The move, which has sparked protracted protests in Armenia, is an important step for reaching a comprehensive peace agreement between the two Caucasus countries after years of fruitless talks mediated by Russia and Western countries.

Armenia has returned to Azerbaijan four border villages it seized decades ago, the countries confirmed Friday, a key step toward normalising ties between the historic rivals who have fought two wars since the collapse of the Soviet Union.

Armenia’s security service said Friday that its border guards had “officially” taken up new positions reflecting a border delimitation agreement between the two countries, handing back the villages of Baghanis, Voskepar, Kirants, and Berkaber.

Azerbaijan’s Deputy Prime Minister Shahin Mustafayev announced separately that his country’s border guards had taken control of the four settlements, which are known by Azeris as Baghanis Ayrum, Asagi Eskipara, Heyrimli, and Kizilhacili.

The move, which has sparked protracted protests in Armenia, is an important step for reaching a comprehensive peace agreement between the two Caucasus countries after years of fruitless talks mediated by Russia and Western countries.

Armenian Prime Minister Nikol Pashinyan had agreed in March to return the four abandoned villages as part of efforts to secure a lasting peace deal. Yerevan and Baku redrew 12.7km (8 miles) of borderland last Thursday, reflecting the return of the four uninhabited villages seized in the 1990s by Armenia.

Pashinyan last week described the deal as a “very important milestone for further strengthening Armenia’s sovereignty and independence”.

However, Armenian residents of nearby settlements say the transfer could cut them off from the rest of the country and accuse Pashinyan of unilaterally giving away territory without any guarantees in return.

Pshinya’s move has sparked weeks of anti-government protests in Armenia, with thousands of demonstrators led by charismatic Archbishop Bagrat Galstanyan accusing the premier of betrayal and demanding his resignation. A new anti-government protest is scheduled for Sunday.

The settlements are considered strategically important since they are located near 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.

Azerbaijan had 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 breakaway region of Nagorno-Karabakh.

Azerbaijan recaptured Nagorno-Karabakh last September when it staged a lightning offensive to regain control of the enclave, where ethnic Armenians had enjoyed de facto independence since the mid-1990s.

The offensive prompted more than 100,000 residents to flee into Armenia within days.

Armenia’s defeat provoked a rift with its historic ally Russia, which Yerevan accuses of failing to defend it in the face of Azerbaijani threats despite security treaty obligations.

After months of diplomatic tensions, Moscow said Friday that it had recalled its ambassador to Armenia for “consultations”.

Foreign ministry spokeswoman Maria Zakharova did not provide a reason for the recall, which is typically seen in diplomatic circles as an extreme step in the face of worsening ties.