TNAG-2790-FCO40-4029-Future-of-Hong-Kong-1993 — Page 29

12. Iran:

(i) external:

obtains Soviet nuclear weapons, complicating regional relationships (ii) internal:

Rafsanjani's pragmatic reforms fail;

emergence of new

foreign policy radicalism;

(iii) Rushdie

assassinated by

Iranian agents.

13.

Former Soviet

republics:

Tajikistan, Georgia, Moldova. Increasing internal conflict threatens Russian population, Russia intervenes militarily in their defence; protracted conflict.

14.

Nagorno-Karabakh: (i) NK military exploitation

of Azeri political instability brings hardliners to top in both Armenia and Azerbaijan; outright

war.

CONFIDENTIAL

£500 million trade

Intelligence.

Close monitoring of situation.

Limited unless Tajik instability spread as far as Kazakhstan (British Gas contract); credibility of UN/CSCE; might require diplomatic

confrontation with Russia (especially in case of Moldova).

BP oil contracts in Azerbaijan; credibility of CSCE process; Turkey and Russia could be drawn into any overt

war.

Breakdown of CSCE/UN efforts; (Moldova) vote for reunification with Romania;

(Georgia) Shavardnadze increasingly challenged by Kitovani;

(Tajikistan) strident statements by Iranians.

Breakdown of CSCE process; refusal of belligerents to negotiate further; recognition of N-K by Armenians; escalation of conflict.

Close monitoring of situation; support for CSCE/UN efforts

Support for CSCE process. Urging caution on all concerned.

CONFIDENTIAL

9