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Azerbaijani Politics Iran in Caucasus and Beyond Karabakh in the Post-War Period South Caucasus Region

New Azerbaijan-Iran Railway Agreement Grapples With Regional Tensions

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Executive Summary:

  • In October, Azerbaijani and Iranian officials discussed the Aras Corridor railway project, a strategic alternative to the contested Zangezur Corridor, amid ongoing Azerbaijan-Armenia tensions and diplomatic efforts to enhance regional connectivity following the 2020 Karabakh War.
  • The Aras Corridor strengthens Azerbaijan–Türkiye–Central Asia ties and aligns with Iran’s International North-South Transportation Corridor, enhancing regional connectivity and trade routes toward Russia.
  • Azerbaijan’s focus on the Aras Corridor reflects regional tensions, including opposition to the Zangezur Corridor, Iran-Israel conflicts, and Russia’s war against Ukraine. The project highlights Azerbaijan’s strategy of adapting to navigate shifting alliances and maintain regional goals.

On October 15, Chairman of Azerbaijan Railways Rovshan Rustamov arrived in Tehran to meet his Iranian counterpart Jabbar Ali Zakeri Sardroudi to discuss the construction of a railway line linking Azerbaijan’s East Zangezur region and its Nakhchivan exclave through Iran (News.az, October 15). The meeting came amid intensive diplomatic negotiations between Azerbaijan and Iran regarding the Aras Corridor transit route linking Azerbaijan to Nakhchivan and further to Türkiye via Iran after a period of silence and diplomatic rifts between the two neighbors (see EDM, March 27).

Categories
Azerbaijani Politics Iran in Caucasus and Beyond South Caucasus Region

How pragmatism drives Azerbaijan-Iran shift on regional transit

Iran’s President Ebrahim Raisi meets with his Azerbaijani counterpart Ilham Aliyev in Tashkent, Uzbekistan on Nov. 9, 2023. (Photo via Iranian presidency)

After rising confrontation and a war of words in recent years, Azerbaijan and Iran have returned to the diplomatic track—emphasizing regional connectivity and infrastructure projects based on pragmatism.

Having pursued coercive diplomacy to contain the rising influence of Israel and Turkey in Azerbaijan since 2020, Tehran has opted for reversive diplomacy towards Baku to de-escalate tensions. The shift is part of a broader Iranian strategy of seeking rapprochement with neighboring states, including Saudi Arabia.

Transit in focus

Regional infrastructure projects lie at the heart of the current pragmatism in the Azerbaijan-Iran relationship, putting political disputes on the back burner.

In Oct. 2023, Baku and Tehran laid the foundation for a new route connecting Azerbaijan to its Nakhchivan exclave through Iranian territory. The ceremony gathered Azerbaijani Deputy Prime Minister Shahin Mustafayev and Iran’s Minister of Roads and Urban Development Mehrdad Bazrpash. Per the initial agreement, a road bridge will be constructed between the two countries, followed by new motorway and railway connections. Although there is currently a functioning road connection between Azerbaijan and Nakhchivan via Iran, the new highway will significantly reduce travel time.