Andrey Karaulov: your Excellency, thank you for this honor which you rendered today to channel TVS. Heydar Aliyevich, we well know each other for a long time, therefore, probably, there is no need to speak what makes related and unites our peoples. And today what divides Russia and Azerbaijan? Which type of problems was not solved?

Heydar Aliyev: First of all, I am glad to meet with you. Yes, we know each other for a long time - more than 10 years. I have left Moscow precisely 10 years ago in June. And it was a week or ten days later you came after me to Nakhchivan where I have lived three years in condition of exiled. Today when I came to the meeting with you, I recollected our talking in a courtyard of my late sister`s little house.

Andrey Karaulov: Nights in Nakhchivan were nice. As to me, at that time there was sincerity in relations between republics of our common country.

Heydar Aliyev: You know what is the main point, naturally, we were living in one state, in one country.

Question: And today Azerbaijan is closer to the NATO than to Moscow?

Answer: You are not right. It is necessary to give the explanation to this. Recollect 1990. What heavy year it was for us. January of 1990, night from 19 of January to 20. I phoned you in the evening on January 20, we met with you on January 21 at 12 o`clock in the afternoon at permanent representation of Azerbaijan in Moscow. What heavy time it was, you remember how people were screaming, crying connecting with bringing of troops, shooting of people.

Question: Have not you met Gorbachev since then?

Answer: No, we have not met, I have no desire to meet. Probably, someone told something to him. I do not know, as far as it corresponds to the truth. And about his regrets, it has no value any more.

Question: Heydar Aliyevich, really Azerbaijan will never forgive our militarists who carried out the order given by Gorbachev and Yazov?

Answer: You know, to forgive is a wide concept. If the person has committed a crime, been condemned and served a part of his sentence I will pardon them or I declare amnesty according to which people are released. That is, in essence, they are forgiven or not forgiven, in general, they are pardoned. But this is such a crime which can never be forgiven. This is brutal crime. Till now interrogation on this case has not finished or, in general, has stopped very long time ago. Therefore, who is legally guilty has not been determined but the political, moral culprit is known. Therefore the question is about this category.

Question: Heydar Aliyevich, some information was spread that Russia, Moscow has always pushed Azerbaijan away from itself. Don`t we reap the fruits of that policy today?

Answer: You know, as a whole, we suffer of many things, completely – Gorbachev`s policies in general, - not only in relation to Azerbaijan, and generally unconsidered policy. Certainly, he and many others consider that he was trying to achieve democratization, reforming of the Soviet Union. But actually, I was a member of the Politburo together with him, he did not know what he was doing. That is, when the ship starts to sail, it knows where and on what coordinate it goes and where will reach. And sometimes it happens so, that it sails on sea, it has not the compass, any coordinates, anything, - where the wind will take it, it will arrive there. Approximately it was such situation. Therefore it has inflicted damage. And as to Azerbaijan, certainly, January 20 wound of Azerbaijan is very heavy.

Question: Heydar Aliyev, really, it is a terrible sin, a terrible sin of those officers which have been compelled to carry out then the order of Defense Minister Yazov, KGB Army General Babkov, Minister of Internal Affairs Bakatin and, certainly, Gorbachev. On the other hand, in any case time goes forward and to observe strengthening of the influence by the United States on my favorite city Baku is big insult to us. Today how many people are in the US Embassy to Baku, in fact more than 200?

Answer: First, I want to make your expression little more precise. A sin of the soldiers. Certainly, they have performed their soldier duties. Certainly, they have showed atrocities. But they are not the main originators. The main originators are those who have planned it here, in Moscow. I mean heads of the Soviet Union Communist Party. And the main originators are heads of Azerbaijan who have planned together with them and carried out it. I do not want a unilateral estimation in ten years. And both those and the then heads of Azerbaijan are guilty. Both those and these are guilty. But as to that, how many employees in the Embassy of the United States of America in Azerbaijan, - and how many in Moscow`s Embassy?

Andrey Karaulov: It is not few, certainly. But employees of our Representation in Azerbaijan are too few. In Baku our diplomats are fewer than Americans.

Heydar Aliyev: And who forbids it? Nobody makes restrictions.

Andrey Karaulov: We want the trade to be extended between our countries, Azerbaijan suggests removing the customs on border and making something like a free zone. But it is unprofitable to us, to Russia.

Heydar Aliyev: First, I once again repeat Andrey, the quantity of employees in embassy does not define anything yet. For example, we are the independent state. We want to have embassies in many countries. It is not because that they are closer to us than others but we simply want to have more close relations in the world. The matter is that we do not have financial opportunities to have those embassies on which we have made the decision. We cannot realize this decision. It is connected with financial questions. In Azerbaijan - let you know and all public know - nobody limits anything, in general, there is no quota. The Russian embassy may want to have now 100 employees, diplomats, nobody will tell here in the government - why. I just want to say that we even do not know how many employees there, it does not interest us and it does not concern us. This is the business of Russia. That is the first.

And the second - you have told about a free trade zone. By the way, today it was one of the basic questions which was discussed at the summit. In 1994 this question was on the agenda. And basically it was accepted, but not completely. We, for example, have accepted it, and ratified. But now there is a process of its rejection. The Russian president declared today that the question is about exceptions to this law. Yes, some questions are unprofitable for Russia, and some questions, may be, to others. We, as being Azerbaijan, did not insist on it. But there were some countries which had great need for it. For example, Ukraine, Kazakhstan and some others. Therefore for us, for example, this question is not any question influencing our mutual relations with Russia.

Question: Does Ukraine pay for oil in full?

Answer: Ukraine pays to us for oil in full.

Question: Why Ukraine does not pay not in full, but even a part close to full volume to us, Russia for gas?

Answer: It would be better to ask it Ukraine. Why are you asking this question me?

Question: I will certainly ask this question Leonid Kuchma. The strange thing turns out. The relations between the CIS countries are really partnership relations. But when the conversation is about Russia - the senior brother - it is possible not to pay, not to give money, to postpone, restructuring and still something to think up. And Russia loses money. Why is it so, Heydar Aliyevich? You are experienced person, explain please.

Answer: Andrey, I do not want to interfere with internal affairs of Russia.

Andrey Karaulov: It is not ours but the affairs of CIS.

Heydar Aliyev: You know, each country in the CIS asserts its interests. The CIS is not the USSR. It is not the union but Commonwealth. And each country protects its interests. By the way, Andrey, I should tell you that Secretary of Russia`s Security Council, Sergey Ivanov, recently was in Baku with a visit. He declared to the press representatives that Azerbaijan was only country in the CIS which had no debt to Russia.

Question: All of us know that it is much easier to carry on dialogue with President Aliyev than the president of CIS`s other country, by the way, of your neighbor. But nevertheless, you also insisted our militarists not to be in territory of Azerbaijan. Is it really bad, Heydar Aliyevich?

Answer: First, how we insisted – we insisted leaving of the Soviet militarists not Russian. Military personnel of the Soviet Union have left Azerbaijan shortly after Azerbaijan has declared the independence. That is, this question did not stand before us.

Question: And borders?

Answer: Borders also, frontier-guards have left too.

Question: And why, Heydar Aliyevich?

Answer: How why, they just left. It was the Soviet Union then. You confuse different things. There is the Soviet Union and there is Russia. It is not the same. And you try to identify it. Yes, during the Soviet Union we were in one state. And consequently everything was common. And when the Soviet Union collapsed, all were separated from each other. We admit, frontier-guards remained somewhere. For example, now Armenia`s borders with Turkey and Iran are protected by the Russian frontier-guards. The Director of the Russian Federal Border Guard Service, Totsky, was recently in Baku. I asked him, how many, for example, you keep frontier-guards in Armenia? He said - three thousands. This is your business, the Russian state. Why do you keep there frontier-guards? Your have enough concerns. And what for you keep frontier-guards in other country? But it is anyway business of Armenia, business of Russia.

Andrey Karaulov: Heydar Aliyevich, let me object. Just 10 days ago 40 Indians have been get out from the train between Baku and Moscow. May be you were not reported. These Indians, bearing resemblance to militants, have decided ostensibly to visit Petersburg. Our frontier-guards have checked up, there is no such service, such firm in Petersburg. It appears that they were going to Chechnya: through Turkey to Azerbaijan and from there to Russia.

Heydar Aliyev: It is absolute misinformative data. General Totsky, who visited Azerbaijan, absolutely declared to the press that the Russian border service had no problems, any complaints, any questions with Azerbaijan. It is an invention. All tragedy is that in mass media- I see Andrey, you have already became so, earlier you were not so, - there are a lot of disinformation directed against Azerbaijan. No Indians, no Arabs were detained anywhere.

And then, consider that our border with Russia is protected from two parties: from the Azerbaijan party - by the Azerbaijani frontier-guards, and on the other hand – by the Russian frontier-guards. So there is a double cordon. If the Azerbaijani frontier-guards have let to pass something, somebody, the Russian frontier-guards should not let them pass. Incidentally, up to the Chechen Republic there is still Dagestan, where there are many Russian armies of different sorts. There they should not let pass. And on TV, in various newspapers it is declared that insurgents penetrate into the Chechen Republic through territory of Azerbaijan. I feel that it is absolute lie, slander and disinformation. Because no Russian service, border or other services have presented any fact.

Question: Mister President, please tell, what quantity of narcotics was detained by your frontier-guards last year on border between Turkey and Azerbaijan?

Answer: You know, Andrey, it seems to me, you don`t absolutely imagine all these questions correctly. Today I can already tell you that the President of Tajikistan has lifted a question with alarm that drugs in tons come from Afghanistan through Tajikistan`s territory at the CIS session. And he has very much asked to help, to take measures, because they can`t do anything. Certainly, their frontier service is young. As a matter of fact, all borders are protected by the Russian border troops there. It is well-known to the Russian media that Europe is now supplied with drugs more than previous times, and 90 percent of these narcotics penetrate into Europe from Afghanistan via Tajikistan, Russia. Narcobusiness have already been created in Afghanistan. They live due to it. On the one hand, they earn very big money from it, on the other hand, probably, they have also other purposes - to damage peoples of other countries. Therefore you simply confuse the address.

Andrey Karaulov: Heydar Aliyevich, not casually I address all these questions to you. I will not be mistaken, if I will tell that you and, maybe, also Mintimer Shaymiev are the most authoritative persons in the Muslim world, in foreseeable borders. We would very much like the voice of our friends, people, who have served the Soviet Union, including Russia all the life, to be sounded in full force in the Chechen events. I understand that even you are not capable to stop the Chechen campaign. I understand that we did not address to you neither for the help, nor advice in Russia, did not offer you, for example, to be the mediator as king of Morocco. But I know what means national diplomacy, informal meetings and informal contacts. In Russia we have apprehended the information on putting forward your candidature to the Nobel Peace Prize with the great pleasure. Heydar Aliyevich, help us to gain an understanding with our Moslems. Because today vahabism…

Heydar Aliyev: Andrey, my dear, I see, you have left Azerbaijan for a long time and not absolutely exact information. I very much regret, because, in my opinion, you are our great friend - both my personal and our people. Here, in Azerbaijan you are perfectly known and appreciated because during heavy time for Azerbaijan, in January events of 1990 you were the only journalist who has arrived in permanent representation of Azerbaijan with your camera and so on. It is very much recollected and appreciated. But, probably, you have not absolutely exact information, not absolutely exact information concerning events in the Chechen Republic. Azerbaijan has repeatedly expressed its opinion about it. What does it consist of? In general we are against separatism, especially against aggressive separatism. You perfectly know that among the peoples and republics of the former Soviet Union, Azerbaijan, the Azerbaijani people suffer from the Armenian separatism more than twelve years.

You know that separatism has no different colors, separatism is separatism. The Armenian separatism became a basis of the conflict, so-called Armenian-Azerbaijani Mountainous Garabagh (Nagorno-Karabakh), which has led to the hardest tragedy for the Azerbaijani people. 20 % of the Azerbaijan`s territory have been occupied by the Armenian armed formations, more than one million Azerbaijanis have been expelled from their residences, living in tents for 7-8 years, and we cannot solve this conflict up to now. What is the reason for it? The reason for it is separatism. Mountainous Garabagh (Nagorno-Karabakh) was autonomous region in structure of Azerbaijan. And this autonomous region exists since 1923. And people in Nagorno-Karabakh - Armenians and Azerbaijanis - live there for centuries. Even since ХIX centuries. To tell the truth, Armenians have been evicted to there, - by the way, I am saying it you to have information, - they are not natives, they are not aboriginals there. Armenians have been moved there by the Russian ambassador in Iran, Griboyedov, somewhere 170-180 years ago. Because approximately in 1980th years in Mountainous Garabagh (Nagorno-Karabakh) Armenians themselves marked the 150-year anniversary of their arrival from Iran in these grounds, they have even established there monument. That is they are not aboriginals of these places. But nevertheless, during the empire period, it settled people as it wanted. But people lived normally. In fact, there were conflicts but then they ceased.

This conflict started in 1988. It is a separatism of Nagorno-Karabakh Armenians, but controlled on the part of Armenia which those times was still union republic of the Soviet Union, just as Azerbaijan, and supported by the Soviet Union leadership and in particular, Gorbachev. We suffer from this separatism. Can we support separatism? We repeatedly insist to write down in documents of the CIS: a position against separatism. And Armenia excludes. And if it does not exclude, signs the document with the clause: Armenia disagrees with this expression.

So there is such separatism in the Chechen Republic where people want to tear off a part of the Russian Federation and achieve independence. The same is done by Armenians in Mountainous Garabagh (Nagorno-Karabakh), they want independence. Although, if we compare them, there is a difference here. Chechens, they are also aboriginals of Russia, but they have no independent country. Armenians have the country. That is, if we have a look at the 1975 Declaration of Helsinki in which inviolability of borders of each country is intended, then we will see that there is also a factor of self-determination for people. But the Armenian people have gained independence for a long time, because the Armenian people have the state on behalf of Republic of Armenia. And the Chechen people have no state, Chechen people lives in structure of Russia as the subject of the Russian Federation. But I do not justify them by it. I just want to explain a little bit to you a difference of separatism there and here. But at the same time there is separatism there and here. We are against separatism, we are against terrorism, we are against extremism, we are against fundamentalism, we are against Vahabism. You do not know such things, therefore you ask me such questions…

Question: No, no, Heydar Aliyevich, I mean other issue. In fact, for you there is no secret, and as well as for us, that when the conflict in Nagorno-Karabakh appeared there went money by the Armenian communities living in America and all over the world. Those times they helped to \"president\" of self-proclaimed \"Nagorno-Karabakh Republic\", to the Armenian Diaspora. Whence does money come to the Chechen Republic today? First of all from the Islamic world - Pakistan, Saudi Arabia, Turkey. And I know that Heydar Aliyevich Aliyev has fine personal attitudes with Demirel, the then president of Turkey, with king of Saudi Arabia, with Pakistan and so on. But the main point of my word is quite other thing. If in informal conditions leaders, real leaders of the Muslim world - Aliyev, Demirel and others would sit down and said \"no\" to Vahabism, then there would be no such international support. Am I not right, Heydar Aliyevich?

Answer: Andrey, you are not right! Vahabism is a current which is very terrible and penetrates into various regions of the world. Well, certainly, it basically begins from Saudi Arabia. How has Vahabism penetrated into Northern Caucasus? It is difficult for me to tell now. I have simply not dealt with this issue. We are afraid of Vahabism too. But Vahabism now is the main force in Afghanistan. If you want to speak about leaders of the Muslim world, many of the Muslim world`s leaders are in the Central Asia. Because the native land of Vahabism is Afghanistan. And there is a war, internal war there for 20 years. But there is not only Vahabism there, but also many other things which are supported by many countries, as well as by western countries.

When the Soviet Union existed and the Soviet leadership decided to overthrow a shah in Afghanistan and to construct the socialist state there, war began. And then between whom there was a confrontation? It was between the Soviet Union and the Western world in the person of the United States of America which supported leaders of opposition to Babrak and then Najibulla systems. Then behind those leaders there were United States of America and other western countries and certainly Pakistan. And already there is neither the Soviet Union and nor forces in Afghanistan which want to construct socialism. They are in the war among themselves. Therefore, Vahabism basically exists there. And, by the way, if we take the countries in former Soviet Union space, we will see that Vahabism has been spread in the Central Asia. It has penetrated here. And it is surprising. Suppose there are traces of Vahabism in Dagestan as well. But nevertheless it has not found there that place which Vahabism has found in the Chechen Republic.

Therefore your views here are erroneous, that Aliyev is the leader of the Muslim world. It is not so at all. Aliyev is the leader of Azerbaijan. If I have good relations with the former Turkish president Demirel, it does not mean that I can solve this question. By the way, during conversation with Demirel they were against Vahabism too. You mean Turkey, but it is necessary to know that Turkey is now the European country. Turkey is a member of all structures of Europe. Turkey is a member of the NATO. Turkey now tries for admission into the European Union. Turkey wants completely to clear itself from this.

Question: And is Azerbaijan trying to be admitted into the NATO, Heydar Aliyevich?

Answer: And why you, in general, set such a question? Are there bases for such question?

Andrey Karaulov: Because in our newspapers, - I do not know, it is the truth whether or not, - unfortunately, there are a lot of suspicions, that for the nearest five years Azerbaijan may become a member of the NATO which will not improve our relations.

Heydar Aliyev: Andrey, I again very much regret that you have come off Azerbaijan.

Andrey Karaulov: It is not me, my colleagues.

Heydar Aliyev: You also believe, you believe this slanderous, misleading information. You know, I have already been bothered, I do not read these Russian newspapers any more in which almost every day there are such articles about Azerbaijan and I have expressed my opinion to former and present leadership of Russia concerning it. They agree with me that it is not a position of Russia. Today, by the way, you have also reminded me, at our narrow session I was silent. But many heads of states complained of Russian mass media - newspapers, TV, - almost all complained.

Andrey Karaulov: It is necessary to stop their talk once and for all.

Heydar Aliyev: President Putin told that it was not a position of the Russian state. By the way, when there held a short press conference - probably, it will be shown, - in my opinion, he touched even on this question. That is, he said mass media should write events more objectively. So here your questions have no essentially basis.

Question: Heydar Aliyevich, I am glad that you have elucidated all of them, many thanks for it. When I ask, it does not mean that I believe in all this nonsense. But I want the voice of our neighbor to be really heard, and it is very good when all questions are responded just by the President. If it is possible, two-three more questions.

In Russia many of us have indignantly apprehended, when it became known that our separate generals sell weapon to Armenia for money. It caused dissatisfaction. On the other hand, Russia worries for the destiny of the Caspian oil. I know that today Russia has no any pretension to Azerbaijan on oil. But Heydar Aliyevich, I am not confident that these pretensions in Russia will not appear after years have passed. Am I right?

Answer: Good question. And now you asked a good question. The first question is not about only separate generals of Russia but in general the Russian Defense Ministry. By the way, in 1997 this fact was brought to light by Russian State Bodies: first, it was disclosed in the Presidential Apparatus, in Control Office and then it was opened, in my opinion, on the basis of documents of the State Duma Defense Committee. It was said that for previous three years, when there was a war between Armenia and Azerbaijan, the Russian Defense Ministry has transferred to Armenia free illegally, unlawful weapon, military techniques and ammunition for one billion dollars.

Andrey Karaulov: Probably, they took bribe.

Heydar Aliyev: Probably, for a bribe. If it is free of charge, it means, for a bribe. After that, certainly, we have started our work. We have documents on all this till now and we have presented them in addition to those documents which are in Moscow. There is guilty of it who received large bribes there, in Armenia. We have brought this question to the attention of the President Boris Yeltsin. I met with him. I remember, I was in Paris, we were marking Rostropovich`s 70-anniversary, and next day here there was a session of heads of the states. I was in a Yelisey palace in the evening, flied from there at night in order to be in the Kremlin in the morning at 10 o`clock. After that I lifted this question at session of heads of the states. Then we had a meeting with president Yeltsin. He told that it was right, he was indignant of it, he made instruction to investigate it and to take necessary measures.

We were very much delighted. And additional materials were demanded from us. We sent them here, investigation was started in Office of Public Prosecutor. And then, summer of 1997 I made official visit to Russia as the President. It was on July 3, 1997. I raised this question. Boris Nikolayevich Yeltsin already talks in another way. He said: yes, we look and so on. I said: no, it is necessary to clear up this business. And then he said: you know it is said that when the Soviet Union was disintegrated more weapon of the Soviet Union remained in Azerbaijan than in Armenia. I said: dear Boris Nikolayevich, does this concern other? First, whence you have taken it? And second, tell me the truth, I think that it is the wrong information. Even if you will give me the proof, that this information is correct, it unless gives the basis to give free of charge unlawfully, illegally, weapon to Armenia on one billion not from the Soviet weapon but from the weapon which has stayed in Russia after disintegration of the Soviet Union? It means that something has taken place unfairly during the partition in 1992. You want to fill illegally Armenia`s weapon arsenal by such way due to it? This has no logic at all. We conducted very sharp conversation and then he was compelled to make offer: we will create tripartite commission to investigate it.

I say: I do not understand again – half year ago you acknowledged all this and gave instruction to investigate. The State Office of Public Prosecutor is engaged in this investigation. And almost everything was proved, originators were determined-it was commander of armies in Transcaucasia which sat in Tbilisi, and before it in Yerevan-all these were determined. And now you say: let`s create the commission. I say: for what? No, let`s create the commission. I say: you know, I am interested in events which happened in 95-96-97 years. And you are interested in 1992. So let`s investigate firstly one, then other issue. No, he insisted. We created the tripartite commission, we invited Serov, first deputy of the Russian Government, but Armenia has refused to participate in this commission. This commission gathered two-three times, but it did nothing. However, distribution of the weapon of the former Soviet Union between the union republics, taken place in 1992, has no concern to unlawful, illegal transfer of weapon to Armenia.

By the way, about 1992. In 1992 in Tashkent a meeting of heads of the CIS states was held after the disintegration of the Soviet Union. There quotas were defined that, who can have how many weapon, in particular tanks and so on. In connection with internal struggle, revolution at that time in Azerbaijan, it was in May, 1992 - there was second-class person and still other person who in general, made agreement with former Russian Defense Minister Grachov and also was trying to become the president. We know that then Grachov has told him to accept this distribution, - by the way, such a distribution has damaged Azerbaijan on a quota according to the Contract on Conventional Armaments in Europe, - and we will help you to become the president. And he has signed this document.

So your question enables me to open very serious pages of history. Therefore till now this question was not solved, people were not punished, nothing was done. It gives us the basis to pretend to Russian Defense Ministry and as a whole to Russia. So it is about the first question.

Question: And does President Putin know about these pretensions?

Answer: He knows.

The second question is about the Caspian oil. I do not know, from what party to approach to this question. There are no disagreements between Russia and Azerbaijan here. In 1994 we began to involve foreign investments. First such large-scale contract was for development of oil deposits in the Azerbaijan sector of Caspian Sea.

What is the Azerbaijan sector? In 1970 when already the oil recovery in Caspian Sea extended, the Soviet Union Council of Ministers has made the decision to divide Caspian Sea into sectors. Basically, even after that the organizations of a petroleum industry in Azerbaijan were engaged in this issue. Because, as you know, 50 years ago, by the way, for the first time in world practice, the Azerbaijani oilmen have received oil from the bottom of the Caspian sea, - there are so-called Oil Stones which are approximately on distance of 100 kilometers from coast. That year cannot be forgotten. But the oil recovery on the Caspian Sea then increased, and later world practice has developed fast, extracting oil started in the seas. For example, in Northern Sea Great Britain or Norway extract oil only for 30 years. But all from the very depths. How much they extract? Only Norway extracts 150 million tons of oil.

Those times I worked here, in Moscow, and knew that it had reasons, because there was a lot of oil in Tumen, it was extracted more cheaply. Annually growth of oil in the Soviet Union made approximately 20 million tons. As a whole, the Soviet Union extracted more than 600 million tons of oil per year and, by the way, it was the basic export product in the Soviet Union for getting stable currency. And consequently the Soviet Union did not allocate means to be engaged more seriously in deposits on Caspian Sea.

And when Azerbaijan became the independent state, there was a problem: what to do? We know that there are rich oil and gas fields there. We have no funds and even if we had funds, Azerbaijan has no technology, techniques which world practice have, that is, the large oil companies of the world. What to do? So, it is necessary to involve foreign investors and the large foreign companies which have already experience on oil recovery on the big depths of water and have modern techniques and technology.

We have concluded the first contract in September, 1994. By the way, after that contract big political events happened in Azerbaijan. Because various forces did not want it. And a day after that there happened an abduction of big state criminals from internal prison of KGB. And then, by the way, all of them appeared in Russia, disappeared here. 10 days later acts of terrorism carried out in Azerbaijan - the vice-speaker of parliament and the chief of Special Administration under the President was killed when I was in the United States of America. 3-4 days after that there was an attempt for revolution on the part of colonel Suret Huseynov who is known to you. All this took place after signing this contract.

Then we tested very heavy consequences of it. And since then we have been engaged in our sector. But then there was a question on definition of the legal status for Caspian Sea. Because when already foreign investors arrived in Azerbaijan, incidentally, after that they arrived in coasts of Kazakhstan and Turkmenistan, there appeared a question on definition of the legal status for Caspian Sea for each near-Caspian country to know where it can extract oil. But till now this question was not solved.

By the way, while signing the first contract we have involved large Russian oil company \"LUKOIL\". That is, we have done nothing without Russia. There are about ten companies, they have different shares. In this contract company \"LUKOIL\" has 10 percent. And in the subsequent contracts \"LUKOIL\" necessarily has a share, and even one deposit. Incidentally, in July, 1997 when I was here, the contract was signed between \"LUKOIL\" and the Azerbaijan Oil Company in the Kremlin and in this contract we have completely given operation to \"LUKOIL\" on development of one deposit in northern part of our sector, adjoining to the Russian sector of Caspian Sea. There are no any questions, any problems.

Question: Heydar Aliyev, does it mean that there are no problems between Russia and Azerbaijan, in general?

Answer: No, there are problems.

Question: The most important problem?

Answer: You know, the most important problem for us is a resolution of the conflict between Armenia and Azerbaijan by peace way, clearing of occupied Azerbaijan`s territories from the Armenian armed forces, returning of refugees -people have been refugees in their state, in their country, live in tents - to their residence where completely had been destroyed and plundered. It is required not less than 10-15 years to restore those residences in order to create normal life after their returning, if there will be funds. Because it is necessary huge funds for it.

Question: And Russia will play only a role of the intermediary, did I understand correctly?

Answer: Russia together with the United States and France plays a role of the intermediary as co-chairmen of the OSCE Minsk group. But Russia always played more active role than the United States, France and other countries. Russia has the big opportunities to settle this conflict. Incidentally, yesterday we talked in the Kremlin on this theme. In the beginning I had a meeting in private with the Armenian President Robert Kocharyan, then we together - President Vladimir Putin, presidents Kocharyan and Aliyev had a meeting. And we discussed just this question.

Question: And what decision was accepted?

Answer: For the present there is no decision, we simply discuss different variants.

Question: But do Armenians discuss these variants, that is, are they ready to go on dialogue?

Answer: Our dialogue goes for a long time. And especially dialogue between Azerbaijani and Armenian presidents goes approximately since the beginning of 1999.

Question: How do you think, when this conflict will be resolved?

Answer: When Armenians will take a constructive position. Because demands of Armenians, Armenia are completely contradicting the international law. Armenians demand the status of state independence to Mountainous Garabagh (Nagorno-Karabakh). For this purpose they demand still the corridor through Mountainous Garabagh (Nagorno-Karabakh) to Armenia which is a large Lachin region besides Mountainous Garabagh (Nagorno-Karabakh). And in reply to it they agree to release the occupied Azerbaijani areas which are not included in Mountainous Garabagh (Nagorno-Karabakh), located around Mountainous Garabagh (Nagorno-Karabakh). As they say, here is a difficulty. You know, in fact, it is illegal. It contradicts international law. Azerbaijan`s territorial integrity and borders have been broken. But it is de facto. And we cannot agree with it de jure. Armenians demand it. We offer some compromises. They have also some offers in this respect. But for the present we are far from coming to the consent.

Andrey Karaulov: Heydar Aliyevich when my comrade Artyom Borovik, who was loved very much, was killed, you sent telegram of condolence. It was published in our newspapers. You were the only President, as differing from your colleagues, you considered necessary not to be silent that day, and to tell consolatory words to his parents and wife. In such minutes, somehow, one understands very sharply that there are such relations, such strings between our countries which will never be broken. And it would be desirable that year after a year number of questions at summit not to increase but get reduced. From this view point your role is great.

Heydar Aliyev: You know, there are a lot of strings. The fact, which you have mentioned, is one of many facts. I knew Artyom Borovik as very skilled, very vigorous, very courageous journalist. By the way, as the journalist and head of those journalistic organizations he had played very great role in democratization of Russia. Therefore I respected him. He has come to Azerbaijan some times, I have met and talked him. It was interesting to me from all points of view. Therefore, certainly, I have apprehended his death very hardly. And sending the telegram I have expressed my attitude.

There are a lot of strings. But it is important these strings are respectably, favorably considered by both parties. First of all on the part of Russia. Russia is a great country. The Russian people are great people. And Azerbaijan is the small country and the people are few in number. As you see, it is different situation. In Azerbaijan we have a proverb: if one step will be made towards us, we will make two steps. But when we do not see a step forward, and on the contrary back, we certainly, do not do a step back but we just stand on our place.