In an agreement with Armenia, 2 Iranian companies will build a 20-mile stretch of highway through Syunik's Kajaran area

Azerbaijan is no longer interested in securing a land corridor through Armenia to Nakhichevan and will instead discuss the issue with Iran, a senior Azerbaijani official told Reuters on Wednesday.

Azerbaijan has long claimed that it has no territorial ambitions against Armenia, and, as recently as last week, insisted on seizing Armenia’s southern section to fulfill its so-called “Zangezur Corridor” agenda.

Speaking in occupied Stepanakert earlier this month, President Ilham Aliyev of Azerbaijan, again insisted that his country will establish the “corridor.”

In recent weeks, however, Iran has signaled that it is working with Azerbaijan to create a land-link to Nakhichevan. A groundbreaking ceremony for a bridge over the Arax River was seen as a start of such a plan. Tehran has vehemently opposed any changes to the current regional borders.

“Azerbaijan had no plans to seize Zangezur,” Hikmet Hajiyev, Aliyev’s top advisor told Reuters.

“After the two sides failed to agree on its opening, the project has lost its attractiveness for us — we can do this with Iran instead,” he added.

Tehran and Yerevan have bolstered their ties in recent years, with the Armenian government awarding a $215 million contract to a consortium of two Iranian companies to upgrade a 32-kilometer (approximately 20 miles) section of the main highway connecting Armenia to Iran through the Syunik Province.

A senior government official and top executives of those companies signed a relevant agreement in Yerevan on Monday in the presence of Armenia’s Minister of Territorial Administration and Infrastructures Gnel Sanosyan and Iran’s Minister of Roads and Urban Development Mehrzad Bazrpash, Azatutyun.am reported.

“We are very happy that … Iranian companies will carry out the construction of this road section,” Sanosyan said at the signing ceremony.

“Our neighbor, Armenia, is very important to us,” Bazrpash said, for his part. “Armenia could play a key role in the framework of the [transnational] North-South transport corridor. I hope that the project will be implemented rapidly.”

The project, co-financed by the Armenian government and the Eurasian Development Bank, covers the highway section stretching from Agarak, an Armenian town adjacent to the Iranian border, to the Kajaran mountain pass, the highest in Armenia. About two-thirds of the road is to be expanded and modernized while the remaining 11 kilometers will be built from scratch over the next three years. In Sanosyan’s words, the Iranians will construct 17 bridges and two tunnels in the mountainous area.

Another, much longer, tunnel planned by the Armenian side will cut through the Kajaran pass. The government has organized an international tender for its construction, which will further shorten travel time between the two neighboring states.

Bazrpash also announced that Yerevan and Tehran have agreed to build a new bridge over the Arax river that marks the Armenian-Iranian border. The two governments will set up a joint working group for that purpose, he told reporters.

The Iranian minister’s presence at the signing ceremony appeared to also underscore the geopolitical significance of the project.