Russia at Risk of Losing Control of Railways in Armenia

Russia at Risk of Losing Control of Railways in Armenia

Executive Summary:

• Yerevan wants Moscow to cede Russian control of South Caucasus Railway to a third country with good relations with both Armenia and Russia, with Kazakhstan, the United Arab Emirates, and Qatar most often mentioned.
• That would end Russia’s control of railways in Armenia under a 2008 agreement currently set to run to 2038 and deprive Moscow of yet another of its levers in the South Caucasus, thereby allowing Yerevan to pursue a more independent line.
• Moscow is reluctant, and if it resists, Yerevan could denounce the 2008 agreement and seek a partner even less to Russia’s liking, including the People’s Republic of China (PRC) and the European Union, which would not want Moscow to slow east–west trade.

Russia’s once powerful railways once dominated both the entire Soviet space and the Soviet empire abroad. They are now at the point of collapse, however, both domestically and internationally. Within the Russian Federation, Russian Rail is suffering from sanctions, aging equipment, and a lack of investment that is reducing its effectiveness in tying the country together and helping Moscow export raw materials (Riddle, December 12, 2025; see EDM, January 13, February 18; Svobodnaya Pressa, March 28). Abroad, ever more countries that Moscow formerly dominated are going their own way, changing from Russian gauge to international gauge tracks and otherwise limiting Russian influence in ways that will make it ever more difficult for Moscow to recover its former position (Window on Eurasia, April 28, 2016, December 1, 2023, May 14, 2025). Moves in that direction are becoming clear in Armenia, whose position as a potential transit country has dramatically increased amid the peace process for the Second Karabakh War, and whose government is now seeking to get out from under the Russian influence it tolerated earlier when it had few alternatives.

In recent weeks, Yerevan has been pressing Moscow to sell its control of South Caucasus Railway, Armenia’s sole railway operator and a subsidiary of Russian Railways, to a third country with good relations with both Armenia and Russia. Armenian officials have suggested that Kazakhstan, the United Arab Emirates, and Qatar are among the interested parties. If that happens, it would end Russia’s control over railways in Armenia—which is under a 2008 agreement set to run to 2038—and deprive Moscow of yet another of its levers of control in the South Caucasus. This would not only help Armenia develop economically but also allow it to pursue a foreign policy increasingly independent of Russia (see EDM, August 5, 2024). The Russian government does not want to agree, but if it resists too much, Yerevan could respond by denouncing the 2008 agreement and seeking an alternative partner to help run its railways. This would be even less to Russia’s liking, as Yerevan appears confident that other partners—particularly the People’s Republic of China (PRC) and the European Union, which would not want Moscow to slow east–west trade —would back Yerevan, further reducing Moscow’s leverage.

Railways played a key role in Armenia’s integration into the Russian and then Soviet political space. When the Soviet Union disintegrated, those links were largely shattered. Armenia’s railway problems were compounded by the closure of the country’s borders with Azerbaijan and Türkiye following the First Karabakh War, and by Yerevan’s inability to prevent the deterioration of the lines (Journal for Conflict Transformation: Caucasus Edition, April 30, 2025). The situation became so dire that in 2008, Yerevan agreed to transfer control of Armenian Railways to Russian Railways under an agreement scheduled to run until 2038. With the end of the Second Karabakh War, the opening of transit with Azerbaijan, and the warming of Yerevan’s relations with Türkiye, the situation has dramatically changed. As a result, Armenia under Prime Minister Nikol Pashinyan has been seeking to increase Yerevan’s control over its railway system, which requires reducing Russia’s role in that sector and will inevitably lead to a decline in Moscow’s influence in Yerevan more generally (Caspian Post, February 18).

Since the August 2025 summit in Washington D.C., at which the leaders of Azerbaijan and Armenia announced plans for the opening of the Trump Route for International Peace and Prosperity (TRIPP) (formerly referred to as the Zangezur Corridor by Azerbaijan) transportation corridor via Armenia’s Syunik Province, Armenia has increasingly questioned Russia’s role in controlling its railways (see EDM, August 12, September 8, 2025). In December, Pashinyan announced that he had asked Moscow to “urgently address” the restoration of rail links in Armenia to Nakhchivan and Türkiye, steps he said were required by Russian Railway’s current role as the owner of South Caucasus Railway (OC Media, December 19, 2025). A few weeks later, Baku said it would reopen transit to Armenia and provide a link so that Armenia could reach Russian rail via Azerbaijani territory (see EDM, November 6, 2025; International Railway Journal, January 26).

In early February, Russian Deputy Prime Minister Aleksei Overchuk said that Moscow had “decided to begin substantive negotiations” with Yerevan about the restoration of the two short sections of rail in Armenia connecting it with Türkiye and Nakhchivan (OC Media, February 13). In response, Pashinyan said that “there is no need for negotiations” for something Russia is required to do by the 2008 accord. He then raised the discussion to a political level by suggesting that Russian Railways’ role in Armenia was causing Yerevan to lose its competitive advantage, as some countries do not want to invest in Armenian routes because of Russia’s presence there. He pointed out that several states, including Kazakhstan, the United Arab Emirates, and Qatar, could serve as replacements for Russia as the manager of South Caucasus Railway (RBC, February 13; International Railway Journal, March 5; Arka. am, March 26). Commentators in Kazakhstan have shown enthusiasm for this possibility (Altyn-Orda, March 26).

Moscow reacted with outrage. The Russian Foreign Ministry denounced Pashinyan’s words, and Russian Security Council Secretary Sergei Shoigu said that Armenia’s railways would simply collapse “overnight” if Russia were to lose its management rights (TASS, February 18; Türkiye Today, February 19). Despite this language, the Russian government decided that it risked more by not engaging and subsequently entered into working-level talks with Yerevan about the future of Russia’s role in managing Armenia’s railways. Pashinyan suggested that this became possible because cooler heads in Moscow recognized that Armenia’s proposals were not directed against Moscow and that shifting control to a third country with good ties to both Russia and Armenia would be a workable compromise (Armenpress, March 5).

Unsurprisingly, Moscow is resisting. Pashinyan has since taken a more cautious position, saying that any change in the status of the South Caucasus Railway must be achieved through negotiations rather than unilateral action. “Scrapping a contract is always a bad thing,” he said, with a negotiated agreement the best way forward (Oragark, March 9). Armenian Speaker of Parliament Alen Simonyan said that several countries have already expressed interest in acquiring the Russian concession for the South Caucasus Railway. He said he had been meeting with various ambassadors. He believed that such a change in railway management would align with Yerevan’s national interests (Russia’s Pivot to Asia, March 5).

Other Armenian officials, including most prominently Foreign Minister Ararat Mirzoyan, are maintaining a tougher line. If Moscow modernizes the links Yerevan is most concerned about, that would be well and good. If it does not, or if it acts in ways that discourage investment by other countries in Armenia, however, then other steps will have to be considered (1lurer.am, March 23).

It is unlikely that any decision will be made in the immediate future. That such statements are being made at all, however, shows just how much the situation has changed not only in transportation in Armenia with the development of the TRIPP, but also in Armenia’s relations with Moscow more generally—and how much influence Russia has already lost.