On 8 August 2025, a landmark “Peace and Relations Agreement” was signed between Azerbaijan and Armenia in the presence of U.S. President Donald Trump, Azerbaijani President Ilham Aliyev, and Armenian Prime Minister Nikol Pashinyan.
This agreement marks a significant development that could reshape the economic, strategic, and security architecture of the South Caucasus. It contains provisions for bilateral cooperation, particularly in transport and transit, with implications for Russia’s role in the Caucasus and for China’s Belt and Road Initiative, which aims to connect Beijing to Europe.
The deal also carries major consequences for Iran — especially regarding its northwestern borders, Eurasian connectivity, and regional power projection.
Iran’s Longstanding Concerns over Zangezur
For years, Iran opposed the Zangezur Corridor, initially branding it the “Turan Corridor” — a term meant to highlight its perceived role in uniting the Turkic world. Iranian conservatives framed the project as a geopolitical threat, accusing academics, analysts, and journalists who supported it of being “Turanians.”
The term Turan literally means “Land of the Turks,” derived from the root word Turk combined with the suffix “-an” used for regions such as Turkestan and Azerbaijan. Tehran feared the corridor would foster Turkic geopolitical integration, linking Turkey with Central Asian republics, and later shifted its rhetoric to argue that the project would bring U.S. and NATO influence into the region.
Iran rejected regional solutions proposed by Turkey, Azerbaijan, and Armenia, as well as Russian attempts to mediate after the Second Karabakh War. Its obstructionist stance pushed other players to seek alternatives, gradually diminishing Iran’s influence in the Caucasus.
A Weakened Position
Several developments eroded Iran’s role in the region:
- Its opposition to Baku during the Second Karabakh War, which ended in Azerbaijan’s victory.
- The 12-day war with Israel and the strain on Iran’s regional allies.
- Armenia’s political realignment and Russia’s declining capacity in the Caucasus due to the war in Ukraine.
Against this backdrop, Tehran’s response to the U.S.-brokered peace deal exposed internal divisions.
- The Foreign Ministry cautiously welcomed the agreement as a contribution to peace, while warning against permanent foreign military or political presence in the region.
- Government spokeswoman Fatemeh Mohajerani insisted Iran’s core concerns were addressed, but rejected foreign military deployments. She dismissed conservative accusations of neglect, arguing that Zangezur represented only a small part of Iran’s border.
- By contrast, senior figures like Ali Akbar Velayati, chief adviser to Supreme Leader Ayatollah Khamenei, declared Zangezur would be a “graveyard for America,” vowing Iran would block the corridor with or without Russia.
- IRGC political deputy Yadollah Javani accused Aliyev and Pashinyan of “inviting America, Britain, and NATO into the Caucasus,” warning that regional powers would act jointly to stop it.
- Hardliners, such as Hossein Shariatmadari, editor of Kayhan, went as far as calling for the closure of the Strait of Hormuz in response.
President Masoud Pezeshkian, however, adopted a more measured stance. After visiting Yerevan on 19 August 2025, he secured assurances that the corridor would remain under Armenian sovereignty and that Iran’s land route to Europe would remain intact. Still, he flagged U.S. corporate involvement as a “serious concern.”
Iran and Armenia also signed 10 cooperation agreements, including building a second bridge over the Aras River and developing a railway link via Nakhchivan–Julfa, potentially giving Iran access to Armenia and the Black Sea.
Old and New Fears
Iran’s anxieties about Zangezur fall into two categories:
- Traditional fear: That it would physically connect Turkic states, laying the foundation for military and strategic cooperation within the “Turkic world.”
- New fear: That the corridor will allow the U.S. and NATO to entrench themselves in the Caucasus, threatening Iran’s national security.
With Azerbaijani-Iranian relations deteriorating, and given Tehran’s strained resources amid wars and sanctions, its ability to obstruct the project appears limited.
Three Likely Moves by Iran
- Joining the Project Instead of Blocking It
Iran may abandon obstruction and engage with the corridor as a stakeholder. Its previously proposed Aras Corridor could be revived as an extension of Zangezur, ensuring Tehran’s participation. - Leveraging China’s Position
Since China has yet to take a clear stance, Tehran may align with Beijing if Zangezur is framed as undermining the Belt and Road Initiative. A Chinese-Iranian front could complicate the project’s progress. - Supporting Alternative Routes
Iran may welcome Chinese–Russian cooperation to build corridors beyond U.S. influence. Yet Tehran fears a possible U.S.–Russia understanding, particularly after the Putin–Trump Alaska Summit, and notes Moscow’s preoccupation with Ukraine could limit its support.
While Iran could use proxy actors to destabilise the Caucasus, its domestic crises and regional pressures make this option unlikely in the near term.
