Azernews.Az

Qabil Ashirov

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For Azerbaijan, the ongoing economic shifts in Russia are far more than distant macroeconomic trends. They represent tangible financial, social, and strategic consequences.

For decades, Russia has served as one of the primary destinations for Azerbaijani labour migrants, seasonal workers, and small-scale entrepreneurs. The flow of remittances from Russia has supported thousands of households, fueled small business creation, and contributed to domestic consumption across Azerbaijan’s regions.

Now, as Russia faces mounting economic pressure triggered by sanctions, structural imbalances, and the prolonged war in Ukraine, the foundations of this economic interdependence are beginning to shift. Slower growth, high inflation, tighter banking regulations, and changing migration policies are altering both the volume and the nature of Azerbaijani economic activity linked to Russia.

The reported 16.3 per cent decline in remittances from Russia to Azerbaijan in 2025 may signal a deeper structural transformation rather than a temporary fluctuation. Reduced transfers directly affect household incomes, currency inflows, and investment capacity, particularly in rural areas where reliance on remittances remains significant. At the same time, Azerbaijani entrepreneurs operating in Russia are reassessing risk, profitability, and long-term stability, increasingly exploring alternative markets.

Indeed, a growing number of Azerbaijani business owners have begun redirecting their operations toward Turkiye and Poland, seeking more predictable regulatory environments and broader market access. This gradual redirection of capital reflects not only economic calculation but also a reassessment of geopolitical risk.

Simultaneously, Moscow appears to be reconsidering its broader approach toward former Soviet republics. Rather than relying predominantly on migrant labour from neighbouring states, Russia has increasingly turned to workers from India. Russian-language media outlets have widely circulated videos and reports highlighting the arrival of Indian migrants in various sectors. This apparent replacement of migrants from former Soviet republics with Indian workers has not been universally welcomed, either within Russia or across the post-Soviet space.

Speaking to AzerNEWS on the issue, economist Natig Jafarly said that Russia’s own economic situation is under strain. Last year, the country recorded particularly weak results. According to him, GDP growth barely exceeded 1 per cent, while inflation reached around 10 per cent, entering double digits.

“As economic conditions worsen, fewer people are turning to Russia, and the volume of remittances sent from the country has also declined,” he said.

Also, Natig Jafarly added that the number of individuals seeking to start businesses in Russia is decreasing, and many are exploring alternative destinations.

“In addition to Turkiye and Europe, Central Asian republics are increasingly becoming attractive options. New opportunities are emerging in Kazakhstan and Uzbekistan, drawing attention from both investors and migrants,” he said.

As for migrants from India, Jafarli noted that Russians appear to prefer that they work temporarily rather than settle permanently. The climate and lifestyle in Russia are not particularly suited to Indian workers, making long-term residence unlikely.

“In contrast, migrants from Central Asia tend to stay longer, maintain strong cultural and religious identities, and establish diasporas. Indian workers are typically brought in for temporary labour and often return home after a few months.

For example, numerous reports circulated about Indian workers in Moscow struggling to clear snow in the streets during winter, highlighting their unfamiliarity with snow and winter conditions. This is part of a broader Russian strategy: the government appears reluctant to allow migrants from neighbouring countries to gain long-term political or social influence, favouring temporary workers from more distant regions instead,” Natig Jafarly concluded.