While the West seeks to isolate Iran over its disputed nuclear program, landlocked Armenia seeks to build relations with its neighbor - without violating international sanctions.
In all of Christian Armenia, there is only one mosque: "The Iranian Mosque," restored 15 years ago by Iran.
The mosque offers classes in Persian and is an essential landmark for visiting Iranian VIPS, like Iran's President Mahmoud Ahmadinejad. He came to Yerevan 15 months ago to meet with Armenia's President Serj Sarkisyan.
The West seeks to isolate Iran, believing its nuclear program is being used to build a nuclear bomb. Iran denies the charge. But Armenia is positioned between two historic enemies - Turkey to the west and Azerbaijan to the east. Armenia has no trade or diplomatic ties with the two nations. Instead, it trades north with its Christian neighbor, Georgia. Now it is trying to expand trade and investment to the south, with Iran.
"Armenia is the only neighbor of Iran where the regime or the government in Iran feels quite comfortable, and is actually keen to increase relations,” says Richard Giragosian, director of the Regional Studies Center, a Yerevan think tank. “From the Armenian perspective, there is a shared sense of isolation, where both Iran and Armenia feel surrounded by either hostile or rival states and feel under blockade or sanctions."
Looking for alternatives
Iran and Armenia are linked by a narrow border - a 35-kilometer long stretch of the Aras River.
A two lane mountain road links Armenia with Iran, a nation with an economy and a territory about 50 times the size of Armenia's.
With the highway slow and often dangerous, Armenians look for alternatives.
Iran expert Gohar Iskandaryan says a top priority is to extend Armenia's Soviet-era railroad south.
"Once Armenia can find investments, we can connect our railway to the Iranian rail network and have access to the Indian Ocean and the Persian Gulf," says Iskandaryan, an Iran expert at the National Academy of Sciences of Armenia.
One bright spot
Six years ago, Armenians started to heat their homes with gas coming through a new pipeline from Iran. Now Armenia wants to build an oil pipeline from Iran and two hydroelectric power plants on their shared river border.
But Iskandaryan says sanctions over Iran's nuclear program could block funding for these projects.
"This is not only Armenia's choice,” she says. “It's an issue for the big powers - the United States and Russia."
While sanctions have hurt Iran's economy and cut trade with Armenia, Giragosian sees one bright spot.
"The Iranian government has actually banned the import of luxury items which includes laptops, makeup and cosmetic products, to even chocolate,” said the think tank director. “Therefore, it will only encourage the rise or emergence of somewhat of a black market where Iranians coming to Armenia for tourism purposes begin to start to acquire these now-prohibited consumer items." Some Iranian tourists to Armenia are looking for more than lipstick.
Arayik Vardanyan, executive director of Armenia’s Chamber of Commerce and Industry, says they are buying apartments. “Many Iranians are coming,” says Vardanyan. “And that could mean that they are searching in advance for places they can leave to if war breaks out.”
The ebb and flow between Iranians and Armenians goes back almost 3,000 years to the construction of Erebuni, a hilltop fortress that gave its name to Yerevan. If modern-day leaders have their way, these two ancient neighbors will continue trading and visiting, paying little heed to the outside world.