In advance of scheduled meetings between the Presidents, as well as the Foreign Ministers, of Armenia and Azerbaijan towards the end of this month, Eurasianet has published two articles from both sides in the conflict over the mainly Armenian-populated territory of Nagorno Karabakh. Haroutiun Khachatrian, an analyst with the Noyan Tapan news agency and a frequent contributor to Eurasianet, says that the Armenian leadership is hopeful but cautious over what could represent “pivotal talks concerning the future of the Nagorno-Karabakh territory.”

A report distributed by Radio Free Europe/Radio Liberty (RFERL) suggested that one compromise under consideration would have Armenia withdraw from at least five of the seven occupied regions (excluding the Lachin, and, most likely, Kelbajar regions connecting Karabakh with Armenia). Armenia would also permit the return of Azerbaijani residents to the occupied territories and to Nagorno-Karabakh proper.

According to a high-ranking sources cited in the RFERL report, Azerbaijan would, in turn, agree to recognize Karabakh’s status based on the results of a referendum to be held among the inhabitants of the enclave within 10 to 15 years. To build bilateral confidence, the sides would open a motorway connecting Azerbaijan, Karabakh, Armenia and the Nakhichivan exclave of Azerbaijan. In addition, according to the same source, Turkey would open its border with Armenia as soon as a Karabakh settlement is signed.

However, Khachatrian also warns that the November parliamentary elections in Azerbaijan, as well as a referendum on constitutional ammendment to be held in Armenia the same month, might yet scupper talks. Already, key figures in the Armenian opposition such as Aram Gaspar Sarkisyan, a former advisor to President Kocharian, have not been happy with the rumors circulating in Yerevan since the end of last year and which now appear to be indirectly or anonymously confirmed by both sides.

Some opposition politicians in Armenia and Karabakh are also critical of the referendum proposal. They point out that the territory already held a plebiscite in 1991 in which residents voted overwhelmingly for independence. In a July 13 interview with the daily newspaper Aravot, Aram G. Sargsian, leader of the Democratic Party of Armenia, argued that the outcome of a future referendum in the territory could turn out to be unfavorable for Armenians, as Azerbaijanis, who have a much higher birth rate, might become a majority in the territory within 10 years.

Meanwhile, Shahin Abbasov, a freelance journalist based in Baku, reiterates Khachatrian’s cautious optimism and says that some media outlets in Azerbaijan are already speculating that the Armenian President Robert Kocharian might sign a declaration “outlining a possible Karabakh settlement” with his Azerbaijani counterpart, Ilham Aliyev, when the two leaders meet in Russia on the sidelines of a CIS summit scheduled to be held on 26 August.

Interestingly, the Armenian Foreign Minister will meet with his Azeri counterpart just days beforehand. However, some cynics suggest that the two governments are merely playing games in order to “justify” to the West whatever measures they feel fit to take in an election and referendum to be held later in the year.

Not all Baku analysts predict even that degree of progress. Ilgar Mamedov, an independent political analyst, suggested that both Aliyev and Kocharian could be posturing in an effort to curry the favor of Western governments and international organizations. Both presidents will soon face crucial political tests at home – parliamentary elections in Azerbaijan and a constitutional referendum in Armenia – and both leaders don’t want to do anything at this delicate point that would undermine their respective international standing. International mediators have pushed hard in recent months to promote a Karabakh solution.

There are also some technical obstacles to the proposals not confirmed by the OSCE Minsk Group but not denied either. For one, the Constitution of the Republic of Azerbaijan prohibits the holding of a referendum anywhere on its territory unless it is conducted nationally. On the other hand, many are talking about increased communications between Armenia and Azerbaijan and I still believe that plans to build a second road to the Iranian border in Armenia can be seen in the context of a possible withdrawal from territory currently under Armenian control — most notably, Zangelan.

One sweetener, however, has already been put on the table. Azerbaijan has proposed opening a new motorway that would link the Azerbaijani town of Agdam (located in Armenian-occupied territory) with the Karabakh capital Stepanakert, and from there, to the Azerbaijani exclave of Nakhichivan. According to Azerbaijani officials, the road would ensure reliable links between Armenia and Karabakh, and also between Azerbaijan and its Nakhichivan exclave.

“This project could make the South Caucasus a united region from the political point of view and would encourage regional cooperation,” said an official who spoke on condition of anonymity. If implemented, Armenia and Azerbaijan would each provide security for their section of the road.

Ultimately, however, any possibility for a peace deal lies with the leadership of the two countries and internal political considerations at home. Stumbling blocks might remain but seem more related to final maneuvering in negotiations rather than anything else. That, in my opinion, includes Azerbaijan’s reluctance to cede Lachin when everyone knows it is unlikely that Armenia would ever return the strategic region that links Karabakh to the republic proper.

Azerbaijan is calling for the resettlement of the Armenian population from Lachin. “For the last 100 years, Armenians did not live in Lachin, so that they have to be resettled,” said Bakhmanov. “But compensation to these people could be paid,” he added, citing the findings of a report by an international fact-finding mission earlier this year.

Probably, we can also see Aliyev’s most recent bellicose statements, as reported by RFE/RL today, on taking Karabakh back by force in this light too. Certainly, we’ll know more at the end of the month.