By John Drennan, Research Assistant and Programme Officer, Russia and Eurasia Programme

On 10 July, the Armenian leadership publicly rebuked its ally and patron, Russia, regarding its engagement on regional security for the first time. President Serzh Sargsyan criticised the Russian government for its decision to move forward with a $1 billion arms delivery to Baku, saying: ‘This is a very painful issue for us. Our people are extremely concerned that our strategic partner is selling weapons to Azerbaijan’. As recently as May, Armenian officials said they were unconcerned by the rumours of the sale. It seems that Yerevan has recalculated, fearing that its strategic advantage in the region actually might be shifting in Baku’s favour.

The arms sale was in fact a series of agreements signed in 2011 and 2012 that had been put on hold. The deal reportedly includes almost 100 T-90C tanks, Smerch and TOS-1A multiple rocket launchers and Msta-A and Vena artillery cannons. Driven by the Russian arms industry, the sale is seemingly in tension with official defence policy, which in the case of the alliance with Armenia is managed by the ministry of defence, which has a base in the country. Reuters, citing a source in the Russian defence ministry, highlighted this clash of interest groups: ‘the order had been on hold for some time to avoid upsetting the military balance in the South Caucasus, where Russia has a military base in Armenia and an agreement to defend the country if it comes under attack. But the deal had been pushed through at the behest of Russia’s powerful arms industry’. As such, a situation now exists where Russian troops could be killed by Russian weapons if the country intervened on Armenia’s side in a hypothetical conflict.

The strategic balance, long in Armenia’s favour, is the result of the evolution of the conflict since the breakup of the Soviet Union. Because Soviet force posture in the Caucasus favoured Azerbaijan, Baku was left with an advantage, at least initially. But the Armenians were a more capable fighting force.

Armenia and Azerbaijan have officially been at war since late 1992, the year after they became independent states. The conflict centres around Nagorno-Karabakh, an Armenian-majority enclave within Azerbaijan’s internationally recognised borders. While Armenia publicly denied providing troops to support the Nagorno-Karabakh Republic Defense Army (NKRDA), it did provide materiel and other resources. Additionally, the Armenian diaspora provided significant aid and succeeded in lobbying the US Congress to ban American military aid to Azerbaijan. At the same time, the Azerbaijani Armed Forces were in general disarray as morale was badly shaken by the loss of territory. By 1994, Baku was compelled to sign a ceasefire and the self-declared Nagorno-Karabakh Republic occupied several strategically important districts outside of the enclave, a total of roughly one-sixth of Azerbaijan’s territory.

Since then, skirmishes have occurred along the ‘Line of Contact’ between the two sides, but full-scale war has not re-erupted. In general, the military balance in the region has favoured Armenia and the NKRDA. The issue of Nagorno-Karabakh has also been a central driver in Armenian policy, as many Karabakhis serve in the Armenian government.

However, as the Azerbaijani economy – boosted by soaring hydrocarbon revenues – has boomed, so too has its defence budget increased. Indeed, as early as 2008 some analysts began suggesting that the regional balance might be starting to shift in Baku’s favour. As documented by the IISS Military Balance, Azerbaijan’s defence budget has far outpaced Armenia’s; by 2013, Baku was spending $2bn to Yerevan’s $447 million. Moreover, the Azerbaijani Armed Forces had 66,950 active duty personnel to Armenia’s 44,800.

This discrepancy in resources has been balanced by Armenia’s alliance with Russia, which has provided assistance in the form of weapons, upgraded technology and training, as well as the physical presence of Russian troops at a military base in Gyumri. This base hosts roughly 3,300 troops; this includes a fighter squadron and SAM battery, which defends Armenian airspace.

However, it is unclear how Russia would react should full-blown conflict resume between the two countries, as the legal obligations of the Collective Security Treaty Organization, of which Armenia and Russia are members, present certain ambiguities.

Those obligations seem to extend only to Armenia’s internationally recognised territory, which would exclude Nagorno-Karabakh. Article 4 of the treaty stipulates that ‘aggression against one of the States Parties…will be considered as an aggression against all’ other signatories. Furthermore, all other CSTO members are required to collectively defend any member subjected to aggression. If a potential future conflict is contained within Azerbaijan’s internationally recognised territory, the other CSTO signatories would not formally be obligated to intervene.

Legal formalities aside, it is unclear how Russia would react given its strong ties with the Armenian military and interest in avoiding a rapid change in the regional balance.

Recently, some of the worst violence has occurred in Nagorno-Karabakh since the early 1990s, potentially signalling the conflict’s shift from a ‘frozen’ to a more active state. In that context, Azerbaijani President Ilham Aliyev took to Twitter on 7 August, publishing a wide range of bellicose rhetoric, including one tweet that stated ‘The war is not over. Only the first stage of it is. But the second stage may start too’. As such, Yerevan has been forced to confront the very real potential for renewed violence in the context of a new reality in which it may no longer be able to easily win – or at least maintain its hard-fought gains – against Azerbaijan.

These fears are exacerbated by the realisation that Russia’s ties with Azerbaijan are growing in significance, despite Armenia’s major concessions to Moscow. In autumn 2013, at Moscow’s request Yerevan abruptly reversed course on a trade and integration deal with the EU in favour of the Eurasian Economic Union.

But loyalty does not seem to be buying Armenia the changes in Russian policy that it seeks. The nature of the partnership is such that Yerevan’s asymmetrical dependence on Moscow creates a situation where the risk of abandonment outweighs the risk of Russian entrapment. This dependence has been further exacerbated by the competing, powerful interest group (the arms industry) driving Moscow’s decision to sell weapons to Azerbaijan. As the junior partner, and much weaker country, Armenia’s only choice is to go along with Russian policy. While unprecedented, Armenia’s criticism is more an act of desperation than a strategic shift and is unlikely to change Moscow’s policy in any way.

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