iran-armenia relations: geoplotitical reality versus political statements

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Iranian-Armenian Relations

Vusal GASIMLI Zaur SHIRIYEV

Zulfiyya VALIYEVA

BAKU 2011

geopolitical reality

political statements

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Iranian-Armenian Relationsgeopolitical reality political statements

Introduction ...................................................................................................................... 4

1. Iranian-Armenian political relations ............................................................................. 10

1.1. Iranian-Armenian political relations: Inverse proportionality of geopolitical reality

and doctrinal principles ............................................................................................... 10

1.2. The vital importance of Iran for Armenia ....................................................................... 18

1.3 “Strategic” importance of Armenia to Iran ..................................................................... 23

1.4. Iran’s position on the Nagorno-Karabakh conflict ......................................................... 26

2. Iranian-Armenian economic relations............................................................................ 28

2.1. Syndrome of “lack of electricity” in Iran ........................................................................ 30

2.2. Iran wants to transform Armenia into a gas corridor ...................................................... 32

2.3. Armenia is “a depot” for railways ............................................................................... 34

2.4. Iran helps Armenia even more through decreasing subsidies to its population .................. 36

2.5. “Black roads” to Armenia ............................................................................................ 36

Conclusion ......................................................................................................................... 38

Bibliography ...................................................................................................................... 42

CONTENTS

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Fundamental changes to the structure of international relations have laid the groundwork for a “new global order” in international affairs. These changes have made it necessary to adapt bilateral and multilateral state policies to handle the new challenges involved. The Caucasus-Caspian Sea region, in the geo-political centre of post-Soviet territory, has become an integral part of this new dynamic, which has been in play since the 1990s, running in line with the classic rules of global policy.

From this point of view, restoration of independence in the South Caucasian countries and transformation from the “old system” to a new global order have resulted in war, loss of territories and the prevalence of aggressive separatism, and the emergence of the power represented by Armenia hedging the establishment of stability in the entire region.

The collapse of the Soviet Union opened up new opportunities and pos-sibilities for the Islamic Republic of Iran, which has deep historical and cultural links with the South Caucasus, to pursue a pragmatic foreign policy. After the Islamic revolution in 1979, Tehran, rejected by the West, had the opportunity to develop its policy in line with the Muslim countries of the former USSR, and in accordance with the ideology of Islamic revolution. While the new environment of the geo-political reality of the 1990s offered new opportu-nities to Iran, it was a difficult climate for

the South Caucasian countries. This gave rise to new opportunities and at the same time challenges considering the historical bonds in the example of Azerbaijan. The idea of taking cultural, racial and historical affinity as essential was prevailing, while determining foreign political and associa-tive relations in the Southern Caucasus states restoring their independence in the “new global order.” In this context, Iran was one of the states, which had to become a natural ally of the Republic of Azerbaijan after the collapse of the Soviet Union be-cause of the foreign political interests and geopolitical reality of Iran.

Whereas formulating its foreign policy from the background of national interests since 1970, Iran had also defined political targets and strategies serving these inter-ests1. As part of a new foreign policy target-ing “leadership in the Islamic front,” this strategic approach was reflected in the con-stitution of Iran2. Although Iran was claim-ing, during the Soviet period, to follow a more pragmatic foreign policy and those ideological approaches were not part of its national interests, today Tehran states that “the aim of Shiah ideology is to strengthen Islamic union.”3 The ideological approach 1 Tensions in Iran’s National Security Strategy http://reut-institute.org/en/Publication.aspx?PublicationId=17692 According to the article 11 of the constitution of Iran, “All Muslims are one nation. The Islamic Republic of Iran shall try to ensure political, economic and cultural unity of the Islamic world”. See: http://www.servat.unibe.ch/icl/ir00000_.html 3 See: http://www.shiitenews.com/index.php?option=com_ content&view=article&id=2406:hia-ideology-seeks-to-cre-ate-muslim-unity-&catid=58:iran&Itemid=27

Introduction

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geopolitical reality political statements

of Iran supported by religion has been re-flected in the “clash of civilizations” theory of the famous scientist in the field of inter-national relations Samuel Huntington. He writes, “Countries will tend to support the ones having similar culture, and protect the balance with the countries with differ-ent culture.”4

While Huntington’s ideas do not mirror existing realities at this point, it is true that Iran has made efforts to project a positive national image on the international stage, with peaceful claims such as “innovation”, “ally of cultures” in its foreign policy un-der the leadership of Seyed Mohammad Khatami, the president of Iran, who won the 1997 elections.

However, even though after the col-lapse of the Eastern block and the Soviet Union, Iran’s policy toward this region re-flected the elements supporting “Muslim solidarity,” it displayed dualism as well. In particular, Tehran, which took over the role of a protector of Muslims in the terri-tory of the former Yugoslavia, secretly sup-ported Muslim peoples living there to gain independence. With the visit of the leader of Bosnian Muslims, Aliya Izetbegovic, to Tehran in 1991, Iran’s Balkan policy was soon accompanied with financial and weapon assistance provided to the coun-try. According to the facts disclosed by the U.S. Congress5 and confirmed by Serbian 4 Huntington, Samuel (2006), The Clash of Civilizations and the Remaking of World Order (Medeniyetler Çatışması ve Yeni Dünya Düzeninin Yeniden Kurulması”), Okuyanus Yayınları, p.268.5 For detailed information see: “Clinton-Approved Iranian Arms Transfers Help Turn Bosnia into Militant Islamic Base,

sources6, Iran has demonstrated material and moral assistance to Muslims of this re-gion with limited resources.

Unlike in the Balkans, Iran’s actions demonstrating support to Muslims of the Soviet Union, which defined its South Caucasus policy through Moscow until the 90s, were exceptionally few during this period. Its main reason was discouraging the Soviet Union from giving political sup-port to opponents of Iran’s regime; thou-sands of people, in particular members of the “Tude” party, were accused with dis-semination of communist ideology and were sentenced in the first stage of the Is-lamic revolution (1979-1983).7 On the eve of the Nagorno-Karabakh war that started with Armenia’s aggressive policy in the South Caucasus neighbouring Iran, the policy of this state against Muslims was quite contradictory. Thus, unlike in the Balkans, by closing its eyes to the ex-ecution of Muslims by Armenians during the war and normalizing its relations with Armenia, Iran demonstrated a double standard and a gap in its foreign policy that was supported by ideological founda-tions, since in reality, the ideology of the Iranian state was established on the policy of protection of Muslims and ensuring the sustainability of security. When viewed as Congressional Press Release”, U.S. Congress, 16 January 1997; Serb leader: U.S. helped Iran arm Bosnians, http://www.milit-arytimes. com/news/2009/08/ap_us_arms_bosnia_082609/ 6 Yossef Bodansky and Vaughn S. Forrest, Iran’s European Springboard?, September 1, 1992, http://www.srpska-mreza. com/Bosnia/bodansky1.html7 Akdevelioğlu, Atay, “İran İslam Cumhuriyeti’nin Orta Asya ve Azerbaycan Politikaları”, Uluslararası İlişkiler, Cilt 1, Sayı 2 (Yaz 2004), p. 132

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destroying the historical Islamic cultural heritage besides the murder of Muslims in the conflict of Nagorno-Karabakh, the sit-uation becomes even sadder. If Iran did not support the aggressive policy of Armenia and instead demonstrate fidelity to their principles, it would be enough for Azerbai-jan, which needed Iran’s material and mor-al support during that period. The confus-ing pro-Armenian position of Tehran was reflected even in the articles of foreign experts. In the writings of these experts studying Iran, it was noted that Iran sup-ported Armenia during the conflict over Nagorno-Karabakh and wished Azerbai-jan to weaken.8 At the same time, foreign experts drew the serious conclusion that during the war of Nagorno-Karabakh, peo-ple, who were forced to seek asylum in Iran through the Araz River, were faced with the serious danger of a humanitarian cri-ses.9 This situation and the fighting going on around the Nakhchivan enclave in Sep-tember 1993 were directly connected with approximately 200 thousand people from Nagorno-Karabakh being forced to flee to the Iranian border.10 After these events, there were sharp statements from Iran’s ruling regime against Armenia’s policy, protest actions were held in front of the Ar-

8 Iran’s Security Policy in the Post-Revolutionary Era, Impact on Foreign Policy, RAND Report, 2001, http://www.rand.org/ pubs/monograph_reports/MR1320/MR1320.ch6.pdf9 Olivier Roy, “The Iranian Foreign Policy Toward Central Asia”, http://www.eurasianet.org/resource/regional/royoniran.html10 Abdollah Ramezanzadeh,Iran’s Role as Mediator in the Nagorno-Karabakh Crisis, Bruno Coppieters (ed), Contested Borders in the Caucasus, Chapter II, VUB University Press, 1996, p. 66

menian embassy in Tehran, and materials were published in printing houses such as “Cahane Islam” with the demand to freeze relations in all spheres with Yerevan.11 As the result of Armenia’s occupation of Na-gorno-Karabakh, the historical territory of Azerbaijan, the artificial Iranian-Armenian border was formed in an uncontrolled ar-eas not regulated by law.

Iran’s tacit support of Armenia’s ac-tions in Nagorno-Karabakh casts doubt on the doctrinal suggestions and prin-ciples in Iran’s foreign policy. Thus, “en-suring solidarity with Islamic countries” considered as doctrine has been ironically characterized as “closing its eyes” to the occupation of a Muslim country’s lands. While taking into account that there is a lack of necessary infrastructure to meet energy demand of the population living in the northern regions of Iran, it is clear that efforts made to develop relations with Armenia in this field were not suc-cessful. In general, Iran’s foreign policy, far from pragmatic until the 90s, resulted in the formation of relations with allies that did not meet the interests of Teh-ran, and moving away from large-scale projects having direct impact on its fu-ture. Staying outside of the Baku-Tbiisi-Ceyhan (BTC) pipeline and the projects of the Transport Corridor for Europe-Caucasus-Asia (TRACECA) connecting Central Asia through Turkey with Europe was relevant neither to pragmatism, nor to the national interests of Tehran.

11 Also there, p.67

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Taking the aforementioned into ac-count, one can see, that even though the foreign policy course of Iran in the 90s was sometimes disastrous, Tehran and Ye-revan shared a special relationship, more as a good opportunity in the background of unfavorable affairs with other neigh-bors. For instance, after the signed cease-fire agreement on Nagorno-Karabakh in 1994, one can see increased efforts from the West, specifically the U.S., in regard to Armenia’s place in a western security orbit. To be precise, there was an idea that after the 90s Armenia was about to move away politically from Russia’s sphere of influ-ence closer to Turkey, as well as the West. Even though there was a thought that Ar-menia would not make this choice because of its closeness to Russia, the factor of Iran was forgotten. Thus, since the 90s the rea-son of Armenia to become independent from the West (Turkey) was the existence of an Iran alternative. 12And in this context, it was clear that Turkey was the only coun-try that could limit regional strength and leadership claims of Iran.

The relations with Iran were of key im-portance for Armenia and were providing the following:

- Strategic – the opportunity to escape isolation in the region as a result of its ag-gressive policy;

- Geographical – the chance to have ac-cess to the seas;

12 Nikolay Hovhannisyan, “Hayasdane Anderkafkasyan-Mercavor Arevelyan Aflharhakagakagan Darazaflercani Gorzon”,The Countries and Peoples of The Near and Middle East XVIII, Yerevan, 1999, p. 16-39.

- Geopolitical – the opportunity to en-sure neutrality by separating Iran from Azerbaijan.

From the view of historical develop-ment, Armenia having closer relations with Iran coincides with the period of the U.S. intervention into Afghanistan through anti-terrorist operations in 2001 and the August war between Russia and Georgia in 2008. If Iran was acting as the party most interested in the development of relations after the year 2001, Georgia, which was for years the support point of Armenia with Russia in its “self-isolation” policy, played an important role through changing the geopolitical reality after the August war in 2008. An examination of the trade turnover between Iran and Armenia, shows that even though Armenian exports to Iran stay stable, an increase has been observed in the investments Iran made to Armenia. Looking at the events happening that relate to Iran from Azerbaijan, which declared neutrality in regard to military ac-tions regarding Iran and Turkey, supported Iran for its policy and blocked NATO’s strategic concept to use Iran as a threat, from this perspective Iran-Armenian rela-tions are not optimistic. And when Turkey protected the use of nuclear energy by Iran for peaceful purposes through its inter-mediary role at negotiations between the West and Iran, even by blocking the indi-cation of Iran by the West as an element of threat through open diplomatic fighting at the adoption of the new NATO strategic concept.

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When taking these serious steps, Tur-key faced negative reaction in the West13. In response, the vice-president of Iran Hamid Bagai labeled the events of 1915 as “genocide” in its statement of August 201014, and this, of course, was contradict-

ing the efforts of Ankara to establish peace in the region. Even though since the 90s Iran has been accepting Turkey as a com-petitor and Azerbaijan as a danger in the region, it needs these countries. And even if Armenia pretends, in its turn, to imple-ment a complementary foreign policy, it openly obtained the status of outpost of Russia, which is not a pleasant image for a sovereign state. Some Armenian experts characterize Armenian-Russian relations

13 In his newspaper article in the “New-York Times”, Thomas Friedman criticised these relations in a sharp form and used the expression “as ugly as it gets”. Role of liberal, democratic Turkey in these relations was not welcomed by the West. See: Thomas Friedman, As Ugly as It Gets, New York Times, 26 may 2010 http://www.nytimes.com/2010/05/26/opinion/26friedman. html?hp=&pagewanted=print# 14 Iran-Armenia relations and the ‘genocide’, http://www.hurriyetdailynews.com/n.php?n=iran-armenia-relations-and-the-8216genocide8217-2010-08-29

as declining from partnership to a position of dependent15.

Today there is a new trend in Iranian-Armenian political relations. Iran’s officials and former civil servants frequently make statements to support the development of Iranian-Armenian relations. In these state-ments there is anxiety, in particular, about the arms build-up in the region and the risk that the Azerbaijan-Armenian conflict will result in a new war. In statements made by a third party, there are accusations against Azerbaijan for developing its military in-dustry.16

At this point, the economic aspects of the development of Iranian-Armenian re-lations generate interest. However, it is im-possible to explain shared economic effi-ciency as the reason for political relations. The share of Iran’s exports to Armenia is less than 0, 05% of their gross domestic product (GDP). So, the importance of the Armenian market for the Iranian economy is about 0.05, i.e. it does not have statistical importance. These bilateral relations are vital for Armenia. Undoubtedly, it raises questions about the efficiency of Iran’s investment interests in Armenia with the smallest economy in the world ranking at 30th place for its internal market and 10th place for its foreign market.

Thus, taking all these into account, it 15 Minassian, Gaidz, 2008. Armenia, a Russian Outpost in the Caucasus?Russie.Nei.Visions, No.27, 15 February, 2006, http://www.ifri.org/files/Russie/ifri_RNV_minassian_Armenie_Russie_ANG _fevr2008.pdf p.1316 Former Iranian Ambassador to Armenia: Azerbaijan ap-peared in isolation, Panarmenian, 09 September 2011, http://www.panorama.am/en/politics/2011/02/09/ ambassador-iran/

And even if Armenia pretends, in its turn, to implement a comple-mentary foreign policy, it openly obtained the status of outpost of

Russia, which is not a pleasant im-age for a sovereign state.

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is possible to evaluate according to their development speed and adaption of bilat-eral relations to clearly benefit economic relations - Iranian-Armenian relations have had three stages: 1991-2001, 2001-2008 and the period after 2008 .

In this short evaluation, the Iranian-Ar-menian relations will be approached from geopolitical and economic perspectives, and will focus on the question “Which party wins, and which loses,” as well as, on the failure of “complementarizm” in the foreign policy of Armenia and inefficiency of trade relations between the countries.

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The above mentioned analyses of rela-tions between Iran and Armenia clearly show that these relations are formed not on the basis of strategic interests, but as a response to events happening in the re-gion. Thus, the new geopolitical reality that emerged after the collapse of the So-viet Union opened short and long-term strategic opportunities for the Islamic Republic of Iran to ensure security and to emerge from isolation. Thus, during the Soviet Union, the evaluation of commu-nism and export its Islamic revolution by Tehran, contributed to forming its policy towards South Caucasus over Moscow, and as Moscow as a threat to their secu-rity, created conditions for development of their relations in the environment of “sen-sitive security”.

Even though new opportunities were created for the pursuit of a pragmatic pol-icy by Iran with post-communist realities changing since the beginning of 90s, the “Iranian model” of these opportunities, i.e. the export of political Islam in the Central Asia-Caucasus region, was evaluated as a threat by the West. From the strategic view, the damage in the amount of 160 billion17 USD done to both parties in the war with Iraq made it necessary for Iran to develop

17 CIA Analysis, Iran’s economy: a survey of its decline, (1991), http://www.foia.cia.gov/, p iii.

trade relations with the recently indepen-dent South Caucasus countries in order to normalize its economic situation. And be-sides preventing the interference of third parties in the region and facing a complex and changing foreign environment from the security point of view, Iran prioritized emerging from isolation by filling power gaps arising in the South Caucasus. At the same time, some political powers in Iran evaluated the new geopolitical envi-ronment as “chauvinistic,” considered the South Caucasus as “a region occupied by Russia and departed from Iran” and had thoughts that this region would again be under the influence of Iran.18 In addition, the expression “Irane bozorg” reminiscent of the mighty Persian emperorship, has again become one of the most used terms in today’s press. The study of Iranian-Ar-menian relations from the perspective of the 90s gives rise to an idea of “doctrines” and “principles” in the foreign policy of both countries to be directed with the in-terference of third parties.19

While dividing the relations between the two countries into three stages, we can see a direct correlation between the

18 Abdollah Ramezanzadeh, mentioned work, p.6819 Fred Halliday, “Condemned to React, Unable to Influence: Iran and Transcaucasia”, John F. R. Wright, Suzanne Golden-berg, Richard Schofield (der.), Transcasucasian Boundaries, New York, St. Martin’s Press, 1996, pp. 71-88

1. Iranian-Armenian political relations1.1. Iranian-Armenian political relations: Inverse proportionality of geopolitical reality and doctrinal principles

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development dynamics and regression of these relations and the interventions by the West and Russia. From this context, the first stage of Iranian-Armenian rela-tions covers the years of 1991-2001. In particular the Nagorno-Karabakh con-flict and Iran’s relations with Russia and the West can be considered the determi-nants influencing the relations between the two countries in this stage. Also Iran considered the interests of the West in the region’s energy resources and its willing-ness to develop relations with the South Caucasus countries as a potential danger for its national security. Notwithstanding its irredentist policy starting with the oc-cupation of Nagorno-Karabakh, Armenia received from the West necessary finan-cial aid, and, thanks to the activity of the Armenian Diaspora in the United States, even prevented issuance of the financial aid allocated for Azerbaijan within the “ Freedom Support Act.” 20In this context, the formulation of Iranian-Armenian rela-tions and its dynamic development gave rise to an idea that the ideological prin-ciples in the national security and foreign policy of Tehran are contradicting each other, and there is even a disparity in the approach itself which is on two opposing poles. Thus, as to the conclusions of par-ties claiming that national interests are prioritized in Iran’s foreign policy instead

20 The Freedom Support Act of 1992 (Freedom for Russia and Emerging Eurasian Democracies and Open Markets Sup-port Act [1], FSA, HR 282) is an act passed by the United States Congress. It is not to be confused with the Iran Freedom and Support Act of 2005 (S 333).

of ideological principles, there is reason to state that Tehran cannot meet national interests, because Armenia receives more support from the West, and follows an aggressive policy. In the geopolitical re-ality of the 90s, according to the parties claiming that Iran follows a foreign policy that is based on religious ideology, the oc-cupation of the territories of Azerbaijan, which is the only Muslim country in the South Caucasus, the destruction of the cultural heritage of Muslims and violence perpetrated against them contrasted with the Islam religion and its cohesive role in Iran’s foreign policy.

The abovementioned shows that the ar-guments of parties, which have been used in describing the dynamic development of the Iranian-Armenian relations, are weak. The support for these two countries’ rela-tions corresponds to the following geopo-litical interests:1. Efforts to balance the relations develop-

ing between Turkey and Azerbaijan;2. Fight against the increase of the West’s

activity on the ground of economic in-terests in the South Caucasus region;

3. Vision of Tehran to use on the global stage the Armenian lobby against the Jewish lobby in the United States;

4. Vision of Tehran to get a chance to in-crease its political power in the region through using the policy of Armenia against Turkey and Azerbaijan;

5. The prolongation and lack of a solution in the Nagorno-Karabakh conflict are

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hampering the efforts of Turkey and Azerbaijan to permanently deal with this issue and to strengthen their role in the region.During this stage, economic relations

with Iran were of significant importance for Armenia. In the Nagorno-Karabakh conflict, Tehran demonstrated political “will” in the direction preferred by Arme-nia. The diplomatic relations between the two countries started with Iran’s recogni-tion of the independence of Armenia on 25 December 1991. Iran demonstrated po-litical support for Armenia and took over the role of the second biggest protector of this country after Russia.

The actions taken by Armenia were

an incentive for the development of rela-tions at the initial stage. Thus, on 9 Feb-ruary 1992 a delegation headed by the Armenian Minister of Foreign Affairs Rafi

Hovanisyan, visited Tehran and two weeks later a delegation under the leadership of Iranian Minister of Foreign Affairs Vilay-eti visited Yerevan. Official meetings were held, and the first steps were taken in the field of diplomatic relations. In Novem-ber 1992, the Commission for Develop-ment of Armenian-Iranian Relations was established in Yerevan with the Decree signed by the President of Armenia Le-von Ter-Petrossian. In order to increase the efficiency of this entity, a forum of Iranian and Armenian businessmen was established under the Iranian-Armenian Chamber of Commerce which managed by Levon Aharonyan, an Iranian Arme-nian. The main objective of both entities was to prevent the increase of Turkey’s

activity in the region, and the growth of Azerbaijan’s economic potential.21 In or-

21 Iran’s Security Policy in the Post-Revolutionary Era, Impact on Foreign Policy, RAND Report, 2001, http://www.rand.org/ pubs/monograph_reports/MR1320/MR1320.ch6.pdf

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der to strengthen this political objective, a bridge was constructed over the Aras River as the main link for trade between the two countries. This bridge saved Armenians from economic isolation during the Na-gorno-Karabakh war. Later, the construc-tion of the Mehri-Gacharan tunnel and a bridge over the Aras River were projected as an indicator of the development of re-lations between the two countries, and in 1996 they were put into operation with the financial support of the Australian Arme-nians.22 The main indicator of the rapid de-velopment of bilateral relations was when Iran took first place in trade relations with Armenia. Iran, who anxiously faced U.S. support in the construction23 of the Baku-Tbilisi-Ceyhan oil pipeline, stayed outside of regional projects because of its fears. Notwithstanding all these, through giving shares in the “Shahdeniz” project, Azerbai-jan still tried to develop bilateral relations with Iran and to help to normalize relations of Tehran with the West. The main specific feature of this period was the development of the Iranian-Armenian relations, which were based on Iran-Russia relations.

The second stage in the Iranian-Arme-nian relations covers the years of 2001-2008. In this period the interest of the West in the South Caucasus increased in the con-text of the international/U.S. fight against terrorism, and in its turn, this was an incen-tive in the integration of regional countries to the West. One of the main elements of

22 Also there, p.1223 Svante E. Cornell, “Iran and the Caucasus”, Middle East Policy (Jan 1998, v5, n4), p. 59

the Iranian foreign policy in this period was in respect to outside interference and for-eign intervention in regional affairs, includ-ing the issue of regional security. In 2001, there was tension in bilateral relations with Iran’s intervention into the Azerbaijani Cas-pian sector. During that period Armenia fixed the speed of the development of its relations with Iran relative to Russian-U.S.

relations. The development of Russian-U.S. relations in the field of anti-terrorism im-pacted negatively the relations of Armenia with Iran. Thus, it drew special attention in 2002 when the U.S. State Department im-posed sanctions24 on Armenia accusing it of selling chemical equipment to Iran, and the Government of Armenia took a step back.25 Armenia drew back immediately as a result 24 US imposes sanctions on Armenian entities, 5/9/2002,http:// www.nti.org/db/nisprofs/armenia/excondev.htm25 Armenia: Westward Foreign-Policy Shift Brings Unease in Iran http://www.eurasianet.org/departments/insight/articles/ eav100502.shtml

Ambassador of Iran in Yerevan Mohammed Fahrad Koleyni stated to the former Minister of Foreign Affairs of Armenia Vardan Oskanyan, “Don’t you think it would be more correct to use the word “multilateral relations” in-stead of “complementarizm” when describing your foreign policy?”

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of the pressure, and put in danger its “effec-tive relations. Namely after this event, the Ambassador of Iran in Yerevan Mohammed Fahrad Koleyni stated to the former Min-ister of Foreign Affairs of Armenia Vardan Oskanyan, “Don’t you think it would be more correct to use the word “multilateral relations” instead of “complementarizm” when describing your foreign policy?”26 As seen, Tehran understood that not Armenia, but Russia was the party defining the strat-egy in its “strategic” relations since 2001.

However, since 2004 the transforma-tion of the Baku-Tbilisi-Ceyhan project from “a legend into reality” stimulated the development of Iranian-Armenian rela-tions. On 26 May 2005, the Prime Minis-ter Andranik Margaryan explained in his interview with the press in the Armenian parliament that the Baku-Tbilisi-Ceyhan pipeline shattered the balance of power

26 Also there

in the region, that Armenia was looking for alternative ways to balance this power in the South Caucasus and that it would evaluate the Iranian-Armenian natural gas pipeline as an alternative project.27 Obvi-ously, the reason for Iranian-Armenian re-lations to get closer and to develop more rapidly since 2004 was based on having a “joint fight” against the increase of Azer-baijan’s economic power in the region.

Notwithstanding the steps taken in this “joint fight” between the parties, Russia

kept its means to neutralize the impact of Iran over Armenia. The impact of Moscow over Armenia was in two forms.

1. The cooperation developing between the two countries in the field of energy with the participation and control of the Russian “Gasprom” as the most obvious example demonstrating that Iranian-Ar-

27 Nana PETROSYAN, ‘Bakü-Tiflis-Ceyhan Bölgede Güç Den-gesini Bozuyor’, http://www.azg.am/&num=2005052604

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menian relations are not based on inde-pendent foreign policy28. According to the energy agreement between Iran and Arme-nia signed in 2004, the total project value was fixed in the amount of 120 million USD. But at the completion of the pipeline the financial value of the project reached 220 million USD. In addition, Iran was ex-pecting to export to Armenia 36 billion cu-bic meters of natural gas. With a length of 141 kilometres, 41 kilometers of the pipe-line would be constructed within the bor-ders of Armenia and Iran would allocate to Armenia a loan of 30 million USD. Then President of Armenia Robert Kocharyan, who could not get a positive response from Moscow when the project was in the fore-front, decreased the diameter of the pipe to be constructed from 1400 mm to 700 mm, which diminished its economic efficiency for Armenia. Thus, Armenia was deprived

28 Kaweh Sadegh-Zadeh, Iran’s Strategy in the South Cauca-sus, Caucasian Review of International Affairs Vol. 2 (1) – Win-ter 2008 , p. 37.

of the opportunity to sell natural gas of Iran to markets of third countries, and lim-ited itself with appreciating the natural gas it got in electricity generation.

2. The increase of Armenia’s economic dependence on Russia, in other words, “Kaliningradation”29 of Armenia gave Russia the opportunity to manage at will the speed of development of the Iranian-Armenian relations. In particular, the main sectors of the Armenian economy passed to the supervision of Russia since it gave or sold to the latter the economic properties of strategic importance at a low price as a result of Russia’s demand to pay back the debts.30 The absolute major-ity of properties purchased by Russia with

29 Even though Kalinigrad is the territory of Russia, it does not have any geographical relation with it. Here “kalinigra-dation” is used not as a geographical adherence, but in the meaning of “owning”. 30 Danielyan, Emily. “Russia Tightens Grip on Armenia with Debt Agreements.” Eurasianet.org. 6 May 2003. http://www.eurasianet.org/departments/ business/articles/eav050703.shtml.

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big promises have never been put into op-eration. These are mainly mobile commu-nication operators, gas and power distri-bution networks and banks which refer to the production sphere. It should be noted that the U.S. aid to Armenia was 1.6 bil-lion USD during 1992-1995 in contrast to Russia owning strategic properties in

return for the debt in the amount of 93 million USD. At the same time, there was no decrease in the aid provided by Washington and the achievement of eco-nomic efficiency was not considered as a priority in answer to that31. Thus, Mos-cow demonstrated that Armenia’s policy, which claimed to be “independent” and mutual with Iran and other countries, was in reality under the supervision of Rus-sia. And at the same time, even though the use of new Nuclear Power Station was

31 Mainville Michael. “Second-Largest Recipients of U.S. Aid, Armenians Fight To Get Ahead - August 9, 2005”. The New York Sun. 9 Aug. 2005

planned for 2017 with the development of the “Mezamor” Nuclear Power Sta-tion (NPS) and signature of the second agreement with Russia, there was another unsuccessful attack on Yerevan’s plans to use nuclear power in the region that Iran could not obtain for the time being. The Armenian experts note with irony that

the management of the planet of Mars de-pends on the management of Mezamor.32 These indicators and the trade volume be-tween Iran and Armenia let to state that Russia was the most winning party in an-swer to financial aids and investments of Iran.

The third period in the Armenian-Ira-nian relations covers the period after the year 2008. In August 2008, the incident of

32 Alkhazashvili, M. “TBILISI: IAEA Chief Visits Armenian Nu-clear Power Plant Metsamor”. Armenian News for Diaspora. 3 Aug. 2005. 09 Nov. 2010. http://www.armeniandiaspora. com/showthread.php?33864-TBILISIIAEA-chief-visits-Armenian-nuclear-power-plant-Metsamor.

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the Russian-Georgian war increased Iran’s importance for Armenia and its economic interest primarily.

In particular, recognizing the indepen-dence of Abkhazia and South Ossetia and stopping peacemaking operations, Russia changed the vector of its military power; as a result the relations of Tbilisi with Moscow were complicated. This, first of all, resulted in the closure of the Georgian “door,” which is the only way out for Arme-nia. Namely, the start of the Turkish-Ar-menian normalizing process was directly connected with the plan of Yerevan to get free from the “geopolitical pincers” and try to prevent the impact of the global eco-nomic crises through foreign investments in the country. It should be noted that the loss of the efficiency of Armenia’s econo-my since 2000 has resulted in a generation of shadow economy and its concentration in the hands of 44 oligarch families.33 One of the results of the global economic cri-ses is the increase in poverty in Armenia’s population. Even though the official fig-ures presented by Armenia show that it in-cludes 25% of the population,34 according to calculations of the World Bank, it covers more than 50% of the population.35 As a

33 Khachatrian, Haroutiun. “Competitive Edge: The pitfalls of monopolies, and the challenges of a business influenced parliament”. ArmeniaNow.com. 04 Jan. 2008. http://www.armenianow.com/special_issues/agbumag/8033/ competi-tive_edge_the_pitfalls_of_m.34 Griffin, Kieth, Thomas Kelley, Terry McKinley, Bargat Asa-tryan, Levon Barkhudaryan, and Armen Yeghriazarian. Growth, Poverty, and Inequality in Armenia. Rep. United Nations De-velopment Programme, 2002. Print.35 “Armenia Data”. Data of the World Bank. Web. 29 Nov. 2010. <http://data.worldbank.org/country/armenia>.

result of the failure in economic policy, the share of Armenia’s foreign trade deficit to GDP was 20%.

Iran, which did not achieve the expect-ed results in Iranian-Armenian relations and whose plans to get political power over Yerevan through economic support were unsuccessful stepped into a new “quality” stage in its relations with Yerevan. In this stage, the efforts of Iranian officials to dem-onstrate political support to Yerevan with

their statements36 and speeches, which clearly for political gain, geopolitical ben-efit perspective, are seen as uncertain in the foreground.

It is clear that Tehran gains neither po-litical, nor economic profit in return for lack of mutual economic efficiency in the relations between the two countries in the present stage, and it’s mainly benefitting Yerevan. However, the conflicting issues arising from growing interests of big pow-ers in the region strengthened this cooper-ation. The Karabakh problem and the mag-nitude of the national revival movement 36 These statements are outburst of interference into inter-nal affairs of Azerbaijan. See: Former Iranian Ambassador to Armenia: Azerbaijan appeared in isolation http://www. pan-orama.am/en/politics /2011/02/09/ ambassador-iran/; Azer-baijan’s accumulation of weapons unpleasant, Iranian ambas-sador says http://news.am/eng/news/47316.html

The Armenian experts note with irony that the management of the planet of Mars depends on the management of Mezamor.

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among Azerbaijanis in the south made Iran and Armenia strategic partners. Thus, Iran strengthens Armenia with economic and political steps taken in the South Caucasus and sacrifices its relations with Azerbaijan for this policy.

At the same time, in this “new stage,” the Armenian and Iranian officials try to gloss over religious difference of Persians and Armenians in their speeches about his-torical affinity. In this respect, in February 2011, the congratulations by the Armenian Patriarch Sibve Sargsyah on the 32nd anni-versary of the Islamic revolution in Iran attracted attention.37 It is known that reli-gion is the key factor in the formation of a nation. Nations feel affinity to each other not only because of their racial features, but mainly for the community of religious belonging. In this context, the Islamic reli-gion is the main factor uniting Turks and Persians in the power of Muslim Turks who ruled the state of Iran periodically. When taking all these points into account, in order to clarify the relations serving new bilateral benefits, there is a need to analyze how both parties see the relations from the perspective of geopolitical importance.

1.2. The vital importance of Iran for Armenia

In light of economic difficulties faced in respect to the non-constructive policy pursued in the region, the gap of doctrinal principles in Yerevan’s foreign policy, and 37 Tehran Armenian patriarch felicitates supreme leader and president, 8/2/2011 Islamic Republic News Agency/IRNA NewsCode: 30232861

contradictions in the practical application of theoretical principles are obvious.

Armenia appears to be a “weak state”38 in respect to following principles and doc-trinal inspiration in their foreign policy. After gaining independence, there were efforts to follow Western-Russian interests on the one hand, and relations were regu-lated with the regional countries such as Iran, on the other. However, the absence of the “complementarism” policy of Yerevan, which became gradually the “orbit” of Rus-sia through selling its state property, was clear in 2003. Meanwhile, even though the geopolitical features that create Armenia’s “blockade-like-feeling from geographical and political sides increase its fears, it can-not provide the necessary means to protect itself. Yerevan, which is afraid of its neigh-bours with its fears rapidly becoming a “phobia,” accepts non-hostile countries as competitors, and this increasingly works against Armenia. Thus, Armenia in this situation openly falls under the influence of, first of all, the Russian and Armenian Diaspora and other actors. It is possible to state that Armenia, whose geographical position cannot be changed, is more anx-ious about feeling it inevitably must take defensive and foreign political decisions and be directed from outside this environ-ment, than to choose these decisions.

The importance of Iran for Armenia has been reflected in the steps taken in the de-

38 Richard Giragosian, Toward a new concept of Armenian National Security, Prepared for third Annual AIPRG Interna-tional Conference 15-16 January 2005 The World Bank Wash-ington DC, p.2-3

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velopment of bilateral relations and in the strategic documents adopted since 1992. In the National Security Concept of Arme-nia that has been in force since February 2007, it is stated that the rationale for rela-tions with Iran are developed within “com-mon borders, historical affinity, cultural relations and economic interests” and are characterized as strategic objectives.39 The strategic paper openly states that Iran’s role is essential for Armenia to get free of isola-tion and get access to the Middle East.

Taking into account all these issues, the following opinion of the president of Ar-menia in respect to the importance of Iran clarifies once more these relations: “Iran is a very important country for Armenia; it is not because we have been neighbours for ages and are still neighbouring countries. There are other reasons as well. Actually, Iran is one of two countries in the world that we have relations with. If we have problems with Iran, it means that the pipe for Armenia to breath gradually narrows.”40

It is possible to state that the following approaches defined in the National Secu-rity Concept of Armenia are not applied in reality or have failed:

Even though Iran tried to have alterna-tive to the energy corridor through coop-erating with Armenia in the field of energy, it is obvious that the effort of Armenia

39 National Security Concept of Armenia, pp.19-20, http://www.natoinfo.am/eng/publications/documents/NationalSe-curity_eng.pdf 40 Эхо Москвы / Передачи / Интервью / Четверг, 27.01.2011: Серж Саргсян, президент Армении http://www. echo.msk.ru/programs/beseda/744902-echo.phtml

failed to create “independently” alterna-tive means taking into account that it sold strategic properties to Russia in 2003 and “Gasprom” had big share in energy proj-ects.

1. The claim that relations between the two countries are supported by economic efficiency:

The projects implemented in the re-gion, but bypassing Iran and Armenia have an impact on both countries’ approaches to each other. Notwithstanding that the crossing of the Baku-Tbilisi-Ceyhan pipe-line through the area of Armenia is eco-nomically favourable, Armenians stepped

Even though Iran tried to have an alternative to the energy corridor through cooperating with Armenia in the energy field, it is obvious that the effort of Armenia failed to cre-ate “independent” alternative means taking into account that it sold stra-tegic properties to Russia in 2003 and “Gasprom” had a big share in energy projects. At the same time, the hopes of Iran to “manage” Ar-menia through economic projects were in vain.

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aside from this project because of current relations with Azerbaijan. Besides not de-pending on the existence of the Gars-Gum-ru railway, the building of the Baku-Tbilisi-Akhalkalaki-Gars railway destroyed the hopes of Armenia to participate in regional infrastructure projects and to be a transit country. Even though Iran tried to have an alternative to the energy corridor through cooperating with Armenia in the energy field, it is obvious that the effort of Arme-

nia failed to create “independent” alterna-tive means taking into account that it sold strategic properties to Russia in 2003 and “Gasprom” had a big share in energy proj-ects. At the same time, the hopes of Iran to “manage” Armenia through economic projects were in vain.

2. The claim that relations between the two countries express strategic and mutual support:

Another factor playing an important role in the closer relations of Tehran and Yerevan is that the relations intended for important and mutual strategic support did not meet expectations for the provision of awaited aid and political support. Yerevan’s approach “as political ally” to the sanc-tions imposed against Iran’s nuclear activ-ity may inhibit his alliance in all respects. It is known that, at present, financial and economic sanctions of the West (U.S.) are

applied against Iran based on the resolu-tion of the UN Security Council. For this reason, Tehran makes efforts to normal-ize its relations with close neighbors, tries to keep them from joining the sanctions and is forced to enlarge cooperation with them41. Even though Armenia considers, in doctrinal papers, the sanctions imposed against Iran as an economic danger to its

41 Harout Ekmanian, Armenia-Iran Relations In Light Of Re-cent Developments, Armenian Weekly – 24/11/2010

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national security, it does not have strength to meet the demands of Iran. The fact that Yerevan follows Moscow in the nuclear is-sue clearly shows the failure of “comple-mentarism,” or rather that the term does not correctly express the foreign policy of Armenia. Thus, Russia’s position, that was close to Tehran’s in the nuclear programme of Iran, is important. According to the lat-est discussions on the nuclear problem, Russia interfered with Iran’s plans on ura-nium concentration. The Russian officials stated their regret for the ineffective com-pletion of the meeting of the “group of six” (Five plus one – big states) about this issue held in Istanbul on 21-22 January 2011. The most obvious example is the state-ment Russia President Medvedev made at the international forum in Davos, “Iran should convince the world that it develops atomic power for peaceful purposes.”42

Iran wants the Armenian lobby to bal-ance to some extent the Jewish lobby, which supports the application of even stricter sanctions and has definite influ-ence in the definition of the U.S. policy in respect to this country, and influence to some extent on the policy of Obama’s rul-ing party to prefer discussions with Iran.

Even though Armenia was helpless to officially support Iran, it helped Tehran through the Iranian financial entities in im-plementation of the nuclear programme. The “Bank Mellat” of Iran has been provid-ing financial means for Iran’s nuclear pro-42 Медведев: «Иран должен убедить мир, что развивает мирный атом», РИА Новости 27.01.2011, http://1news.az/ region/Russia/20110127120447791.html

gramme since 2003. Millions of USD was transferred to Iran from the branch office of the bank in Yerevan (Mellat Bank SB CJSC).43

Contrary to these two approaches, the important role of Armenia for Iran was confirmed in the following issues:

1. Arms saleOn the basis of recently revealed “Wikile-

aks” documents, it is possible to say that arms transferred by Armenia to Iran resulted in the death of U.S. soldiers in Iraq. The fol-lowing notes are reflected in the documents leaked to the press in connection with this:

“In 2003, Iran purchased rockets and ma-chine guns from Armenia. In 2007, these weapons were used in two Shia militant attacks in Iraq. A United States soldier was killed and six others were injured in these attacks.” The United States was especially concerned about the direct participation of high-level Armenian officials in the transfer

43 Iran’s Dirty banking- How the Islamic Republic skirts In-ternational Financial Sanctions, p.3, http://www.redcellig.com/ media/Irans_Dirty_Banking.pdf

The “Bank Mellat” of Iran has been providing financial means for Iran’s nuclear programme since 2003. Millions of USD was transferred to Iran from the branch office of the bank in Yerevan

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of arms to Iran44, and in 2008, the United States even wanted to impose sanctions on Armenia. It became evident that antitank rockets RPG-22 were manufactured in the Vazovski Machine-building plant and ma-chine guns were produced by the “Arsenal” company of Bulgaria. The agreement was

signed by the “Zao Veber” company of Ar-menia (part of their shares are state-owned) and the “Abdi Asjerd” arms company of Iran. According to American claims, the Ira-nian government paid money for arms, but did it secretly through an Armenian bank. It should be noted that the documents were signed by then-Defense Minister and cur-rent President Serzh Sargsyan. This fact was widely disseminated and confirmed in the Armenian press.45 44 US embassy cables: US fury at Armenia over arms transfers to Iran, Guardian 28 November 2010, http://www.guardian.co.uk/world/us-embassy-cables-documents/184879Vazovski45 Sargsyan, Hakobyan Did Not Deny Armenia’s Arms Trans-fer to Iran: WikiLeaks, http://www.epress.am/en/2010/12/07/

2. Drug trafficking

One of the areas of “strategic” impor-tance to Iran-Armenia relations is drug traf-ficking. As stated in the reports of the Unit-ed Nations Office on Drugs and Crime, drug trafficking is carried out throughout the 132 kilometer territory under occupa-tion. After the disruption of the “Balkan Route,” this was the main international narcotics transit route until the end of the 90’s, drug mafia opened new transit routes. In this regard, Azerbaijan’s territories occu-pied by Armenia have turned into a profit-able sphere of trade for the Armenian rul-ing elite. The facts illuminated in Armenian sources also prove that former President Robert Kocharyan and current President Serj Sargsyan created favorable condi-tions for the plunder of natural resources of Azerbaijan’s occupied territories, as well as use of these territories by international drug mafia. Armenia’s ruling elite has links with the international drug mafia. Part of the profit gained from the transit of drugs through Nagorno-Karabakh is being spent for maintenance of armed forces of the separatist regime and its provision with weapon and food.

The “International Narcotics Control Strategy Report” prepared by the U.S. De-partment of State on March 2, 2010 states that especially Iran and Afghanistan are the main transit countries in transport of drugs to Europe. Azerbaijan shares a 611

sargsyan-hakobyan-did-not-deny-armenias-arms-transfer-to-iran-wikileaks/

The facts illuminated in Armenian sources also prove that former

President Robert Kocharyan and current President Serj Sargsyan created favorable conditions for

the plunder of natural resources of Azerbaijan’s occupied territories,

as well as use of these territories by international drug mafia.

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km frontier with Iran and its law enforce-ment agencies face difficulty in the fight against illegal trafficking of drugs because of the inability to control the occupied regions (132 km of the border)46. At the same time, the report notes that 95 percent of drugs originating in Afghanistan are transported through Iran and uncontrolled areas in the conflict zone.

Nagorno-Karabakh, which is identified as an “uncontrolled area” in most interna-tional reports, is open space for the transit of drugs and activities of terrorist groups. It has already been confirmed that these “un-controlled” gray zones are one of the main places of development of cooperation be-tween Iran and Armenia and activities of clan groups. The 132 km border between Azerbaijan and Iran, which is under the de facto control of Armenia, has been actively used for production, transit of and traf-ficking in drugs, arms and human beings, illegal migration, concealment of terror-ists, money laundering and other danger-ous types of transnational crime. The facts and the proof about international threats posed by the occupied regions and transit of drugs from Iran to Europe with the help of Armenian clans as stated in the speech of the Azerbaijani delegation in the First International Meeting of high officials re-sponsible for security issues held in Sochi on October 5-6, 2010, confirm this once again: “Because it is beyond the sphere of national and international law, this zone re-mains inaccessible for adequate and timely

46 http://www.state.gov/p/inl/rls/nrcrpt/2010/index.htm

response to the aforementioned threats. Therefore, we regard the issues connected to the settlement of the Nagorno-Kara-bakh conflict as a key part of the work to ensure national and regional security and prevent terrorism and other threats.”47

Information on participation of Arme-nian officials in the drug trade with Iran shows that transfer of drugs between the two states is carried out through the oc-cupied Nagorno-Karabakh and Arme-nian political elite, including Levon Ter-Petrossian, personally profit from this trade.48

1.3 “Strategic” importance of Armenia to Iran

The study of Iranian-Armenian rela-tions reveals that Yerevan has a specific sta-tus in foreign policy concept and regional policy pursued by Tehran after the Islamic revolution of 1979. This distinct status is not about historical foundations and ratio-nality of relations between the two states; on the contrary, it is about the shaping and development of relations contradicting both Iran’s foreign policy concept and its national interests. Arguments of this can be found in the doctrinal principles exist-ing in Iran’s foreign policy.

47 «Международный терроризм наряду с оккупацией территорий Азербайджана Арменией - угроза нацио-нальной безопасности страны», http://www.1news.az/poli-http://www.1news.az/poli-://www.1news.az/poli-www.1news.az/poli-.1news.az/poli-news.az/poli-.az/poli-az/poli-/poli-poli-tics/20101012012848473.html48 WikiLeaks: former President Ter-Petrossian was per-sonally profiting from narcotics trade to Iran, http://www.panarmenian.net/eng/world/news/60585/WikiLeaks_for-mer_President_TerPetrossian_was_personally_profiting_from_narcotics_trade_to_Iran

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It has been confirmed that political Is-lam stands at the center of Iran’s foreign policy in the region. The process of the emergence of political Islam in this coun-try coincides with the period of a strained relationship between religion and politics after the Islamic revolution. There was need for a strong, unifying ideology, based on radicalism in some respect, against a reactionary policy pursued by big states in the region. This vacuum had gradually been filled with ideology of political Islam feeding on “Shia solidarity.” Consequently, the political environment of the Middle East totally changed, becoming rich with radicalism, terrorism and extremism, and close cooperation of the region’s elector-ate with political Islam began. Consider-ing the aforementioned, incompatibility of Iran-Armenia relations with the nature of Teheran’s foreign policy could also be seen in its foreign policy principles:

- Thus, the first principle of Iran’s for-eign policy is that it has the nature of Is-lamic revolution49. Taking into account that every revolution has a revolutionary theory in its foundation, the revolutionary feature of Iran’s foreign policy can be seen in the motto of “Neither the East, nor the West – Islamic Republic”50 proclaimed in 1979.

- The second principle is that it has a totalitarian nature. In other words, all

49 Mehdi Mozaffari, Iranian Ideological Foreign Policy, Cen-tre for Studies in Islamism and Radicalisation (CIR), Denmark, April 2009,50 The article 151 and 152 (as well as 3, 5 and 11) of the constitution of Iran are also based on these theses on inde-pendence. The aim of Imam Khomeini was to create an inde-pendent state free from both the west and the east.

economic, political and military issues should be in conformity with the require-ments of Islam. The totalitarian nature of the regime can be seen from the concen-tration of political leadership in the hands of the religious elite and the reference to this point in Article 110 of the state’s con-stitution.51

- The third principle is that it opposes the “Westphalian system.” That is to say, the Iranian regime rests upon Islamic Umma (Ummat-e Islam). This, in turn, lies in the opposite pole of a frequently expressed idea of “Iranian nation” (“Mellat-e Iran”) based on ethnicity.52 The ideology of the state can be described by the term “Islamic Land” (“Vatan-e Islam”) and this principle requires defending not the land, but Islam and umma.53 Protection of Islam should be shaped on the basis of protection of all Muslim countries and their citizens.

- The fourth principle is Persian chau-vinism and its character of imperialistic ambition in foreign policy. While Iran had been portrayed as the leader of the Islamic world during the reign of Khomeini, in subsequent periods, it became limited only to the Shia world.54 Tehran, which fears the negative influence of this on the role of Iran in the region, accused the United States of using this moment to turn Iran against

51 The Constitution of the Islamic Republic of Iran, Article 4, p. 20.52 Mohammad Reza Djalili, Diplomatie islamique: stratégie internationale du Khomeynisme (Paris: PUF, 1989), pp. 58-63.53 Mehdi Mozaffari, the given work, p. 1254 Karim Sadjadpour, Reading Khamenei: The world view of Iran’s most powerful Leader (Washington DC: Carnegie En-dowment for International Peace, 2008), p. 25.

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Sunnite Arabian countries. However, Iran’s leadership role in the Islamic world is not accepted by Sunni Arab states and this claim seems unrealistic. At the same time, Iran should maintain its hegemony in the region through schematic combination of political, cultural and non-traditional military methods and find such a security system that it becomes impossible without Iran to reach an optimal solution in Iraq, Afghanistan, Lebanon, the Arab-Israeli conflict and generally in all states of the Persian Gulf.

In considering the application of the aforementioned principles of Iran’s for-eign policy relative to Armenia, it becomes evident that the development of relations contradicts the doctrine. At the same time, a similar picture comes to the fore after the systematization of relations of the two countries in geopolitical reality:

1. Strategic – even if it is claimed that Armenia plays an important role in helping Iran to overcome isolation in the region, it is clear that this is not a strategic criterion; in order to overcome an economic decline after the Iraqi war in 1991 and the isolation imposed by the West, Iran needed to ex-pand financial resources and develop trade relations with the newly independent states. In comparison, the present trade turnover between Iran and Armenia has not yet reached the level of turnover in the first years of Iranian-Azerbaijani economic relations. This proves once again that as a strategic criterion, it is beneficial to Arme-nia, not Iran.

2. Geographical – Armenia received ac-cess to the seas; if Iran gives Armenia ac-cess to the seas, then Armenia cannot give any incentive to Iran to extent its coopera-tion with Russia, which is considered to be strategic for Tehran, since it has become impossible for Armenia to access the seas without Georgia.Taking into account that Armenia is the “outpost” of Russia, it is im-portant for Iran’s for interest to consider the geopolitical reality not of Yerevan, but of Moscow. In this case, Tehran is aware that the “neutrality” of Armenia or its re-sponse when the West imposed sanctions, is not its free choice.

3. Geopolitical – Taking into account that Armenia is the “outpost” of Russia, it is important for Iran’s interest to consider the geopolitical reality not of Yerevan, but of Moscow. In this case, Tehran is aware that the “neutrality” of Armenia or its re-sponse when the West imposed sanctions, is not its free choice

To the question of whether relations between the two countries have strategic importance for both parties, the answer given in today’s reality is distinctly in fa-vour of Yerevan. This fact will result in strengthening relations of Armenia and Iran long term. The bilateral relations be-tween Armenia and Iran are regulated based on more than 200 papers signed at high levels. Among them, there are agree-ments for cooperation in the military field as well.

As mentioned before, recently Iranian officials made statements expressing sup-

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port of Yerevan, and interference into the affairs of “third” countries, which is not relevant to ethnic-diplomatic values. The majority of these statements are directly connected with the “concern” in respect to the rapid arming of the region around the Nagorno-Karabakh conflict. At this time, it is interesting to examine the role of Iran in the Nagorno-Karabakh conflict and its at-titude towards the solution of the conflict.

1.4 Iran’s position on the Nagorno-Karabakh conflict

In its foreign policy principles, Iran claims to be the leader state of the Islam-ic world, but it becomes evident that the policy pursued by Iran with regards to the conflicts of the Muslim world is in contra-diction with its ideological and doctrinal principles. Proceeding from the claims of the Sunni world that the leadership of Iran in the Islamic world is real only for the Shia, then it also becomes clear that Iran’s leadership in the Islamic world is paradoxi-cal. From this standpoint, Iran, which indi-cates the issue of “Palestine” as the factor of Islamic solidarity in its foreign policy, in re-ality, aims at gaining political benefit – cre-ating an anti-American frame of mind in the Arab world by symbolizing this prob-lem. But it is not obvious that Iran is inter-ested in the resolution of the problems of the Muslim world. The paradox in Tehran’s policy becomes more evident with regards to the Nagorno-Karabakh conflict. On the one hand, in their statements Iranian of-ficials consider Karabakh as the territory

of Azerbaijan; on the other, they try to portray the conflict as a war between Azer-baijan and the Armenians of Nagorno-Karabakh. Even though they declare that Karabakh is a historical territory of Azer-baijan, in practice, they want the problem to remain in the present condition without turning into a hot war. Especially, against the background of the declarations of Iran defending the interests of Yerevan in the Nagorno-Karabakh conflict, Iran’s role in the resolution of the conflict is interesting. Since 1991, Iran’s position on the Nago-rno-Karabakh conflict has been as follows:

First, Iran strengthened Armenia with its economic aid during the period of the conflict and turned a blind eye to the occu-pation of the Azerbaijani territories. Arme-nia’s continuation of occupation during this time, after the official visit of Iran’s Foreign Minister Ali Akbar Vilayati to Baku for me-diation in the Nagorno-Karabakh conflict in December 1991, and the occupation of the Shusha city by Armenian forces while the leadership of Azerbaijan was negotiat-ing with Armenia in Tehran laid down the foundations of this disloyalty.55

Second, even though Iran does not want the Nagorno-Karabakh conflict to turn into an active military operation, it is inter-ested in the maintenance of the status quo from two aspects:

1. It is considered that as long as the conflict continues, it will have a negative ef-fect on the economic development and the

55 Iran-Azerbaijan relations, see: http://library.aliyev-heri-tage.org/az/6163780.html

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strengthening of statehood of Azerbaijan. To put it in the words of Zbigniew Brzezin-ski, former U.S. national security advisor: “If Azerbaijan achieves a political stabil-ity and economic development it needs, Iranian Azerbaijanis will fight for the real-ization of the idea of “Great Azerbaijan”.56 From this standpoint, even though it does not impose any danger, the “prevention-ism” of Tehran shows that it considers the weakness of a Muslim state as its reason for existence (raison d’être), which is contrary to its ideological foreign policy principles.

2. One of the issues discussed within the resolution package is the deployment of the peacekeeping forces of the West, to be more precise, of a third party in the re-gion after the signing of a political agree-ment. In the case of peacekeepers, Iran, which is concerned about the deployment of the United States in the region, opposes the implementation of this idea through various means and emphasizes this as a threat to its national security.57

Thirdly, the “neutrality” of Tehran, which has been claiming to be interested in mediation of the settlement of the Nago-rno-Karabakh conflict since the middle of 2010, raises suspicions. Especially, Iran’s military cooperation with Armenia and the nature of the signed agreement give rise to this. Thus according to the memorandum of cooperation signed between Armenia

56 Zbigniew Brzezinski. The Grand Chessboard American Pri-macy And It’s Geostrategic Imperatives, 1998, p.14357 Tehran says will oppose ‘American forces’ in Karabakh, http://www.armenianow.com/karabakh/23799/iran_kara-bakh_us_peacekeepers

and Iran in Yerevan in 2002, in the areas of defence and security , the two sides are mutually cooperating starting with the ex-change of military school students to the establishment of joint enterprises that will produce products for defensive purposes. Under the agreement signed between the ministries of defence of Iran and Armenia, the two states will cooperate on the provi-sion of the home front. According to the experts, the agreements signed in the field

of defence are directed straight against Azerbaijan.58

Under such conditions, it becomes clear that there are no diplomatic grounds for the recent efforts of Iranian officials to promote the negotiations on the resolution of the Nagorno-Karabakh problem between the parties to the conflict as a “neutral” power. 58 Şabanov Gündüz, İran: siyasət milli maraqlarla ziddiyyətdə, http://www.525.az/view.php?lang=az&menu=10&id=26015

The 132 km border between Azerbaijan and Iran, which is under the de facto control of Armenia, has been actively used for production, transit and traf-ficking of drugs, arms and human beings, illegal migration, conceal-ment of terrorists, money laun-dering and other dangerous types of transnational crime.

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To put it in the words of Tatul Hakobyan, the expert on foreign policy of the Civilitas Foundation of Armenia, “In 1992-1994 of-ficial Tehran was the main supporting point for Armenia in its integration into the world at the most difficult times,” 59and today the peaceful efforts of Tehran can be evaluated as attempts to help Armenia overcome dif-ficult situations.

At the same time, the fact that Iran turns a blind eye to trafficking in drugs and hu-man beings in the occupied territories of Azerbaijan is an example of the creation of “gray zones.” The 132 km border between Azerbaijan and Iran, which is under the de facto control of Armenia, has been actively used for production, transit and trafficking of drugs, arms and human beings, illegal migration, concealment of terrorists, mon-ey laundering and other dangerous types of transnational crime.

All of these factors make it possible to say that Iran adheres to a “hypocritical” position on the settlement of the Nagorno-Karabakh conflict. Iran’s policy, groundless claims and declarations with regard to the conflict show that Yerevan prefers the logic of the proverb “the enemy of my enemy is my friend.”

2. Iranian - Armenian economic relations

Paying attention to the economic in-dexes of the relations between Iran and

59 Harout Ekmanian, Armenia-Iran Relations in Light of Recent Developments, 24 November 2010, http://www.ar-menianweekly.com/2010/11/24/ekmanian-armenia-iran-rela-tions-in-light-of-recent-developments/

Armenia, it is possible to describe this co-operation as the relations as one-sided. Otherwise, the fact that the aforementioned historical-political relations are not “deep” is more evident in the economic indexes.

Diagram 1. Disproportion in Iran’s eco-nomic relations with Azerbaijan and Armenia

Source: Data on the volume of domestic and ex-ternal market are collected from “The Global Com-petitiveness Report. 2010-2011”, data on foreign trade turnover with Iran are taken from the State Statistical Committee of Azerbaijan and National Statistical Ser-vice of Armenia

According to 2009 data, Iran has a 4.7% share in total exports and 4.9% share in imports with Armenia, which ranks it re-spectively 9th and 6th among trade part-ners of Armenia.60 Iran’s exports to Arme-nia amount to less than 0.05% share in our southern neighbour’s GDP. It means that the importance of Armenia’s market for Iranian economy is about five hundredths

60 Export and import of the Republic of Armenia by coun-tries, 2010, http://www.armstat.am/file/doc/99461633.pdf

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of one percent, which does not have statis-tical significance. Conversely, these eco-nomic relations are of vital importance to Armenia. Iranian officials make statements about their wishes to increase trade turn-over between the two states to 500 mil-lion61 and even 1 billion US dollars.62

Thus, Iran pursues an unrealistic goal of reaching and surpassing Russia in foreign trade turnover with Armenia. As a compar-ison, Russia’s trade turnover with Armenia in 2009 reached 900 million US dollars63, which is less than the figure aimed at by Iranian officials. Moreover, Iran’s trade re-lations with Armenia are restricted within the framework of Russia’s interests and are unpromising. Russia would agree with the development of trade relations with Arme-nia and Iran only on the basis of the unfa-vorable trade regime for the Islamic repub-lic. It is no coincidence that the volume of Iranian-Armenian foreign trade between 1996 and 2009 increased just by 1.7 mil-lion US dollars. Taking into consideration the exchange devaluation, in real terms, it is a decrease. Such circumstances once again prove that Russia has accepted Iran’s participation in the Armenian economy within narrow limits and Iran’s wish to strengthen trade in Armenia is “tilting at windmills”. There is no logic in Iran’s inter-

61 Иран намерен наращивать преимущественно экономическое сотрудничество с Арменией, http://www.regnum.ru/news/1181385.html62 Ирано-армянская дружба, или Пара слов о «моральном» праве судить соседей, 2011, http://1news.az/analytics/20110124012408830.html63 Export and import of the Republic of Armenia by coun-tries, 2010, http://www.armstat.am/file/doc/99461633.pdf

est in establishment of economic relations with Armenia under unfavorable condi-tions and at Russia’s bidding.

According to the calculations of the World Economic Forum, while Azerbaijan ranks 84th in the world on GDP Armenia occupies 111th place. On the volume of

foreign trade Azerbaijan is 60th and Ar-menia is 129th among countries. In real-ity, Iran should have been more interested in foreign turnover of commodities with Azerbaijan, whose scale of domestic and foreign markets is relatively bigger. For ex-ample, Iran’s foreign trade turnover with Armenia made up 195 million US dollars in 2009, turnover of commodities with Azerbaijan would have much more poten-tial than this. In truth, Iran’s trade turnover with Azerbaijan in 2009 made up 86% of the volume of foreign trade with Armenia, totaling 169 million US dollars. Iran’s es-tablishment of increased trade with Arme-nia rather than Azerbaijan, which possess-

It is no coincidence that the vol-ume of Iranian-Armenian foreign trade between 1996 and 2009 increased just by 1.7 million US dollars. Taking into consideration the exchange devaluation, in real terms, it is a decrease.

30


es a developed infrastructure that would ensure a larger market and better econom-ic relations, as well as religious, historical, linguistic and cultural affinity with Iran, is

irrational from an economic point of view.In comparison, Azerbaijan’s trade turn-

over with Turkey, which has closed its bor-ders with Armenia and cut off economic relations, exceeded 1 billion US dollars in 2009, more than 4-5 times than the volume of foreign trade between Iran and Armenia. It is noteworthy that Iran and Turkey have similar economic potential. The experience of Turkey shows that it is more beneficial to refuse economic relations with Armenia and cooperate with Azerbaijan. Iran should not overlook a country with economic pow-er such as Azerbaijan for the sake of reach-ing the limited market of Armenia.

2.1. Syndrome of “lack of electric-ity” in Iran

The efficiency of investment interests of Iran in Armenia are questionable, as

According to the calculations of the World Economic Forum,

while Azerbaijan ranks 84th in the world on GDP Armenia occupies 111th place. On the

volume of foreign trade Azerbai-jan is 60th and Armenia is 129th among countries. In reality, Iran

should have been more interested in foreign turnover of commodi-ties with Azerbaijan, whose scale of domestic and foreign markets

is relatively bigger.

Table 1. Dynamics of export and import operations from Armenia to Iran (in million US dollars)

Source: National Statistical Service of Armenia

31



Armenia has the smallest economy in the world, which ranks 30th for its domestic market and 10th for its foreign market.64 If Iran, which has the 2nd largest natural gas resources in the world, is forced to import natural gas because of lack of investment, then what is the economic efficiency of investments planned to be made in Arme-nia? Which “feasibility study” supports the investments made in the 186 kilome-ter gas pipeline to Armenia and promises a daily supply of 6.3 million cubic meters of natural gas, while Iran needs Azerbaijan in order to supply the northern regions with “blue fuel”?

It is not possible to explain, based on economic principles, the investment of 323 million USD by Iran, which is 19th for electricity production and 20th for con-sumption, for the construction of the Mehri Hydro Power Station (HPS) over the Araz River and its agreement to hand over the power station to Armenia after 15 years.

If Armenian officials try to explain the efficiency in the purchase of electricity in return for the sale of gas to Armenia, they will have difficulties in providing a logical explanation. If a raw material (natural gas) is sold and a ready product (electricity) is purchased in return, then it means that something economically valuable in this production chain is gifted voluntarily to Armenia. It should be taken into account that the Development and Export Bank of Iran allocated 30 million USD for the first

64 The Global Competitiveness Report 2010-2011, World Economic Forum

part of the gas pipeline to Armenia, plus the transportation of gas and electricity is accompanied by relevant expenditures and losses. Finally, this transaction damages the energy security of Iran. It should be noted that Iran is among countries using energy most inefficiently, 18.5% of electricity is lost before it reaches consumers.65 The act of importing electricity to Armenia in-creases losses because of the distance, and it is not good for Iran. Thus, Iran only loses from an economic and energy security point of view when it sells gas to Armenia instead of electricity. And if we add nega-tive reactions of Azerbaijan, Turkey and Russia as well, this transaction is a disad-vantage for Iran, and in favor of Armenia.

Notwithstanding economic inefficien-cy, Iran continues its efforts to supply Ar-menia with electricity. It is not possible to explain, based on economic principles, the investment in the amount of USD 323 mil-lion allocated by Iran, which is at 19th place for electricity production and 20th 66 place for its consumption, for the construction of Mehri Hydro Power Station (HPS) over the Araz River and its agreement to hand over the power station to Armenia after 15 years. When this third line will be put into operation in 2013, the energy swop opera-tions between the two countries will dou-ble.67 In this case a question arises: What

65 http://www.iran-daily.com/1388/3374/html/economy.htm66 https://www.cia.gov/library/publications/the-world-fact-book/geos/ir.html67 Power Swap With Armenia Will Double, http://www. i ran-da i l y. com/1389/10/2/Ma inPaper /3852/Page/4/?NewsID=32317

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does Iran gain from this transaction?First of all, taking into account that the

demand for electricity in Iran has increased by 10% annually and subsidies have de-creased68, it is more important to create new energy sources in the country than to

68 http://www.entrepreneur.com/tradejournals/ar ti-cle/197642455.html

support the invader, Armenia, in this field.Secondly, while annual electricity pro-

duction in Armenia is 1800 kW/hr per capita, this indicator is about 3000 kW/hr in Iran. Thus, Iran spends its population’s money for the energy security of Armenia.

Thirdly, the aridity in 2007-2008 dem-onstrates that there are breaks in the activ-ity of the HPS in the region..69 In this case, what is the interest of Iran, which is a coun-try rich with energy, in the construction of a HPS? All of the abovementioned points do not explain Tehran’s support to Arme-nia that is relevant to neither material, nor moral principles.

2.2. Iran wants to transform Armenia into a gas corridor

By constructing a gas pipeline to Arme-nia, Iran wanted to transport natural gas through this country to Georgia, Ukraine and even Europe in future. However, the Iranian regime miscalculated the situation and especially overlooked the fact that Ar-menia was actually the post of Russia and this led to a total failure of Iran’s intention. The point is that Russia understood Iran’s purpose and immediately took possession of the Razdan Heating Power Station and “ArmRosqazprom”, which controls Arme-nia’s gas network (80% of shares belongs to Russia’s “Gazprom”, 20% owned by the government of Armenia). It was enough for Russia just to dictate its will to Arme-nia. Thus, Iran’s intention to transport gas

69 Энергетичекие интересы Ирана в �аспийском Регио- Энергетичекие интересы Ирана в �аспийском Регио-не, Альберт Зульхарнеев, Индекс Безопасности, №2, 2009

By constructing a gas pipeline to Armenia, Iran wanted to trans-

port natural gas through this country to Georgia, Ukraine and even Europe in future. However, the Iranian regime miscalculated the situation and especially over-looked the fact that Armenia was

actually the post of Russia and this led to a total failure of Iran’s intention. The point is that Rus-

sia understood Iran’s purpose and immediately took possession of

the Razdan Heating Power Station and “ArmRosqazprom”, which

controls Armenia’s gas network (80% of shares belongs to Russia’s

“Gazprom”, 20% owned by the government of Armenia).

33



to Europe through Armenia passed under the control of Moscow with timely inter-ference of Russia. In the face of the strong reaction of Russia, which did not want to have a rival (such as Iran, with 29 trillion cubic meters of gas reserves) in the gas markets of Georgia, Armenia and Ukraine, Iran’s economic diplomacy directed at Ar-menia ended in failure. Even if today Iran clears the “Gazprom hurdle” in Arme-nia, it will not be able to overcome the “Chinese Wall” created by the West in Georgia. The Iranian regime has already understood that its gas agreements with Armenia did not achieve both regional economic and long term geopoliti-cal goals and only played into Russia’s hands in Armenia.

In addition to this, Azerbaijan, with its flexible diplomacy in this area, is on the eve of realizing what Iran failed to gain in the territory of Georgia. Azerbaijan occu-pies a dominant position in Georgia’s natu-ral gas infrastructure and even the State Oil Company of the Azerbaijan Republic (SO-CAR) intends to buy a gas pipeline through Georgia that supplies Russian natural gas to Armenia. The Mullacracy should now think about whose words Georgia is going to speak: Azerbaijan’s, which is a friend, or Armenia’s and Russia’s, which are hos-tile countries? Or maybe the Mullacracy, which is enemy number one of the West, thinks that Iran will have any serious influ-ence on Georgia – the closest partner of the West in the region?

If Tehran intensifies its cooperation

with Azerbaijan in the gas sector, it can meet its wasted expectations. For this, Iran should unthread the gas labyrinth set up by Russia in Armenia. If Iran re-jects Armenia, there is a big potential for the development of Azerbaijani-Iranian cooperation in the gas sector. In January 2011, the main terms of the contract on Azerbaijani natural gas transaction were signed between the SOCAR and National Iranian Gas Export Company. Under the main terms, the contract will be signed for 5 years, Azerbaijan will supply 1 billion cu-bic meters of gas to Iran in 2001 and the volumes to be supplied will be reviewed each year.70 The point is that even though Iran’s main gas reserves are concentrated in the south of the country, the northern part is more industrially developed. Therefore, there is more need for natural gas (accord-ing to the calculations of the US Energy Information Administration (EIA), the south of the Caspian Sea, i.e. Iranian sec-tor holds 0.1 billion barrels of proven re-serves and 15 billion barrels of estimated reserves). In these circumstances, Iran can buy natural gas from Azerbaijan without any additional investment and supply it to the northern regions rather than transport a limited natural gas to Armenia and work for “Gazprom”.

In January 2009, Iranian deputy oil minister Hossein Shirazi stated that Iran was ready to invest 1.7 billion US dollars in the development of Phase 2 of the Shah-deniz field.71 It should be noted that Na-70 http://socar.az/3004-news-view-az.html71 Энергетические интересы Ирана в �аспийском Регио- Энергетические интересы Ирана в �аспийском Регио-

34


tional Oil Company of Iran has a 10% share in Shahdeniz field. Thus, for the first time, Iran can closely participate in a large scale development of hydrocarbon resources of the Caspian Sea through involvement in the field owned by Azerbaijan. It would be more beneficial for Iran to approach Azer-baijan and participate in Phase 2 of a glob-ally important Shahdeniz field rather than its fruitless cooperation with Armenia.

2.3 Armenia is a “depot” for railways

Another form of ineffectual Iranian-Armenian economic relations reveals itself in the efforts to establish railway corridor between the two states. Even Armenia’s Minister of Transport and Communica-tion, Manuk Vardanyan, stated that they were searching for financial resources for the feasibility study of the North-South railway72, which has been discussed for years. How can Tehran agree to this proj-ect, when Armenia cannot even finance the feasibility study of Iranian-Armenia railway? The creators of the North-South railway concept through Armenia, which is planned to connect Russia and Iran in the long-term perspective, forgot one nuance: the factor of Georgia.

Georgia’s national interests are against the growth of Russia’s influence in the re-gion and especially the realization of the process by Armenia, which has territorial claims against Georgia.не, Альберт Зульхарнеев, Индекс Безопасности,№2, 200972 http://www.arka.am/rus/transport/2011/01/25/23616. html

There are arguments that Georgia will receive dividends as a transit country after the construction of the North-South rail-way, but these arguments are counteracted by the West, which is against the domi-nance of Russia and Iran in the region, and seeks to influence the policy of Tbilisi.

Thus, the North-South railway line that is going to connect Iran and Armenia will have the same fate as the gas pipeline that links the same points. The North-South is the railway going to depot: there is no sense to spend 2 billion US dollars for this. Because Russia accepts Iran’s right to par-ticipate in the Armenian economy within a restricted framework: Tehran plays a tech-nical service role for Armenia in force ma-jeure circumstances. The Georgian events of 2008 also showed that in order to pre-vent a total blockade of Armenia, Russia should always leave open “the vent-light” from its post to Iran.

Considering Russia’s imposing limits

Russia accepts Iran’s right to par-ticipate in the Armenian economy

within a restricted framework: Tehran plays a technical service

role for Armenia in force majeure circumstances.

35



as well as Armenia’s restricted domestic market, the construction of a railway for 2 billion US dollars cannot make any eco-nomic sense. The cost reimbursement ra-tio of the railway at the cost of 2 billion US dollars is very low in order for Iran to carry out foreign trade relations with Armenia,

worth on average 200 million US dollars annually, and this project is also unprof-itable. In reality, first vice president of Iran Mohammad Reza Rahimi declared his country’s intention to construct the railway: “This railway will link Armenia to other states through Iran”.73 As evi-dent, in circumstances of a lacking invest-ment environment, Iran agrees to the rail-way project for establishment of Armenia’s relations with outside world.

If Iran wants to become a transit country in the North-South corridor, it should cooperate with Azerbaijan, which is in more a favorable position because of 73 Joint Economic Commission With Armenia, http://iran-dai-ly.com/1389/8/5/MainPaper/3811/Page/4/?NewsID=28565

shortness of distance, lower transporta-tion costs and available transport infra-structure. It is intended to construct an Astara (Azerbaijan)-Astara (Iran) railway line and railway bridge on the Astarachay river to connect Azerbaijan and Iran’s rail-way networks. The new Qazvin-Rasht-Anzali-Astara railway, line with a length of 370 kilometers, should be constructed in the territory of Iran to connect an Iran-Azerbaijan-Russia railway network on the corridor. In line with reports, construction of this new railway has been included in the development plan of Iranian railway network and an initial feasibility study has been carried out.74 According to the con-ducted analysis, the volume of expected transportation of goods in the Azerbaijani part of the corridor will increase up to 2 million tons in the first 3 years, 5-6 million tons in the second phase and 15 million tons in the third phase, when the direct rail-way connection will be established. Thus, Azerbaijan’s contribution to the develop-ment of the North-South corridor will be considerably higher in comparison with Armenia, the regional back street. While all economic calculations are in favor of Azerbaijan, Iran’s preference in the con-struction of the North-South railway for Armenia, which is disadvantageous with respect to transit, is hard to understand.

Even Armenian authors agree that the construction of the Kars-Akhalkalaki or the Batumi-Rize, as well as Qazvin-Rey-Astara railways, the establishment of road 74 Şimal-Cənub beynəlxalq nəqliyyat dəhlizi, http://www.azerbaijan.az/_Economy/_Ways/ways_04_a.html

If Iran wants to become a transit country in the North-South cor-

ridor, it should cooperate with Azerbaijan, which is in more a fa-vorable position because of short-ness of distance, lower transporta-tion costs and available transport

infrastructure.

36


and railway connection between the main part of Azerbaijan and Nakhchivan through the territory of Iran will result in Armenia’s isolation.75 When Armenians themselves admit that they have reached a deadlock, Iran’s attempts to help them overcome this deadlock by investing millions of US dol-lars is like raising the dead, and this policy does not have any economic grounds.

2.4. Iran helps Armenia even more through decreasing subsidies to its population

There is no result in searching for effi-ciency and a number of questions arise in the study of inefficient economic relations between Iran and Armenia. In particular, one of the factors giving rise to these ques-tions is the statement of the Minister of Oil of Iran, Masud Mirkazim, “a new oil pipe-line will be laid starting from Tabriz in Iran up to the border of Armenia”.76

The fact is that Iran hardly meets the oil demand of its northern regions thanks to the increase of the production capacity of oil refineries and improvement of infra-structure. As a result, it goes into swop op-erations with Kazakhstan and Turkmeni-stan, and returns back to the Persian Gulf in the south the oil it purchased from them for its refineries in the north (Rey, Tabriz and Neka). Iran does not have infrastruc-ture to transmit the oil produced in the

75 Новые геоэкономические тенденции на Южном �авказе, Игор Мурадян, 2010, http://geopolitika.ru/Arti-://geopolitika.ru/Arti-geopolitika.ru/Arti-.ru/Arti-ru/Arti-/Arti-Arti-cles/99376 Iran to boost energy exports to Armenia, 2011, http:// www.tehrantimes.com/index_View.asp?code=235090

south to the regions with developed in-dustry in the north. In this case, Iran meets the demand of refineries in the north at the cost of the Turkmen and Kazakh oil. When there is a lack of oil in the north of Iran, what is the economic logic in laying a new oil pipeline to Armenia? Is not it bet-ter for Iran to meet demand of its northern regions, and then to think about Armenia? How is it possible that while decreasing in-ternal subsidies given to oil products, Iran increases subsidies to Armenia?

2.5. “Black roads” to Armenia The road agreed between Russia, Iran

and India within the Northern-Southern corridor is planned to cross the territory of Armenia. However, the constructing this road, which is not because of economic ef-ficiency, but rather a result of political in-trigues, is unpromising. It is not by chance that the winner of the bid announced for the construction of the Yerevan-Ashtarak part of 11.7 kms of the Northern-Southern road was not notified and then failed.77 A well-minded investor would never put mil-lions of USD for a project in danger, which is economically inefficient and serves only to put Armenia on its feet. The risks (com-mercial, political and so on) of this project are high. Even if Iran joins the most pow-erful anti-Azerbaijan coalition, it cannot make Armenia a transit corridor. Even for the most pessimistic calculations, Georgia

77 Проект строительства второго участка автодороги Север-Юг будет готов в марте 2011 года – министр, http:// www.miacum.ru/gazeta/2010/12/24/Проект_строительства_ второго_участка_автодороги_Север-Юг_будет_готов_в

37



receives annually a transit profit78 in the amount of 250 million USD because of the opportunities opened by Azerbaijan, and that makes up 10% of Georgia’s state budget. It is not real that Iran goes against Baku and opens a new corridor over Ar-menia. There are two more arguments strengthening the idea of Georgia blocking the development of the Iranian-Armenian transit vector towards Europe: Azerbaijani residents in Georgia are the biggest inves-tors and tax payers. Thus, the geo-econom-ic importance of Azerbaijan is associated not with the paradigm of “corridor” but “regional transit centre”. Tehran should accept Azerbaijan not as an object, but as a party, and regional player having strong influence and leverage. From this point of view, demo projects of Iran realized in Ar-menia against the will of Azerbaijan are a loss of resources and time for Tehran.

78 Новые геоэкономические тенденции на Южном �ав- Новые геоэкономические тенденции на Южном �ав-казе, Игор Мурадян, 2010, http://geopolitika.ru/Articles/993

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During the study of Iranian-Armenian relations in the political and economic fields, it is possible to make a number of conclusions for both countries from the point of view of geopolitical benefit.

From the Armenian point of view, the conclusions can be systematized in the fol-lowing order:

First of all, the historical development of the Iranian-Armenian relations starting from the ‘90s was going in the way Russia that permitted Yerevan, and the relations were directly dependent from the develop-ment speed of the Russian-Iranian relations. And even if Moscow was not interested in the isolation of Armenia from regional transport projects, it tried all means to “Ka-liningradise” Armenia, i.e. to keep it under control. If we look at the situation, the ef-forts to establish necessary economic lo-gistics to break Armenia dependence on Moscow are condemned to failure, as the majority of Armenia’s large scale entities are under Russia’s control. The Armenian economy is virtually dependent on Russia. In this case, it would be wrong to state that Armenia freely follows independent foreign policy with Russia, since the Iranian-Arme-nian border is protected by Russia in every sense.

Secondly, we can see the failure of the “complementary” political course in the foreign policy of Armenia. As the result of unsuccessful foreign policy of Armenia,

the annual loss in the GDP is 10-13%.79 Besides, both Armenian and international experts accept the non-existence of the foreign political course under the name of “complementarism”. The case, when the US State Department imposed sanctions80 on Armenia, accusing it of selling chemical equipment to Iran, and the Government of Armenia retreated81, can be an example of the nonexistence of “complementarism” directly related to Iran. As it is expected, Armenia drew back immediately as the result of the pressure, and put in danger its “efficient” relations. Namely, after this event, the Ambassador of Iran in Yerevan, Mahammad Koyelini, stated to the for-mer Minister of Foreign Affairs of Arme-nia, Vardan Oskanyan: “Don’t you think it would be more correct to use the word “multilateral relations” instead of “comple-mentarism” when describing your foreign policy?”82 The most correct evaluation of Armenia’s foreign policy was stated by the former president of the country, Le-von Ter-Petrossian, during his speech at “Freedom” square on 8 December 200783:

79 Lev Freinkman, Cost of Closed Borders for Armenia Trade, Journal of Economic Policy and Poverty,2010, p.980 US imposes sanctions on Armenian entities, 5/9/2002,http:// www.nti.org/db/nisprofs/armenia/excondev.htm81 Armenia: Westward Foreign-Policy Shift Brings Unease in Iran http://www.eurasianet.org/departments/insight/articles/ eav100502.shtml82 Ibid83 Levon Ter Petrosian, “History, Ideology, Typology”, Speech at Freedom Square, 8 December, 2007, available at http:// www.levonforpresident.am/?lang=eng

CONCLUSION

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“Robert Kocharyan and Serzh Sargsyan consider Armenia as their own property, and share it with their family members and far relatives. The officials dismissed in Karabakh were immediately employed in Armenia. And the Karabakh people gradu-ally took over the entire business environ-ment of our country.” While dealing with the Karabakh clan and foreign Diaspora as their desired result, the government deals with the Moscow, since Armenia’s econo-my is paralyzed because of the sale of im-portant state property to Russia in 2003 and the global financial crisis. This type of foreign policy course cannot be called “complementarism” or “a balanced policy”.

Thirdly, Armenia provoked the official intensification of relations with Iran, after the gas crisis between Russia and Ukraine in January 2009, it was reported about the will of European countries to normalise their relations with Iran and efforts of Ye-revan to develop its relations in the name of protecting the country’s interest.84 In reality, even though the origination of this paradigm is justified to some extent with energy interests, it seems impossible for Yerevan to follow a foreign policy far from “Russian” influence. It is possible to note two cases that happened quite recently. First of all, when in April 2006 Russia marked up the price of gas transported to Armenia and closed the Verkhniy Lars crossing point at the Russian-Georgian border (the only one land connection of

84 “Agenda for Armenian Foreign Policy 2009-2010”, Yere-van, Armenia, 2009, p.38, http://www.acgrc.am/Agenda%20 for%20Armenian%20Foreign%20Policy%202009-2010.pdf

Armenia with Russia), even a number of pro-Russian politicians had doubts in re-spect to the reliability of Russia’s policy to-wards it’s the most faithful partner, in this case Armenia. Secondly, in the months of June-July 2010, the Armenian press high-lighted that the development of military situation was against the development of the country as a failure of the state, and characterised Armenia as being under the influence of Russia as “a bad copy”85 of Russia and noted the emerge of negative tendency as the result. In particular, the fear in Armenian society continued until Russia signed the agreement in August extending the period of the use of military bases of Russia in Armenia. All these obvi-ously indicate that Russia has political and economic means permitting to protect its interests in Armenian society, Moscow has deep roots which gives a chance to balance Iran-Armenian relations when a danger-ous moment might come and turn it for its benefit.

In respect to Iran, the following conclu-sions can be made:

First of all, while constantly talking about “brotherhood and Islamic solidar-ity” with Azerbaijan, the Iranian officials deprive millions of Azerbaijanis of the opportunity to have education in their na-tive language and have cultural autonomy. However, they protect cultural and reli-gious interests of the Armenian minority. Thus, today in Iran there are 29 special edu-85 Arman Melikyan: Armenia is a bad copy of Russia, 17 August 2010, http://www.panarmenian.net/eng/politics/ news/52225/

40


cation centers for Armenians. We can refer to kindergartens, secondary schools and lyceums here as well. The Armenians living in Iran have the right to read and write in their native language.86 The official Eastern Armenian language is used in Iran. There are approximately 200 education and cul-tural units of the Iranian Armenians.

Secondly, the Iranian National Oil Company has 10% of shares in the “Shah-deniz” project. Notwithstanding that in 2001 the Iranian vessels attacked the Azer-baijani territory in the Caspian Sea, and were withdrawn through diplomatic mea-sures of Azerbaijan and the unofficial re-sponse of Turkey. Even though Azerbaijan develops bilateral relations also in the en-ergy sector, Tehran tries to realize projects that do not have any economic perspective.

In addition, as the result Iran’s sharp and inexpiable position in the definition of the legal status of the Caspian Sea, the problem has not yet been solved. Since Iran evalu-ates the presence of the West in the region as a threat to its national interests, Tehran’s energy policy cannot be successful. Even though the biggest project, “Nabucco” of the EU “Southern Corridor” is in big need of Iranian gas, Tehran’s position, which is against its national interests, makes the par-ticipation of the country in this project im-possible. Thirdly, Iran sharply responded to the cooperation of the NATO and the USA with regional countries and consid-ers it as a threat to its security. Even though 86 Arman Poladyan, Religious minorities in Iran, Religion and Society Volume n.910, February 2010, http://hra.am/content/library/religion-10.pdf

the president of Armenia, Serzh Sargsyan, denies87, according to the memorandum on cooperation signed in Yerevan between Armenia and Iran in the fields of defence and security88, both have the intention to cooperate ranging from the exchange of attendees of military schools to the estab-lishment of joint ventures for production of defensive products. According to the agreement signed between the ministers of defence of Iran and Armenia, both coun-tries will cooperate militarily during the war. In this case, it is obvious that there was no diplomatic justification for the ef-forts of Iranian officials as a neutral power between the conflicting parties in the solu-tion of the Nagorno-Karabakh conflict. To put it into the words of Tatul Hakobyan, the expert on foreign policy of the Civilitas Foundation of Armenia: “In 1992-1994, Tehran was the main supporting point of Armenia in its integration into the world at the most difficult times”, and today Teh-ran’s peaceful attempts can be evaluated as efforts to help Armenia to overcome a dif-ficult situation.

Fourthly, it becomes obvious that Iran forms its regional policy in the background of the failure of doctrinal principles in its foreign policy. The internal and external changes worries Iran from the perspective of protecting Islamic principles as “Islamic state”.89 The presence of the US in Afghani-

87 See, Serj Sarkissian’s interview to “Ekho Moskvo”, January 201188 Emil Danielyan, Armenia: Yerevan Courts Unlikely New Security Partners -- The U.S. And Iran, Radio Free Eu-rope, Yerevan, 29 March 2002 http://www.rferl.org/nca/fea-tures/2002/03/29032002101905.asp89 Seyid Cəlal Dehkani, Əmniyyəte heste şenaxte dər siyasəte

41



stan gives ground to enlarge cooperation with Russia for balancing the power of Iran, and this brings up ideological prob-lems of Iran, supported by Islamic prin-ciples. It is impossible to explain by any religious ideology the fact that Iran turns a blind eye to human and drug trafficking in the occupied territories of Azerbaijan and establishes actually a “gray zone”. 132 kilometers of the Azerbaijani-Iranian bor-der, which is, de-facto, under the control of Armenia, have been actively used for the production, transit and trafficking of drugs, arms and human beings, illegal mi-gration, concealment of terrorists, money laundering and other dangerous types of transnational crimes.

Thus, in the current situation, the in-tensification by Iran of its relations with Armenia cannot be considered to be effi-cient based on the abovementioned eco-nomic indicators. At the same time, in the regional situation, it seems unreasonable that Iran interferes into domestic affairs of Azerbaijan when the latter’s policy is to build a close neighborhood and friendship with Tehran. Unlike the ‘90s, today Azer-baijan has economic and military capac-ity as well as diplomatic skills to respond to such danger. In 1998, the President of Armenia L.Ter-Petrossian invited the Ar-menian society “to think” in his famous article.9092. It seems there is need for both

xarici Cumhure İslame İran, Revabete Xarici, bahar 1388, 1, s. 54.)90 War or Peace? Time for Thoughtfulness, Levon Ter- Petrossian, 1998 http://khosq.com/hy/article/2009/08/06/ war_or_peace_time_for_thoughtfulness_by_levon_ter_ petrossian_1998

Iranian and Armenian officials to think. One should not forget that logical end of thinking is to make a conclusion.

In the future, efforts of Iran to develop geopolitical relations with Armenia may increase contradictions with the Islamic world. The geo-economic importance of Azerbaijan is associated not as a “corri-dor”, but with the paradigm of “regional transit centre”. Tehran should accept its role as a transit regional player. In this re-spect, demo projects of Iran implemented in Armenia against the will of Azerbaijan will result in lost resources and time. At the present situation, Azerbaijan’s diversified strategy of foreign policy and resources has allowed the finding of a modus vivendi with the regional and non-regional actors. Their peculiar and sometimes contradictory policy will necessitate bringing Iranian-Ar-menian relations in line with geopolitical logic and Tehran drawing back its support for the occupiers.

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Iranian-Armenian Relationsgeopolitical reality political statements NOTES

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geopolitical reality political statementsNOTES

iran-armenia relations: geoplotitical reality versus political statements

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