Executive Summary
This report assesses the recent meeting between the Armenian President and the Iranian Vice-President who focused their attention on the INSTC and bilateral economic cooperation.
It explores how infrastructure collaboration advances Tehran’s regional transport goals and bolsters Yerevan’s attempts to ensure dependable access routes despite geopolitical limitations.
The report also analyses the implications of Armenia’s growing alignment with the European Union and the United States, which may challenge Iran’s influence. Key risks stem from competing corridor initiatives, regional power rivalries, and shifting external engagements.
Key Takeaways
- Iran is leveraging the INSTC to entrench its influence in Armenia and secure its role in regional transport networks.
- Yerevan’s rising cooperation with Brussels and Washington creates new political variables that complicate Iran’s strategic calculations.
- The development of parallel Azerbaijani-Turkish corridors remain a direct threat to Iranian regional positioning.
Background Information
On August 4, 2025, Armenian President Khachaturyan held bilateral talks with Iranian Vice President Mohammad Reza Aref in Turkmenbashi, Turkmenistan, during a multilateral conference focused on landlocked developing states.
Armenia and Iran reiterated the importance of their partnership, referencing their history together and common goals for energy, infrastructure, and economic advancement. They especially emphasised the role of the Meghri-Kajaran section of the International North-South Transport Corridor (INSTC).
Khachaturyan underscored how vital the corridor is to regional connectivity and commended Iran for its efforts. The talks also included broader regional dynamics and underscored the significance of mutual respect and being good neighbours.
Geopolitical Scenario
Iran’s investment in Armenian infrastructure serves both strategic and defensive purposes. It bolsters Tehran’s aim of establishing a firm presence in the Eurasian connectivity thanks to the INSTC, which connects Russia and the Indian Ocean. The Meghri-Kajaran section enables Iran to exert influence in the South Caucasus and resist efforts to diminish its role in developing Eurasian transport networks.
Tehran has a particular interest in obstructing the development of the Zangezur Corridor, a transport route backed by Azerbaijan and Turkey. If implemented under Ankara and Baku’s control, it would bypass Iran, diminish its leverage in the region, and sever Armenia’s territorial cohesion. The imperative therefore shaped Iran’s activity in Meghri to maintain oversight of cross-border movements in the Syunik Province, a strategic area where different actors have interests to promote their transport corridors.
Armenia’s growing political and defence ties with the European Union and the United States add more complications. Recent EU monitoring deployments on Armenian territory and US-Armenia military training initiatives have raised Iranian concerns over a Western military and intelligence presence near its northern frontier. Tehran can interpret these events as an intrusion into its usual buffer zone and a threat to its sway over Yerevan’s important choices.
This shift in Armenian foreign policy orientation could limit Iran’s capacity to merge its position, particularly if Western actors provide Yerevan with alternative economic and logistical routes that bypass Iranian territory. Internal economic pressures, sanctions, and the risk of regional overextension constrain Iran’s ability to respond.
The European Union and Russia’s competition over Armenia and China’s increasing interest in infrastructure funding across the Caucasus further complicate Tehran’s strategic calculus.
Indicators to Monitor
- Announcements related to EU or US-funded infrastructure or defence cooperation in Armenia.
- Iranian officials’ statements or actions regarding foreign military or observer presence in southern Armenia.
- Implementation progress of the Zangezur Corridor or changes in its proposed jurisdiction.
- Trade volume shifts between Iran and Armenia following Western engagement.
- Reactions from Russia, the United States or the European Union regarding Tehran’s activity in Armenian infrastructure.
Conclusion
By partnering with Armenia on the Meghri-Kajaran section of the INSTC, Iran is purposefully working to ensure its continued regional access, economic relevance, and political influence. However, Yerevan’s increasing orientation towards the EU and the United States introduces new variables that could reduce Tehran’s leverage.
In the South Caucasus, infrastructure is now a major tool in geopolitical rivalry, the result of which will depend on how well the strategic priorities of regional and external actors are aligned. To determine the trajectory and resilience of these partnerships, it is fundamental to monitor infrastructure projects, foreign involvement, and regional and international actors’ reactions.
*Cover image: Armenian President Khachaturyan held bilateral talks with Iranian Vice President Mohammad Reza Aref in Turkmenbashi, Turkmenistan (Credits: CC BY-SA The Office of the President of the Republic of Armenia)
