A New Chapter for the South Caucasus: Armenia Navigates Peace, Regional Integration, and the Future of Karabakh Armenians

Armenian Prime Minister Nikol Pashinyan

The South Caucasus is reportedly entering a new era, marked by recent peace agreements between Armenia and Azerbaijan. Following declarations by Armenian Prime Minister Nikol Pashinyan and the signing of initial agreements in Washington, the region is grappling with complex realities, particularly concerning the fate of Karabakh Armenians and the establishment of lasting stability.

Pashinyan Declares Peace and New Realities

On 18 August 2025, Prime Minister Nikol Pashinyan addressed the Armenian nation, asserting that peace has been established between Armenia and Azerbaijan. He highlighted that the agreements initialled in Washington on 8 August 2025 have ushered in "a completely different, completely new South Caucasus" and a "new Republic of Armenia". Pashinyan acknowledged that this new reality is unfamiliar, stating, "We don't know what peace is, what it means to live and work in peace... We have to learn from scratch what peace means and how to live in peace". He also noted that Armenia has emerged from a "30-year blockade" as a result of these agreements.

The Contentious Issue of Karabakh Armenian Return

A central and highly sensitive issue is the return of Karabakh Armenians to their homes. Following Azerbaijan's one-day operations in Karabakh in September 2023, over 100,000 ethnic Armenians left the region, with most seeking refuge in Armenia. Pashinyan himself had previously described this exodus as "ethnic cleansing," an accusation denied by the Azerbaijani government.

Currently, Pashinyan's stance is that the return of Karabakh Armenians is "not realistic" and even "a dangerous topic for peace." He believes that discussing the return of refugees, both Armenian and Azerbaijani, could "harm peace" and become a new source of tension between the states, an approach he has shared with official Baku. Instead, he asserts that Karabakh Armenians "must settle in Armenia, live here, engage in creative activities and integrate into society as full citizens of the Republic of Armenia". Over 10,000 Karabakh Armenians have reportedly received Armenian passports by August 2025.

This position has sparked protests in Yerevan, with some in civil society deeming it inflammatory. Kristin Vardanyan, a deputy from the "Hayastan" block in the Armenian parliament, stated that peace is "not possible" without resolving the issue of Karabakh Armenians, questioning how peace can be achieved if people are not told where they will live and how they will coexist.

However, some Karabakh Armenians echo Pashinyan's sentiment. Marut Vanyan, originally from Khankendi (Stepanakert), who left after the 2023 operations, stated that Pashinyan is "100 percent right". Vanyan believes that for an ordinary Karabakh Armenian, returning is "simply a dream" due to lingering "bitter memories," "hatred," "fear," and "distrust". Despite this, he admits to missing his home when viewing videos from Karabakh. Richard Giragosyan, head of a regional research centre in Yerevan, noted a sense of resentment among Karabakh Armenians towards Pashinyan's government, but deemed political mobilisation unlikely.

Azerbaijan, for its part, has articulated a reintegration plan for returning Armenians, promising:

• The right to speak their own language.

• Social benefits.

• Employment programmes.

• Exemption from certain taxes.

• Security provided by Azerbaijani police.

The "Trump Route" and Regional Connectivity

A key outcome of the Washington agreements is the establishment of the "Trump Route" (TRIPP), a connection project aimed at linking Azerbaijan's main territory with its Nakhchivan exclave through Armenia's southern region. The joint declaration specifies that Armenia will cooperate with the US and mutually determined third parties to define the framework for this project, committing to achieving this goal "as soon as possible". US President Donald Trump announced that Armenia has agreed to lease the route to the US for 99 years.

Pashinyan stressed that this route would not open "new doors of concern" for Armenia because the Washington Declaration includes the principle of reciprocity, guaranteeing "balanced and mutually acceptable solutions" with Azerbaijan. The declaration further specifies that this route will preserve Armenia's sovereignty, territorial integrity, and jurisdiction. The process for simplifying border crossings along this route will be determined in future negotiations.

International Perspectives and Other Developments

On 19 August 2025, Iranian President Masoud Pezeşkian met with Pashinyan in Yerevan, stating that regional problems should be managed by Caucasus countries themselves, and involving "external powers" only complicates the situation. Pezeşkian reaffirmed Iran's support for Armenia's territorial integrity and its backing for the peace talks between Armenia and Azerbaijan, highlighting the strategic importance of peace for Iran.

Other important issues discussed by Pashinyan included the delimitation and demarcation of state borders between Armenia and Azerbaijan. He also addressed the matter of Armenian prisoners held in Azerbaijan, noting that while Armenia has pushed for their inclusion in a peace agreement since early 2022, they are now pursuing "tremendous diplomatic work" to ensure their return swiftly, independent of the peace agreement's signing.

In separate but related news, reports indicate that a SOCAR (Azerbaijan State Oil Company) oil base in Ukraine's Odesa region was attacked by Russian forces on 18 August 2025, marking the second such incident in recent days.

The recent developments signify a transformative period for Armenia and the South Caucasus, as leaders strive to solidify peace and foster regional integration amidst lingering historical grievances and the complex humanitarian issue of the displaced Karabakh Armenians.