The trade volume between Russia and Kazakhstan last year was around 5 billion tenge, which is considerably lower than in 2001. The reasons for rapidly dwindling trade, as officially admitted, are higher railway tariffs in Russia, complicated customs regulations, and different levels of value added tax in the two countries. There have been many fruitless attempts in the past to harmonize trade regulations within the Customs Union created in 1996. In 2000 this body was transformed into the Eurasian Economic Community. But when one considers the amount of time and effort lost, too little progress has been made since then.

In Moscow Kazakh President Nursultan Nazarbayev and his Russian counterpart Vladimir Putin discussed these issues. Of course, it will take years to unravel all the problems. Despite the remaining divergences, both sides have paved a good way for further improvement of relations in past months. They have reached an agreement on the division of the Caspian Sea, set up a joint venture to transport Kazakh gas to Western Europe, and signed a long-term agreement on the Baikonur launching site. And last but not least, Kazakhstan has secured Russian assistance in modernizing its armed forces. For Kazakhstan, Russia is by virtue of its geographical position a new silk road linking with European markets.

However, in economic terms, Kazakhstan and Russia do not seem to have much to share. Russia, slowly moving along the road of reform, has retained many traits of the socialist economy. They are in no rush to privatize the agricultural land leased to farmers. In Kazakhstan, the process is being whipped up by top government officials, and is fraught with social troubles. Despite slower economic growth, Russia has declared the development of public welfare system its priority, which is not the case in Kazakhstan.

Russia had never underestimated the strategic importance of its closest ally in Central Asia, Kazakhstan, which provides not only a reliable foothold in the region for Russia, but also serves as a buffer against Islamic radicalism from the South. Kazakhstan’s foreign policy cannot possibly run counter to Russian interests, at least for the time being. It is not credible that any other country in Central Asia will offer Russia greater support in its bid to regain control of Central Asia.

If Russia’s intention is to draw Kazakhstan into its orbit of influence, the present situation is very conducive to achieve that goal. Russia has toned down its criticism of Kazakhstan for allegedly discriminating the Russian minority. Although many Russians have left Kazakhstan over the last ten years, they still make up an estimated 28,6% of the population. In high-level talks, officials of the two countries have long set aside such sensitive issues as the status of the Russian language in Kazakhstan or excessive demands of the Russian community for territorial autonomy in some northern parts of Kazakhstan. As long as the two neighbors are moving toward closer integration, Russian nationalists seem to lie low. Besides, many Russian, Cossack and other Slavic communities, which have vexed Kazakh authorities so much in the past, are now ridden by petty strife within their own ranks.

The Kazakh population, too, is divided over the issue of integration with Russia. There are people who feel a strong nostalgia for the socialist past. Others fear that any kind of integration will end up with the loss of independence. Some opponents of the rapprochement with Russia have even gone so far as to accuse government officials of putting short-term gains above the interests of the nation. The biggest fears of the nationalists were provoked by the recently declared intention of the leaders of Russia, Kazakhstan, Belarus and Ukraine to introduce a common currency of the Eurasian Economic community by 2011. Most of the opponents of integration reject the very idea of Kazakhstan forging a union with the Slavic nations.

But the process does not hinge on the will of nationalists from both sides. At the last meeting of leaders of the Eurasian Economic Community, the presidents of Kazakhstan and Russia have once again confirmed their commitment to build closer ties. Some skeptics think that they are not as concerned with the problems of integration as they are with the parliamentary elections ahead.