Iran will boost its influence in the South Caucasus

Significance Relations between Iran and the South Caucasus states, Armenia, Azerbaijan and Georgia, are in flux, driven by various geopolitical and economic concerns. Despite ever closer ties, tensions between Tehran and Moscow over the proposed Zangezur corridor heightened earlier this year but have since eased. Impacts Armenia and Azerbaijan are close to signing a peace agreement, which would reduce the ability of external actors to intervene in the region. Russia and Iran will continue work on expansion of the International North-South Transport Corridor (INSTC). Armenia’s relations with Iran will remain robust as Tehran is interested in strengthening Yerevan’s position vis-à-vis an emboldened Baku. Georgia’s political and economic ties with Iran will not strengthen significantly in the near future.