The Importance of the Zangezur Corridor and Iran's Opposition to It

In the past four years, following the start of peace negotiations between the governments of Baku and Yerevan, the Islamic Republic of Iran has consistently taken a strong stance against the opening of the Zangezur corridor to connect Nakhchivan to the territory of Azerbaijan, even threatening military intervention at times. Recently, with Russia's announcement of support for the opening of the Zangezur corridor, Iran's Assistant Foreign Minister expressed concern during a meeting with Alexei Dedov, the Russian ambassador in Tehran, reigniting the topic in Iranian media. Ali Khamenei, the leader of the Islamic Republic, also stated during a meeting with Nikol Pashinyan, the Prime Minister of Armenia, who visited Iran for the swearing-in ceremony of Masoud Pezeshkian, that Tehran considers the Zangezur route detrimental to Armenia and remains steadfast in this position. Iranian officials have presented various arguments against this plan, ranging from NATO's potential presence in the region to disruptions in the transit of Iranian goods from Armenia to foreign markets and changes to traditional borders between Iran and Armenia. The Zangezur corridor was the route connecting the autonomous Republic of Nakhchivan to Azerbaijan before the collapse of the Soviet Union, but it was closed in the early 1990s following the outbreak of war between the two Armenias and Azerbaijan. After the 44-day war in the fall of 2020, Yerevan and Baku signed a nine-point ceasefire agreement mediated by Russia, which stipulated that Azerbaijan would open the Lachin road to connect Khankendi to Armenia, while Yerevan would revive the Zangezur corridor to connect Nakhchivan to Azerbaijan, provided that Russian peacekeepers and Turkish observers would be stationed in these corridors. Since then, the Islamic Republic of Iran has explicitly opposed Article 9 of the agreement, initially arguing that the opening of this corridor would disrupt Iran's transit route through Armenia to foreign markets. However, Iranian customs statistics indicate that the volume of Iranian goods transiting through Armenia to Russia is very limited, accounting for only one percent of Iran's exports to Russia. In contrast, over 40% of Iran's exports to Russia occur via Azerbaijan and the rest through the Caspian Sea. Iran's second argument is the potential opening of NATO's presence (Turkey as a NATO member) in the Caucasus. Azerbaijan regained the city of Khankendi, predominantly inhabited by Armenians in Nagorno-Karabakh, in November last year. Following that, there was no longer a need for Russian peacekeepers in the Lachin corridor, and the Russians completely withdrew from Nagorno-Karabakh. Now, if the Zangezur corridor is opened, there would no longer be a need for foreign peacekeeping forces, but this can only be realized if the two countries sign a peace treaty and Armenia takes responsibility for ensuring the security of the Zangezur corridor. With the elimination of foreign forces in Zangezur, Iran's current arguments against the corridor revolve around two main points: the loss of traditional borders between Iran and Armenia and Iran's exclusion from regional transit plans. Some experts believe that the issue of the loss of borders between Iran and Armenia can only be justified if Zangezur passes directly through the zero border point between Iran and Armenia and is controlled by foreign peacekeeping forces, a scenario that has practically been ruled out. To alleviate Iran's potential concerns about being sidelined from transit plans, Azerbaijan has begun constructing a similar corridor within Iranian territory since last year, in cooperation with Tehran, parallel to the Zangezur route to connect its territory to Nakhchivan. However, Iran insists on maintaining exclusive control over transit from Azerbaijan to Nakhchivan by sidelining the Zangezur corridor. From Azerbaijan's perspective, the Zangezur corridor is not only a route to connect the country to Nakhchivan but also the shortest path for the transit of Chinese goods passing through Central Asia and the Caucasus to Turkey and European countries. In recent years, Azerbaijan has significantly increased the volume of foreign goods transit along the East-West route by launching the Baku-Tbilisi-Kars railway, but the Zangezur corridor offers a much shorter route than the one through Georgia and also provides the opportunity for growth in land transit of goods. Armenia is also aware of this, and Nikol Pashinyan, the Prime Minister of Armenia, announced last January, after the start of the joint corridor project between Iran and Azerbaijan parallel to Zangezur, that they are ready to provide their communication infrastructure for connecting Nakhchivan and Azerbaijan under 'conditions similar to Iran.' Just this spring, the volume of foreign goods transit from Azerbaijan reached eight million tons, nearly half of which was related to transit along the East-West route. In comparison, Iran had only 14 million tons of foreign goods transit throughout the last year, earning one billion dollars from this sector. Thus, the Zangezur corridor or its alternative in Iranian territory represents a highly profitable transit route that could generate hundreds of millions of dollars in transit revenue for Armenia or Iran annually, especially considering that currently, 45% of foreign goods transit from Azerbaijan is conducted by trucks and land routes. Over the past two years, Azerbaijan has constructed several highways along the North-South and East-West routes and aims to increase the volume of foreign goods transit to about 70 to 100 million tons by 2030, highlighting the economic significance of the Zangezur corridor or its alternative in Iranian territory. The key point is that Iran is a sanctioned country, and transit of goods through it faces numerous challenges, including financial transfers, insurance, and even political risks, which is why the Baku government is keen on the opening of the Zangezur corridor.