The South Caucasus, Azerbaijan in particular, is facing water shortages as precipitation levels are decreasing and the levels of the region’s rivers are dropping. Water tensions are also linked to the Nagorno-Karabakh conflict between Armenia and Azerbaijan. As Azerbaijan faced a severe water shortage in the months leading up to the 2020 war, Nagorno-Karabakh became even more relevant for Azerbaijan in terms of its drinking water, irrigation and hydropower.
Roughly three-quarters of Azerbaijan’s water supplies originate outside the country, with the Kura and Aras rivers being the main sources. Although Azerbaijan managed to capture dams along the Aras and reservoirs in Nagorno-Karabakh in the 2020 war, its water problems remain prevalent due to poor domestic water management, climate change and upstream dams. Both the Kura and the Aras originate in Turkey, which has increased construction of water infrastructure on both rivers in recent years.
Dispute over Nagorno-Karabakh
Armenia and Azerbaijan have a long-standing dispute over the Nagorno-Karabakh region. The Soviet Union placed Nagorno-Karabakh under the control of the Azerbaijan Soviet Republic, even though a large part of the population at the time was Armenian. The conflict escalated in February 1988, when the Karabakh Armenians first tried to join the Armenian Soviet Republic and later pushed for their own state. The so-called First Nagorno-Karabakh war ended in May 1994, when a ceasefire was brokered by Russia, leaving Nagorno-Karabakh under Armenian control.
In the fall of 2020, the war between Azerbaijan and Armenia escalated again. In the decade preceding the war, Azerbaijan spent five times more on its military than Armenia ($24bn vs. $4.7bn), financed mainly through its oil and gas exports. This shifted the military balance of power in the conflict in favour of Azerbaijan. This process was further supported by Turkey, which has cooperated militarily with Azerbaijan since independence and supplied it with military drones prior to the war. The 2020 war ended in a trilateral agreement to end the second war that was again brokered by Russia. This agreement benefitted Azerbaijan by letting Baku keep control over the areas it captured during the war plus several adjacent areas, from which Armenia agreed to withdraw.
The role of water in the 2020 war
Nagorno-Karabakh is home to three tributaries of the Lower Kura and five tributaries of the Lower Aras, which Azerbaijan uses to irrigate important agricultural areas bordering Nagorno-Karabakh where no other rivers flow. In Soviet times, various dams were built on these rivers which left these dams under Armenian control after the 1994 ceasefire agreement. Joint water management has been limited because of recurrent hostilities between both states.
The Conflict and Environment Observatory (CEOBS) documented the environmental dimensions of the 2020 war when both sides accused the other of causing environmental harm both in official statements and online (dis)information campaigns. With regards to water, this included claims about either deliberately cutting off or polluting water flows.
Azerbaijan often cites a 2016 report by the Parliamentary Assembly of the Council of Europe (PACE), which found that Azerbaijani frontier regions were deliberately deprived of water by Armenia controlling the dams upstream in Nagorno-Karabakh. Many of the water-related Azerbaijani accusations against Armenia focused on the Sarsang dam. Located on the Tartar River, which flows through climate-vulnerable agricultural regions in Azerbaijan, the Sarsang dam accounts for roughly half of the hydropower production of Nagorno-Karabakh. Whereas Armenia normally releases the water from the Sarsang reservoir during winter to generate hydropower, Azerbaijan needs it in summer to irrigate its agricultural lands. Azerbaijan accused Armenia of what they called ‘eco-terrorism’, arguing that the Sarsang dam was the 'the biggest threat to regional ecological and national security', as it could breach at any time due to technical failure or deliberate action.
The Armenians, in turn, argue that before 1994, the Sarsang dam was used by Azerbaijan to divert water away from the Karabakh region to lower areas in Azerbaijan. The Armenian Defense Ministry further accused Azerbaijan of targeting water infrastructure during the war, which it claimed could lead to an environmental disaster.
Water sharing on the Aras
Azerbaijan’s main offensive took place along the Aras River and was meant to give Azerbaijan access to the city of Shusha and the strategically important Lachin corridor, in which the only road connecting Armenia and Nagorno-Karabakh is located. But it also resulted in the capture of water infrastructure when Azerbaijan captured the Khudafarin and Qiz Qalasi dams. This allowed for the construction of the new power plants, together with Iran – on which Azerbaijan and Iran had already agreed in 2016. The dams gave Azerbaijan some control over the flow of the lower part of the Aras. However, they do not ease its worries about water shortages.
The capture of Khudafarin and Qiz Qalasi does not give Azerbaijan access to new water resources as the flow of the Aras towards the Khudafarin reservoir depends on the water inflow from upstream areas in Turkey, Armenia and Iran. There is no overarching agreement over the water management for both the Kura and Aras, and cooperation often remains based on outdated Soviet-era agreements. Azerbaijan itself also draws water from the Aras River through the Aras Dam, located on the border of Azerbaijan’s Nakhchivan enclave and Iran. Turkey’s upstream dams further determine the flow towards Khudafarin and Qiz Qalasi.
Azerbaijani environmentalists have already pointed to the risks that the construction of the Turkish Beşikkaya dam on the Kura poses to the water flow to Georgia and Azerbaijan. The Turkish Soylemez dam similarly threatens the flow of the Aras, according to Iran’s foreign minister. Turkey argues to have the right to utilise transboundary rivers flowing through its territory, if this causes no significant harm and water is shared equitably.
Captured water infrastructure in Nagorno-Karabakh
Although Azerbaijan captured 30 out of 36 of the dams in Nagorno-Karabakh during the war, this helped minimally in alleviating its water problems. Azerbaijan did not capture the Sarsang dam, leaving Armenia largely in control over the region’s most significant water source. The Artsakh Information Center reported that officials from Nagorno-Karabakh have been in contact with the Azerbaijani authorities regarding the management of the Sarsang dam since 2021. But Azerbaijan and the de facto authorities of Nagorno-Karabakh reached only an informal agreement in June 2022, in which 18.000 cubic metres of water is to be released to Azerbaijan per day during the summer, allowing Azerbaijan to use the water for irrigation.
Furthermore, water from water reservoirs in Nagorno-Karabakh to farms in Azerbaijan runs through earthen canals, causing water to seep into the ground before reaching its destination. The problem is exacerbated by an increase in water-intensive cotton farming, which decreases the amount of water available for drinking and food production. Azerbaijani President Ilham Aliyev publicly acknowledged the problems with water loss and pledged to invest in their water infrastructures.
Azerbaijan is undertaking a large-scale modernization scheme of its newly recaptured territories. Companies from Turkey and Israel have been awarded contracts to modernise water infrastructure in the region. Azerbaijan furthermore signed a contract with Israel’s national water company Mekorot in April 2022, which included the design of a so-called ‘master plan’ for the Azerbaijani water sector. Turkey’s State Hydraulic Works (Devlet Su İşleri – DSI), the Turkish state agency responsible for water management, is actively involved in the construction of new water infrastructure in captured areas of Nagorno-Karabakh and other areas of Azerbaijan.
Climate change and the way forward
Climate change exacerbates the water problems in all countries on the Kura and Aras. The region has been facing declining precipitation and water levels of both the Kura and Aras have been dropping in recent years. This makes shared management of the two rivers even more important. Azerbaijan could capture more water infrastructure following a recent escalation of the conflict, but this is unlikely to help it solve its water problems in a structural manner.
Turkey’s DSI helps Azerbaijan to tackle its domestic water management issues, but Turkey’s water policy on the Kura and Aras reduces the flows of both rivers. While it was politically convenient for the Azerbaijani leadership to blame Armenia to some extent for its water problems, Turkey’s water policy has so far not led to tensions between Azerbaijan and its main ally. For the future, Azerbaijan will somehow need to cooperate with Turkey on the Kura and Aras to increase its water supplies structurally.