By Zulkhayo Nishanova, Assistant Teacher at the Department of International Economics of UWED The escalation of the military-political situation in the Middle East, including the conflict surrounding Iran and the temporary restriction of maritime traffic through the Strait of Hormuz, has had a significant impact on global energy and food markets. The Strait of Hormuz is a key route in global energy logistics, through which approximately 20% of the world's oil supply and more than 30% of liquefied natural gas pass. Amid transit restrictions in late February–March 2026, the global oil market experienced a sharp price surge: Brent crude prices increased by 60–64% over a short period, exceeding USD 110 per barrel. This price increase was accompanied by high volatility and the emergence of a so-called “war premium” in energy prices. As of April 8, 2026, partial stabilization of the situation is being observed. The United States and Iran, with mediation by Pakistan, reached an agreement on a two-week ceasefire, conditional upon ensuring safe navigation through the Strait of Hormuz, which Israel also joined. The Republic of Uzbekistan officially supported this decision, noting its importance as a step toward de-escalation and a transition to a political and diplomatic resolution. Global markets responded promptly to these developments: Brent crude prices declined to around USD 94 per barrel, while natural gas prices in Europe fell by approximately 18.5% to USD 518 per thousand cubic meters. This indicates a reduction in the geopolitical premium and a high sensitivity of prices to changes in the external political environment. At the same time, the increase in prices of precious metals reflects the persistence of uncertainty and cautious behavior among investors. The rise in energy prices during the escalation period had a multiplicative effect on the global economy, primarily through increased transportation, logistics, and production costs. This has already been reflected in global food price dynamics. According to the Food and Agriculture Organization of the United Nations (FAO), the global food price index increased by 2.4% in March 2026 compared to the previous month. The highest growth was recorded in certain categories: vegetable oils rose by 5.1%, sugar by 7.2%, and wheat by 4.3%. Additional pressure is being generated through the fertilizer market: urea prices exceeded USD 700 per ton, increasing by approximately 70% since the beginning of the year. The global mineral fertilizer price index rose by 38 points over the month, reaching 183 (with a base value of 100 in 2010). Considering that a significant share of fertilizer supplies passes through the Persian Gulf region, logistical constraints are increasing agricultural production costs and creating risks of delayed food price growth. The economy of the Republic of Uzbekistan is also, to some extent, exposed to these external shocks. According to official statistics, annual inflation in March 2026 amounted to 7.1%, with the main contribution coming from the food sector (accounting for 76.2% of the increase in the consumer price index). Monthly growth in food prices reached 1.2%, significantly exceeding the dynamics of non-food goods (0.3%) and services (0.2%). In particular, price increases have been observed for meat (up to 15% year-on-year), eggs (17%), as well as sugar and fish. Food inflation stands at approximately 5.6% on an annual basis, reflecting the continued pressure from external factors. External shocks are transmitted to the domestic economy through the fuel channel. Rising prices for oil and petroleum products lead to higher transportation and production costs, creating a chain effect of increasing prices for goods and services. In addition, rising fertilizer prices may affect the cost of agricultural production in subsequent production cycles. At the same time, the current situation is characterized by mixed trends. On the one hand, the achieved ceasefire and the initiation of negotiations create conditions for short-term stabilization of energy prices and a reduction in inflationary pressure. If the ceasefire is maintained and a stable political and diplomatic dialogue is established, further declines in oil and gas prices and gradual normalization of logistics chains are possible. Under this scenario, inflation in the Republic of Uzbekistan may remain within the range of 7–7.5% by the end of 2026. On the other hand, the temporary nature of the ceasefire (two weeks) implies the persistence of high risks of renewed escalation. In the event of a breakdown of the agreement and a resumption of the conflict, there is a likelihood of oil prices rising again to USD 110–130 per barrel, further increases in fertilizer prices, and intensified inflationary pressure, which could accelerate inflation to 8% or higher. Thus, the escalation in the Middle East has had a significant impact on global markets and the economy of Uzbekistan. However, current signs of de-escalation create a window of opportunity for stabilizing the macroeconomic situation. In these conditions, the implementation of a balanced economic policy aimed at reducing vulnerability to external shocks becomes crucial. To minimize negative impacts and capitalize on emerging opportunities, it is advisable to: in the short term — strengthen monitoring of fuel and socially significant food prices, ensure readiness to apply targeted regulatory measures, and utilize state reserves and commodity intervention mechanisms when necessary; in the medium term — intensify diversification of energy and fertilizer supply sources, develop alternative logistics routes, and expand support measures for agriculture, including subsidizing fuel and fertilizer costs; in the long term — accelerate the development of alternative energy, improve energy efficiency of the economy, reduce dependence on imported resources, and increase domestic food production and processing capacity. In addition, it is recommended to take advantage of the current stabilization of global prices to build strategic reserves of energy resources and food at more favorable prices, thereby enhancing the resilience of the economy to potential future external shocks. Overall, despite the existing risks, the current situation creates preconditions for stabilizing price dynamics and strengthening the macroeconomic stability of the Republic of Uzbekistan, provided that comprehensive and proactive policy measures are implemented in a timely manner. * The Institute for Advanced International Studies (IAIS) does not take institutional positions on any issues; the views represented herein are those of the author(s) and do not necessarily reflect the views of the IAIS.

The Taliban government has launched a mechanism for multilateral political consultations with Central Asian states. Kabul intends to use the new dialogue platform to expand practical cooperation in trade, transit and transport connectivity, and to coordinate efforts in this process. This aligns with the agenda of the Regional Contact Group of Special Representatives of Central Asian Countries on Afghanistan, which was established in 2025 at Uzbekistan’s initiative. At an extraordinary meeting of the Group, held on February 16, 2026 in Astana, Kazakhstan, participants emphasized the need for a coordinated and independent approach to the Afghan issue. This approach appears to be based on viewing Afghanistan as a country of opportunities rather than a source of threats — a perspective adopted and supported by virtually all countries in the region. The Taliban is prepared to follow a similar course and engage in collective dialogue with Central Asian partners on issues of mutual strategic interest. The holding of the six-party meeting in Kabul was a clear confirmation of this. The Afghan side advocates a pragmatic model of regional integration, with a focus on realising its own economic potential. The stated goal is to increase trade turnover with the Central Asian republics to $10 billion while also mitigating the trade imbalance. Currently, Afghan exports account for less than 10 percent of the $2.7 billion trade volume, despite almost doubling in 2025. Cooperation in transit is an important component of economic integration between Afghanistan and Central Asia. Kabul is eager to see transport infrastructure projects implemented swiftly, as these are intended to transform the country into a major hub for transcontinental logistics. Uzbekistan is leading the construction of the Kabul Corridor and the Surkhan-Puli-Khumri power transmission line, while Kazakhstan is planning to build the Torghundi-Herat railway, with the prospect of extending it to Pakistan via the western Afghan provinces. Meanwhile, Turkmenistan is accelerating construction of the TAPI gas pipeline towards South Asia. The TAP and CASA-1000 projects, which aim to export electricity from Turkmenistan, Kyrgyzstan, and Tajikistan, also remain a priority. Such activity demonstrates a commitment to long-term investment in Afghanistan’s development. However, it also requires coordinated action from the parties involved — both trade and transit cooperation with Kabul and ensuring the security of future infrastructure. A number of proposals put forward by Afghan Foreign Minister Amir Khan Muttaqi to his counterparts during the consultative dialogue addressed precisely this issue. Judging by official rhetoric, the Taliban are interested not only in establishing international trade and energy corridors through Afghanistan, but also in complementing these. In this context, the Afghan side emphasized the importance of a unified approach to implementing joint economic projects, which will certainly be welcomed by the Central Asian states.  * The Institute for Advanced International Studies (IAIS) does not take institutional positions on any issues; the views represented herein are those of the author(s) and do not necessarily reflect the views of the IAIS.

By Roksana Izzatova, Dilorom Gulomjonova, Mushtariybonu Nazarova, UWED undergraduates, interns at IAIS The Future Combat Air System (FCAS), conceived in 2017 by Emmanuel Macron and Angela Merkel as Europe’s flagship defence programme, is now on the verge of collapse. The growing tension between Germany and France over the development of next-generation fighter jets showcases more than an industrial disagreement, it exposes the fragility of Europe’s ambition to become strategically autonomous in security matters. The viability of the FCAS program and Europe’s broader defense integration are threatened by escalating political, industrial and strategic risks.  The conflict in Ukraine and the changing transatlantic landscape have fueled demands for Europe to take more ownership of its security affairs. For several decades, European security has been heavily dependent on NATO and, by extension, the United States. However, France revived their concept of “strategic autonomy”, due to strategic uncertainty and also concerns about long-term U.S. commitment. Germany, with its long-standing Atlanticist approach, has increasingly come to accept this narrative, especially since the Zeitenwende in 2022. But while there is a broad consensus on the need for strategic autonomy, there is no smooth sailing in collaborative efforts. The FCAS project was meant to be the backbone of Europe’s future airpower capabilities, which would have combined advanced fighter aircraft, drones and digital combat systems. At the heart of the impasse lies a fundamental mismatch in military requirements. France, on the one hand, wants to safeguard its strategic autonomy in the defense industry and export flexibility. Germany, on the other hand, emphasizes shared governance and parliamentary control. France needs a jet capable of carrying nuclear weapons and launching from aircraft carriers, while Germany does not. These diverging operational needs were, remarkably, never reconciled at the programme’s outset. As one former senior French official told The Guardian, the project appeared to have been conceived “at a very high political level”, without adequate discussion about whether the two countries actually needed the same aircraft. The industrial dimension has compounded the problem. Dassault sees no obligation to surrender its intellectual property to Airbus, while Berlin increasingly views French behaviour as an attempt to extract German financing for a platform Paris control. Germany’s patience is fraying. One German MP described FCAS as “not a strategic necessity but an industrial trophy” for Dassault. What makes the current moment particularly consequential is the shift in the underlying power dynamic. When FCAS began, Germany’s defence spending was modest. Now, Berlin expects to spend €150bn by 2029, nearly twice France’s budget. Germany is no longer willing to play a deferential role, and France’s Rafale export success means Dassault has little commercial incentive to compromise. Achieving strategic autonomy requires three elements, industrial integration, political trust and joint defense strategy. Europe has the technological know-how and resources. However, the political will to share sovereignty in areas such as defense production is still in question. Without harmonization between the two leading European powers, Germany and France, European autonomy will be prone to splintering into multiple parallel national projects rather than a single security framework. Furthermore, the ambition for autonomy in Europe must not be conflated with a disconnection from NATO. Rather, it represents a more balanced relationship between Europe and the United States, where Europe has meaningful capabilities. However, division within Europe undermines its leverage and credibility. Without success in flagship programs such as FCAS, the ambition to be an autonomous security provider will remain a dream rather than a reality. The project is on the brink of collapse because of the controversial approaches between Germany and France. Despite having a deadline till December 2025, to make final decisions about its implementation, neither side commented on making a compromise. The delay or failure of FCAS leads both countries to make costly interim upgrades in their Rafale and Eurofighter jets, which weakens the implementation of the project. Furthermore, there is another project signed altogether with FCAS in 2017, the Main Ground Combat System, that can fail if FCAS is not achieved. Also, it could lead to fragmentation in European air power as the countries could rely on buying fighter jets from the US Next Generation Air Dominance(NGAD) or Global Combat Air Programme (GCAP) of the United Kingdom, Italy and Japan. For all the talk of reducing European industry fragmentation, the continent could end up with different sixth-generation fighter programmes. At a moment when Europe urgently needs to demonstrate strategic coherence, the FCAS crisis reveals just how fragile its foundations remain. In this regard, the split between Germany and France in the FCAS program is more than a difference in aircraft design and industrial participation. It is a representation of a larger strategic issue, whether Europe can move beyond the national interests of defense to build an integrated security framework. Without resolving these contradictions, Europe’s dependence on external security guarantees will continue. However, if it manages to do so, the FCAS program could become the bedrock of a more autonomous and strategically integrated Europe. * The Institute for Advanced International Studies (IAIS) does not take institutional positions on any issues; the views represented herein are those of the author(s) and do not necessarily reflect the views of the IAIS.

Energy cooperation between China and Russia remains one of the key pillars of their economic relationship, particularly amid the structural transformations of global energy markets in recent years. The reallocation of export flows and the changing geography of demand have increased the importance of the Asian direction for Russian energy resources, with China firmly establishing itself among the primary consumers. Against the backdrop of declining Russian gas supplies to Europe, China has become a crucial export market, reflected in the growing volumes of pipeline deliveries via the Power of Siberia-1 route. At the same time, prospects for further infrastructure expansion, including potential new routes, continue to be discussed, although the timelines and parameters of their implementation remain subject to negotiation. Financial and economic interaction in the energy sector is accompanied by an increasing use of national currencies in settlements, reflecting a broader trend toward the diversification of international trade instruments. At the same time, constraints persist, related to infrastructure capacity, pricing parameters, and external economic conditions. In parallel, China continues to pursue a strategy of diversifying its energy supply sources. A significant role in this regard is played by liquefied natural gas (LNG) suppliers, as well as the development of alternative routes and directions of cooperation, including with countries in the Middle East, Southeast Asia, and Central Asia. In the medium term, demand for natural gas in China is expected to grow, accompanied by an increase in import dependence. This dynamic creates conditions for further development of cooperation with various suppliers, including Russia, albeit within a competitive environment where price, reliability of supply, and flexibility of terms remain key factors. The escalation of tensions in the Middle East and the associated risks to maritime logistics have increased attention to overland energy supply routes. In this context, Eurasian directions, including Russian and Central Asian routes, are gaining additional importance as elements of supply resilience. At the same time, the growing role of overland infrastructure does not negate the broader logic of diversification. China continues to adhere to a pragmatic approach, seeking to balance different sources of energy supply and minimize risks associated with external shocks. For Central Asian countries, these developments create both new opportunities and additional challenges. On the one hand, their importance as transit and resource nodes within the regional energy architecture is increasing. On the other, there is a growing need to balance domestic demand with external commitments, while preserving a multi-vector foreign economic policy. Under these conditions, a key factor of resilience is the ability of regional states to pursue a balanced and flexible energy policy aimed at strengthening internal security and effectively leveraging emerging opportunities for international cooperation. * The Institute for Advanced International Studies (IAIS) does not take institutional positions on any issues; the views represented herein are those of the author(s) and do not necessarily reflect the views of the IAIS.

In recent years, international migration processes have become closely linked to global geopolitical changes, and political and security issues have had a significant impact on the movement of citizens. The Middle East region, in particular, is at the center of complex political and security developments, making the issue of ensuring the safety of foreign citizens living or working in the region particularly urgent. In this regard, the measures taken by Uzbekistan to repatriate citizens from the Middle East can be recognized as one of the effective indicators of the state's consular policy and migration management system. According to official data, as of March 10, 2026, more than 25,000 citizens from the Middle East have been repatriated to Uzbekistan. In particular, more than 21,000 citizens from Saudi Arabia, more than 3,500 from the United Arab Emirates, as well as citizens from Iran, Qatar, Bahrain, and Oman, were repatriated. This process once again confirms the direct link between global migration and geopolitical factors. The Middle East has long been a center of global political competition, representing a key point in international politics in terms of energy resources, strategic transport corridors, and geopolitical interests. This region is a destination for labor migration for many countries, and many foreign citizens work in the service, trade, and tourism sectors. Therefore, political changes in the region have a significant impact on migration flows. In modern international practice, consular diplomacy is an important tool in ensuring the safety of citizens, and the evacuation measures being implemented by Uzbekistan are a practical expression of this policy. The importance of coordinated cooperation between state bodies and international transport infrastructure and diplomatic relations is reflected in the repatriation of citizens. This demonstrates the state's ability to take quick and effective measures in emergencies. Today, the migration process is seen as a complex issue related not only to economic, but also to national security and social stability. The increase in the number of citizens living abroad requires states to more effectively manage migration processes. In recent years, Uzbekistan has implemented a wide range of reforms to regulate labor migration, protect the rights of migrants, and establish a safe migration system. At the same time, I believe that measures to repatriate citizens from the Middle East will be considered an important part of this policy. The digitization of consular services, the creation of a rapid communication system with migrants, and the strengthening of emergency preparedness mechanisms may become even more relevant in the future. In conclusion, the geopolitical situation in the Middle East directly affects global migration processes, and one of the main tasks of states is to ensure the safety and protection of their citizens abroad. The evacuation measures being implemented by Uzbekistan are an effective example of modern consular diplomacy and migration management and are emerging as an important area of ​​the state's foreign policy aimed at protecting the interests of its citizens. In the future, improving migration policy, ensuring safe labor migration for citizens, and developing consular services will remain priority areas of Uzbekistan's foreign policy. * The Institute for Advanced International Studies (IAIS) does not take institutional positions on any issues; the views represented herein are those of the author(s) and do not necessarily reflect the views of the IAIS.

Ongoing geopolitical tensions around the world are affecting continental trade routes of strategic importance to Central Asian states. The war in Ukraine, the largest modern crisis in Eurasia, continues to impact the dynamics of cargo transportation along the east-west axis, emphasizing the importance of a diverse approach to logistics organization. Uzbekistan is demonstrating maximum flexibility in this regard, striving to reduce the cost of export and import deliveries and ensure the most effective and ensure access to promising markets, including the European Union. In 2024, Uzbekistan’s foreign trade with EU countries amounted to $6.4 billion, marking a 5.2% increase. According to last year's results, the country’s top 20 trading partners included several European states, such as Germany, France, Switzerland, Italy and Poland, with a combined trade turnover of over $1.4 billion. The Northern Corridor, passing through Kazakhstan, Russia and Belarus, remains the optimal channel for Uzbekistan to deliver goods to the eurozone. In 2023, over 1 million tons of cargo were transported along the Uzbekistan-Kazakhstan-Russia-Belarus-EU railway route. One of the main transshipment hubs is the Małaszewicze railway terminal in Poland, where cargo from Central Asia arrives after crossing the Brest–Terespol checkpoint on the Belarusian–Polish border, before being delivered across Europe. This dry port, located along the Northern Corridor, handles over 90% of rail trade between the EU and China. In January 2026, the President of Uzbekistan instructed the government to consider creating a dedicated transport corridor for domestic carriers to Poland via Brest in Belarus. This is due to the need for the rapid delivery of perishable goods, primarily fruit and vegetables, to the European market. Meanwhile, Uzbek-Polish trade has declined in recent years due to high logistics costs and the introduction of restrictions related to security risks on routes to western direction using road transport. In 2025, bilateral trade turnover amounted to $383.7 million, compared to nearly $400 million the previous year. Reorienting freight traffic to railways going to Poland, Lithuania and Latvia, with subsequent transshipment of goods into containers or trucks, could significantly reduce the cost of transportation from Central Asia to Europe. However, this would require addressing current issues relating to the shortage of rolling stock and the complexity of customs procedures, which impact the efficiency of northern railway routes.  In order to boost mutual trade and develop their own transit potential, Uzbekistan and Poland are planning to establish joint logistics centers. One of these centers will be located in Mazovia, the largest transport hub in Eastern Europe. This will pave the way for Uzbekistan’s integration into European supply chains and expand the scope for the practical implementation of the Enhanced Partnership and Cooperation Agreement with the EU, which was signed in October 2025.   * The Institute for Advanced International Studies (IAIS) does not take institutional positions on any issues; the views represented herein are those of the author(s) and do not necessarily reflect the views of the IAIS.