Russia Grants $200 Million Loan to Armenia to Buy Advanced Weapons and Modernize Army

YEREVAN — The National Assembly formally allowed the Armenian government on Thursday to borrow $200 million from Russia for purchasing new and advanced Russian weapons for Armenia’s armed forces.

The parliament overwhelmingly ratified a relevant Russian-Armenian agreement that was signed in Yerevan last Friday.

The Russian “export credit” carrying a 3 percent interest rate is repayable in 13 years, with a 3-year grace period.

“We are acquiring a new type of weapons which the Armenian armed forces have not had in their arsenal until now.These modern arms will have a substantial impact on balancing forces in the region.” Deputy Defense Minister Ara Nazarian said, presenting the agreement to lawmakers.

Nazarian did not specify what kind of weapons will be delivered to the Armenian military. He indicated only that the fresh Russian arms deliveries will boost the military balance in the Nagorno-Karabakh conflict. “This is aimed at enabling us to continue to ensure peace and the balance in the region,” he said.

Citing an unnamed Republican party source, 1in.am news service reported earlier in the day that Armenia could specifically get hold of sophisticated Iskander-M missile systems with a firing range up to 500 kilometers.

Armenian leaders have repeatedly hinted at the impending acquisition of Iskander-Ms in recent years. The missiles known for their precision would significantly enhance the Armenian military’s ability to attack Azerbaijan’s vital oil and gas installations in case of another war for Nagorno-Karabakh.

The release of the Russian loan followed growing criticism in Armenia of recent years’ large-scale Russian arms sales to Azerbaijan. President Serzh Sarkisian added his voice to that criticism earlier this year.

The Russian-Armenian agreement on the loan was signed on Friday amid continuing street protests in Yerevan against an electricity price hike initiated by Armenia’s Russian-owned power distribution network. Sarkisian made major concessions to the protesters the following day. He said the Armenian government will tap its funds set aside for a “further strengthening of national security” to subsidize the energy tariffs in the country in the coming months.

This fueled opposition claims that a part of the Russian loan will be used for that subsidy. Nazarian dismissed such speculation on the parliament floor.

Other Armenian officials denied any connection between the “Electric Yerevan” protests and the latest Russian-Armenian arms deal.