossein Jaber Ansari told a press conference on Monday.
"For several years Iran has been an observer state in the SCO and is interested in strengthening that organization. The removal of sanctions creates new possibilities for acquiring full membership for Iran in the SCO," wrote Iran's ambassador to Moscow, Mehdi Sanai, on his blog.
Tajikistan President Emomali Rahmon with his Iranian counterpart, Hassan Rouhani, in happier times (2013). (photo: president.tj)
Iran has shrugged off a rhetorical assault waged by Tajikistan's government and has ratified a security cooperation agreement signed by the two countries before their relations took a nosedive in recent weeks.
Iranian media and Iran's embassy in Dushanbe reported that Iran's parliament has ratified an agreement on defense and security cooperation. It's not clear from the reports exactly what the agreement entails; Tajikistan President Emomali Rahmon and his Iranian counterpart Hassan Rouhani signed a number of agreements during the latter's visit to Dushanbe in September 2014. Those agreements reportedly included provisions on information sharing in law enforcement and drug trafficking.
Whatever the content of the agreement, the ratification normally wouldn't be especially newsworthy. But it comes as Dushanbe has heaped criticism on Tehran for allowing the exiled opposition leader Muhiddin Kabiri to participate in a conference in Iran in December. Tajikistan's foreign ministry sent a diplomatic note to Iran objecting to the “head of a terrorist party suspected of mounting an attempted overthrow of the government” was invited to Tehran. In his sermon last Friday, Tajikistan's top mufti said that Iran was "abetting terrorism" by inviting Kabiri.