Welcome to the South Caucasus Brief, a monthly update from the Institute for Security Analysis. Now more than ever, stakeholders need clarity and cohesion when it comes to South Caucasus policy. In this newsletter, ISA’s experts provide personal observations and analysis on overlooked developments reshaping the South Caucasus.

Leading this month

On August 24, while presiding over a meeting of the incoming parliament, Prime Minister Nikol Pashinyan struck a combative tone, declaring the advent of the Fourth Republic. This new political era is rooted in the concept of “Real Armenia” — an ideological vessel for Pashinyan’s policy priorities — bent on fundamentally reshaping Armenia’s national life and identity.

“Real Armenia” — Armenia’s de facto governing ideology — effectively elevates appeasement to state policy. Its ideological tenets eschew longstanding national priorities in favor of vague notions of “peace” and regional accommodation. Much of its substance echoes decades-long Azerbaijani, Turkish and Russian narratives — hence the concern across quarters of Armenian society.

And the incoming government’s policy program seeks to catapult Pashinyan’s ideological ambitions into reality. The five-year action plan covers a wide range of issues including normalization with Azerbaijan, TRIPP, and constitutional changes, among other priorities. Its constitutional reforms have attracted significant attention. The government aims to float a new constitution, with proposals to remove language long contested by Azerbaijan — particularly references to Nagorno-Karabakh and the 1990 Declaration of Independence.

The government’s action plan also embraces “spiritual security,” featuring a roadmap for the ouster of Catholicos Karekin II and the adoption of a new charter for the Armenian Apostolic Church. This unprecedented foray into ecclesiastical affairs is part of a now years-long, coordinated campaign against the Armenian Church — with Azerbaijani and Russian involvement. Both Baku and Yerevan have increasingly cast Etchmiadzin as an obstacle to regional “peace” — one that must be cowed into submission. Just last week, prosecutors appealed to reimprison the well-regarded Archbishop Mikael Ajapahyan, head of the Armenian Church’s Shirak Diocese.

As its social reengineering campaign gathers pace, the Pashinyan administration is also laying the groundwork for a schism with the Diaspora. Successive Armenian administrations have pigeonholed their Diaspora brethren — extracting extensive largesse while denying it influence over strategic affairs. But the current government — which views the Diaspora as a sort of fifth column — appears keen to curtail its already limited clout.

Following the June elections, the government passed a law barring most citizens living abroad from voting in national elections. In contrast, many regional countries (i.e., Moldova and Turkey) permit unrestricted overseas voting. The authorities are also mulling changes to citizenship laws that could erect fresh barriers for Diasporans seeking Armenian nationality.

While shunning the Diaspora, the Pashinyan administration is simultaneously reshaping domestic political life. In recent months, Armenian authorities have launched a sweeping crackdown against a host of opponents — ensnaring civilians, civil society figures and political actors. Earlier this week, widely detested former President Robert Kocharyan was detained on politically tinged corruption charges. Authorities also launched a corruption probe into former President Serzh Sargsyan, while seizing the assets of prominent oligarch Gagik Tsarukyan.

This crackdown extends beyond the national stage. Armenian authorities recently arrested an opposition figure as part of a pressure campaign to seize control of Gyumri’s municipal administration. Meanwhile, Yerevan State University dissolved its prestigious Department of Foreign Literature amid government interference. The department was led by Anush Sedrakyan, a political scientist who ran in the recent elections on the “Wings of Unity” party list. Longtime lecturer Ruben Melikyan was also recently dismissed.

Collectively, these authoritarian maneuvers amount to an effective criminalization of dissent, sowing a broader culture of fear. Some observers suggest these political theatrics may also serve as a smokescreen for fresh concessions vis-à-vis Azerbaijan. During a pre-election speech, Pashinyan declined to rule out the eventual transfer of disputed enclaves — several of which are situated near critical infrastructure. And like clockwork, earlier this week the Armenian prime minister effectively declared Tigranashen — which sits along a critical motorway to Syunik — Azerbaijani territory.

As Yerevan pursues a policy of unfettered appeasement, the deeper risk is a creeping West Bank-ization of Armenia: not open military confrontation, but something more corrosive. Zones of conditional sovereignty. Policy capture. Armenian institutions providing the administrative layer for an externally defined political order. This is not an architecture for peace. It is managed capitulation dressed in the language of normalization.

What we are watching

Tripped up: The much-touted TRIPP corridor continued to capture headlines this summer. In July, the Trump administration tapped Russian-born, Chicago-based businessman Konstantin Sokolov as its envoy to TRIPP. As part of his role, Sokolov will manage a $201 million fund to accelerate regional connectivity via energy and transportation infrastructure.

The appointment of the Saint Petersburg-born investor raised eyebrows. Sokolov, who has no diplomatic background, is a prolific political donor, recently contributing more than $12 million to Republican campaigns and entities affiliated with U.S. President Donald Trump.

Sokolov also maintains significant economic interests across Armenia. His holding company recently acquired the Teghut copper-molybdenum mine. And in 2024, Sokolov secured a 20 percent stake in Armenian telecom firm Viva alongside Chinese businessman Zhe Zhang.

Sokolov has routinely sought to downplay links to his home country. But a closer look casts doubt on these claims. According to documents reviewed by ISA, Sokolov continued to visit Russia following the Kremlin’s invasion of Ukraine and appears to have maintained a local financial footprint. Sokolov also reportedly maintains close ties with Russian oligarch Oleg Deripaska, who runs industrial giant Basic Element. (Deripaska was a former business partner of Donald Trump’s erstwhile campaign manager, Paul Manafort.)

Fresh on the heels of his appointment, Sokolov visited Yerevan in August as part of “ongoing efforts to implement the TRIPP program.” The agenda was fairly standard, featuring meetings with senior officials and the usual photo ops. More notable was his travel companion, Aryeh Lightstone, senior adviser to the U.S. special envoy for peace missions. Lightstone played a critical role in shaping the Abraham Accords — a series of agreements establishing diplomatic ties between Israel and several Arab states. (He also has a background in right-wing Jewish nonprofits.)

During his visit, Sokolov was keen to jumpstart physical progress on the corridor. While there is little work on the ground, Armenia and Azerbaijan are already trumpeting the corridor and setting the stage for its expansion. During a recent interview at the Heritage Foundation, Armenia’s Ambassador to the United States Narek Mkrtchyan noted that TRIPP could eventually include pipelines, electricity transmission lines and fiber-optic infrastructure alongside roads and railways. (The interview drew condemnation due to Heritage’s longtime role as a platform for pro-Azerbaijani propaganda.)

Mkrtchyan’s comments were echoed days later by Azerbaijani President Ilham Aliyev. During an address to state television, Aliyev stressed the importance of expediting TRIPP’s implementation and expanding its scope. He announced plans to build electricity transmission lines from Azerbaijan to Nakhichevan via Syunik, claiming construction “will take a maximum of six months.” In the same breath, Aliyev called for shuttering Armenia’s nuclear power plant while offering Azerbaijani electricity as an alternative — perhaps signaling an interest in fostering Armenian dependence on Azerbaijan’s energy sector.

And what a timely coincidence. Aliyev’s lofty plans already appear to be gaining traction. Earlier this week, representatives from the Armenian and Azerbaijani energy sectors met in occupied Nagorno-Karabakh to discuss “the possibilities of importing and exporting electricity between the two countries.”

Moving forward, Baku appears intent on accelerating Armenia’s integration into its political and economic orbit. And TRIPP remains a central plank in Azerbaijan’s efforts to consolidate influence in Armenia’s southern environs. While ostensibly geared toward economic integration, the proposed scheme — which involves an external oversight mechanism — is poised to curtail Armenian sovereignty over the strategic zone. (And despite the Trump administration’s role in advancing the scheme, many observers argue that sustained U.S. engagement is far from guaranteed and that control could ultimately revert to Azerbaijan.)

Energy maneuvers. Azerbaijan has long sought to shape regional energy dynamics — and infrastructure — to its strategic advantage. And in recent months, Baku has renewed efforts to cement its leverage across critical energy supply lines.

During a May 18 meeting in Baku, Georgian Prime Minister Irakli Kobakhidze and Azerbaijani President Ilham Aliyev inked a series of agreements across the energy and transportation sectors. Under the arrangement, Georgia reportedly forfeited its share of transit capacity in the Baku–Tbilisi–Erzurum gas pipeline to Azerbaijan for the next two decades — a major boon for Baku’s export capacity.

Since Moscow’s invasion of Ukraine, Azerbaijan has sought to promote itself as an alternative energy supplier to Russia, particularly across Europe’s eastern flank. (In June, Azerbaijan inked a fresh gas deal with Germany.) But despite lofty pledges, Azerbaijan’s capacity to meet its growing export commitments remains limited. Baku is increasingly laundering Russian diesel to meet its ballooning export targets.

Throttled pipeline access is poised to push Tbilisi toward sourcing more energy from its erstwhile adversary, Russia. Moscow has already boosted energy supplies to its southern neighbor. In 2025, energy behemoth Gazprom reported exporting 40.4 percent more gas to Georgia compared to the previous year. And in the long term, amid Azerbaijan’s declining energy reserves and a failure to cultivate alternative partnerships, Georgia may find itself locked into deeper energy ties with Russia.

And herein lies the residual geopolitical value of the arrangement — one that exposes Azerbaijan’s role in perpetuating Russian influence in the South Caucasus. The deal expands Baku’s capacity to service European markets with sanctioned Russian-origin gas, while deepening Georgia’s dependence on Russian supplies. For the Kremlin, it is a win-win.

Ossetian shakeup. This summer, South Ossetia’s typically moribund political scene has been rather animated. In June, South Ossetian President Alan Gagloev announced his resignation — and new post as an adviser to the Kremlin. (His troubled administration failed to tackle chronic economic and governance crises.)

During his farewell speech, Gagloev touted the recently signed Treaty on Deepening Allied Cooperation with Russia. Signed on May 9, the strategic partnership agreement pushes for greater bilateral coordination across political and economic spheres — ostensibly aimed at “improving socio-economic conditions and infrastructure” in the unrecognized republic. The deal has drawn concern over Russia’s creeping integration of South Ossetia.

(Moscow is unlikely to pursue formal annexation in the near term; it has little to gain and risks sabotaging ties with the pro-Kremlin Georgian Dream.)

Gagloev’s choreographed departure was preceded by the dissolution of his cabinet — and appointment of North Ossetian official Marat Kambolov as prime minister. According to reports, Kambolov was tapped by Moscow to assume the reins of power and accelerate South Ossetia’s integration with Russia. (Kambolov is also an associate of Sergey Kiriyenko, a top Kremlin official overseeing swathes of Russia’s near abroad — including Armenia, Abkhazia and South Ossetia.)

Now, South Ossetia is in the throes of an electoral cycle, with presidential elections scheduled for September 18. According to the South Ossetian Central Election Commission, four candidates are contesting the polls, including now-acting President Marat Kambolov. The Kremlin protégé is widely considered the frontrunner.

In recent years, the Kremlin has curtailed local sovereignty in South Ossetia — and Abkhazia — with a particular focus on reshaping political elites. (Moscow, working with local stakeholders, has a long track record of dismantling and molding national elites across its near abroad.) South Ossetia’s political class has been largely hollowed out. And Moscow is waging a sustained pressure campaign against Abkhazia’s pro-sovereignty camp — perhaps in an attempt to restructure its political order ahead of the 2027 parliamentary elections.

Deals and visits ✈️

• Armenian firms launder Russian gold
• UK sanctions Georgian firms for Russian crypto evasion
• Russia, Azerbaijan cargo traffic surges
• EU sanctions SOCAR’s Kulevi terminal
• Armenia expands imports from Russia and Kazakhstan via Azerbaijan

What we are reading

• Azerbaijani defense sector bolsters Russia’s missile arsenal (United 24)
• Armenia’s military faces mounting non-combat deaths (RFE/RL)
• Yerevan moves to stifle emerging patriotic opposition (Aravot)
• Moldovan oligarch operates Kremlin’s crypto sanctions network (Economist)
• White House flags Tbilisi, Baku as Chinese trade evasion hubs (Financial Times)