FILE PHOTO: Refugees from Nagorno-Karabakh region ride in a truck upon their arrival at the border village of Kornidzor, Armenia, September 27, 2023. REUTERS/Irakli Gedenidze/File Photo
BRUSSELS (Reuters) - The European Union could review ties, including financial aid, with Azerbaijan and sanction individuals if the situation worsens following Baku's military takeover of the Nagorno-Karabakh enclave, according to an EU diplomatic service paper.
The paper said the EU could reconsider political engagement, financial assistance and sectoral cooperation, without being more specific. It does not mention Azerbaijan's energy sector.
Azerbaijani forces seized control of the enclave - populated mainly by ethnic Armenians - last month, triggering an exodus of more than 100,000 people to Armenia.
EU foreign policy chief Josep Borrell and many leaders of the 27-nation bloc condemned the operation. But diplomats say there are disagreements among EU countries over whether to take firmer diplomatic or political action.
The EU's search for a response is complicated by its moves to rely more on Azerbaijani oil and gas as it has moved away from Russian energy due to Moscow's war in Ukraine.
The paper, prepared by the European External Action Service and seen by Reuters, outlines further possible reaction but is cautious in tone.
It says that if the situation deteriorates, the EU could consider a review of its relations with Azerbaijan "on the basis of a gradual approach".
"In case serious human rights violations are committed, restrictive measures against individuals responsible for such violations could be envisaged," the paper said.
Decisions on EU sanctions generally require unanimity among member countries.
A diplomat from a country favouring a tougher stance toward Azerbaijan, speaking on condition of anonymity, said the document "reflects a balance of different positions of member states: We want more, but others do not want anything at all."
Diplomats say France, Germany and the Netherlands are among those pushing for strong signals of disapproval toward Baku while others such as Austria and Hungary are at the opposite end of the spectrum.
A second diplomat said the EU may not end up doing much more than condemning Azerbaijan's action and instead focus on supporting Armenia, economically and possibly with military aid.
The paper suggested the EU consider "political and economic actions to further support the democratically elected authorities of Armenia, including in the area of security and resilience, and the continuation of the democratic reforms".
(Reporting by Andrew Gray and John Irish; writing by Andrew Gray, Editing by Angus MacSwan)
