Iran’s Role in India's Strategy in the South Caucasus

The changing world order is marked by the growth of new power centers and redistribution of spheres of influence. India is becoming one of the key poles, and the South Caucasus one of the regions of competition. Restoration of the regional balance of power as a pledge of peace and economic development through cooperation is possible with India’s participation. Iran has an important role in establishing and maintaining India’s position in the region. It serves as a link, a hub, and a buffer and is also a partner “on the ground” capable of securing common assets.

Dynamic in the South Caucasus: Factor of Iran

Balance changes are taking place not only at the global level but also regionally. The South Caucasus is no exception. The 2020 war in Artsakh/Nagorno-Karabakh was a turning point, but a new status quo really began to take shape after September 2023 when Azerbaijan attacked and conducted ethnic cleansing of the Armenian population amid the de facto dissolution of Nagorno-Karabakh. After the mass exodus of Armenians, Russian peacekeepers also later withdrew from Nagorno-Karabakh, although their mission for peacekeeping had initially been planned to last until at least 2025. ^[1]

Now there are three recognized states (Armenia, Georgia, Azerbaijan) and two partially recognized states (Abkhazia and South Ossetia) on the political map of the South Caucasus. At the same time, the region continues to be dynamic. Azerbaijan, a key power in the South Caucasus, continues to exert pressure on Armenia with the support of its NATO ally Turkey. Today, under threat of force from Baku, the “demarcation” of the Armenian-Azerbaijani border is taking place, during which Yerevan is handing over territories. Baku and Ankara are keeping the “Zangezur corridor” project on the agenda, providing a land connection between Turkey and Azerbaijan through the territory of Armenia with subsequent access to the Caspian Sea and Central Asia.

Over the past decades, Russia has been the exclusive security provider in the South Caucasus. However, Moscow was not able to hold the balance of power by providing the necessary support to its ally Armenia against the backdrop of military aggression by Azerbaijan in 2021–2022. And with the outbreak of war in Ukraine, the situation worsened. Moscow failed to keep Baku from attacking Nagorno-Karabakh, which was within the zone of responsibility of Russian peacekeepers. In parallel with the decline in Armenian-Russian relations, the Turkish-Azerbaijani alliance is strengthening. The Shusha Declaration signed in 2021 between Baku and Ankara ^[2] has become a defence pact. Moreover, it separately outlines the key objectives of the alliance, one of which is the opening of the “Zangezur corridor.”

As one of the three regional powers, Iran cannot stand by and observe a rebalancing that is directed against its interests. At the level of its Supreme Leader Ali Khamenei, Tehran has declared the inadmissibility of border changes in the region,^[3] regularly recalling its red line in this area. As President Erdogan of Turkey later confirmed, Iran is the main obstacle to opening the “corridor.” ^[4] In this sense, Tehran’s firm stance on regional change, in terms of borders and demography, ^[5] makes Iran a pro “status quo” state in the South Caucasus, interested in maintaining the existing configuration. This is also demonstrated by Iran’s military and political activity, which made it possible to stop Azerbaijan’s advance deep into Armenia during the September 2022 aggression.

Outlining India’s Approach Toward the South Caucasus

The transformation of the world order from unipolar to multipolar involves several processes. One of the main ones—the redistribution of the balance of power and spheres of influence at global and regional levels—occurs through the emergence of new centers of power or the strengthening of existing ones. Success is not always determined by political, economic, and military potential but by the ability to use these to project one’s agenda. For example, to consolidate its status as a center of power, Kazakhstan offered to provide mediation in Armenian-Azerbaijani negotiations. ^[6] China’s mediation efforts led to an agreement between Iran and Saudi Arabia, and today, Beijing is working on an agenda for a Russian-Ukrainian and Palestinian-Israeli settlement.

At the global level, it is evident that India is emerging as one of the world's major centers of power. Every rising great power has an expanding geography of interests. These are related to various considerations. First, there is a need to ensure security “at the far periphery.” In 2020 the South Caucasus was one of the hottest spots in the world. Turkey and Pakistan actively interfered in regional processes to break the balance and create their zone of influence. Both states became exporters of instability. Ankara was directly involved in the war at the level of top military leadership and organized the transfer of terrorists from the Middle East. Islamabad welcomed Azerbaijan’s victory, justifying the war with the return of land. ^[7] The instability of the South Caucasus may hamper Indian efforts to use the region as a logistical hub to reach Russia and Europe.

Second, there is the building of connectivity projects. India’s economic rise has been accompanied by the construction of new transport and logistics routes to ensure fast and safe exchange of goods. Today, New Delhi has several projects on its agenda. These include India–Middle East–Europe Economic Corridor (IMEC) and the International North-South Transport Corridor (INSTC), one branch of which coincides with the proposed “Persian Gulf–Black Sea” route. The first project, which is more than 5,000 kilometers long, is inclusive in that it involves many states and reaches European ports in the Mediterranean Sea. As security risks increase with the growth of instability in the Middle East, diversification of transport routes is important. This consideration increases the importance of the “Persian Gulf–Black Sea” corridor, which will run parallel to the INSTC, and aims to connect Mumbai with Bandar Abbas in Iran and then Armenia and onward to Europe or Russia. ^[8] Therefore, the importance of the South Caucasus in the Indian connectivity strategy is increasing.

Third, the growing cooperation between Armenia and India has the potential to shape a model of relations that they can apply in their foreign policy toward other states. For example, India is gaining new experience in security cooperation with small states in the extended neighbourhood, which coincides with the Indian vision of focusing beyond its immediate neighbourhood. Military-technical cooperation is an important element of relations between the two countries. In this sense, Armenia is playing an important role in India’s endeavour to enter the global arms market. The successful implementation of agreements will be an important experience and contribute to expanding the number of partners of India.

Importance of Iran in India’s Strategy

Iran is seeking to position itself as a self-sufficient center of power in the new world order. So far, Tehran’s sphere of interest has been limited to the perimeter of its border and the Middle East, without going far beyond the region. At the same time, Iran is continuing to expand the geography of cooperation through multilateral institutions. At the end of 2023, Iran signed a free trade zone agreement with the Eurasian Economic Union (EAEU). It joined BRICS—the intergovernmental grouping that connects Brazil, Russia, India, China, South Africa, Iran, Egypt, Ethiopia, and the United Arab Emirates. The South Caucasus remains a priority area based on two considerations: communications and security.

For several reasons, Iran’s role in the South Caucasus is important in the context of India’s policy implementation. First, securitization of transport communications: Tehran is actively implementing the North–South and Persian Gulf–Black Sea transport corridors, designed to connect India with Russia and Europe, respectively. Under this project, new agreements are being reached to share Iranian ports. Implementing this transport corridor will not be possible if the configuration in the South Caucasus changes again. As noted, Turkey and Azerbaijan are promoting the “Zangezur corridor project,” a land link connecting Turkey and Azerbaijan through the territory of Syunik, the southern province of Armenia bordering Iran. The realization of this project will lead to the disappearance of the Armenian-Iranian border and, consequently, to the impossibility of implementing the Persian Gulf–Black Sea project. Moreover, continued pressure on Armenia prevents the possibility of lasting stability in the region and jeopardizes INSTC, including the Iran–Azerbaijan–Russia route.

Second, the balance of power must be maintained “on the ground” until Indian weaponry is integrated into Armenia’s defence system. The risk of limited escalation continues to exist. Ankara and Baku continue to exert military and political pressure on Yerevan. As long as Armenia makes unilateral concessions under pressure from its two neighbours, Azerbaijan will not use force to achieve its goals. But should Armenia stop fulfilling Azerbaijan’s demands, the risk of Baku using military force will increase. Given the sharp power imbalance between the two sides, the result of a potential escalation will be obvious—another territorial loss by Armenia, instability in the South Caucasus, and a change in the geopolitical configuration in favour of the Ankara–Baku axis. Yerevan continues to carry out military reforms and is making arms purchases to improve defence capabilities and equalize the balance of power. Today, Armenia is becoming the primary importer of military-industrial complex products from India. It will take a long time to receive the procured weapons and integrate them into the armed forces. In the case of aggression by Azerbaijan in the short term, Armenia will not be able to demonstrate a defence capability based on Indian arms effectively. In this sense, Indian armaments may have a bad performance, making it much more difficult for India to enter the broad arms market. Suppose the Armenian side succeeds in the long term. In that case, India will get the best promotion in the military industry, accelerating the growth of New Delhi’s position as a new global arms exporter.

Third, implementing agreements between Armenia and India on military-technical cooperation is possible only through Iranian territory. An alternative route for the delivery of Indian arms to Armenia could be via Central Asian states, then Russia and Georgia. This route significantly complicates logistics and is almost impossible. Today, Tehran is interested in restoring the balance of power in the region, which is possible by strengthening Armenia’s defence capability. Therefore, military-technical cooperation between India and Armenia through the territory of Iran is not only effective and reliable but the only option.

Thus, Iran acts as India’s main partner in the South Caucasus, securing India’s position in the region. Transport corridors are long-term projects and, therefore, need to be secured. Today, there is a certain security vacuum in the region, which different actors are seeking to fill. The Turkey–Azerbaijan bloc is becoming dominant. If the competitive trend toward strengthening the bloc’s positions continues, the winner will be the bloc with control over transport communications in the region. To mitigate risks and implement its policy in the South Caucasus, India should expand cooperation with Iran, including through trilateral formats such as India–Iran–Armenia.

References

^[1] https://www.primeminister.am/en/press-release/item/2020/11/10/Announcement/ [3]

^[2] https://coe.mfa.gov.az/en/news/3509/shusha-declaration-on-allied-relations-between-the-republic-of-azerbaijan-and-the-republic-of-turkey [4]
^[3] https://asbarez.com/any-change-to-armenia-azerbaijan-border-is-unacceptable-iran-warns/ [5]
^[4] https://turkic.world/en/articles/turkiye/111736 [6]
^[5] https://arminfo.info/full_news.php?id=84303&lang=3 [7]
^[6] https://www.euronews.com/2024/05/28/middle-powers-have-the-power-to-save-multilateralism [8]
^[7] http://armiya.az/ru/news/166757 [9]
^[8] https://economictimes.indiatimes.com/news/international/world-news/armenia-proposes-iran-black-sea-corridor-for-indian-traders/articleshow/98526297.cms?from=mdr [10]

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