Political and economic aspects of Iran's relations with Central Asian countries

Abstract

Central Asia holds economic and political significance for the Islamic Republic of Iran. Their cooperation has great potential for both sides. However, Iran's practical role in economic and political relations within the region remains limited.

Currently, Iran does not have a significant position among the top ten economic partners of regional countries. Iran’s foreign trade with Central Asia is less than 2% of Iran’s total foreign trade. The most important reasons for this are the lack of priority given to economic development domestically, resulting in Iran's weakness in investment, technology, and the private sector, the lack of diplomatic priority for the region, and sanctions limiting Iran. Some developments in recent years have given hope for the expansion of cooperation between Iran and Central Asian countries. In this regard, we can refer to the preferential trade agreement between Iran and the Eurasian Economic Union from 2019, the free trade agreement from 2023, Iran's membership in the Shanghai Cooperation Organization from 2022, the neighborhood policy and the eastern policy of the new government from 2021. All these economic and political communications have been leading to an increase in development of relationships between Iran and Kazakhstan, Uzbekistan, Kyrgyzstan and Tajikistan. Although bilateral relations between Iran and Kyrgyzstan are not particularly dynamic, but relations between Iran and Uzbekistan are the most complex in the region among the CA countries.

All in all, Iran and Central Asian countries have taken important steps towards each other in order to have political stability and economic development over the last decade. Thus, Tehran has enormous potential for cooperation with the post-Soviet countries of Central Asia, but its implementation is closely connected with the geopolitical situation around Iran.