North Caucasus Conflict In Focus: Major Risks And Implications

BMI View: The precarious security situation in the North Caucasus poses a major challenge for the Russian authorities, who are at risk of losing control of this vital region. The Kremlin has few good options, and will most likely maintain a combination of repression and federal subsidies, but tough security policies will create a backlash that could undermine its position further.

The recent Boston Marathon bombing has again put the North Caucasus region of Russia under the international spotlight, because the two alleged perpetrators, the Tsernaev brothers, had family ties with Chechnya and Dagestan. The North Caucasus is Russia's southernmost region, comprising the mainly Muslim autonomous republics of Adygea, Karachay-Cherkessia, Kabardino-Balkaria, North Ossetia-Alania, Ingushetia, Chechnya and Dagestan. Although the region has long been wracked with instability as a result of the wars in Chechnya, the upsurge in violence since the start of 2009 (especially in the republics of Dagestan and Ingushetia) is particularly concerning for the authorities. For Moscow, the nightmare scenario would be a series of prolonged local insurgencies that would cause it to gradually lose control of this strategically important region and undermine its status as a world power.

Dagestan The Most Violent Region Although Russia officially declared an end to 'emergency operations' in Chechnya in April 2009, and claims to have pacified the breakaway republic, violence in the North Caucasus remains high and has increased since the start of 2009, according to data collected by the US-based Center for Strategic and International Studies (CSIS) over the course of 2008-2010. Violent incidents typically include abductions or assassinations of public officials and military personnel by militants, bomb attacks or other destruction to property, and armed crackdowns on suspected or actual militants by security forces, which often lead to damage to property.

In recent years, Dagestan, which is immediately east of Chechnya, has emerged as the most violent republic of the North Caucasus. According to Caucasian Knot website, which monitors the region, during the first quarter of 2013 Dagestan experienced the highest number of violent incidents with 124 people killed and at least 75 injured. Over the same period, Chechnya was the second-worst affected republic, with 20 killed and 17 wounded. Ingushetia ranked third, Kabardino-Balkaria fourth, and Karachay-Cherkessia fifth. North Ossetia-Alania was the safest republic, with no victims of armed conflict. To date, the highest-profile victim of the violence has been Ingush President Yunus-Bek Yevkurov, who was severely injured in an attack on his motorcade in June 2009, although he subsequently recovered and resumed his official duties.

A New (Old) Tinderbox
The North Caucasus

Strategic Importance Of The North Caucasus The Caucasus region is of great importance in near eastern affairs. It has been a geopolitical battleground for centuries, with Ottoman Turkey, Imperial Russia, Iran, and various Western powers all vying for influence in the region at various times. Russia has been the dominant power since the 19 th century, but the collapse of the Soviet Union in 1991 challenged this, as the South Caucasian republics of Georgia, Armenia and Azerbaijan became independent states. Georgia and Azerbaijan's pro-Western orientation paved the way for the US, Turkey and Israel to gain influence, to Russia's chagrin. The North Caucasus' current importance stems from several key factors:

Russia's Southern Flank: First and foremost the Caucasus provides Russia with access to the Black and Caspian Seas, with the former allowing an outlet to the Mediterranean. Second, without control of the North Caucasus, Russia cannot project land power towards Georgia and Azerbaijan, which have both been seeking to reduce Moscow's traditional dominance over them. For example, Russia's August 2008 war against Georgia to help the separation of South Ossetia and Abkhazia would have been much more difficult if the North Caucasus had been wracked with major insurgencies.

Russia's Fear Of Separatist Forces: After the Soviet Union collapsed, many wondered if the Russian Federation would also break up. To date, Chechnya is the only Russian autonomous republic or territory to have sought secession, and for Moscow it was important to make a show of force that it would not tolerate independence, lest this encourage other regions. This was the key reason why Russia fought so determinedly, at the cost of tens of thousands of lives, to crush Chechen separatism in the early 1990s and early 2000s. If Moscow were to lose control of the North Caucasus, this could raise questions about the de facto survivability of the Russian Federation itself.

Russia's Fear Of Foreign Forces: Moscow's concerns about external encroachment were another reason why it fought the Chechen wars. The Kremlin perceived three external powers at work, namely Turkey, the West, and the forces of militant Islam. Turkey has a significant North Caucasian diaspora dating from the 19th century and has cultural ties with the region. Meanwhile, some in Russia's power circles see Western countries as secretly orchestrating violence in the North Caucasus to weaken Russia, although there is no concrete evidence of this.

Overall, militant Islam is arguably the most dangerous of these external forces. Moscow fears that more of the North Caucasus' Muslim populations could become radicalised, causing extremism to spread to other Russian Muslim regions such as Tatarstan and Bashkortostan, and leading to more terror attacks against Russia's major cities. In particular, the Kremlin fears that the 2014 Winter Olympics in nearby Sochi and the 2018 FIFA World Cup could become terrorist targets.

Eurasian Energy And Transport Corridors: The North Caucasus's importance to Russia has increased following the re-emergence of the Caspian Sea basin as a major oil- and gas-producing region. In this respect, the Caucasus must be seen as the geographic centre of a broader macro-region running from the Balkans and Black Sea in the west to the Caspian Basin and Central Asia in the east. The Caucasus is the main land bridge in the region, through which energy pipelines pass. If any external powers were to usurp Moscow's grip on the region, this would reduce Russia's geopolitical standing. The Western powers also have reason to fear regional violence, as they have invested heavily in the Caspian energy sector.

The Struggle For Eurasia
The Caucasus' Geopolitical Environment

Sources Of Instability In The North Caucasus Although violence has been increasing in the North Caucasus, the region has long been vulnerable to instability. Arguably, this has been exacerbated by the Chechen wars of 1994-1996 and 1999-2004. The following are major factors contributing to instability:

High Degree Of Ethnic Diversity: The population of the North Caucasus has considerable ethnic diversity, which Russia has manipulated over the generations as part of its divide-and-rule policy. Chechnya is by far the most homogeneous republic (more than 90% Chechen), which is why it was the most determined to break free from Russia. Dagestan is the most heterogeneous republic, but this has not spared it from violence. Indeed, its very diversity has exacerbated violence.

Another key fault-line in the region is that between orthodox Christian North Ossetia and its predominantly Muslim neighbours. The Ossetians' common religion with Russia means that they have long been seen as favoured by Moscow. Indeed, when hundreds of thousands of Chechens and Ingush, who were deported by Stalin to Central Asia in 1944 on suspicion of pro-Nazi sympathies, returned to the Caucasus in 1957, they found that Ossetians had taken some of their properties. This lingering animosity led to a brief (one-week) Ingush-Ossetian war in late 1992 and appears to have been a reason why regional Islamist militants seized the Beslan school in North Ossetia in 2004 (the school siege led to hundreds of civilians being killed). Although publicly claiming to support Chechen independence, the militants were apparently seeking to provoke a pan-Caucasian Christian versus Muslim religious war.

Border disputes are another manifestation of ethnic tensions. In the summer of 2012, Chechnya's government began pressing claims to parts of eastern Ingushetia, which it claimed was historically Chechen land. The dispute stems from the fact that prior to 1992, there was a joint Chechen-Ingush republic within the Russian Federation, and when Chechnya declared independence, Ingushetia did not. The current Chechen president, Ramzan Kadyrov, appears to be using the dispute to further his republic's position and his own influence in the North Caucasus, but this is opposed by Ingush president Yevkurov.

Elsewhere, the past few years have seen a growing movement among the Circassians for a joint republic. The indigenous Circassian people (Adyges, Cherkess, Kabardins and Shapsugs) are spread among the republics that incorporate their names (Adygea, Karachay-Cherkessia, and Kabardino-Balkaria), but which they share, often uncomfortably, with other groups. They also have an extensive diaspora in Turkey and the Middle East, which could conceivably be mobilised in their support. The Circassians are particularly keen to highlight their grievances around the 2014 Winter Olympics in Sochi, which was once their capital. That year will mark the 150 th anniversary of their expulsion from and perceived genocide in the North Caucasus at Russia's hands.

High Incidence Of Poverty And Unemployment: The North Caucasus is a poor region with a high degree of unemployment, in many areas more that 50%. This combination of poverty and joblessness means that the region's young people are vulnerable to recruitment by criminal gangs or even militant Islamist groups ( see below).

High Degree Of Corruption: The Russian federal government provides the North Caucasian republican administrations with 70-90% of their budgetary revenues. Following the abolition of republican and gubernatorial elections in 2004 after the Beslan school siege, the Kremlin appoints all regional leaders. This means that local elites are highly dependent on the federal government. However, the creation of these well-funded elites has fostered corruption, owing to the lack of oversight of generally authoritarian elites.

This, together with the heavy presence of armed groups, means there is considerable violence unrelated to ethnic or religious reasons. Indeed, some link the attempted assassination of Ingush President Yevkurov in 2009 to rivalry between local criminal groups. A further downside of this dependency relationship is that Russian nationalists have become increasingly resentful about the amount of federal funds being spent in the North Caucasus.

Penetration By Militant Islamists: Since the 1990s, the North Caucasus has been targeted for radicalisation by Muslim extremists from the Middle East and elsewhere. Essentially, while the Chechen rebellion of the early 1990s began as a secular-nationalist struggle, it was quickly taken over by radical Islamists, who sought to impose ultra-harsh Wahhabi norms on the traditionally Sufi population and shift the focus of the war to creating a greater North Caucasian Islamist state stretching from the Black Sea to the Caspian Sea. The main militant group in the region is the Caucasus Emirate, led by Chechen separatist leader Doku Umarov, who is Russia's most wanted man.

After Russia withdrew from Chechnya in the late 1990s, Islamist militants from the republic started agitating trouble in neighbouring Dagestan. In recent years, Moscow has consolidated a pro-Russian Chechen leadership by co-opting former Chechen rebels who split from the Islamists, but the latter retain cells (combat Jamaats) across the region.

Human Rights Violations: In order to fight Islamist militancy, local authorities have used highly repressive measures. In a report published on July 1 2009, Amnesty International chronicled cases of arbitrary detention, disappearances and torture of those suspected of being Islamist or separatist militants, and threats or violence against their relatives, including forced evictions and the destruction of their houses. These practices will only increase public opposition to local leaders, who are seen as doing Moscow's bidding.

North Caucasus - Profile Of Republics
Territory Population Major ethnic groups (%) Capital President Background
Source: Russia 2010 Census, BMI
Adygea 439,996 Russians (64%), Adyghes (25%) Maykop Aslan Tkhakushinov (Jan 2007- ) Legislator
Karachay-Cherkessia 477,859 Karachay (41%), Russians (32%), Cherkess (12%) Cherkessk Rashid Temrezov (Feb 2011- ) Legislator
Kabardino-Balkaria 859,939 Kabardins (57%), Russians (23%), Balkars (13%) Nalchik Arsen Kanokov (Sep 2005-) Businessman
North Ossetia 712,980 Ossetians (65%), Russians (21%), Ingush (4%) Vladikavkaz Taymuraz Mamsourov (May 2005-) Legislator
Ingushetia 412,529 Ingush (94%), Chechens (5%) Magas Yunus-Bek Yevkurov (Oct 2008-) Military, paratroop commander
Chechnya 1,206,551 Chechens (94%), Russians (2%) Grozny Ramzan Kadyrov (Feb 2007-) Former rebel fighter
Dagestan 2,910,249 Avars (29%), Dargins (17%), Kumyks (15%), Lezgins (13%) Makhachkala Ramazan Abdulatipov (Jan 2013- ) Legislator

Russia's Policy Options

In light of the above factors, Russia has been pursuing several simultaneous policies, which have yielded mixed results. These include:

Reliance On Regional 'Strongmen': The Kremlin has, in some cases, relied on regional 'strongmen' to maintain order. The most obvious example is the Chechen president, Ramzan Kadyrov, who took over in 2007 after his father was assassinated in 2004. The Kadyrovs were separatists co-opted by Moscow to lead Chechnya back to relative normality, with generous reconstruction aid from the federal government. However, under Ramzan Kadyrov, Chechnya remains a highly repressive state with widespread human rights violations attributed to his elite military units (known as the Kadyrovtsy). This threatens to undermine his legitimacy.

Meanwhile, Russia risks becoming ever more dependent on one person or one clan to maintain its authority in Chechnya. In addition , some in Moscow fear that Kadyrov is slowly 'Islamising' the republic and could eventually turn against the Kremlin, despite his professed loyalty.

Neighbouring Ingushetia has been led by three successive military or security commanders, the most recent of which is Yunus-Bek Yevkurov. He was appointed in October 2008 after his predecessor, Murat Zyazikov, was widely criticised for his allegedly corrupt and ineffective rule. However, Yevkurov has failed to rein in violence, raising doubts about whether anyone can bring stability. Moscow can also bypass regional presidents by sending Russian generals to take charge of local security, as was the case in 2009-2010, when deputy interior minister Colonel-General Arkady Yedelev assumed control of Ingushetia's security. However, by replacing local security personnel with federal (especially ethnic Russian) officials, the Kremlin risked opening new rifts in the law enforcement system.

The Russian leadership is aware that strong-arm rule is insufficient to bring stability. On January 19 2010, it created a new North Caucasus Federal District, Russia's eighth such region, consisting of the republics of Chechnya, Dagestan, Ingushetia, Kabardino-Balkaria, Karachay-Cherkessia and North Ossetia -Alania , and the Stavropol region, under the administration of Alexander Khloponin, hitherto governor of the Siberian territory of Krasnoyarsk. Khloponin was chosen for his achievements in social and economic projects, and his task is to end the insurgency by improving socioeconomic conditions in the North Caucasus. However, his lack of experience in the region and the magnitude of his task suggest that he will not ultimately be successful.

Federal Economic Assistance: Moscow provides the vast majority of the budgetary revenues for the North Caucasian republics, essentially buying peace. This policy certainly makes sense, for the region could benefit from improved economic opportunities, and construction provides employment for thousands of young men who might otherwise drift into criminal groups. In July 2010, the Kremlin announced a new 10-year economic development plan for the region, aimed at creating 400,000 new jobs.

However, the policy of increased federal aid has four major shortcomings. Firstly, it creates a culture of dependency, reducing incentives to become more self-sufficient. Secondly, the money is vulnerable to waste through corruption, which, if glaring, could exacerbate tensions between the pro-Russian elites and the wider population. Thirdly, Moscow cannot indefinitely subsidise the region, especially as it grappled with a sharp recession in 2009. Fourthly, the generous aid to the North Caucasus has led to resentment elsewhere in Russia that the region is disproportionately benefiting from the Kremlin. Russian nationalists opposed to President Vladimir Putin have cited high federal assistance to the Caucasus as one of their grievances.

Cultivating Key Muslim Clerics: In late August 2009, the then-President Dmitry Medvedev called on Russia's leading Muslim clerics to do more to dissuade young Muslims from becoming radicalised. Among his suggestions was a new Muslim television channel, greater controls over those going to study abroad (lest they come under extremist influence), and new social programmes aimed at the young in the Caucasus. However, it is far from clear if moderate clerics can make a difference, especially given the poor economic situation and widespread human rights abuses. Furthermore, such clerics are themselves at risk of elimination, and several of them have been assassinated in recent years.

Democratisation: Prior to the September 2004 Beslan school siege, most leaders in the North Caucasus were elected. Thereafter, the Kremlin determined that all of Russia's regional leaders would be appointed by the president. Hence, all North Caucasian leaders owe their positions to President Vladimir Putin. However, the Kremlin must still be sensitive to the popularity of regional presidents, which explains why it replaced the then-Ingush President Zyazikov in October 2008. In 2012, following popular protests, Russia restored the practice of elections to regional leadership posts. Nonetheless, elections are highly unlikely to be restored in the North Caucasus, due to its instability. Indeed, in April 2013 Putin signed a law that allows individual regions to opt out of elections. The move was widely seen as benefiting incumbent North Caucasus presidents. As of April 2013, Dagestan and Ingushetia had taken steps to ensure that their future heads will be chose by republican parliaments rather than by voters.

Future Scenarios

There are several different ways in which the violence in the North Caucasus could play out:

Best-Case Scenario: Insurgency Winds Down. In the best-case scenario, the current insurgency represents the 'last throw of the dice' by Islamist militants, most of whose top leaders have already been killed. Russia successfully pacifies the region through increased support (including federal troops) for local security forces, achieving a relative if uneasy calm. Radical Islamists gradually become increasingly marginalised as their hardline Wahhabist leanings put them at odds with the local population. Meanwhile, preparations for the 2014 Sochi Winter Olympics stimulate local development. This scenario is possible, but looks less likely in light of recent developments.

Intermediate Scenario: Indefinite, But Low-Level Insurgency. Russia could be faced with a low-level insurgency for many years to come, with its policies failing to restore order. This scenario would involve more militant attacks and more reprisals by security forces against militants or their relatives. Such an insurgency would be tolerable for the Kremlin, so long as it is geographically contained and limited to a small fraction of the population. Many countries have experienced low-level peripheral insurgencies, in some cases for decades, which have failed to become a serious threat to national security. We consider this scenario the most probable one .

Worst-Case Scenario: New North Caucasian War. The insurgencies in Dagestan and Ingushetia could spread to the other republics in the region, forcing the Kremlin to send more federal troops there and increase repressive measures. In this scenario, we would expect many more terror bombings of administrative buildings, assassinations of regional officials, and violent reprisals against militants and civilians by the security forces. Splits could emerge between federal and regional authorities that undermine the war effort and even persuade the latter to turn against Russia.

The local populations could become increasingly radicalised, leading to new acts of terror against Russia's main cities, as shown by the Moscow Metro attacks of March 2010 and Moscow Domodedovo International Airport bombing of January 2011, and a new push to radicalise Russia's other Muslim regions. Ultimately, Russia could lose de facto control over the North Caucasus, even as it is forced to devote more military resources there. This, in turn, could justify continued authoritar ian rule in Russia and distract the leadership from economic reform. Although this scenario is plausible, at this stage we believe that the current insurgency lacks the triggers to take it to a higher level of violence.

This article is tagged to:
Sector: Country Risk, Oil & Gas
Geography: Russia

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