When the White House hosted a breakthrough Armenia-Azerbaijan summit last month, much of the focus was on Russia’s notable absence. Yet it is the effect on neighbouring Iran that is a more significant development and one that has much wider repercussions. More specifically, the signing of an ambitious agreement committing Yerevan and Baku to establish a new road and rail transit network signals the marginalisation of Tehran.
The agreement, which provides for the opening of a strategically important motorway and railway passing through southern Armenia connecting Azerbaijan to its exclave of Nakhichevan, stands out as a seemingly successful victory for western engagement. Backed by the US and bolstered by a supportive EU, this connectivity project effectively sidelines Russia and sidesteps Iran.
In fact, some cynics have pointed to this agreement as merely a western move driven by a geopolitical agenda, claiming that the administration of US President Donald Trump sees an opportunity for something akin to a real-estate deal rather than an opening for peace between Armenia and Azerbaijan.
Such cynicism was only buttressed by the immodest naming of the project by the US, which hailed it as the Trump Route for International Peace and Prosperity, or Tripp. Although there is merit in that argument, the breakthrough agreement is nevertheless an important achievement.
After a war in 2020 and Azerbaijan’s subsequent military victory dramatically redefined the geopolitical map of the South Caucasus, Yerevan and Baku embarked on a series of daunting, frequently stalled diplomatic negotiations. Against that backdrop, the August agreement is a much-needed win-win for post-war security. For Armenia, after a disheartening round of maximalist rhetoric from Azerbaijan, it represents a welcome return to diplomacy over the threat of force. For Azerbaijan, the agreement provides an important step closer to Baku’s strategic vision to become a regional gateway to Central Asia and beyond.
Aside from the fanfare of the White House ceremony, the real diplomatic progress actually came in an earlier round of talks between the Armenian and Azerbaijani leaders in Abu Dhabi in July. That UAE engagement provided the foundation for the later Washington meeting and marked a milestone in the broader trend of diplomatic momentum.
The UAE has also invested diplomatic capital in the troubled talks, holding separate bilateral meetings with each side just one day prior to their meeting in Abu Dhabi, further suggesting a greater role for the Emirates in securing a lasting peace in the South Caucasus region.
The wider implications are greatest for Iran, however. The agreement’s sidestepping of Tehran is not only a geopolitical move but a geographic measure. Seen from the Iranian perspective, the sudden shift to an East-West orientation poses an immediate challenge to the North-South trajectory of Iranian interests through Armenia and Georgia to Russia. This dramatically different strategic compass further diminishes Iran’s potential to become more of a regional power in the South Caucasus.
A second negative constraint on Tehran is the agreement’s role in the encirclement of Iran. After the demonstrable waning of Iranian proxy power in the Middle East – and the weakening of Hezbollah and Hamas in particular – the vulnerability inherent in Iran’s “northern exposure” is now magnified by the planned introduction of an American presence in southern Armenia. Given that Yerevan remains Tehran’s sole friendly and stable neighbour, the encirclement of Iran will now be complete.
A third factor relates to Iranian power projection. The agreement reached in Washington is not only a diplomatic breakthrough in Armenian-Azerbaijani relations but also serves as a framework for the construction of East-West connectivity infrastructure. This means that the redirection of roadways and railways through southern Armenia is lasting and long term, and not susceptible to Iranian pressure or persuasion. Such an irrevocable development will further erode any recovery of Iranian power and influence in the neighbouring South Caucasus.
Despite the realisation of these negative outcomes, Iran has adopted a more positive stance, as evidenced by a flurry of diplomatic activity with Armenia. The state visit of Iranian President Masoud Pezeshkian to Armenia just 10 days after the White House event was the first opportunity for Iran to convey its “concerns regarding the presence of third-party forces near our common borders” according to an official statement on X. The same concern was reiterated by the Iranian President in a later phone call with his Russian counterpart, stressing Tehran’s opposition to the “outsourcing of regional issues” and criticising the Armenian side for having considered granting the US a role in operating the road and rail links.
The diplomatic activity continued, with Armenian National Security Council Secretary Armen Grigoryan being sent to Tehran to reassure Dr Pezeshkian and other officials that the Armenian government pledged that “no foreign power can disrupt the friendly and strategic relations of our countries” according to remarks carried by the Mehr news agency. This was a reference to the improbable suggestion of the US sending military personnel to provide security for the transit routes.
More recently, the Iranian President has made it clear that his government is generally satisfied with the Armenian reassurance and has since adopted a more conciliatory stance. However, equally plausible is the likelihood that Iran has recognised the inevitability of the deal.
Thus, from such a position realising its weakness, Tehran has now moved to save face, embarking on a new strategy based on what it sees as the sole opportunity for recovery. This one scenario for Iran to regain and restore its decreased power and influence stems from a probable – yet risky – bet on Russia.
Such a turn back to a reliance on Russia is driven by more assertive hardline elements in Tehran, centred around supreme leader Ayatollah Ali Khamenei, the Islamic Revolutionary Guard Corps and the armed forces’ chief of staff, Maj Gen Abdolrahim Mousavi.
Yet this is a risky, if not desperate, move by Iran. The limits of any such expectations for Russian support are apparent in light of Moscow’s inaction during the Israel-US attacks on Iran in June, as well as the ongoing distraction of its war in Ukraine.
But at the same time, looking to Russia is also tempting as it is Moscow that is likely to be the most active and even perhaps the most effective spoiler, capable of undermining this new American-backed agreement between Armenia and Azerbaijan.
