A New Great Game is Unfolding in the South Caucasus. Is India Prepared for it?

India must move beyond arms deals and wake up to the real stakes in the South Caucasus power struggle.

The three countries of the South Caucasus—Armenia, Azerbaijan, and Georgia—have seen a renewed scramble for their resources and territory as transit routes by different powers again.

(Photo: Aroop Mishra/The Quint)

A new great game is unfolding in the Southern Caucasus. Is India ready for it? So far, there has been no indication. All reports and discussions here regarding the Southern Caucasus are rather reductive—framing the region as one where a proxy war between India and Pakistan can play out.

Indians have, till now, viewed the region mostly through the lens of India's defence exports to Armenia, and its arch-rival Azerbaijan's support to Pakistan. The discourse on the region has hardly moved beyond that.

It is important to note that military cooperation between Armenia and India have been developing rather dynamically since at least 2020, when Armenia procured four Swathi mobile radar systems, totalling $40 million. 

Growing Indo-Armenian Defence Cooperation

In 2022, Armenian Defence Minister Suren Papikyan visited India. The same year, Armenia placed an order in India for Pinaka multiple-launch rocket systems, anti-tank missiles, and ammunition valued at approximately $245 million. 

Armenia also ordered 90 advanced towed artillery systems (ATAGS) worth $155.5 million from India, with the first batch of six 155-millimeter towed Howitzers delivered in August 2023.

Besides that, Yerevan ordered $41 million worth of anti-UAV defence systems from Indian company Zen Anti-Drone System (ZADS) and a tactical wheeled vehicle-mounted 155 millimetre/39 MArG Howitzer system developed by Indian Kalyani Strategic Systems. Armenia's armed forces are also undergoing reforms, and India is helping with their capacity building. 

What’s So Special about the South Caucasus?

The region's strategic importance cannot be overstated. It has traditionally been perceived as a buffer zone between Russia, Turkey, and Iran. It is also often perceived as a bridge between Asia and Europe. As such, it has often invited regional and great power rivalries in the region. As Halford Mackinder had said in 1904, "...whoever controls the (Eurasian) Heartland, controls the World-Island..."

The three countries of the South Caucasus—Armenia, Azerbaijan, and Georgia—have seen a renewed scramble for their resources and territory as transit routes by different powers again. Having emerged as sovereign states from the Soviet Union, they continued to be in Russia’s sphere of influence.

But Russia’s links with its traditional partner in the region, Armenia, are now weakening.

The only country in the region to be part of Moscow-led military and economic alliances, Armenia has now announced that it has frozen its membership of the Collective Security Treaty Organisation, but continues to be enmeshed with Russia economically.

New Players in the Game

Armenia is now trying to diversify its foreign policy and partnerships with countries of the West, and the East, which includes India and China.

Georgia, which had long broken with Russia, and veered towards the West, now finds itself pivoting back to Russia alongside a firm Chinese foothold there. Azerbaijan, the most resource rich state in the region with its huge gas reserves, had also long slipped out from Russia’s sphere of influence.

It turned to the European Union and the Mediterranean region, moving into Turkey's embrace forged through cultural and linguistic bonds.

With its military support to Azerbaijan in its war with neighbour and arch-rival Armenia over the contested territory of Nagorno-Karabakh, Türkiye has manoeuvred itself to become the second-most powerful regional player there.

Things get more complicated with Azerbaijan's close relations—both economic and military—with Israel. This complicates matters for India as in this region, India and Israel, close strategic and defence partners, find themselves on the opposite sides of the traditional fault line—the rivalry between Azerbaijan and Armenia who has become, till now unofficially, a strategic partner for India.

Ties between Azerbaijan and neighbouring Iran are also strained, given Azerbaijan's proximity to Israel, as well as its often-veiled irredentist claims on Iran’s northern Azerbaijan region. And now, the US has entered this cauldron.

The Zangezur Corridor Issue

Given the region's natural resources, energy pipelines, and transport corridors, this was perhaps inevitable. The timing is also crucial, coming as it does in the wake of Iran-Israel's 12 days war and American intervention which ended the war.

At the heart of all this jostling is the race to control the so called "Zangezur Corridor", a strategic freight and transport corridor, which has long been coveted by Azerbaijan but which Armenia and Iran are dead against.

The Zangezur Corridor, which is an Azeri nomenclature, not recognised by Armenia, is an overland 32 kms long transport corridor through landlocked Armenia that Azerbaijan would like to have, which would connect it to the Azerbaijani exclave of Nakhichevan in western Armenia and through it onward to Türkiye.

The corridor would cut through Armenia’s southernmost province of Syuni which borders Iran’s Azeri province in the north. Azerbaijan has been pushing for this corridor for some time, and with its victory in Karabakh, has been aggressively pursuing this objective.

Corridor or Sovereignty Violation?

The agreement reached between the two Southern Caucasian neighbours at the end of the 2020 war had provided for land access for Azerbaijan to the Azeri enclave of Nakhichevan in Western Armenia, on the border with Turkey.

While Armenia interprets this as opening up a road access, Azerbaijan wants it to be a “corridor” without any Armenian customs or border control over it.  Armenia interprets this as a violation of its sovereignty.

As a landlocked country unlocking transport and trade corridors is very important for Armenia. 

It understands that it stands at the crossroads of major trade corridors—the Middle Corridor, the International North South Transport Corridor (INSTC), the Belt and Road Initiative, and aspires to take advantage of its geostrategic location for geo-economic gains.

To that end, Prime Minister Nikol Pashinyan has unveiled an ambitious plan to make to make Armenia the "Cross-roads of Peace", that is a connectivity hub for countries in the region and beyond.

Transport and trade corridors would be able to connect Eastern Europe and the Mediterranean with Central Asia, South Asia and the Indian Ocean. All this, however, would take place with full Armenian control and sovereignty over it. Hence, the corridor as currently envisaged by Azerbaijan and Türkiye, and tacitly even by Russia whose soldiers guard the country’s borders with Iran and Türkiye, is unacceptable for it.

Turkish, Iranian and Russian Stakes in the Corridor

Azerbaijan is supported in this pursuit by Turkey as it would give the latter direct land access to Azerbaijan, Iran, and further to the Caspian Sea and the Central Asian countries. Iran sees this as a threat because, if implemented, the corridor can cut off Iran’s access to Armenia and further to Georgia, and the Black Sea, as well as to Russia.

The corridor would also enable the quick and easy transportation of Turkish arms and troops to Azerbaijan in case yet another war breaks out in the region, something that neither Iran nor Armenia can allow.

It is also here, that Azerbaijani irredentist claims on Iran’s Azerbaijan region can be actualised.

With its recent war with Israel and the US, Iran's long-held belief that Israel uses Azerbaijan's territory as a base from where to spy on and gather intelligence on it, has been further bolstered by the war.

For Russia the corridor would allow it to regain some of the leverage and strategic space it lost with the Karabakh war as its peacekeeping troops had to leave the region. Russia also owns and controls some infrastructure in Armenia, like the railways. Armenia further ordered out the Russian troops that patrolled the Armenia-Azerbaijan border. The corridor would also allow it seamless passage to Iran and Türkiye.

The American Proposal and Armenian Uncertainty

An American involvement now would further feed into Iran’s security concerns, while enabling greater Turkish and Israeli access to the region. It would also complicate matters for sanctions-hit Russia, for whom greater NATO penetration would be unacceptable. It still maintains a military base in Armenia. That, however, is what strategists and policy makers have called for.

According to US Ambassador to Türkiye Tom Barrack, the US proposes that a private company finance the construction of roads, railways, pipelines, and telecommunications networks and be granted temporary operational rights under the Build-Operate-Transfer (BOT) scheme for a hundred years.

Once the investment is recovered, ownership would revert to the Republic of Armenia. On 16 July during a long press conference, Prime Minister Pashinyan acknowledged that he had received such a proposal. The Turkish media has since been highlighting this and rumours have been gaining traction that Armenia is outsourcing the corridor.

These reports have started ringing alarm bells in Armenia and Pashinyan's office has rejected any such agreement that would forfeit Armenia's control over any part of its territory. Sources in Armenia, however, do concede that the country is under tremendous pressure to accept such a proposal, with scant resources, and internal political turmoil.

What Lies Ahead for India

Time will reveal what unfolds with the trade route but India should be prepared. As such, its interests in this particular case converges most of all with Iran's and Armenia's. 

India has woken up a trifle late to the potentials of the region.

Any physical blockade of Iran has the potential to disrupt India's connectivity aspirations through both the Chabahar port and the INSTC.

While India maybe in a position to use any US involvement in its favour it will also have to contend with a greater Turkish penetration in the region where it has just got a foothold in.

(The author is an award-winning journalist specialising on Eurasian affairs. This is an opinion piece and the views expressed above are the author’s own. The Quint neither endorses nor is responsible for the same.)