Last week the Kremlin formally announced its decade-long anti-terror operation in Chechnya over. In practical terms, it translates into puling out the federal forces and repealing stringent restrictions related to freedom of movement for civilians in Chechnya. This measure aroused little enthusiasm in Russia, though.

In point of fact, the internal conditions in Chechnya and the North Caucasus at large are continuing highly explosive. Actually, peace in Chechnya has been reached owing to massive infusions of cash by Moscow into the breakaway republic’s political and economic infrastructure. The Kremlin managed to outbid the separatists, use them to marginalize or eliminate the implacable opposition, and raise the living standards of the populace at the expense of federal appropriations.

Thus, the Kremlin has achieved a partial stabilization in Chechnya and its major ruling clans’ loyalty. In return, these clans were given both economic benefits and an unprecedented amount of political autonomy commensurable with actual independence minus its formal attributes.

The Kremlin is hardly in full control of Chechen developments. President Ramzan Kadyrov and his supporters are wielding power there. They did the best they could to rid the region of Moscow’s protégés and to weaken, if not bring to naught, the leverage the federal forces used to exercise in the republic.

Today Moscow’s long-lasting policy of putting down Chechnya by flooding it with petrodollars has exhausted itself. The Kremlin no longer enjoys the huge financial resources it used to possess, and the opportunities for new cash infusions into Chechnya are presently limited. A lack of financial resources could well trigger a new tide of separatism and force the current Chechen elite to gravitate to new power centers, primarily in the Moslem world. Another incentive for separatism in the North Caucasus is undoubtedly, Russia’s diplomatic recognition of Georgia’s breakaway republics of Abkhazia and South Ossetia. It is an attractive precedent for other separatist forces in the Caucasus.

The counter-terror regime in Chechnya drove many Islamic militants to cross into the neighboring ethnic republics – Ingushetia and Dagestan – and resume their activities there. Now, the terrorism rates in those regions are by far higher than in Chechnya. Lifting the anti-terror regime is bound to facilitate separatist operations in the North Caucasus dramatically and enhance the threats facing Russia.

As for maintaining individual rights, lifting the anti-terror regime is unlikely to bring about a change for the better. In addition, the federal center could well lose the few levers of controlling Chechnya’s domestic environment it used to enjoy. Thus, the Kremlin’s move is unlikely to produce any improvement of the political and socio-economic conditions in Chechnya and the North Caucasus at large.