The Caucuses region is simmering with tension, and, due to its strategic geographic location and Caspian energy markets, the international community cannot afford to let the situation boil over.
Lying in between Russia, Turkey, and Iran, the Caucasus is a politically and ethnically diverse region. In the North are the Russian Republics, which are generally considered part of the Russian Federation, despite some of the sub-regions claiming independence. The North Caucuses is home to the Caucasus Emirates, a militant jihadist organization that has been active since 2007. This past June, part of the insurgent group pledged its allegiance to ISIS, as ISIS’ seeks to expand its geographic reach. Many Islamist terrorists have since left the Caucasus for Syria to engage in jihad. This, however, drove a wedge in the North Caucus insurgency, with some believing that ISIS’ tactics are too brutal.
Despite Russia’s dubious claims of anti-ISIS military operations in Syria, Russian forces have been ramping up against the Islamists in its backyard since the beginning of January. Specifically, military exercises are taking place in both Chechnya and Dagestan, the center of the militant Islamist movement in the North Caucasus, and Russian forces have begun counterterrorism operations there. Dagestan now increasingly resembles a war zone, warns Mairbek Vatchagaev of The Jamestown Foundation.
Adding to this growing instability in the North Caucasus, Russia’s dwindling economy—largely due to the low global oil prices and Western sanctions—is opening space for these sub-regions to gain more power. According to Russian economist Denis Sokolov, “If the year 2015 was the year of the zachistka (mop-up operation) against the regional elites, the year 2016 will become the year of political innovations for the North Caucasus.” These regional elites may abuse a weakened Russia to spur a rise of secessionist movements.
But that is not the only conflict simmering in the Caucasus region. The South Caucasus includes Armenia, Georgia, Azerbaijan, and the hotly disputed territories Abkhazia, South Ossetia, and Nagorno-Karabakh. The Southern Caucuses have been avoiding Russian attempts to expand its influence. And, as Russia’s close neighbors, these countries’ diverging domestic and foreign policies could spur instability in this region, detracting resources that could otherwise be used to fight the terrorists in the North.
With a devaluating ruble, the Russian government is slowly losing its financial bargaining power over the Caucuses, in addition to the financial resources needed to prevent instability from growing in the region. The Russian economy, which has not grown since 2013, experienced over a 3 percent contraction in GDP last year. Meanwhile, Russia has been spreading itself thin across various arenas, such as its military operations in Syria—which, according to The Moscow Times, costs Russia up to $4 million per day. The Russian government also relocated top military units from the North Caucuses to Ukraine to support the rebel insurgents in the East, and has incurred serious financial costs to fund these activities.
Perhaps even more concerning is how Russia might respond if it believes that it is losing control over its neighbors. In recent years, Russia has instigated conflict to gain domestic support amidst perceived regional inferiority versus Europe, such as with Georgia in 2008 and Ukraine in 2014.
To Alexey Malashenko, from the Carnegie Endowment for International Peace’s Moscow Center, the bigger fear is what the Islamist militants will do upon returning from the Middle East. “They’ve gained significant combat experience while fighting for ISIS and are much more fanatical now,” he says, which “can destabilize Russia’s southern areas.”
Director of the Central-Asia Caucasus Institute at Johns Hopkins University, Mamuka Tsereteli, agrees that Russia will face a continuous terrorist threat in years to come. He encourages Russia “to look at root causes of the domestic terrorism and consider radical reforms internally that can implement rule of law and facilitate economic development,” pointing out that Russian policies contributed to radicalization of Chechens, fueling the terrorism.
Although it may seem like solely a Russian problem, instability in the Caucasus has larger, global implications for energy markets. The Caspian Sea contains large oil and natural gas reserves, estimated at 48 billion barrels of oil and 8.7 trillion cubic meters of gas. Instability in the region may disrupt the ongoing projects there, and further complicate talks to delineate the offshore energy sources. Europe, which has suffered from limited energy sources since Russia implemented sanctions in 2014, is especially interested in the Caspian Sea; though, China is the one strengthening ties with the Southern Caucasus through increased regional investments.
The unchecked growth of the terrorist threat and conflict in the North could further destabilize the region, creating counterterrorism and economic challenges for not only Russia, but also the international community.
Alana Garellek is an International Producer with The Cipher Brief.
