A genuine mediator

By readjusting its stance and acting as a genuine outside mediator to seek a resolution to the conflict – instead of shadowing a Russian lead which is fundamentally biased in favor of Armenia – Iran can help shake up the status quo. The Armenian occupation of Azerbaijani lands is in the long-run unsustainable but Tehran can still make a positive impact on its bilateral relations with Baku if it can demonstrate that it does have the capacity to practice sincerely neutral policies in that long-standing conflict. To start with, it requires more Iranian pressure on Yerevan to open itself up for a diplomatic resolution and prevent another round of military clashes with Azerbaijan over the fate of Nagorno-Karabakh.

At the moment, Tehran’s ties with Armenia remain close and Iran continues to be a trade and transportation lifeline that Yerevan will not be able to replace should circumstance change. That said, Armenia is overall confronted with a set of daunting socio-economic challenges, including weakening economic conditions and large outflow of citizens who are choosing to emigrate. It would be an exaggeration to call Armenia a failed state but there can at the same time be little doubt that the country’s prospects at the moment are far from promising. From Tehran’s narrow national security perspective, a policy of encouraging Yerevan to reconsider its obstinate stance on Nagorno-Karabakh can actually go a long way in enhancing the long-term stability of Armenia by finally settling the 20-year old dispute once and for all.

Furthermore, regardless of the close history that Iran also shares with Armenia, the fact remains that it is Azerbaijan that has emerged as the economic engine of the South Caucasus. Seen from an Iranian national interest, it is exactly Baku that should be prioritized. Put simply, Russia’s near unqualified political and military support for Armenia might serve Moscow’s goals in the Caucasus but it makes little sense for Tehran to pretend that Iranian and Russian interest in this part of the world overlap.

Assessed more broadly, by simultaneously improving relations with the United States and Azerbaijan, the Iranians can feel far less concerned about the Caucasus as a potential zone of instability where Tehran’s own interests can be at risk. Once it has through concrete action lifted the level of confidence in its relations with Baku, the Rouhani administration can initiate measures aimed at outstanding disputes including the final demarcation of the Caspian Sea where both Azerbaijan and Iran as littoral states are key players and where a regional deal has failed to materialize since the question first arose in 1991.

It is once such steps have been taken that President Rouhani can with more confidence speak of closer joint cooperation with Baku in the energy field or tout the idea of Iran as an outlet point for the landlocked states of the South Caucasus that seek to reach international markets. This is all within the realm of possibility. And Rouhani has himself put the process in motion: By reducing tensions with the United States Iran will be in less need of Russia’s – albeit unreliable – diplomatic support on the global stage and this change in the equation can free Tehran’s hands in the South Caucasus in a way that has the potential to contribute positively to political stability in the region.

Where from here

At a time of renewed American-Russian tensions following Moscow’s annexation of Crimea and intervention in eastern Ukraine, the South Caucasus is once again in the global spotlight. On the one hand, there is the fear of Russian machinations in the region as part of its rivalry with the West. In a worst-case scenario, this might mean Russian attempts to stir tension or even revive the armed conflict between the Armenians and the Azerbaijanis as a way of strengthening Moscow’s geopolitical hand in the South Caucasus. Such a scenario is certainly not in the interest of Iran even though some anti-American voices in Tehran fail to admit to the risks for Iran associated with an assertive Russia that maneuvers unopposed.

At the same time, Russia’s fallout with the West has undoubtedly heightened the potential of the South Caucasus as an alternative energy supplier to world markets. However, to prevent outside machinations to the detriment of the interests of the peoples of the region or to utilize emerging economic opportunities such as those found in the energy sector requires that Armenia, Azerbaijan but also Georgia to increase collective efforts to maintain peace and work toward permanent political solutions to the outstanding territorial disputes in the region. 

Meanwhile, Tehran’s recent advances toward Baku are part of a broader effort to limit Iran’s isolation and prevent Azerbaijan from aiding or joining any potential Israeli or U.S. military operations against its nuclear program. These Iranian anxieties are massively exaggerated. Baku entirely accepts the security risks it would face in the event of a war between Iran and the West, including mass refugee inflows from Iran, inaccessibility to the semi-autonomous exclave of Nakhchivan (an Azerbaijani region sandwiched between southern Armenia and northern Iran), and, in the worst case, direct Iranian military retaliation. Moreover, there is no evidence that Baku would look to an attack on Iran as an opportune moment to realize any irredentist dreams some might have.

Instead, President Rouhani needs to formulate a policy that is independent of Russia’s agenda for the region. Only by doing so can the Iranians help break the precarious status quo that presently exists. On the question of Nagorno-Karabakh, while Iran should continue to support the mediation efforts of OSCE Minsk Group – lacking as they might be – it should cease its neurotic opposition to any Western physical intervention as part of a diplomatic settlement. The Iranians are specifically against the idea of foreign peacekeepers to be deployed to the disputed territories. At the same time, Tehran has made no condemnations of Russia’s long military presence in Armenia estimated at some three thousand troops that are slated to remain in the country until 2044. There is, however, a cause for some optimism that Tehran may reassess some of its previous policy positions.

In the event that Rouhani genuinely help steer his country back to the international mainstream over the next few years, including abandoning the policy of militant anti-Westernism, then it becomes far more likely that Tehran can participate in a process of meaningful mediation between Armenia and Azerbaijan. To begin with, Baku will be far less likely to oppose an Iranian role that is not seen to interfere in its domestic politics or one that shadows Moscow’s bias in favor of Armenia, which has been the case during most of the last twenty years. At the very least, President Rouhani’s pledge of renewal of ties with immediate neighbors should include an even-handed approach on the question of solving the Nagorno-Karabakh conflict.  

There can be no question that the ongoing process of détente between Iran and the United States can radically change the regional political dynamics in the South Caucasus. On the one hand, there are undoubtedly those in Yerevan who see a less isolated Iran as a boon for Armenia and as a way of more easily circumvent the Azerbaijani-Turkish cordon. From an Iranian perspective, however, better ties with Western states should be seen as an opportunity to be less fixated on a Western footprint in the South Caucasus. Instead, Tehran ought to consider such circumstance as an occasion to rid itself of two decades of subservience to Russian interests in the region and a chance to implement a bona fide policy of mediation in a region that still suffers from a number of unresolved conflicts, including Nagorno-Karabakh.

Alex Vatanka is a Senior Fellow at the Middle East Institute in Washington, DC.

Image: president.ir