![The Azeri Army has cultivated a range of international relationships over the years, the unit shown here was participating in a multinational exercise led by the US in Georgia. [Image: US Army]](https://tbh.center/wp-content/uploads/2026/08/New-Options-for-Azerbaijan.jpg "New Options for Azerbaijan")
For Azerbaijan, the significance of Armenia’s parliamentary elections on 7 June 2026 extends beyond the political orientation of its immediate neighbour. While much of the international discussion in recent months surrounding Prime Minister Nikol Pashinyan’s re-election has focused on Armenia’s developing relationship with the European Union and the gradual erosion of Russian influence in the South Caucasus, Baku views the outcome through a somewhat different lens.
The key question was not whether Armenia is continuing to move ‘closer’ to Europe, but whether the government in Yerevan is actually capable of implementing political and legal (constitutional) commitments Baku wants in order to consolidate the post-conflict order following Azerbaijan’s military victory in 2023.
In many ways, Azerbaijan is also entering a new phase, but from a position of considerable strength. The military campaigns that fundamentally reshaped the South Caucasus over the past five years achieved what Azerbaijan had pursued since independence. First, the 2020 war restored Azerbaijani control over much of the territory lost during the collapse of the Soviet Union. Then, the lightning September 2023 operation effectively ended the existence of the self-proclaimed Armenian administration in Nagorno-Karabakh and re-established Baku’s authority across the entire territory internationally recognised as part of Azerbaijan.
From Baku’s perspective, the territorial dispute that dominated regional politics for more than three decades has been resolved. Yet military victory has not automatically produced a comprehensive political settlement. A final peace agreement between Armenia and Azerbaijan remains incomplete. Border delimitation continues, transport routes remain largely closed, and mutual distrust built up over decades of conflict has not disappeared because the balance of power has shifted.
The challenge facing Azerbaijan’s leadership is therefore no longer how to alter the regional status quo, but how to consolidate it. This is why the re-election of Pashinyan matters. Armenia’s Prime Minister is not viewed in Azerbaijan as a political ally. Indeed, many of the most serious confrontations between the two countries occurred during his time in office. Yet there is also a growing recognition in Baku that Pashinyan may be the only Armenian leader currently capable of delivering the compromises needed to move the peace process forward.
The Pashinyan government’s acceptance of Armenia’s internationally recognised borders, its emphasis on regional normalisation, and its increasingly pragmatic approach towards relations with Azerbaijan all stand in contrast to the more maximalist positions advocated by some nationalist opponents. The June 7 election result therefore offers a degree of continuity at a moment when Azerbaijan’s priorities are increasingly shifting from military affairs towards economics and connectivity.
This reflects a broader transformation underway within Azerbaijani strategic thinking. For decades, the country’s geopolitical importance rested primarily upon oil and gas exports and unresolved conflict. Today, a new set of opportunities is emerging. Russia’s war against Ukraine has accelerated European efforts to diversify transport routes, supply chains, and energy networks. As a result, the South Caucasus has taken on greater significance as part of eastwest connectivity linking Europe with Central Asia.
And it is Azerbaijan that occupies the central position within this developing landscape. The Port of Baku on the Caspian Sea, railway links connecting the Caucasus to Türkiye, expanding logistics infrastructure, and established energy export networks have all increased the country’s strategic relevance. Cargo volumes moving across the so-called Middle Corridor have risen considerably since 2022, while European and regional actors have intensified efforts to develop alternative routes that bypass Russia.
The strategic value of regional stability has increased as transport corridors, infrastructure investment, and cross-border trade, all require a degree of predictability that prolonged conflict cannot provide. In this regard, peace with Armenia is now viewed not so much as a diplomatic objective, but more as an economic necessity. Importantly, the possible reopening of transport routes connecting Azerbaijan with its Nakhchivan exclave are part of this wider picture.
Although disagreements remain over implementation and legal arrangements, the broader principle of restoring regional connectivity has gained support among multiple external actors. The United States, the European Union, Türkiye, and various Central Asian governments all see value in improving transport links across the South Caucasus. For Azerbaijan, such projects offer economic benefits while simultaneously reinforcing its position as a critical transit state between Europe and Asia.
Beyond economics, these initiatives are increasingly linked to wider geopolitical interests. The proposed Trade Route for International Peace and Prosperity (TRIPP), championed by the US and supported by several regional partners, reflects broader efforts to strengthen east-west connectivity across the South Caucasus, while reducing dependence on routes passing through Russia. Although details are still to be fleshed out, TRIPP aligns with Azerbaijan’s longer-term objective of positioning itself as a key transit hub linking Europe, the Caspian basin, and Central Asia. For Baku, TRIPP offers an opportunity to convert its place in the region into lasting economic and geopolitical influence.
There are still significant obstacles for Baku however, for example with Iran. Relations with Tehran require careful management since Iran is ultra-sensitive to geopolitical changes along its northern border and has long expressed concerns regarding regional transport projects that, in its view, will alter existing strategic balances. At the same time, Azerbaijan’s close defence relationship with Israel continues to generate unease among Iranian policymakers, particularly against the backdrop of wider regional tensions.
Iran’s position also adds a further layer of complexity. Although Tehran has cautiously improved relations with Baku in recent years, it continues to view developments in the South Caucasus through a wider strategic lens. For example, Iranian policymakers remain sensitive to any transport arrangements that could alter regional power balances, reduce Iran’s role as a transit state, or expand the influence of Türkiye, Israel, and the United States along its north-western frontier. While Tehran’s rhetoric regarding regional connectivity projects has become somewhat more pragmatic than in previous years, concerns surrounding transport routes through Armenia’s southern Syunik province have not disappeared. For Azerbaijan, maintaining momentum behind regional integration while avoiding unnecessary friction with Iran will remain a key element of its wider strategy.
Russia presents a different challenge for Baku though. Although Moscow’s influence in the South Caucasus has noticeably declined, it remains an important actor with long-term political, economic, and security interests. Azerbaijan has by and large sought to maintain a pragmatic relationship with Russia while avoiding the direct confrontations that have characterised some of Moscow’s other relationships within the former Soviet space. This balancing act has helped preserve Azerbaijan’s strategic flexibility, though it may become increasingly difficult as regional alignments continue to evolve.
For Europe, meanwhile, Azerbaijan’s growing importance creates both opportunities and dilemmas. European interest in Azerbaijani energy exports has increased substantially since the outbreak of the full-scale war in Ukraine, while wider connectivity initiatives have elevated the country’s profile within discussions surrounding economic resilience and supply-chain diversification. However, Azerbaijan remains a state that prioritises strategic autonomy and resists becoming fully aligned with any single geopolitical bloc. This approach is not likely to change anytime soon. Instead, Baku appears determined to maintain productive relations simultaneously with Türkiye, the European Union, Central Asian partners, Israel, China, and, if possible, Russia. Such a balancing act reflects not only Azerbaijan’s geography, but also its wider ambition to maximise flexibility within an increasingly fragmented international environment.
Three years after regaining full control over Nagorno-Karabakh, Azerbaijan finds itself facing a whole new set of challenges. For much of the post-Soviet period, Azerbaijani strategy was centred on changing the regional order. Today, it is increasingly focused on preserving and institutionalising the new order that emerged from the conflicts of 2020 and 2023.
The significance of Pashinyan’s re-election lies firmly within this context. The result does not guarantee peace, nor does it eliminate obstacles that continue to complicate relations between Armenia and Azerbaijan. It does, however, preserve the possibility that military outcomes can eventually be translated into political agreements and economic opportunities. For Baku, that may now represent the most important strategic objective of all.
Author: David Liddell
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