Xankandi

Stepanakert (also known as Xankəndi from the name used by Azeris; that name was previously spelled in the Latin alphabet as Xankendi and Khankendi under formerly used transliterations from the Cyrillic and Arabic alphabet versions of the name) is the capital city of the self declared Nagorno-Karabakh Republic. Control of the area has been the subject of dispute between Azerbaijan and Armenia, including war, ever since the dissolution of the Soviet Union. As of 2006, Stepanakert, like the rest of Nagorno-Karabakh, is under Armenian control, and much of the former local Azeri population has been displaced eastwards.

The city was founded as Xankəndi in 1917 after the October revolution. In 1923 it was renamed to Stepanakert, to honor Stepan Shahumyan, an Armenian communist leader from Baku. After Azerbaijan declared its independence from the Soviet Union, it was renamed by the Azeri governmant back to Xankəndi, as part of a campaign of Azerification of what had been the autononomous oblast of Nagorno-Karabakh with a majority Armenian population. Fighting broke out over control of Nagorno-Karabakh which resulted in Armenian control of the region and a connecting corridor to Armenia to the west. There has been an unoffical but observed cease-fire in place since 1994.

Prior to the war, Stepanakert's economy revolved mostly around food processing, silk weaving, and winemaking. Since the war, the city's economy has been greatly damaged.