India in the South Caucasus: Implications for Russia, Iran and Turkey

Today, in the South Caucasus, as in many other regional subsystems, the presence of the non-West and the global South is expanding. In this sense, India continues to play the most visible role. In many ways, New Delhi is a factor capable of influencing various regional processes. Indicators present long-term regional intentions (the implementation of transport corridors), that also aim to build strategic relations both with the key centers of power in the South Caucasus and directly with the states of the region at the bilateral level. This demonstrates the potential of New Delhi to become an actor capable of determining processes in the region, not only influencing them.

India's approach to the South Caucasus not only correlates with Russian and Iranian regional interests, but also complements them. In this regard, discussing regional issues on existing international platforms involving Russia, Iran and India (e.g. EAEU and BRICS), which Iran has already joined, may be of some interest. There are at least two identifiable instances where Turkey’s may clash. With this in mind, a political or diplomatic response from Ankara cannot be excluded.

In the South Caucasus, the interests of Russia and India not only do not clash, but are complementary. India does not aim at replacing Moscow's position. On the contrary, it promotes the status quo, reducing the likelihood of conflict by maintaining Russia's ally and sees the region and Armenia as a link to the EAEU.

The current transformation of the world order is accompanied by the growth and rise of new centers of power that are expanding the scope of their presence. One of these centers is India, which has become one of the most visible actors in the South Caucasus over the past year. This raises a valuable question: what are the implications of New Delhi's activity for regional actors?

India Focused on the South Caucasus

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Recent dynamics in the South Caucasus have changed the balance of power in the region. While Russia has traditionally played a leading role, both regional players (Iran and Turkey) and non-regional players (France, the EU and the US) have become more active. Competition for “on the ground” presence and for new negotiation formats now determines the region’s balance of power. The emergence of India as a new actor is an important component that could impact regional dynamics.

Before India became visible in the South Caucasus, Pakistan was notably quite active. In 2017, Baku, Ankara and Islamabad signed a trilateral statement on regional cooperation. Later, in 2020, Pakistan supported Azerbaijan during the war in Nagorno-Karabakh. Islamabad regularly participated in military drills with Ankara and Baku, now known as the “Three Brothers”. In January 2021, the trilateral Islamabad Declaration was signed between the parties, emphasizing solidarity with the government and people of Azerbaijan after the war. It also signaled that the parties attach great importance to promoting peace, stability and development in their own regions (South Caucasus and South Asia) and "endeavor to advance these ideals for the common prosperity and the wider region’s security". Later, in July of the same year, the trilateral Baku Declaration was signed, contributing to the strengthening strategic ties between the three countries. Military and military-technical cooperation between was also realized. However, Pakistan's geographical expansion was not disregarded by India.

However, there is one serious obstacle in the relations between India and Azerbaijan—the latter supports the Pakistani stance on Kashmir. Turkey also has a similar position on this issue. This Ankara-Baku-Islamabad trilateral format became evident in the 2020 Nagorno-Karabakh conflict, when both participants actively supported Azerbaijan's actions. Trilateral cooperation has also inspired India to create its own trilateral format—India, Armenia and Iran. Notably, Armenia has shown clear support for India's approach to Kashmir. This trilateral cooperation focuses mainly on communication and resource management. However, in the future it can be seen as counter to the growing cooperation of the already existing Ankara-Baku-Islamabad format.

Today, India is becoming Armenia's key partner in military-technical cooperation. Previously, this position was taken by Russia, which accounted for over 93% of Armenia's arms and military equipment in 2011–2020. Later in 2021, Yerevan and Moscow signed a new arms supply agreement. However, due to the inability to fulfill the obligations under the contract, due to the outbreak of the conflict in Ukraine, Russian manufacturers were unable to quickly deliver the equipment. Therefore, a vacuum was created in this area, which Yerevan needed to fill as soon as possible, as Baku continued to purchase arms, mainly from Israel and Turkey, putting military pressure on Armenia.

According to various assessments, the total volume of arms and military equipment contracts is estimated at about $2 billion with a wide range of products. The contracts include Pinaka MLRS, SWATHI radars, anti-tank missiles with ammunition, 155mm artillery pieces and anti-UAV systems. Notably, Armenia became the first foreign operator of the Akash SAM system. According to Indian experts, having become the largest importer of Indian arms, Armenia is gradually turning into India's strategic ally in the South Caucasus. In addition to military deals, the mutual appointment of military attachés by the parties was another key moment of progress in the defense sector.

Other important areas of cooperation between Yerevan and New Delhi, which have a strategic dimension, is in transport and logistics. Both countries are interested in the implementation of the Persian Gulf-Black Sea international transport corridor. This project is designed to link India to the EAEU and EU markets via Iran, Armenia, Georgia and the Black Sea, especially given the fact that India is facing logistical problems connecting with the EU both via Russia, due to the conflict in Ukraine, and via the Suez Canal, due to traffic congestion and growing tensions in the Red Sea. According to the plan, the cargo will be transported to Iran's Chabahar port, then it can reach Russian and European markets via Armenia and Georgia. With continued economic growth, as well as tensions expanding in the Middle East, it is important for New Delhi to diversify trade routes to connect faster and more securely with its important markets.

The other areas of cooperation between Armenia and India are secondary, but are designed to support the deepening relations. Such is demonstrated with the discussion and signing of cooperation agreements relating to the economy, investments, energy, customs control, migration, etc.

Implications for Russia

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The step-by-step expansion of India's presence in the South Caucasus may be met by regional players in a variety of ways, depending on the extent to which interests overlap or clash. Given the role and place of the region in Russia's current foreign policy strategy, the following implications are highlighted.

First, the confrontation between Russia and the West is already projected into regional subsystems and is perceived as a zero-sum game. In this context, India is not part of the collective West and does not project its interests. Competing in the region, which is within Russia's sphere of interest, is not on India's agenda. Therefore, New Delhi's expanding presence in the South Caucasus does not threaten Russia’s zero-sum game approach.

Second, India considers Armenia as a bridge to the EAEU. Negotiations on the creation of a free trade zone continue between the parties, as New Delhi is now preparing to become an observer country of the EAEU in 2024. In this context, Armenia is perceived as a natural extension of the economic union capable of linking the EAEU and India.

Third, India's arms supply to Armenia, Russia's only CSTO and EAEU ally in the region, strengthens Yerevan's military capabilities. This, in turn, helps level out the balance of power in the South Caucasus, reducing the risk of a new escalation, which is in line with Moscow's interests. Given Russia's inability to supply arms, Armenia has found a compromise (from a political viewpoint) in terms of a non-Western partner.

Fourth, an important link between the EAEU and India should be the implementation of the Persian Gulf-Black Sea trade route, which is not opposed to the Russian North-South initiative, but is complementary to it. In this context, an important role will be played by Iran, which has signed an FTA with the EAEU, and through whose territory will exchange communication, linking India with Armenia, and further—with Russia and the entire market of the Union.

Thus, in the South Caucasus, the interests of Russia and India not only do not clash, but are complementary. India does not aim at replacing Moscow's position. On the contrary, it promotes the status quo, reducing the likelihood of conflict by maintaining Russia's ally and sees the region and Armenia as a link to the EAEU.

Implications for Iran

India's increased presence in the South Caucasus is important for Iran for several reasons. First, it increases Tehran's role as a transit country not only regionally but also globally. India's participation in the modernization of the Chabahar port and its subsequent involvement in the development of the Persian Gulf-Black Sea and North-South transport corridor will strengthen Iran's position as a hub connecting India with Europe and Russia. These routes may increase their relevance as an alternative route against the backdrop of the ongoing escalation along the border of traditional Middle Eastern routes. In this sense, Armenia’s support, through whose territory these routes will pass, will accelerate the project implementation processed and increase Iran's importance.

Second, the development of military-technical cooperation between Yerevan and New Delhi will contribute to Armenia building up its military potential. Today, Iran conducts an active and largely preventive policy in order to maintain its status quo and prevent the Turkish-Azerbaijani bloc from strengthening any further. This leads to the need to accumulate political, diplomatic and military means, as was the case, for example, in 2022, when Tehran managed to stop Azerbaijan's large-scale aggression against Armenia. Such actions cannot avoid creating tensions between Tehran and Baku. At the same time, Yerevan has to use additional instruments of deterrence, for example, by deploying an EU observer mission to the border. Therefore, increasing Armenia's defense capabilities can lead to a situation where Yerevan will become the dominant provider of its security and will not seek additional support from the EU and Iran.

Thirdly, strengthening India's position in the South Caucasus will help to level out the regional power balance. Today, the presence of non-regional actors, such as Israel and Pakistan, on the side of Azerbaijan, which have confrontational or competitive relations with Iran, cement power imbalances. Therefore, if India's involvement in the region, as well as its rapprochement with Armenia, is brewing these imbalances, Iran may positively welcome this prospect.

Overall, India and Iran's interests in the South Caucasus are largely complementary, both in terms of developing communication and increasing Iran's role, as well as levelling out the balance of power in the region. The only problem that may cause some kind of “jealousy" between the two is Armenia's preference to develop military-technical cooperation with India rather than Iran. Tehran was ready to provide Yerevan with the necessary armaments, but the Armenia abstained from military-technical cooperation. At the same time, with Tehran regularly providing its territory as a transit hub of Indian arms to Armenia, this indicates the absence of a real conflict of interests. Therefore, this factor can be perceived as a healthy competition for the arms market.

Implications for Turkey

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One of the beneficiaries of the change in the balance of power in the South Caucasus following the 2020 war is Turkey. It has legitimized its military presence in the region, signed a strategic document with Azerbaijan and successfully promoted its "3+3" negotiation format, which was accepted by the key centers of power—Russia and Iran. In other words, the expansion of Turkey's political, diplomatic and military presence in the South Caucasus allows Ankara to impact and sometimes even set the agenda in the region.

The emergence of a new actor such as India may have implications for Turkey in the context of the balance of power in the region and transport-related communication. In the first case, the consequences developing military-technical cooperation between Yerevan and New Delhi do not correlate with Ankara's interests in the region, as the recalibration of the balance of power will not be directed in favor of Turkey's strategic ally. However, in this context, the most pressing issue may be the India-promoted implementation of transport and logistics routes. Today's Turkey, which has global ambitions, is implementing numerous projects that are aimed at strengthening its position in communication systems (both transport and energy). This focus is designed to turn Turkey into one of the major hubs. In this regard, various communication and energy projects are being implemented—“Middle Corridor”, "Southern Gas Corridor" and others.

Generally, these routes are latitudinal and connect Europe with Asia along the “West-East” line through Turkey’s territory. In this sense, they compete with the North-South and Persian Gulf-Black Sea longitude transport routes, which pass through Iran. The implementation of these projects will not only strengthen Tehran's position in the struggle for regional leadership, but will deprive Ankara of the role of a transit hub, which it seeks to monopolize. An important link in this context is India, which contributes both to unlocking Iran's transport potential and getting involved in communication projects in the South Caucasus.

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Today, in the South Caucasus, as in many other regional subsystems, the presence of the non-West and the global South is expanding. In this sense, India continues to play the most visible role. In many ways, New Delhi is a factor capable of influencing various regional processes. Indicators present long-term regional intentions (the implementation of transport corridors), that also aim to build strategic relations both with the key centers of power in the South Caucasus and directly with the states of the region at the bilateral level. This demonstrates the potential of New Delhi to become an actor capable of determining processes in the region, not only influencing them.

India's approach to the South Caucasus not only correlates with Russian and Iranian regional interests, but also complements them. In this regard, discussing regional issues on existing international platforms involving Russia, Iran and India (e.g. EAEU and BRICS), which Iran has already joined, may be of some interest. There are at least two identifiable instances where Turkey’s may clash. With this in mind, a political or diplomatic response from Ankara cannot be excluded.