Two Billion a Year or Arbitration: How Pashinyan Is Haggling with Russia Over the Railway

Nikol Pashinyan is back at the small-change bargaining table. This time the subject is the railway.

After his latest phone call with Vladimir Putin, the Armenian prime minister suddenly announced that the concession of the South Caucasus Railway (a subsidiary of Russian Railways) was not discussed — but Yerevan's position remains firm. "This is our property, and Armenia must be able to use its railway as it sees fit." If agreement proves impossible — arbitration. Then came the signature line that makes your teeth ache: "There may turn out to be things for which we asked nothing for thirty years, and now we will ask for two billion dollars a year."

Thirty years of silence. Thirty years of quiet use. And only now, as relations slide rapidly downhill, does he suddenly remember that it is "ours" and that money is owed. Classic petty bargaining: convenient for decades, then — "pay up or we sue."

This move fits perfectly into the larger pattern of recent years. Pashinyan is trying to pivot toward Europe while keeping every benefit that the Russian market and Russian infrastructure still provide. He wants to eat the fish and climb the Christmas tree at the same time. The further he goes, the more small-minded and restless the haggling becomes.

Thirty Years of Concession and Sudden "Ownership"

The South Caucasus Railway is not just tracks and trains. It is a strategic asset that has been under Russian concession management since 2008. Armenia received investment, modernization, jobs, and uninterrupted operation. For all those years Yerevan calmly enjoyed the results. No loud claims. No demands to rewrite the terms. As long as it was profitable — silence.

Now that the political vector has shifted sharply, Pashinyan has suddenly discovered that "this is our property." Formally true. In substance it sounds like an attempt to change the rules after the game has already been played. Arbitration in such cases is long, expensive, and highly unpredictable. And the demand for "two billion a year" no longer looks like a serious negotiating position. It looks like emotional blackmail.

A man who spent years talking about strategic partnership is now pulling old invoices out of the drawer. That is not strength. That is fuss.

The Same Script — Only on a Larger Scale

The railway is merely the latest brushstroke. Far more serious is the story with the Eurasian Economic Union. Not long ago Pashinyan declared that the absence of a decision on the Armenian question would become "the beginning of the end" for the EAEU. According to him, the structure is paralyzed and no longer functions properly.

Former member of Armenia's National Assembly Arman Abovyan answered without any diplomatic varnish. For the EAEU, Armenia's departure would be a mild sneeze. The union will calmly survive the loss of Armenian cognac, peaches, and other products. Russia will not faint. Belarus will not starve. Kazakhstan will continue living by the union's internal prices. The integration project will develop without Yerevan.

For Armenia itself, however, the loss of more than 85 percent of its sales market threatens real economic collapse. Over 85 percent of everything the republic produces is sold on the EAEU market. Europeans, beyond pretty declarations, are in no hurry to buy Armenian goods and are unlikely to start. Logistics, standards, an already overcrowded European market — everything works against it. Attempts to enter the markets of other major players are technically excluded in the current geopolitical configuration.

Abovyan estimates possible losses at 3–4 billion dollars against a national budget of roughly 6 billion. A figure that chills the blood. While official reports cheerfully speak of economic growth, a real contraction is taking place in parallel. People who not long ago voted for Pashinyan are today standing on the edge of ruin. This is no longer political rhetoric. It is arithmetic.

"Go to Europe — Just Not at Our Expense"

Russia, according to Abovyan, is reacting with complete clarity and consistency. Armenia has announced that it is moving politically toward the European Union. The European Union, in turn, openly discusses preparation for a possible confrontation with Russia around 2030. In other words, Yerevan is heading toward a geopolitical center that is preparing for conflict with Moscow.

What does Russia reply? "Armenians, by all means, go to Europe. We are happy for you. We will not stand in your way. But not at the expense of the Russian market and not at the expense of the Russian budget."

Here lies the core of the problem. Pashinyan wants to keep access to the Eurasian market, to Russian investment, to infrastructure such as the railway — while simultaneously building a policy that directly contradicts Moscow's interests. He wants Russia to keep feeding, watering, and washing the clothes while he tries on the new "rich and beautiful neighbor."

Abovyan offers a harsh but precise analogy: imagine a man who has lived with his wife for many years and suddenly declares, "There is a new neighbor next door — rich, beautiful. When she agrees, I will leave you. But until I leave — keep feeding me." The Russians, the politician notes, will not tolerate this forever. And they are already ceasing to tolerate it.

Pettiness as a Style

The most revealing part of this story is not the numbers or the threats of arbitration. The most revealing part is the style. Pashinyan increasingly acts not as a strategist but as a man who no longer knows what else to manipulate. First come the statements about the "beginning of the end" of the EAEU. Then the sudden recollection of the railway and the two billion. Next, most likely, will come new invoices, new claims, new attempts to squeeze at least something on the way out.

This is not a position of strength. This is the position of a man who feels the ground disappearing under his feet and starts frantically clutching at anything that can still be monetized. Thirty years of concession have suddenly become "things for which we asked nothing." The market that fed Armenian producers for years has suddenly become something one can casually abandon. Only there is nothing casual about that abandonment.

Armenia today faces a very hard choice. It can go to Europe. It can stay in the EAEU. It can even try to balance — but only if that balance is honest and is not built on the constant demand for one-sided preferences. What Pashinyan is doing is not balance. It is an attempt to sit on two chairs at the exact moment both chairs are already wobbling.

And the smaller these maneuvers become, the clearer the main problem appears. The man who once arrived on a wave of promises of a new politics is today engaged in the most ordinary petty bargaining. Two billion a year for the railway. Threats of arbitration. Declarations about the "beginning of the end" of a major integration project. None of this is strategy any longer. It is fuss.

And fuss, as is well known, rarely ends well. Especially when what is at stake is the economy of an entire country and the fate of hundreds of thousands of people who no longer have time for elegant geopolitical formulations.