State of Peace and Conflict 2025

CWA # 1901
State of Peace and Conflict 2025
Armenia-Azerbaijan Peace Deal: Protracted Conflict, Conditional Peace and the American Interest
Conflict Weekly #313, 31 December 2025, Vol. 6, No. 52

Rohini Reenum
31 December 2025

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What happened?
In March, Armenia and Azerbaijan finalised a draft peace agreement to end the four-decade-long conflict. The Agreement on Peace and the Establishment of Interstate Relations between Azerbaijan and Armenia came after bilateral negotiations; however, was not signed by the parties due to Azerbaijan’s two preconditions: it called for a closure of the Minsk Process and an amendment of the Armenian constitution.

In July, leaders of both countries met in the UAE to resolve the contentious issues, without yielding any results.

On 8 August, Armenian Prime Minister Nikol Pashinyan and Azerbaijan’s

President Ilham Aliyev signed a US-brokered peace deal. The deal included the initialling of the aforementioned peace agreement and a vow to make efforts towards its signing and ratification. The deal also included a US-proposed transit corridor dubbed the Trump Route for International Peace and Prosperity (TRIPP). Additionally, both countries jointly appealed for the closure of the Minsk Process and related institutions, including the OSCE Minsk Group. Trump stated: “The countries of Armenia and Azerbaijan are committing to stop all fighting forever; open up commerce, travel and diplomatic relations; and respect each other’s sovereignty and territorial integrity.”

On 9 August, Russia commended the peace deal and cautioned that “the involvement of non-regional players should strengthen the peace agenda, not create new divisions.” Turkey welcomed the deal, terming it a “very beneficial development.” Iran cautiously welcomed the deal, rejecting the proposed corridor passing near its border, terming it “worrying” and “political treachery.”

On 18 August, Iranian President Masoud Pezeshkian met Armenian Prime Minister Pashinyan in Armenia and conveyed apprehensions over the transit corridor. Pezeshkian cautioned: “Governance in the Caucasus region must remain Caucasian – outsourcing the resolution of Caucasus issues to extra-regional forces will complicate it.” Pashinyan clarified: “Roads passing through Armenia will be under the exclusive jurisdiction of Armenia, and security will be provided by Armenia, not by any third country.”

What is the background?
First, a decades-long protracted conflict. The conflict has been over attaining and retaining control of Nagorno-Karabakh, an enclave in Azerbaijan with a majority ethnic -Armenian population. Originally a part of the Russian empire, Nagorno-Karabakh was rebranded by the erstwhile Soviet Union as the Nagorno-Karabakh Autonomous Region and brought under the Soviet Socialist Republic of Azerbaijan, which was then a part of the Soviet Union. The conflict started with the breakdown of the Soviet Union in the late 1980s. While Azerbaijan wanted to retain control over Nagorno-Karabakh, the latter’s regional parliament voted to become an independent republic in 1991. A war broke out over the issue in 1992 and lasted until a ceasefire was brokered by Russia in 1994. Armenia gained control of the region, along with adjoining Azerbaijani territories. In 2020, a second war broke out with Azerbaijan launching an offensive. A Russia-brokered ceasefire ended the war, with Armenia agreeing to return all occupied territory outside the former Soviet Nagorno-Karabakh Autonomous Region to Azerbaijan. Russian peacekeepers were also stationed at the Lachin Corridor, which connects Nagorno-Karabakh with Armenia. Subsequently, in 2023, a lightning Azerbaijani offensive helped recapture Nagorno-Karabakh, while causing a mass exodus of Armenians from the region. This, however, propelled negotiations for a peace agreement, which culminated in the current peace deal.

Second, previous failed peace attempts. The first formal attempt was the creation of the OSCE Minsk Group in 1992 with co-chairmanship of France, Russia and the US. The group met several times with Armenian and Azerbaijani delegations, but no resolution was reached. After the second war, Azerbaijani President Aliyev took the position that the group was no longer needed as the conflict had been resolved since Baku had recaptured the region. The Russian invasion of Ukraine further derailed the process as Russia and the US refused to communicate within the format. After the 2023 offensive, Aliyev called for a complete dissolution of the process. The second formal attempt was the finalisation of the above-mentioned peace agreement. Few points of contention remained, with Baku demanding that Armenia amend parts of its constitution that lay claim to Azerbaijani territories. Meanwhile, Armenia remained apprehensive of the Azerbaijani demand for a transit corridor linking it to its Nakhchivan exclave bordering Turkiye.

Third, the proposed transit corridor and the US interest. The corridor conundrum was resolved in principle by the US proposal to develop a transit corridor between the two countries. This move effectively fulfilled Azerbaijan’s longstanding demand to connect with its exclave and assuaged Armenia’s apprehensions regarding its territorial sovereignty (Azerbaijan had demanded unrestricted access to its exclave via Armenian territory). The White House said that the corridor would be leased for 99 years and the country will have exclusive developmental and management rights, wherein US private companies will engage in investments and infrastructure development. The proposed corridor also has the potential to become a key geo-economic asset for the US, as it could provide alternate trade routes between Europe and Asia, bypassing Russia. Further, Forbes has estimated that the corridor could generate around USD 50-100 billion in annual trade flows.

Fourth, the sidelining of traditional regional players. Russia was the traditional mediator and security guarantor in the region with overt support for Armenia. However, Russia’s preoccupation with the Ukraine conflict caused its eventual decoupling with Armenia following its failure to rescue the latter during the 2023 Azerbaijani offensive. The derailing of the Minsk process further reduced its involvement in the peace process. This was reflected in the Russian President Vladimir Putin’s reattempt to mediate a peace deal in 2024, which went unheeded. Turkey, which had traditionally backed Azerbaijan in the conflict and part of the Minsk process, was also not consulted in the recent peace negotiations. Iran, which is a key Armenian ally and neighbor, was by and large excluded from the peace process.

What does this mean for 2026?
First, the probable roadblocks to the peace deal. The fundamental issue that can arise is non-adherence (by choice or otherwise) to proposed and promised terms by either party. Any protracted conflict has points of contention that reappear intermittently and have the potential to sabotage the peace process. For instance, to amend its constitution to accommodate the Azerbaijani demand, Armenia will have to hold a “popular referendum,” a process that is as tedious as unpredictable. Meanwhile. Armenia’s parliamentary elections are scheduled for June 2026, which makes it highly unlikely that the incumbent president will try any unpopular moves. Another roadblock is likely be the exclusion of traditional players, which not only border the countries but also have significant economic and geopolitical stakes in the region; with their respective spheres of influence, roles, and interests, they are unlikely to abandon, especially Russia and Iran.

Second, the rise of Trump as a peace-broker. This deal has cemented Trump’s image as an unconventional peace broker with geo-economic opportunism as his tool and low-hanging fruit for the parties involved. This method, however, has a significant drawback. The success of the peace deal is contingent upon the economic gambit delivering its due in time. For instance, given the centrality of the TRIPP to resolving the strategic demands and concerns of both parties, the success of the peace deal has been, at least in part, conditional on the success of the corridor. Fortunately, Armenian Prime Minister Pashinyan informed in November that construction on the TRIPP will commence in the latter half of 2026. Unfortunately, the history of international relations is replete with examples of proposed, initialized and abandoned corridors. Consequently, the success of the peace deal will also depend on the US’s commitment towards the process and its effective implementation.

Third, the US’s inroads into the South Caucasus. The American move, although seemingly motivated by economic considerations, can also be viewed as aimed towards making inroads into a region that was traditionally a Russian sphere of influence. With the existing presence of US’s two historical foes in the region, namely Russia and Iran, there are fears, with good reason, that this might turn the South Caucasus into a theatre of geopolitical rivalry, destabilizing the entire region.

About the author 
Rohini Reenum is a PhD student at NIAS, Bengaluru. 

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