In January 2025, Russia and Iran signed a 20-year Treaty on Comprehensive Strategic Partnership, encompassing the political, economic, and military sectors and potentially reshaping the dynamics of power and influence in the South Caucasus. The agreement, unprecedented in scope, underscores Moscow and Tehran’s growing alignment amid shifting global alliances. Its significance extends beyond bilateral relations, carrying profound geopolitical consequences for the region.

The treaty focuses on deepening economic and security ties. Sanctioned Moscow and Tehran have found common ground in forging alternative trade routes, circumventing Western financial systems, and reinforcing military cooperation. The South Caucasus, a historically contested space where Russian, Turkish, and Persian influences have long competed for dominance, is a natural focal point of this evolving partnership.

Global Dimension: Toward a Common Vision

Proponents of the liberal paradigm in international relations might interpret the growing partnership between Russia and Iran as a strategic alignment of authoritarian regimes aiming to challenge and undermine the liberal democratic order. In contrast, realist theorists could view this relationship as a pragmatic coalition motivated by mutual survival imperatives in a context marked by geopolitical instability and shifting power dynamics.

Beyond theoretical interpretations, the realities of Moscow and Tehran’s strategic calculus suggest a more nuanced picture. Despite the grand rhetoric surrounding their 20-year partnership, the agreement stops short of a formal strategic alliance. Their partnership still competes in key areas—notably in the South Caucasus, where their geopolitical interests are not fully aligned, and in global energy markets, where both are sanctioned suppliers and have limited opportunities. Rather than engaging in outright rivalry, the two countries have signaled a preference for managed coordination, mutual support under Western sanctions, and an unspoken understanding not to undercut each other’s positions, including in the South Caucasus.

At the heart of their rapprochement lies a shared vision of a multipolar world that limits external interference while maintaining selective engagement with global markets. This approach is neither full autarky nor complete integration. Instead, Russia and Iran seek to insulate parts of their own and neighboring regions from Western influence while remaining open to economic ties with non-Western states. Their coordinated stance is evident in Iran’s accession to major multilateral frameworks favored by Russia: full membership in the Shanghai Cooperation Organization in 2023, entry into BRICS (the 10-member intergovernmental organization containing Brazil, Russia, India, China, South Africa, Egypt, Ethiopia, Indonesia, Iran, and the United Arab Emirates) in January 2024, and observer status in the Eurasian Economic Union by December 2024.

These alignments reflect not a dramatic shift but a gradual synchronization of worldviews. Russia’s 2023 Foreign Policy Concept already outlined a vision of global order that closely mirrors Tehran’s ambitions—one in which sovereignty trumps international norms, regionalism takes precedence over global governance, and Western-led institutions are seen as illegitimate arbiters of international affairs.

While neither Moscow nor Tehran seeks total isolation, their partnership signals a broader trend: the consolidation of an alternative geopolitical ecosystem that challenges Western dominance not through open confrontation but through strategic circumvention and parallel institutions. Whether this axis proves resilient or a temporary alignment of convenience will depend on how effectively they navigate their underlying frictions—and how the broader geopolitical landscape evolves in the years ahead.

Regional Dimension: South Caucasus as a Strategic Artery and Zone of Interest

Russia and Iran’s strategic partnership has clear implications for the South Caucasus, a region they view through three primary lenses: economic, energy, and political. The International North–South Transport Corridor is at the heart of their economic ambitions—a long-envisioned trade route linking Russia to the Persian Gulf and beyond. The Western segment of this route runs through the South Caucasus, with Azerbaijan serving as the crucial transit point. However, a key missing link remains: the 162-kilometer Resht–Astara railway in northern Iran. Moscow has already committed substantial resources to this effort. In 2023, Russia allocated a €1.3 billion intergovernmental loan to finance the railway’s completion connecting Iran to Russia through Azerbaijan. In 2024, a high-level Russian delegation led by deputy prime ministers visited Tehran to reaffirm commitments to the project. Among them was Vitaly Savelyev, appointed in 2024 as the Kremlin’s special representative for INSTC development. His front-row presence at a meeting between Russian President Vladimir Putin and Iranian President Masoud Pezeshkian underscored the initiative’s strategic weight for Moscow.

The treaty between Russia and Iran highlights the importance of “seamless” transportation along these corridors, but achieving this goal requires overcoming several technical and logistical limitations. Two key issues stand out: first, as mentioned above, completing the Resht–Astara railway by its planned 2028 deadline and integrating Russia’s 1,520-mm rail gauge with Iran’s 1,435-mm gauge, which aligns with European standards; second, electrifying key sections of the route to enhance efficiency. For Moscow and Tehran, the South Caucasus is not merely a transit zone but a vital artery for breaking out of isolation and expanding access to markets. Any regional instability due to unresolved conflicts directly threatens their ambitions. The level of diplomatic and financial investments they have committed suggests a determination to safeguard these routes at all costs. For Armenia, Azerbaijan, and neighboring states, this intensifying Russian-Iranian coordination presents both opportunities and challenges, as regional connectivity is increasingly shaped by the geopolitical calculations of two sanctioned powers seeking alternative economic lifelines.

Another crucial common interest for Russia and Iran in the region is energy. After signing the agreement, the parties finalized the route of a planned gas pipeline from Russia to Iran, which will pass through Azerbaijan. According to this agreement, initial capacity is expected to be modest, at about 2 billion cubic meters per year, but it envisions an eventual expansion to 55 billion cubic meters. The agreement carries several strategic implications. First, Iran’s largest gas reserves are concentrated in the south, yet the country’s northern regions still require steady supplies. Moscow may already deliver small volumes of gas to Iran through existing connecting pipelines in Azerbaijan. Swap arrangements could also become relevant in this context. Second, the long-term potential of such a high-capacity pipeline raises the prospect of Russian gas reaching the Indian market. The Peace Pipeline, designed to transport gas from Iran to Pakistan and, potentially, to India, has been under discussion since 2005. The project stalled for years, largely due to the threat of US sanctions. However, in May 2024, reports indicated that Pakistan and Iran had revived plans to complete the pipeline. With a projected annual capacity of 55 billion cubic meters, it could eventually serve as a conduit for Russian gas to South Asia. Given its role in the transit corridor connecting Russian energy supplies to emerging markets, the project would further elevate Azerbaijan’s strategic importance.

On the political front, Article 12 of the treaty outlines two key commitments by Russia and Iran. First, the countries pledge to contribute to strengthening security in the South Caucasus. Currently, this clause remains largely theoretical, with no concrete measures implemented. Moreover, Moscow and Tehran have not always aligned on key regional security issues, particularly regarding unblocking transport communications in the South Caucasus. One possible avenue for cooperation could be establishing a formal security dialogue between relevant agencies.

Second, the agreement commits both parties to preventing “interference in these regions and the destabilizing presence of third states.” This aligns with Russia’s broader goal of reducing Western influence in the South Caucasus and Iran’s long-standing objective of limiting Israeli presence in Azerbaijan. It also dovetails with their mutual support for the “3+3” regional format, which seeks to exclude Western actors from South Caucasus diplomacy.

The Bilateral Dimension: Deepening Ties, Persistent Limits

Based on the 2001 Treaty on the Basis for Mutual Relations and the Principles of Cooperation, the recent strategic partnership formalizes a new phase in Iran’s and Russia’s relationship.

In 2023, a free trade agreement between Iran and the Eurasian Economic Union was signed, and in December 2024, Tehran secured observer status. The same year, the integration of the two countries’ national payment systems—Russia’s Mir and Iran’s Shetab—was finalized, further facilitating financial transactions between them. Their military-technical cooperation has advanced, too. In 2022, Iran began supplying arms to Russia, most notably Shahed-136 kamikaze drones, which gained widespread attention. By 2023, Tehran confirmed it had received Russian military aircraft and helicopters, including the Su-35 fighter jet. These developments indicate a shift in the level and quality of Russia–Iran relations, which has been formalized in the new treaty.

However, despite these advances, significant challenges remain. Trade turnover, which surged in 2022 due to Western sanctions on Russia, declined by 17.3% in 2023, falling to $4 billion. Since bilateral trade appears to have reached its current limits, it remains unclear whether Iran’s integration with the Eurasian Economic Union will be sufficient to reverse this trend.

The new treaty is a strategic partnership, not a military alliance. Despite its broad scope, the Russia–Iran agreement is not a defense pact. Two key points underscore this.

First, in 2024, Russia signed a similarly titled Comprehensive Strategic Partnership Treaty with North Korea, which contained 23 articles—fewer than the 47 articles in the current one with Iran. The key provision in the agreement with North Korea is Article 4, which explicitly commits each party to providing military and other assistance “by all means in its possession without delay” if the other is attacked. No such clause exists in the Russia–Iran treaty. Second, Article 3 of the Russia–Iran treaty states that if one party is attacked, the other must not provide military or other assistance to the aggressor. While this clause is not new (identical to Article 3 of the 2001 treaty between the two countries), its inclusion reaffirms a long-standing principle; it does not signal any substantive shift in security commitments.

The new agreement may soon face its first major test. Three possible scenarios could challenge the depth of the elevated partnership. The first is a shift in US foreign policy. The new American administration might seek negotiations not just with Russia but with Iran, too, extending beyond Ukraine in the case of Russia or the nuclear program in the case of Iran. Any such talks could include proposals that place conditions on Russia–Iran cooperation, particularly in energy or technology. The second scenario involves intensified US secondary sanctions. Should Washington escalate economic pressure on one of the treaty’s signatories, the other would face a difficult choice: continue cooperation and risk severe penalties or reduce engagement and risk undermining the treaty’s credibility. The third—and most drastic—scenario would be a military attack on Iran by Israel, possibly with US support. Such an event would put the treaty to its most serious test.

While the Russia–Iran treaty reflects an evolving partnership, its durability will be measured by its ability to withstand external pressures and geopolitical shifts. Whether Moscow and Tehran can sustain their current trajectory—or whether economic constraints and strategic risks will impose limits—remains to be seen.

A Truly Regional Connectivity for Regional Stability 

The Russia–Iran strategic partnership is reshaping connectivity in the South Caucasus, with Azerbaijan emerging as a key transit hub. However, maintaining regional stability requires balancing interests among all stakeholders. Integrating Armenia and Georgia into major infrastructure initiatives will be essential, not only through transport projects that position Azerbaijan as a central link but also through electricity transit corridors with significant economic potential. Armenia’s membership in the Eurasian Economic Union further enhances its role, particularly following Iran’s ratification of a free trade zone agreement with the bloc in 2025 and its acquisition of observer status in 2024.