Strategic Assessment

Iran’s Drive for a Railway Connection to Armenia

Iran has started actively promoting a railway connection to Armenia in its efforts to reposition itself in the new situation emerging in the South Caucasus in the wake of the 44-day Second Karabakh War between Armenia and Azerbaijan (September 27-November 10, 2020). Iran was keen on maintaining the status quo in the South Caucasus region, but this was upset by Azerbaijan’s swift and sudden military victory over Armenia in the war. Russia, in collaboration with Turkey, brokered a truce deal known as the Trilateral Statement that ended the Second Karabakh War between Armenia and Azerbaijan. Tehran was kept at bay by Moscow and Ankara in brokering the deal, despite its long and close engagement with the South Caucasus. As a result, Iran found itself as a major potential loser from the war and subsequent truce. Motivated to counter this negative scenario, and especially under the pressure of opponents and critics of President Hassan Rouhani and Foreign Minister Javad Zarif, Tehran seeks to reposition itself into the new situation in line with its interests. 

One effective way of advancing this goal from Iran’s perspective is to build a railway line to Armenia. Indeed, Iranian Foreign Minister Javad Zarif’s regional tour to Armenia, Azerbaijan, Georgia, Russia, and Turkey on January 25-28, 2021sought to serve that purpose. In particular, Tehran pushed for reactivation of a railway line from Iran to Armenia via a short Soviet-era connection, now dysfunctional due to the Karabakh conflict, through Azerbaijan’s Nakhchivan exclave (wedged between Iran, Turkey, and Armenia), and then further extending to the Black Sea and Russia via Georgia. 

After his regional tour Zarif tweeted the main purpose of his trip: “Visited Iranian & Azerbaijani Jolfa [railway stations on the border]. Discussed with local officials—on both sides—new opportunities by reopening of railway connecting Persian Gulf, Black Sea &Russia through Nakhchivan& Armenia.” However, no public statement was made in that regard in any of the capitals during the tour on this component of the negotiations agenda, reflecting the controversial and uneasy nature of the issue.

Baku and Yerevan compete to win Tehran’s sympathy over the conflict. Yet with the reactivation of the Soviet-era Armenian-Azerbaijani railway and transit corridors, Tehran’s economic and political significance stands to significantly diminish.

Currently, all the traffic between mainland Azerbaijan and its Nakhchivan region passes through Iranian territory. Part of the transit between Azerbaijan and Turkey likewise runs through Iran. Furthermore, the Iranian route plays a role as a “second lifeline” after the Georgian route for landlocked Armenia, whose borders with Azerbaijan and Turkey remain shut due to the Karabakh conflict. Baku and Yerevan compete to win Tehran’s sympathy over the conflict. Yet with the reactivation of the Soviet-era Armenian-Azerbaijani railway and transit corridors, Tehran’s economic and political significance stands to significantly diminish. 

This would entail some decline of Iran’s geopolitical position in the South Caucasus region. In particular, possible normalization of relations between Armenia and Azerbaijan, and the opening of Turkey-Armenia-Azerbaijan-Russia railway connection may lead to Turkish-Armenian normalization and a reopening of borders between the two. Nonetheless, some in Tehran initially hoped either Yerevan or Baku would fail to follow through on unblocking of the transit corridors between the two foes, or it would be of a limited scale. However, the January 11 trilateral meeting of Nikol Pashinyan, Ilham Aliyev, and Vladimir Putin, the Armenian, Azeri, and Russian leaders, respectively, shattered those hopes. Russia and Turkey established a joint military center to monitor compliance with the truce accords on the ground in the Karabakh conflict zone.

Azerbaijan established full control over its state border with Iran, having regained a 132-km segment of its border from the Armenian armed forces during the war. Azerbaijan’s successful operations sparked enthusiasm and ethno-national sentiments among Iran’s multimillion ethnic Azerbaijani population. Iran’s arch enemy, Israel, appears to be happy with the outcomes of the Second Karabakh War for a few reasons. It is no secret that Israeli-made military equipment, in particular highly sophisticated drones, alongside Turkish drones in the Azerbaijani arsenal, were proven as “game-changing” in modern warfare during the Second Karabakh War. The war was a real battlefield showcase of technological and combat supremacy and high precision of Israeli drones and other military equipment. It also had a psychological effect in favor of Israel since the products of its military industry played a role in determining the fate of the war on the borders of Iran. The successful performance of Israeli weapons amplified the positive popular reputation of Israel in Shiite-majority Azerbaijan. Azerbaijan’s de-occupation of its territories and restoration of full control over the Iranian border further frees Baku’s possibilities to expand a partnership with Israel. During the war, some Azerbaijani MPs called on Baku to open an embassy in Israel. On April 28, 2021, the Azerbaijani minister of economy, Mikayil Jabbarov, announced that Azerbaijan will set up trade and tourism representation offices in Israel to upgrade the cooperation. All these raise serious concerns in Tehran that are manifested in various fashions.

Iran pursues multiple objectives by pushing for the railway connection to the Black Sea via Armenia. An immediate Iranian goal is that the activation of the railway line to Armenia represents a major way of compensating for at least some of Iran’s potential losses due to the outcome of the Second Karabakh War and related restoration of the Armenian-Azerbaijani-Russian transit routes.

In addition, Russian border troops are in charge of guarding Armenia’s borders with Iran and Turkey. Moreover, under the trilateral truce deal, more Russian border troops will be deployed to secure a corridor between Azerbaijan and its Nakhchivan region along the 48-km Armenian-Iranian border. Basically, Russian control of the Armenian-Iranian border will be doubled. Some in Iran fear this means that Iran may have no direct border with Armenia anymore. Azerbaijan’s President Aliyev said that “this will not be something new for Iran,” since Russians have been guarding the Armenian-Iranian border anyway for a long time.

Iran’s Strategic Goal in the Railway Connection

Iran pursues multiple objectives by pushing for the railway connection to the Black Sea via Armenia. An immediate Iranian goal is that the activation of the railway line to Armenia represents a major way of compensating for at least some of Iran’s potential losses due to the outcome of the Second Karabakh War and related restoration of the Armenian-Azerbaijani-Russian transit routes. In addition, this would soothe domestic concerns and criticisms of the government over its inability to properly protect the Iranian interests in the context of the recent war. At the same time, there are much deeper, geopolitical, and strategic goals that are embedded in Tehran’s push for the railway connection to Armenia.

First, Tehran hopes to become a transit hub between the Asia, Gulf, and India regions and Europe, competing with while complementing the Chinese Belt and Road Initiative(BRI) project, if for no reason other than that Iran is located along the BRI routes and in fact is also a crossing point of BRI and the North-South Transport Corridor (NTSC),which is under development by Russia, Iran, and Azerbaijan, via Armenia away from Azerbaijan. These two transport corridors are competitors particularly due to rivalry between Beijing and Delhi. Moreover, the NSTC is also regarded as an alternative to the Suez Canal, considerably reducing travel time and related shipping costs; this was highlighted especially after the 2021 obstruction of the Suez Canal.

Modified version of "1-12 Grey Map World" & CIA Maps (cc by sa 3.0)

Second, Tehran wants to bypass Russia and Azerbaijan, a Turkish ally and Israeli strategic partner, to reach Europe. In fact, Iran strives to re-route the NSTC. 

Third, Tehran seeks suitable access to the Black Sea and then to Europe. Iran sought to establish a comfortable land corridor to the Mediterranean coast via Mosul in Northern Iraq and Syria. However, a Russian and Turkish as well as US military presence in Syria obstructs materialization of this corridor and Iran’s free walk along it. Now they may face Iran in the Black Sea, and since the Crimean annexation, the Black Sea has emerged as a hotspot for geopolitical rivalry. Neither the Turks nor the Russians need Tehran there.

In this light, there are several barriers and difficulties that Tehran will inevitably face in its efforts to actualize the project. Clause 9 of the Russian-Armenian-Azerbaijani trilateral accord stipulates unblocking “all” economic and transport connections in the region. A major Iranian media outlet, the Tehran Times, depicts this clause as “vague” because it is prone to different interpretations. For Tehran, “all” transport lines include the Iranian-Armenian railway connection through Azerbaijan’s Nakhchivan exclave that is between Armenia, Iran, and Turkey. But in the context of the trilateral accord itself, “all” rather means those who made and signed the deal—Armenia, Azerbaijan, and Russia. Furthermore, the document specifies only the transport line between mainland Azerbaijan and Nakhchivan.

This line was active during the Soviet era as a railway connection between Iran and the former USSR, and became unusable due to the breakout of the Karabakh conflict between Armenia and Azerbaijan in the early 1990s. A brand new railway connection bypassing Azerbaijan, Tehran, and Yerevan demands an investment of billions of dollars due to severe mountainous landscape of the area, and this sum is neither available nor affordable with either of them. In the 2000s, Yerevan and Tehran tried to pursue an idea known as the Southern Armenian Railway project, but it was eventually abandoned for financial and other reasons. The Southern Armenian Railway project then was designed as part of the NSTC to connect the Black Sea and Europe to India and Gulf regions. Instead, Azerbaijan, Iran, and Russia took on the development of the NSTC through the territory of Azerbaijan away from Armenia.

Russia is more flexible vis-à-vis Turkey because Moscow seeks to pull Ankara away from its traditional Euro-Atlantic alliances, and the planned opening of the Russian-Azerbaijani-Armenian-Turkish railway line would serve that purpose.

Finally, the Russian state railways company took over the entire Armenian railway network in 2008. As a result, building any connection with or use of the Armenian railways network falls under the competence of the Russian railways company.

Thus, Tehran inevitably needs to obtain consent from Baku and Moscow to materialize the railway connection to Armenia. But the problem for Iran is that the project runs contrary to the interests of Azerbaijan and Russia not only for economic but also and perhaps more importantly for geopolitical considerations. In that light, realization of this railway project looks uncertain. In the meantime, Iran will keep relying on motorway transits to Armenia and then Georgia, and hope for the delay or impossibility of actual implementation of Armenian-Azerbaijani-Russian trilateral accords regarding the unblocking of the transportation lines. 

Strategic Ramifications of the Iranian-Armenian Railway

Russia is more flexible vis-à-vis Turkey because Moscow seeks to pull Ankara away from its traditional Euro-Atlantic alliances, and the planned opening of the Russian-Azerbaijani-Armenian-Turkish railway line would serve that purpose. Anyway, Azerbaijan and Turkey are connected by the Baku-Tbilisi-Kars railway (BTK) line via Georgia. Even recently, the first cargo train from Turkey arrived in Russia using the BTK via Azerbaijan. In the case of Iran, the unblocking of the Armenian railway connection would facilitate Tehran’s unfettered reach to Armenia, Georgia, the Black Sea region, and Europe, including Ukraine. 

By Giorgi Balakhadze (CC BY-SA 4.0) 

In spite of being a much lesser actor than Russia, Azerbaijan’s consent is needed. After all, the Iranian and Armenian railways are to connect through Nakhchivan exclave of Azerbaijan. The reactivation of the Iranian-Nakhchivan-Armenian-Georgian railway simply means for Azerbaijan stripping it of freight transits and related geopolitical significance while empowering its foe Armenia. Therefore, it would be a very hard decision for Baku to concede opening the Nakhchivan corridor to the Iranian-Armenian-Georgian railway. It is also hard to imagine whether Baku alone might be able to resist pressure from Tehran. Indeed, without going into detail, Baku has admitted the possibility of opening an Iranian-Armenian railway link via Azerbaijan’s Nakhchivan region, but hinting that it would be restricted to Armenia without extending to Georgia and beyond.

Against this backdrop, a major question is whether Georgia would bow to Zarif’s proposals. Hypothetically, even if Tehran gains consent from Baku, and Moscow is persuaded to approve, will Tbilisi agree? Even if in the best scenario for Tehran, in case Moscow becomes convinced as to the opening of Iran-Nakhchivan-Armenia-Georgia, in exchange for its approval the Kremlin will want Tbilisi’s agreement to extend the Iran-Nakhchivan-Armenia-Georgia railway line to Russia as it functioned during the Soviet era. 

That would have been acceptable to Tbilisi, but the Russian-Georgian railway connection passes through Georgia’s breakaway region of Abkhazia. There is much domestic opposition in Georgia to engagement with breakaway regions and/or Russia on Moscow’s terms, and agreeing to the opening of this line would effectively mean Tbilisi’s recognition of Abkhazia as independent of Georgia. Furthermore, this railway connection with Russia would diversify Moscow’s options for access to the region and beyond, enhancing its regional grip and providing Moscow with leverage over Georgia. Even long before the Second Karabakh war, Moscow sought to establish the railway to Armenia via Georgia but without Iranian involvement. The Abkhazian deadlock was impossible to overcome.

Nonetheless, Tehran’s proposal may still sound attractive to Tbilisi. But all that has significant ramifications for Georgia and its trans-Atlantic aspirations, as Georgia must consider its Western partners, in particular the position of the United States on the matter. This is likely to have complicated Javad Zarif’s mission to lobby in Tbilisi in favor of the project. How Georgia will respond to the Iranian offer, particularly concerning its Russian component, is unclear at this point. Under different administrations the US turned a blind eye to Armenia’s close ties with Iran. If and how far the Biden administration will go along with Iran will be a significant, determining factor for Tbilisi’s decision on the Iranian-Armenian-Georgian railway link, which would ultimately connect Iran to Russia. An additional problem is that the US and Europe are still at odds on the Iranian topic and have yet to reach a consensus on the future of the Iran nuclear agreement. 

Yet at the moment, the West is silent on the topic. Perhaps one reason for the West avoiding the railway project is that the railway connection from Iran to the Black Sea and Russia is anyway set to go forward. But the question following the Second Karabakh War is whether it would pass through Azerbaijan or Armenia. One nuance that the West could take note of is that the Armenian route would eventually lead to rising Russian and Iranian influence and presence in Georgia in particular and the region in general. But the Azerbaijan route would keep Georgia considerably off the Russian and Iranian shadows, not least because the Russian-Iranian leg of the railway will not involve Georgia. Furthermore, all these old and new transit lines eventually serve regionalization of the South Caucasus nations with and among Iran, Russia, and Turkey but effectively curb perspectives of regionalism among Armenia, Azerbaijan, and Georgia themselves, hence leaving them in a vulnerable position irrespective of whatever relative gains they make from the regionalization with the regional hegemons. For Iran, it is at least a big source of discomfort to see a long segment of the corridor pass through Azerbaijan territory due to contemporary and historical controversies, whereas Armenia’s standing is further weakened in contrast to Azerbaijan, particularly in the aftermath of the Second Karabakh War. This gives a clue to the Israeli perspective on the issue.

It is noteworthy that Israel has to go on with applying a differentiated, tailor-made approach to each of the three South Caucasian nations. Armenia has recently opened an embassy in Israel. But the substantive level of the bilateral relationship remains low and tense. Armenian PM Nikol Pashinyan’s interview to Jerusalem Post is a case in point. Turning down Israel’s offer of a humanitarian aid, Pashinyan was on-record before the cameras saying that “Israel should send that aid to the mercenaries and to the terrorists as the logical continuation of its activities.” Ties between Israel and the region’s most pro-West nation, Georgia, are friendly. Nevertheless, strong antisemitic statements by high-ranking clergymen of the Georgian Orthodox Church in January-February 2021 indicate that the bilateral relationship is not free from controversies considering the strong position of the Orthodox Church in the country. Israel’s strategic partner, Azerbaijan, which has adopted multiculturalism as an official policy, is credited with being the home of what is oftentimes described as Europe’s “last surviving shtetl,” the historic all-Jewish town in Guba region. Moreover, the singularities and specific character of relationship with Azerbaijan makes it particularly valuable for Israel. In that light, Israel can do little apart from lobbying against the Armenian route, since one major driver for the Iranian push for railway connection to the Black Sea via Armenia by effectively rerouting the NSTC away from Azerbaijan is to serve Tehran’s strategy to counterbalance Israel’s strategic partner Azerbaijan with Iran’s strategic partner Armenia in the region.