Azerbaijan had demanded the return of the four villages as a condition for a peace deal after decades of conflict.

Armenia has agreed to return several villages to Azerbaijan in what both countries say is an important milestone as they edge towards a peace deal after fighting two wars since the collapse of the Soviet Union.

Azerbaijani Ministry of Foreign Affairs spokesperson Aykhan Hajizada posted on the social media platform X on Friday that Armenia would return four villages near the countries’ shared border that had been “under occupation” since the early 1990s. He called it a “long-awaited historic event”.

In Armenia, the state news agency quoted Prime Minister Nikol Pashinyan’s office as saying: “In this process, the Republic of Armenia receives a reduction in risks associated with border delimitation and security.”

It said the handover in practice involved “two and a half villages” because Azerbaijan already partly controlled the settlements involved, but it added that the demarcation of the border was a “significant event”.

The settlements are deserted but are strategically important because they are close to Armenia’s main highway north towards the border with Georgia. Much of Armenia’s trade travels on this road, and it goes to the pipeline through which it receives gas from Russia.

The agreement was reached at a meeting on the two countries’ border, chaired by their deputy prime ministers.

According to a written statement by Azerbaijan, one of the issues the commissions reached agreement on was determining the border along Azerbaijan’s Gazakh province.

Turkey’s state-run Anadolu news agency reported that the line will pass through the villages of Baghanis (Armenia)-Baghanis Ayrum (Azerbaijan), Voskepar (Armenia)-Asagi Eskipara (Azerbaijan), Kirants (Armenia)-Heyrimli (Azerbaijan) and Berkaber (Armenia)-Kizilhacili (Azerbaijan),

This means Armenia will return to Azerbaijan the villages of Baghanis Ayrum, Asagi Eskipara, Heyrimli and Kizilhacili, all which it occupied during the First Karabakh War of 1988-1994, Anadolu said.

Azerbaijan has been demanding the return of the villages as a condition for a peace deal after more than three decades of conflict, mostly centred on the region of Nagorno-Karabakh.

Momentum shifted dramatically in favour of Azerbaijan in September when its forces staged a lightning offensive to regain control of Nagorno-Karabakh, where ethnic Armenians had enjoyed de facto independence since the mid-1990s. Virtually the entire population of 100,000 people fled to Armenia within days.

Russia had posted peacekeepers in Nagorno-Karabakh after the last major war between Armenia and Azerbaijan in 2020 but said this week it had begun withdrawing them. Azerbaijani President Ilham Aliyev is due to meet Russian President Vladimir Putin on Monday.

Russia, distracted by its war in Ukraine, risks losing influence in the Caucasus region, which it sees as its historic sphere of influence.

The United States and the European Union have also been pressing the two sides to reach a peace deal.

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