Alliance in Zagreb location (4)
I believe the answer is:
bloc
'alliance' is the definition.
(bloc is a kind of alliance)
'in zagreb location' is the wordplay.
'in' says the answer is hidden in the clue.
'BLOC' is hidden in the letters of 'zagreb location'.
(Other definitions for bloc that I've seen before include "Group of parties or countries united in common interest - sounds wooden" , "Allied group of countries or political parties" , "Political grouping of countries" , "Group whose members have common objectives" , "Group of countries with a shared aim" .)