THE mountain kingdom of Georgia once sat astride the richest trade route in the ancient world - the legendary Silk Road. In the 21st century, the country's modern rulers say, Georgia could again become a critical link between East and West. They hope the oil trade can make their tiny nation of just 5.5 million people as strategically important as the Persian Gulf is today. But earning that pivotal role will depend on more than Georgia's geographical position, tucked between Central Asia and Europe. Formerly part of the Soviet Union, Georgia faces thorny questions before it is stable enough to attract the world's attention as a reliable trade route. Since 1991 the country has been brought to the edge of extinction by war, gang rule, a coup d'etat, and economic catastrophe. Today Georgia is a case study in the perils of post-Soviet reconstruction. Among the challenges it faces: * How to carve out an independent niche in world affairs with its old imperial master, Russia, breathing down its neck; * How to build a modern state that can rein in feuding warlords; * How to encourage a market economy and keep it out of the hands of organized criminals. A small country the size of Belgium, Georgia has to look back more than 700 years to find its glory days. Churches from the 11th and 12th century still dot the landscape, testifying to the skills and wealth the country once enjoyed. St. Andrew the apostle preached here, and Georgia was one of the first countries in the world to adopt Christianity - in the 4th century. But Georgia suffered the ravages of its envious neighbors for hundreds of years, starting with the Mongol warrior Tamerlane in the 14th century, who sacked the country with his customary vigor. Persian and Turkish rulers followed his example until Georgia fell under Russia's yoke 200 years ago. Today Georgia finds itself in one of the most violent and tense regions of the world, with Iran to the south, Chechnya to the north, and Armenia and Azerbaijan (which are still technically at war) right next door. But the Georgian government, led by former Soviet Foreign Minister Eduard Shevardnadze, is trying to look to a more prosperous future as an international transport corridor, moving the vast resources of Central Asia to the West. A decision next month by a Western-led consortium will test this vision. The consortium, involved in a $7.5 billion deal to drill oil from Azerbaijan's Caspian Sea fields, will choose a route for its pipeline. Georgia hopes it will choose a pipe that would run through its territory to Turkey and then to the Mediterranean. Russia, however, is still smarting from the loss of its former republic in such a strategically sensitive part of the globe. It is fighting hard to have the oil run north through its network of pipelines. As a small nation dwarfed by a giant neighbor, Georgia has to play its cards carefully in its dealings with Moscow. Russia helped pro-Russian Abkahzian rebels, a minority ethnic group concentrated in the western part of the state, break away from Georgian rule. Though the Abkahzian region remains part of Georgia, Russia could easily upset things here again at any time.