We examine the form, properties, stability and evolution of doubly-connected (two-vortex) relative equilibria in the single-layer $f$-plane quasi-geostrophic shallow-water model of geophysical fluid dynamics. Three parameters completely describe families of equilibria in this system: the ratio $\gamma = L/ {L}_{D} $ between the horizontal size of the vortices and the Rossby deformation length; the area ratio $\alpha $ of the smaller to the larger vortex; and the minimum distance $\delta $ between the two vortices. We vary $0\lt \gamma \leq 10$ and $0. 1\leq \alpha \leq 1. 0$, determining the boundary of stability $\delta = {\delta }_{c} (\gamma , \alpha )$. We also examine the nonlinear development of the instabilities and the transitions to other near-equilibrium configurations. Two modes of instability occur when $\delta \lt {\delta }_{c} $: a small-$\gamma $ asymmetric (wave 3) mode, which is absent for $\alpha \gtrsim 0. 6$; and a large-$\gamma $ mode. In general, major structural changes take place during the nonlinear evolution of the vortices, which near ${\delta }_{c} $ may be classified as follows: (i) vacillations about equilibrium for $\gamma \gtrsim 2. 5$; (ii) partial straining out, associated with the small-$\gamma $ mode, where either one or both of the vortices get smaller for $\gamma \lesssim 2. 5$ and $\alpha \lesssim 0. 6$; (iii) partial merger, occurring at the transition region between the two modes of instability, where one of the vortices gets bigger, and (iv) complete merger, associated with the large-$\gamma $ mode. We also find that although conservative inviscid transitions to equilibria with the same energy, angular momentum and circulation are possible, they are not the preferred evolutionary path.