Edit: Basically, I am having Kurdistan achieve independence in the 80s, be a communist-leaning pariah state in the 90s, an ally to the US in the 200s, and then go on to become a sort of hybrid between Scandinavia and Japan and South Korea by 2016, with beautiful vacation destinations and a fairly large, diverse immigrant population.
The Kurdish Rebellion
In 1983, the United States supports Kurdish rebels in Iraq. This somewhat disrupts the Iraq War, drawing Iraqi attention to two different conflicts. Iran uses this as an advantage, taking Kut and almost having a road to Baghdad before the Kurdish rebels in Iraq spread the revolution to Iran. At this point, Syria joins the war and helps Iraq hold Baghdad, although the government is evacuated west to Rutba.
Iran decided too soon that the war was won and declared the Islamic Republic of Iraq based in Basra. They paid little mind to the growing Kurdish forces along the Iraq-Iran border, with false reports coming to them of the rebels being poorly organized and under equipped.
Iraq did recognize them as a threat and, with Syria's forces reinforcing Iraqi holdings, marched a force north to stop them. By this point, much of Western Europe were backing the Kurdish rebels alongside the United States and Canada. They gained much international legitimacy as Massoud Barzani, the young, energetic leader of the Kurds, gave rousing speeches broadcasted on Western television. He would tour around Europe and even visit President Reagan in the White House for New Year's Day of 1984.
Barzani seemed to be everything that the West could ask for of a Middle Eastern leader. He favored democracy and Western culture. He gave speeches about liberty and equality. He was handsome and charismatic. Through him, the Kurds could make their dream of independence into a Western dream of a modern Middle Eastern republic, one without the controversy and baggage of Israel.
The West was no longer just supplying weapons to the Kurds. They delivered tanks and planes. Offices helped to train and organize Kurdish units. Material goods were given to build up a powerful infrastructure for the Kurds to move their militias, which were more and more resembling armies.
It took all of this to convince Syria, Iraq, and Iran that their biggest threat right now was the Kurdish Rebellion. More and more troops began to be dedicated to fight the Kurds but it was too little too late.
In 1985, the Syrians, Iraqis, and Iranians were brought to peace talks, headed by the United States. During those talks, the Republic of Kurdistan was officially established. There were celebrations in the streets as the Kurdish majority regions of Syria, Iraq, and Iran were all taken and united into a new country.
This was all well and good for the West. They saw this as the happy ending of a story, but it was really just the beginning.
The Republics of Kurdistan
The same day that the Republic of Kurdistan celebrated its independence, the PKK began using this new, friendly nation to plot a similar rebellion in the Kurdish areas under Turkish rule. The PKK was a far left movement that sought the creation of an anarchistic society built off of the foundation of Libertarian Socialism, Communalism, and Feminism. There were elements of the PKK in the rest of Kurdistan, but they had moderated under US scrutiny, become indistinguishable from far-left European democratic socialists. The true believers were the ones preparing this rebellion, headed by Abdullah Ocalan. Ocalan would become a very controversial figure in later Kurdish history, eventually seeking to completely rewrite the constitution from which Kurdistan came to be.
For now though, he was simply the man preparing a rebellion against Turkey, which would be the largest in Turkish history. The True Path Party, a conservative party, was currently in power in Turkey and when the rebellion began. They immediately sent out the army, but the PKK forces were made up of veteran armies, having just spent the last few years fighting Syria, Iran, and Iraq, and were armed to the teeth with the latest in American and Western European technology. Turkey called up NATO to help, claiming Kurdistan, which was now beginning the process of seeking membership, had invaded them. The NATO response was that this was simply an internal rebellion and that they would not act one way or another, fearing the public's reaction to actions taken against Kurdistan so soon after the fought so hard for their independence.
The PKK was terrified by this. Many of its members were under the impression that the West would back their Turkish rebellion like they did in the other countries. It was obvious to the leadership of the PKK and to us now that the last thing the United States wanted to do was back a far-left rebel army invading one of their allies, especially so close to the Soviet border. That's when the PKK turned towards the Soviet Union. The Soviets backed them in secret, arming them with whatever they could offer. The USSR was sitting in a precarious position in the world at this time and felt that an ally in the Kurds could really help them to reinvigorate leftist movements across the world.
With this backing, the PKK was able to successfully fight the Turkish army to a stalemate over the course of the next four years. The PKK was in control of most, but not all, of Turkish Kurdistan. The Turkish and Kurdish armies were exhausted of men and resources. It had been a brutal war that claimed countless lives. It was at this point that members of the government of Kurdistan began to secretly supply and back the PKK. Believing that, if there was a decisive PKK victory in this campaign, then Kurdistan could simply take the territory and all would be at peace.
This is almost what happened. Ocalan's men successfully routed the Turkish forces thanks to fresh recruits and as many tanks, fighters, and bombers as they needed. They managed to push the Turks back all of the way to areas that had a large Turkish minority, instead of a simple majority. From there they went further and marched all of the way to the Black Sea, taking Trabzon and Rize. With the threat of further PKK expansion, Turkey relented and offered peace terms. The PKK was given all of the territory from and including Gaziantep, Malatya, and Kars. While the cities they took on the Black Sea were not given to them, they were given two sea routs, through Hopa to the Black Sea and Dortyol to the Mediterranean Sea.
The PKK declared itself the Worker's Republic of Kurdistan upon its independence, shocking the world. Many in the West saw this as a Stalinist abomination of the county they had supported the independence of five years earlier. The Worker's Republic then went on to ask for annexation by Kurdistan, giving precious sea routes to the landlocked nation and nearly doubling their population, in exchange for a constitutional convention to make the new government far more left leaning. Kurdistan accepted and the following constitutional convention was an unmitigated disaster.
United Kurdistan Stands Alone
There was much hostility and constant arguing among those who attended. Many of the Kurdish representatives from the PKK were not expecting to have to make compromises and pushed to hard for too much for the more moderate representatives's liking.
The talks lasted nearly eight months, during which time the Worker's Republic still operated as an independent nation that nearly nobody recognized. Finally, an agreement was reached. Kurdistan would be a representative democracy in the style of the West, but there would be zones in which government was operated as anarchist communities. 12% of any representative body had to be made up of unelected technocrats (appointed from the population much like jury duty) and the body would have to be at least 20% women to be allowed to begin operating. If not, then there would have to be a re-election.
The intricacies of the new Republic of Kurdistan, which would now celebrate its founding on April 13th of 1990, do not matter as much as the West's response. Kurdistan was bombarded in the press. Many saw the state they had set up as housing radical leftists and there were many who believed that Kurdistan would soon join the Warsaw Pact. Little did the world know that the Warsaw Pact would be dissolved on the 6th of July of that same year.
By the end of the year 1990, Kurdistan was viewed as a rogue state that stood alone among the powers of the world. It was a social pariah to the West and was not in a state of collapse like the East, but was surging up economically despite all of this.
Kurdistan Today
Throughout the 90s, Kurdistan continued on the path it had set for itself. As other left-leaning governments and parties collapsed or moved to the right as the USSR fell, Kurdistan sat as an oddity both in the Middle East and globally.
The country became more and more as a source of oil for Europe, using the money to develop its infrastructure to become some of the most striking and modern in the world. The country had been somewhat depopulated by the rebellions that had torn their territories apart, so they spent a fair amount of money attracting migrants from across the Middle East, Africa, and South Asia. Those who came due to this program continued to reside in the country well after the damage had been more than repaired, forcing Kurdistan to make a system that gave an easy path to citizenship.
When 8/21 happened, the President of Kurdistan openly declared that any attack on the West was an attack on Kurdistan as well. The young nation became a key ally to the United States throughout the 2000s, helping in campaigns in Afghanistan starting in 2002 and Iran starting in 2003. Although a tension always existed with US-Kurdish relations due to Kurdistan's continued close ties with Russia and the country's strong leftist tradition, cordial relations persisted.
In 2009, as the wars in the Middle East began to whine down, Kurdistan began a plan known as the "21st Century Model." This plan was to become a prime location of tourism and a tech hub. They were able to make Mosul, Van, and Cinar, near Diyarbakir, into prime time tourist destinations with lavish resorts and modern skylines. Erbil became a major tech hub, sometimes called the Kurdish Silicon Valley, which would produce computers and appliances to compete with American, Japanese, and Korean companies.
Although the Middle East is a hotbed of instability and conflict, with Kurdistan having to place strong border patrols along its eastern and southern borders, following the Arab Spring and the Iraqi Civil War. A handful of major bombings have taken place in, what extremists sometimes call "The Treacherous Kurdish Nation," but cooperation with American and Israeli secret services has helped to minimize the damage caused and often prevent them from taking place at all.
Overall, Kurdistan has stood as beacon of hope and change in a region that really needed ever since its inception. It has its own problems, but hopefully it can push on into the future as a leading figure in the Middle East and on the international stage.