Shaping the Region: The New Geopolitical Realities in the South Caucasus Following the Karabakh War

The consequences of the Second Karabakh War are already shaping the South Caucasus region. Azerbaijan combined its carefully executed military strategy with well formulated diplomatic moves which have established a checks and balances in the region. 

The Karabakh War and the New Regional Configuration

During the military operations the Minsk Group co-chairs – France, the USA and Russia – chose one side, contrary to their mandates and international law, and unanimously defended Armenia, calling for an immediate halt to operations without any political exit out of the conflict. France and Russia attempted to advance a new UN Security Council resolution to nullify the four existing resolutions, which condemn the occupation of Azerbaijani districts and call for the withdrawal of troops. This hit the buffers with the intervention of members of the Non-Aligned Movement at a closed Security Council session. During the 44-day war Baku consistently demanded the return of Azerbaijani refugees to Mountainous Karabakh and the de-occupation of the seven adjacent districts, which Yerevan rejected on many occasions. After Armenian Prime Minister Nikol Pashinyan agreed to sign the Russian-brokered cease-fire statement, Azerbaijan also put its signature to it and Russian peacekeepers were deployed to the region. This means that out of its own geopolitical interests Moscow will have to reject any French and American attempts to revive the issue of status for Mountainous Karabakh which is a departure from Russia’s previous position. 

Armenia’s imports from China and India can pass through Iran via the Gulf, which will shorten the transportation period since freight takes a longer route through Georgia at present. In addition, the Turkish military presence in the form of the joint centre for monitoring the ceasefire counterbalances Moscow and sidelines Paris and Washington as Minsk Group co-chairs, making the centre a double strategic achievement for Azerbaijani diplomacy.

Over the last three decades until autumn 2020 the status quo in the Armenian-Azerbaijani conflict was a major factor in formulating regional policies for many countries, including Iran, Russia, Turkey, the US and France. Though no longer frozen, the Karabakh conflict remains an important geopolitical tool for these countries to retain influence in the region. Russia, France and the US used the frozen conflict to advance their national interests in the region, as the three countries were the co-chairs of the OSCE Minsk Group, the international mediation format created for the conflict in the 90s. The formulas proposed by the Minsk Group co-chairs contradicted international law and existing UN Security Council resolutions which urged Armenia to withdraw its occupying forces from the seven occupied Azerbaijani districts adjacent to Mountainous Karabakh. In other words, under the guise of establishing a buffer zone around Mountainous Karabakh Armenia tried to use the seven districts as a bargaining chip to achieve self-determination for Mountainous Karabakh outside Azerbaijan.

Over the years a major shift in Armenia’s Karabakh policy started to emerge when Yerevan set up illegal Armenian settlements in the seven districts, moving settlers there from Lebanon, Syria and Armenia itself in order to create new realities on the ground. The co-chairs did too little to address the scope of the annexation of Azerbaijani territories via demographic engineering projects. By turning a blind eye to this they tried to keep the conflict frozen and to use it as a tool to advance their respective regional policies. 

The status quo satisfied Moscow in particular, which considers the region its backyard and within its zone of influence, as it allowed the Kremlin a degree of control over both Armenia and Azerbaijan. For France, being a Minsk Group co-chair meant global prestige for French diplomacy as it advanced economic interests in Azerbaijan and satisfied its domestic Armenian diaspora that Paris would always defend Armenian interests in resolving the conflict. Washington tried to prevent Moscow from gaining the upper hand in the region by advocating the idea that in any resolution scenario no co-chair member should be present in the region as a peacekeeper.

The factors that shape Tehran’s policy towards Azerbaijan include the large ethnic Azerbaijani minority in Iran. Tehran views the strong Azerbaijani Republic on its north-western borders in terms of cross-border kinship, so Armenia’s occupation of more than 130 km of Azerbaijan’s state border with Iran created a buffer zone between the large Azerbaijani communities in north-western Iran and the Republic of Azerbaijan. Iran’s support for Armenia to counterbalance and weaken Azerbaijan is closely linked to its internal political situation and ethnic makeup.

From Isolation to Cooperation: New Challenges and Opportunities for Regional Ties

As a result of the 44-day war Azerbaijan successfully liberated the seven adjacent districts and re-established its sovereignty over the previously uncontrolled borders with Armenia and Iran. Tehran issued unfounded allegations that foreign terrorists were operating in the region and deployed a large contingent of IRGC to the Azerbaijani border. One of the reasons was the joyful support of Iranian Azerbaijanis from across the border as the Azerbaijani army advanced. Iran’s concern over the new Nakhchivan railway and communication route is that Tehran will lose out economically as it puts tariffs on goods travelling from mainland Azerbaijan to Nakhchivan, and the corridor will allow Ankara to boost its trade with the central Asian countries via Azerbaijan and the Caspian. Azerbaijan and Turkmenistan finally reached agreement to exploit a long disputed natural gas field in the Caspian following the Karabakh War and this might potentially lead to the transportation of Turkmen gas via Azerbaijan to Europe.

The joint statement on Nov. 10 established a Russian peacekeeping force in the areas of Mountainous Karabakh mainly populated by Armenians and unblocked all regional communications. According to the joint statement, Azerbaijan will get a land connection to the exclave of Nakhchivan and onwards to Turkey while in return Armenians can use the Russian-controlled Lachin corridor linking Armenia to Karabakh.

A joint Russian-Turkish ceasefire monitoring centre has been established in line with the statement and is now operating in the conflict zone. The Russia-Turkey tandem played a crucial role and sidelined the other Minsk Group co-chairs – France and the US. French President Macron’s biased and unsubstantiated remarks as well as the adoption of a resolution by the French parliament calling for the recognition of Karabakh aggravated the situation and destroyed France’s reputation as a just peace broker. New US President Joe Biden has in the past supported the Armenian American lobby in the Senate and in his election campaign said he would restore Section 907 to the Freedom Support Act. It remains to be seen how the new administration will formulate its policy, taking into account the French failure. Both the US and France can play a positive role by convincing the Armenian side to normalise relations with Turkey, which would result in open borders between Turkey and Armenia since Armenia is no longer occupying Azerbaijani territory.

When formulating regional policy, Washington cannot ignore the newly emerging geopolitical realities, as American strategic interests also include diversifying gas supplies to Europe in order to lessen European dependence on Russian natural gas. The Turkmen-Azerbaijani agreement gives the green light to the long advocated export of Turkmen gas to Western markets. This gas could be pumped through Azerbaijan’s now operational TAP pipeline into Europe, which serves US and EU energy interests. Unblocking vital regional communications will increase trade and boost transportation between Armenia and Russia and also shorten the transportation route between Azerbaijan and Turkey. Russia’s control over regional communications enables its participation in the South-North transportation route. As the vital economic and transportation projects start to operate, this can have a positive impact on achieving a lasting peace in the region.

The obstacles to this are the potential formation of a new revanchist government in Armenia, which could delay the implementation of the projects covered by the joint statement, and possible negative interference by France and the US over the status of Mountainous Karabakh. However, the projects might yet to be implemented, as, despite the deep political crisis in Armenia, its current leadership still has some legitimacy. Turkey and Russia will both have to defend their interests against a potential Biden administration retaliation in respective bilateral ties, so they may see their interests converging. 

Rufat Ahmadzada is a graduate of City, University of London. His research area covers the South Caucasus and Iran. The views and opinions expressed in this article are those of the author.

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