The publication was originally published in IRAS.
The geopolitics of the South Caucasus remains dynamic. A new, albeit temporary, status quo emerged after September 2023, when Azerbaijan took control of Nagorno-Karabakh through military action. This led to the mass displacement of the Armenian population and the subsequent withdrawal of Russian peacekeepers.
Baku’s current initiatives pose significant challenges to regional stability. Chief among them is the proposed “Zangezur corridor,” which, in the short term, is an attack on Armenia’s territorial integrity and, in the long term, is important in terms of Iran’s security. Another contentious initiative is the concept of “Western Azerbaijan,” an irredentist project aimed at establishing an Azerbaijani-Turkish presence in the South Caucasus at Armenia’s expense, similar to Baku’s decades-old idea of “Southern Azerbaijan,” a territorial claim to Iran’s northwestern provinces.
This destabilizing agenda, intended to reshape the regional balance, must be met with a constructive response focused on preserving peace and maintaining stability.
Regionalization in the South Caucasus: Challenges and Dynamics
After the shift in the regional balance following the 2020 Nagorno-Karabakh War, Turkey proposed the creation of a consultative format known as “3+3,” involving the three South Caucasus states (Armenia, Georgia, and Azerbaijan) and their neighbors (Iran, Russia, and Turkey). This framework allowed Ankara to play a more active role in regional affairs while opening similar opportunities for Iran. Russia also viewed the format favorably, as it excluded the West from participation. However, the main challenge in the South Caucasus is not the West, which cannot directly and actively shape regional developments, but Turkey, which can influence conditions on the ground. The legitimization of Ankara within the “3+3” framework may have destabilizing consequences, as Turkey continues to advance destructive initiatives. A relevant precedent can be found in Syria: Within the framework of the “Astana format,” Turkey committed to separate terrorist groups from the opposition.
In practice, however, Ankara provided full support to terrorist factions, facilitating their rise to power by force in 2024. The same year, in 2024, a representative office of so-called “Western Azerbaijan,” a Baku-backed political project aimed against Armenia and Iran, was established in Turkey, accompanied by statements endorsing the proposed “Zangezur corridor”—both initiatives threatening regional stability. Meanwhile, the Armenia–Turkey and Armenia–Azerbaijan borders remain closed, as Ankara refuses to normalize relations with Yerevan until all of Baku’s demands are met.
Actual regionalization requires, at a minimum, the unblocking of transportation and communications links based on common principles applicable to all states and the normalization of relations through peace treaties or interstate agreements. With regard to the reopening of transit routes, Armenia, Iran, and Russia oppose the “corridor” approach for different reasons. However, Yerevan and Tehran’s positions are more closely aligned, while Moscow remains focused on implementing Article 9 of the 2020 ceasefire agreement, ensuring the presence of Russian border guards along key transport routes. At the same time, Iran has sought to counterbalance the so-called “Zangezur corridor” proposal by advancing the “Aras corridor,” offering Baku a more feasible route to Georgia. This dynamic positions Iran as a key regional arbiter with the potential to mediate competing interests.
Beyond the so-called “Zangezur corridor” and “Western Azerbaijan” initiatives, additional destabilizing factors threaten regional stability in the South Caucasus and beyond. These include the presence of Israeli military and intelligence operations in Azerbaijan, which Iran perceives as a security threat; Baku’s rising military expenditure; and Azerbaijan’s expanding military and defense cooperation with Pakistan, which provides offensive weaponry, including attack aircraft, that could reinforce regional power asymmetries. These and other developments have reshaped the strategic balance in the South Caucasus and risk provoking new confrontations that could undermine regionalization efforts and the establishment of lasting peace.
Potential Mechanisms for Regional Stability
The election of Donald Trump has added to the great uncertainty in global geopolitics. On the one hand, tensions within the Euro-Atlantic alliance are evident, alongside a visible inclination of the United States toward normalizing relations with Russia. On the other hand, the US approach toward Iran continues to range between “maximum pressure” and openness to negotiations. This volatile geopolitical environment creates a “gray zone” that could encourage strategic adventurism.
The shifting balance of power in the Middle East—particularly following the change in leadership in Syria—has opened new opportunities for Turkey to expand its influence in the South Caucasus. Meanwhile, for Israel, positioning itself to strike Iran remains a central foreign policy objective. The Azerbaijan–Israel and Azerbaijan–Turkey military-political alliances and the trilateral military cooperation between Azerbaijan, Turkey, and Pakistan necessitate a counterbalancing framework in the South Caucasus. However, multilateral and bilateral cooperation mechanisms should not focus solely on countering these alliances but should instead foster regional stability.
One key step toward mitigating regional issues would be signing a new agreement between Armenia and Iran to serve as the foundation for their bilateral relations. The current framework—the Declaration on Principles and Aims of Relations between the Republic of Armenia and the Islamic Republic of Iran, signed in 1992—is outdated, given the evolving regional and global context. A new strategic partnership agreement could modernize Armenia–Iran relations and help balance the dynamic between Iran and Azerbaijan, which remains strong despite periodic diplomatic crises. For Armenia, such an agreement would also reinforce its commitment to regional stability, complementing its Strategic Partnership Declaration with Georgia (signed in January 2024), its Strategic Partnership Charter with the United States (signed in January 2025) and the forthcoming new Partnership Agenda with the European Union. Based on this renewed Armenian-Iranian framework, a series of initiatives to maintain regional stability could be developed and implemented.
Another potential mechanism for ensuring security in the South Caucasus is establishing a regional balance of interests. Key infrastructure projects, such as the railroad component of the International North-South Transport Corridor (INSTC), the Iran–Russia gas pipeline, and the interconnection of Iranian and Russian electricity grids, are set to pass through Azerbaijani territory. These developments could result in Baku gaining a logistical monopoly over transportation and energy in the region.
Diversifying infrastructure routes and projects is essential to mitigate these risks. One possible counterbalance is developing and prioritizing an Armenian-Georgian road component within the INSTC (Iran–Armenia–Georgia–Russia), which would reduce Tehran and Moscow’s reliance on Azerbaijan’s railway network.
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Establishing a balance of interests and power is essential to maintaining stability in the South Caucasus. The military-political alliance between Armenia and Russia is not functioning as effectively as outlined in their agreements, while the Turkey–Azerbaijan alliance continues to expand. At the same time, Moscow’s reliance on Ankara and Baku has grown in recent years due to its ongoing confrontation with the West.
The power vacuum that emerged between 2020 and 2023 was actively filled by Turkey, which, alongside Azerbaijan, pursued a revisionist agenda to reshape the regional status quo. In this context, Iran has an opportunity to counterbalance the shifting power dynamics. Its deepening ties with the Eurasian Economic Union (EAEU), the signing of a strategic partnership agreement with Russia, and its participation in key infrastructure projects have already positioned Tehran as an influential actor in regional affairs.
