This article offers a timely and policy-oriented analysis of the profound disruptions reshaping Eurasia’s energy and transport architecture under the 2026 Iranian crisis. Focusing on the systemic consequences of the military escalation around Iran, the study examines how the functional blockade of the Strait of Hormuz triggered not only a sharp energy shock, but also a wider crisis in logistics, food supply chains, and regional economic security. By situating these developments within a broader geopolitical framework, the article argues that the global economy has entered a new era in which security considerations increasingly outweigh traditional assumptions of efficiency and open trade. A central contribution of the article lies in its detailed examination of how the crisis has affected Central Asia, particularly through the disruption of southern trade and transit routes. It shows that the combination of instability in Iran and renewed conflict along the Afghanistan–Pakistan border has placed the region in a condition of strategic vulnerability, cutting off previously important corridors to global markets. In this context, the article demonstrates that the consequences of the crisis extend well beyond energy pricing, influencing food security, inflationary pressures, and the future viability of major regional infrastructure initiatives. Using Uzbekistan as a case study, the article explores how the country is being compelled to revise its foreign economic and logistical strategy. Particular attention is given to the accelerated importance of the Middle Corridor and the China–Kyrgyzstan–Uzbekistan railway, both of which are presented not simply as development projects, but as strategic instruments of resilience and long-term sovereignty. The analysis highlights how Uzbekistan’s geographical position may be transformed from a structural constraint into a source of geopolitical and economic advantage, provided that route diversification and infrastructure adaptation are pursued with urgency. Overall, the article makes a compelling argument that the 2026 crisis marks a decisive turning point in Eurasian geopolitics. It concludes that Central Asian states, and Uzbekistan in particular, must adapt to a more fragmented and competitive international environment where protected and diversified corridors are becoming essential to national survival. Combining geopolitical analysis with concrete regional implications, the article provides an important contribution to current debates on energy security, connectivity, and strategic resilience in a rapidly changing international order. * 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.

At the end of February 2026, a series of military conflicts erupted simultaneously along the Afghanistan–Pakistan border and the Middle East, particularly in the territory of Iran. The escalation of tensions along Afghanistan’s western and eastern frontiers has significantly worsened the humanitarian situation in the country. Against the backdrop of ongoing instability, the situation has created a complex balance of risks and opportunities for Central Asian states. On the one hand, security risks are likely to increase. On the other hand, Afghanistan’s growing economic vulnerability opens additional space for political influence from its northern neighbors. Amid an already existing structural crisis, the escalation of conflict in the Middle East has dealt a particularly severe blow to Afghanistan. As a result, the Afghan authorities have effectively lost the capacity to contain rising prices in the short-term period, largely due to shrinking opportunities for trade diversification. Under these conditions, the northern corridor through Central Asia is emerging as virtually the only viable alternative, at least in the near term. For Central Asian states themselves, the prospect of deepening humanitarian engagement with Afghanistan during a time of crisis is inherently dual in nature: while it entails certain risks, it may also generate significant benefits for several reasons. Firstly, the ongoing conflicts have effectively placed Afghanistan between two major geopolitical fault lines. Since November of the previous year, the closure of the border with Pakistan has disrupted traditional supply routes, while the escalation of tensions in the Middle East has also put imports from Iran at risk. As a result, March 2026 saw a sharp increase in prices, particularly for food and medical supplies. For years, Afghanistan’s geographic and political proximity to Iran provided favorable conditions for transit trade, making Iran one of the country’s largest trading partners, with an estimated turnover of around $3.2 billion. However, under current conditions, this relationship has turned into a critical dependency. This is evidenced by the most pronounced price increases being recorded in provinces bordering Iran, such as Herat. The situation has been further aggravated by the setback to the Chabahar port project, which had been viewed as a key alternative route bypassing Pakistani transit corridors. Ongoing instability in the region now casts doubt not only on the port’s viability but also on broader infrastructure initiatives. In effect, Afghanistan is facing an unprecedented level of logistical isolation. Secondly, rising tensions around Afghanistan’s borders have led to a unique pattern of dual refugee flows, placing additional strain on already fragile local infrastructure. According to reports by the UN High Commissioner for Refugees, U.S. and Israeli strikes on Iranian territory have increased the likelihood of a new wave of displacement, with implications for neighboring countries. Afghanistan is particularly vulnerable in this regard, as Iran has long served as one of the largest host countries for Afghan migrants. Recent developments at border crossings indicate an unusual trend: thousands of Afghans who previously held legal status in Iran are now returning home. Whereas deportations once dominated cross-border flows, there is now a noticeable increase in so-called “voluntary” returns. Reports suggest that up to 1,500 individuals per day, including those with valid passports and residence permits are leaving Iran. A similar pattern is emerging along Afghanistan’s eastern borders. According to UN data, more than 100,000 people were displaced within the first week of clashes between Afghanistan and Pakistan. In addition, Afghan media report that forced deportations continue at a rate of up to 20,000 individuals per week. Importantly, a large share of returnees lack both financial resources and viable opportunities for rapid economic reintegration. This not only increases pressure on the domestic economy but also risks becoming a source of longer term socio-economic instability. The current cyclical nature of migration flows further undermines Afghanistan’s resilience to ongoing crises. Thirdly, declining international funding combined with disruptions to logistical routes has deepened Afghanistan’s economic vulnerability. This leaves the Taliban authorities with limited capacity to stabilize the domestic market or maintain social order. The situation is further exacerbated by a shortfall in donor support. According to Georgette Gagnon, Acting Head of the United Nations Assistance Mission in Afghanistan (UNAMA), a sharp reduction in funding has significantly worsened the humanitarian outlook. In 2026, humanitarian organizations planned to assist 17.5 million Afghans, requiring $1.71 billion in funding. However, only around 10% of this amount has been secured to date. Beyond financial constraints, the conflict has also created barriers to physical access for humanitarian assistance. The International Organization for Migration (IOM) reports that several of its transit centers have suffered damage during recent fighting along the Pakistani border. Moreover, the organization has suspended operations in a number of provinces due to security concerns. Despite growing needs, the ability to deliver aid remains severely constrained. In this context, underfunding has become a critical factor exacerbating the crisis. Fourthly, there has been a marked deterioration in food security. Over the past year, this issue has become as prominent on the international agenda on the same level as gender inequality. Data from the World Food Programme indicate a dramatic worsening of the situation. It is estimated that in the winter of 2026, more than 17 million Afghans were facing acute food insecurity. This figure saw an increase of 3 million compared to the previous year. Particularly alarming is the rise in malnutrition among vulnerable groups. Nearly 4 million children are suffering from malnutrition, many of whom require urgent medical assistance. International organizations notethat the food crisis has reached its peak in recent decades, with some acknowledging that they are no longer able to meet emergency needs due to insufficient funding. The factors mentioned above point to Afghanistan’s critical dependence on external assistance. At the same time, existing infrastructure and the political willingness of Central Asian states to engage, particularly Uzbekistan,  with Afghanistan may create a paradoxical opportunity. Prolonged military and political crises in the Middle East, combined with strained relations with Pakistan, are likely to further strengthen and expand the presence of Central Asian goods within Afghanistan’s import structure. In the long term, this may contribute to the development of more stable and trust-based economic ties between the countries. Looking ahead, Central Asian states may capitalize on the current situation to consolidate their role as key transit and humanitarian hubs linking Afghanistan with the outside world. The development of transport and logistics infrastructure, the expansion of humanitarian programs, and improved regional coordination could contribute both to stabilizing Afghanistan’s economy and to enhancing regional connectivity. Thus, despite the evident risks, the current crisis has the potential to reshape the regional architecture of cooperation. Provided that a coordinated policy is developed, Central Asian states may not only mitigate security threats but also use the situation to expand economic engagement, strengthen transport corridors and enhance their geopolitical significance in the region. * 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 Mubina Khodjaevа, Master’s student at UWED, IAIS Research Intern The military operation carried out by the United States and Israel against Iran in late February 2026 became a new source of tension in the Middle East and drew reactions from several countries in the Asia-Pacific region (APR). The stated goals of the operation - preventing Iran from developing nuclear weapons and changing the strategic balance have increased debate about the use of force without broad international support and its possible effects on regional stability. Overall, several APR countries took a cautious approach, limiting their responses mainly to diplomatic statements and calls for de-escalation. China expressed the clearest position. On March 2, 2026, the Chinese Foreign Minister, Wang Yi, stated that China supports Iran in protecting its sovereignty and territorial integrity and stressed the need to stop military actions. A spokesperson for China’s Foreign Ministry, Mao Ning, also warned about the risk of the conflict spreading and called for respect for international law. This response reflects Beijing’s long-standing view that the use of force without approval from the United Nations Security Council is unacceptable. It also reflects China’s practical interests, since Iran is important for the country’s energy security. Chinese analysts also note that a rise in tensions could draw U.S. attention and resources away from other regions, which may create new diplomatic opportunities for Beijing. Japan took a more restrained position. The country’s Ministry of Foreign Affairs expressed concern about the situation and pointed to possible risks to stable energy supplies. Prime Minister Sanae Takaichi confirmed Tokyo’s long-standing view that Iran should not develop nuclear weapons and stressed the need for a diplomatic solution to the crisis. At the same time, the Japanese government did not openly criticize the actions of the United States, reflecting an effort to balance its alliance commitments with its economic interests. Japanese analysts note that continued instability in the Middle East may push Tokyo to speed up efforts to diversify energy sources and reduce dependence on supplies from the region. Malaysia offered a critical view of the situation. During a parliamentary debate, Prime Minister Anwar Ibrahim described Israel’s actions, supported by the United States, as a violation of international order. This position follows Kuala Lumpur’s traditional foreign policy approach, which emphasizes sovereignty and international law. Malaysian analysts note that the country’s stance is also influenced by strong public support for the Palestinian issue, which plays an important role in domestic political discussions and reflects solidarity with Muslim countries during the Middle Eastern crisis. Notably, Indonesia adopted a cautious but active approach. The country’s Ministry of Foreign Affairsexpressed regret over the failure of negotiations between the United States and Iran but did not place direct blame on either side. At the same time, President Prabowo Subianto stated that Indonesia is ready to support dialogue and consider taking on a mediating role. Representatives of the country’s largest Muslim organization, Nahdlatul Ulama, also called for an end to violence and for stronger diplomatic efforts. Given the organization’s strong influence in Indonesian society and its links with Islamic institutions abroad, it could serve as an additional channel for dialogue between the parties. Possible support for Iran from Nahdlatul Ulama may partly be explained by religious factors, as the organization often shows solidarity with Muslim countries during international crises. However, Indonesian analysts note that Jakarta’s initiative may face difficulties, as Indonesia has limited political and strategic influence over the main actors in the conflict. Overall, the responses of Asia-Pacific countries show differences in tone but share a common element of caution and limited readiness to become directly involved in the Middle Eastern crisis. On the one hand, countries in the region are interested in maintaining stable energy markets and trade routes. On the other hand, they seek to avoid political risks related to participation in the conflict. In the near future, Asia-Pacific countries will likely continue to rely mainly on diplomatic responses, limiting their involvement to official statements, mediation initiatives, and support for international mechanisms of conflict resolution. * 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.

This article by Mr. Dilshod Olimov provides a comprehensive policy-oriented analysis of the evolving energy geopolitics of Central Asia in the period from 2016 to 2030, with a particular focus on the strategic role of the Republic of Uzbekistan. The study argues that the traditional model of regional energy competition, historically based on the control of resources and transit routes, is gradually being replaced by a new paradigm centred on energy system resilience, infrastructure reliability, and institutional capacity. In this context, factors such as grid sovereignty, seasonal balancing capacity, investment mobilisation, and energy diplomacy increasingly determine the geopolitical position of states in the region. The paper examines how Uzbekistan has emerged as a pivotal actor within this transformation due to its large domestic energy market, central geographical location within regional power networks, and the comprehensive energy sector reforms initiated since 2016. Particular attention is given to the institutional and economic reforms implemented under the leadership of President Shavkat Mirziyoyev, which have significantly reshaped the country’s electricity and natural gas sectors, expanded renewable energy capacity, and improved the investment climate. These reforms have contributed to strengthening Uzbekistan’s energy security while simultaneously broadening its diplomatic and economic maneuvering space. The article also evaluates the structure of energy balances across Central Asian states and demonstrates how asymmetries between hydro-based and hydrocarbon-based energy systems create both vulnerabilities and opportunities for regional cooperation. In this regard, the development of cross-border electricity trade, modernization of power grids, and the creation of a regional electricity market such as the REMIT initiative supported by the World Bank, are examined as key mechanisms for transforming regional interdependence into a source of stability and mutual benefit. Finally, the study explores the broader geopolitical environment surrounding Central Asia’s energy transition, including the growing involvement of external actors such as China, the European Union, and the United States. The article concludes that Uzbekistan’s strategy of diversifying energy sources, expanding renewable generation, strengthening grid resilience, and promoting regional electricity market integration positions the country as a central “node of resilience” in the emerging energy architecture of Central Asia. * 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 policy brief examines the evolving role of climate finance in addressing the growing economic and environmental risks associated with climate change. In recent years, climate change has moved beyond the realm of environmental policy to become a systemic challenge affecting macroeconomic stability, financial systems, and long-term development strategies. Global temperature trends and the increasing frequency of extreme weather events demonstrate that countries must accelerate both mitigation and adaptation efforts while mobilising significantly larger volumes of financial resources. The brief highlights the widening gap between the scale of global climate ambitions and the availability of financing. Achieving climate targets in emerging and developing economies requires approximately $2.4 trillion annually by 2030, yet current financial flows remain far below this level. This shortfall creates growing competition for limited concessional and private capital and underscores the need for new mechanisms capable of mobilising larger investments from both public and private sources. Special attention is given to Central Asia and Uzbekistan, where climate risks are intensifying despite the region’s relatively modest contribution to global greenhouse-gas emissions. Rising temperatures, increasing water scarcity, and greater variability in river flows create serious challenges for agriculture, energy systems, and economic stability. The policy brief argues that climate finance in the region remains heavily dependent on externally driven, project-based funding and is disproportionately concentrated on mitigation, while adaptation and resilience measures remain chronically underfunded. The paper concludes by outlining key priorities for strengthening climate-finance systems in Uzbekistan and Central Asia. These include expanding private-sector participation, integrating ESG standards into financial decision-making, improving institutional capacity for developing climate-investment projects, and strengthening transparency and climate-data infrastructure. Together, these measures can transform climate finance from a narrowly defined environmental instrument into a central pillar of economic resilience and sustainable development. * 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.

Amid ongoing military strikes in the Middle East involving Iran, the United States, and Israel, South Asia is witnessing a latent conflict of its own. Along their shared border, Afghanistan and Pakistan remain engaged in simmering conflict. Cross-Border Dynamics Late 2025–early 2026, relations between Afghanistan and Pakistan have entered a more volatile phase marked by a shift from episodic border incidents to more sustained and direct military confrontation. While tensions along the so-called Durand Line have historically been a recurring feature of bilateral interaction, recent dynamics suggest a qualitative transformation in the security affairs. The escalation along the Afghanistan–Pakistan border is driven by a combination of factors: rising cross-border militant activity, shifts in Pakistan’s national security approach, limited governance capacity in Afghan territory, and the absence of durable diplomatic channels for conflict resolution. As a result, bilateral relations are increasingly defined by a logic of force, with military tools gradually becoming institutionalized as an acceptable means of exerting pressure. A central driver of instability remains the activity of terrorists belonging to the Tehreek-e-Taliban Pakistan group. Militant attacks in Pakistan have intensified following the Taliban’s takeover of Afghanistan in 2021, often focusing on security installations along the frontier. Pakistani authorities have repeatedly expressed concern that Afghan territory is being used by militant elements for shelter, recruitment, and logistical coordination. Afghan officials, in turn, have rejected allegations of complicity and have criticized cross-border strikes as violations of sovereignty. This exchange of accusations has narrowed the space for constructive dialogue and complicated efforts to rebuild confidence. Recent Escalations A major terrorist incident in Islamabad in recent weeks marked a turning point, intensifying domestic political pressure on Pakistan’s leadership and accelerating the adoption of a preventive, force-based containment strategy. In this context, Pakistan has increasingly considered striking militant infrastructure beyond its borders. Since late 2025, military activity along the Afghanistan–Pakistan border has steadily increased. In 2025, Pakistan experienced 699 terrorist attacks that killed 1,034 people, a 34% and 21% increase from 2024. Pakistani air and missile strikes against suspected TTP positions in eastern Afghan provinces have been met with retaliatory actions by Afghan armed groups against Pakistani border facilities. The recent clashes on February 26-27 signaled a transition into open armed confrontation, with border skirmishes in the Kurram region escalating into large-scale combat involving heavy weaponry, drones, and additional troop deployments. At the same time, the conflict is accompanied by an intense information struggle, with each side releasing contradictory reports on casualties and operational outcomes, reflecting attempts to shape favorable political narratives. Taliban sources claiming significant Pakistani losses and capture of military positions, while Islamabad reported only two soldiers killed and 36 militants neutralized. Subsequent Pakistani statements increased militant casualties to 72, with over 120 wounded, alongside the destruction of 16 border posts and seizure of weapons, reflecting an ongoing information battle and mutual inflation of figures. The broadening geographic scope of clashes into several eastern Afghan provinces, along with public statements about planned large-scale operations, points to a high degree of centralized control over military activities. The situation has resulted in recurring use of military force as a persistent feature of bilateral relations, increasing the likelihood of a prolonged, low-intensity conflict. Parallel to the military escalation, political dialogue between the parties has deteriorated. Pakistan accuses Afghan authorities of failing or unwilling to restrict anti-Pakistan armed groups, while Kabul views Pakistani strikes as violations of sovereignty and external pressure. Mutual public accusations, including alleged links to international terrorist networks, have further eroded trust, leaving diplomatic channels largely ineffective in preventing crises. External Responses Key international actors have responded cautiously. According to the White House, The United States recognizes Pakistan’s right to self-defense against terrorist threats while holding Afghan authorities responsible for preventing cross-border attacks. The Russian MFA continues to characterize the situation as evidence of persistent military-political instability in Afghanistan. These positions effectively provide limited legitimacy for the use of force while insufficiently incentivizing rapid de-escalation mechanisms. Escalation risks The escalation of the Afghanistan-Pakistan confrontation may also pose systemic long-term risks for Central Asia also. Intensified armed conflict between Kabul and Islamabad reduces Afghan authorities’ ability to maintain internal security, creating conditions for the potential northward redeployment of radical groups. Continued conflict may increase the vulnerability of transregional infrastructure initiatives, including trans-Afghan connectivity projects, which regional states view as key to diversifying external economic routes and access to Indian Ocean ports. Border destabilization may delay these projects or increase their political and insurance risks. Humanitarian considerations remain critical. The expansion of hostilities is driving displacement, worsening socio-economic conditions in Afghanistan, and potentially increasing migratory pressure on neighboring Central Asian states. Additional threats include the gradual militarization of the southern strategic perimeter of the region. The establishment of cross-border strikes and regular military operations might create a persistent zone of instability near Central Asia’s borders. Finally, the risk of increased involvement by external actors may emerge. External actors’ involvement in stabilization or support for individual sides may transform the local conflict into a broader regional confrontation, indirectly affecting Central Asian interests. Thus, the current dynamics of Afghan-Pakistani relations indicate a steady trend towards armed confrontation with limited opportunities for diplomatic settlement. The combination of cross-border terrorism, strategic mistrust and the permissibility of military reactions creates the conditions for continued instability on the southern borders of Eurasia. The activities of the Tehreek-e-Taliban Pakistan group remain a key destabilising factor, as do mutual accusations by the parties of using each other's territory to organise cross-border attacks. At the same time, the weakening of diplomatic mechanisms and increased domestic political pressure on Pakistan's leadership are contributing to a shift towards a more active strategy of preventive military action along the Durand Line. Taken together, these trends are creating a stable zone of instability that could have a long-term impact on security in Central Asia, the implementation of trans-Afghan infrastructure projects, and the development of regional economic connectivity. If the current dynamics continue, the most likely scenario appears to be a protracted low-intensity conflict accompanied by periodic phases of escalation. * 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.