Roads extending from North to South, West to East: Azerbaijan's achievements in transport and logistics

Azerbaijan plays a special role in the region with its geographical position, strategic transit points, and developed transport infrastructure.

Azerbaijan's ancient traditions in logistics and developed transport infrastructure have turned it into a transport hub. Azerbaijan implements several important projects to restore the Ancient Silk Road and contributes to the process as a participant in international corridors. Azerbaijan not only serves as a gateway between East and West but is also an important transit center connecting North and South. All these factors indicate Azerbaijan's strategic position.

Report reviews Azerbaijan's achievements in the transport and logistics sector over the past year, steps taken to expand the country's transit capabilities, and highlights important projects in the development of air, sea, railway, and automobile transport.

Azerbaijan attaches special attention to the development of railways

One of the important developed areas of the country's transportation system is railways. Azerbaijan pays special attention to the development of railways, just like other types of transport sector, and acts as an initiator of international projects in this regard. As the only country participating in both East-West and North-South transport corridors, Azerbaijan has invested in infrastructure projects related to railways, highways, and air transport at its own expense.

Thanks to the formation of the North-South International Transport Corridor, which will connect Asia and Europe in terms of transportation, the transit cargo transportation capabilities of Iran, Azerbaijan, and Russia will increase. Cargo from Southeast Asian countries will enter India's Mumbai port, and from there to Iran's Chabahar and Bandar Abbas ports. From these ports, cargo will be transported by train through the Qazvin-Rasht-Astara (Iran)-Astara (Azerbaijan) railway through our country's territory to Russia and Europe.

In May 2023, Russia and Iran signed an agreement on the construction of a 162-kilometer section of the Rasht-Astara railway. The construction of this section will provide rail connectivity throughout the entire region from St. Petersburg to the Bandar Abbas port in the Persian Gulf. Construction is expected to be completed in 2027-2028.

The North-South corridor, established through an intergovernmental agreement signed between Russia, Iran, and India, aims to reduce delivery times for cargo from India to Russia and Northern and Western Europe. While it takes more than 6 weeks to deliver cargo from India to Russia via existing routes currently, this duration will be halved once the North-South transport corridor becomes fully operational. The full operation of the corridor will also significantly increase Azerbaijan's transit revenues in the future. Azerbaijan will earn $2.5-$3 billion annually from the transportation of transit cargo.

According to estimates, the cargo transportation potential of the North-South International Transport Corridor will increase from 14.6 million tons to 24.7 million tons by 2030. This will be a major boost to Azerbaijan's transformation into the region's main transit and logistics center.

Azerbaijan Railways CJSC and the Asian Development Bank (ADB) signed a loan agreement worth $131.5 million in November 2024 to restore the main section of the North-South corridor in Azerbaijan to strengthen regional connections. The total value of this project is $160.5 million, of which $29 million is covered by the Azerbaijani government. The funds will be directed to complete the restoration of 166 kilometers of highway in the Sumgayit-Yalama section of the corridor, including civil structures and railway crossings.

Additionally, the chairman of Azerbaijan Railways CJSC (ADY), Rovshan Rustamov, stated that cargo transportation is planned in both North-South and South-North directions next year.

The chairman noted that work is underway to complete construction at the Astara railway loading terminal. According to the action plan, the construction of the Astara terminal will be fully completed next year, and Azerbaijan's cargo handling capacity in this regard will reach 4 million tons.

Also, on December 21, 2024, a cooperation agreement was signed between Azerbaijan and Russia for the development of transit cargo transportation through the North-South international transport corridor. The agreement, which determines the conditions for cooperation in the development of railway infrastructure and transit transportation, aims to increase the efficiency of transport connections and enhance the potential of the Western route of the North-South corridor, as well as stimulate the increase in cargo volume by rail transport and ensure a balance between the growth rate of transportation volumes and the development of railway transport infrastructure.

Cargo transportation along the western route of the North-South international transport corridor passing through Azerbaijan increased by 31% in the first 11 months of 2024 compared to the same period last year.

Another important project in which Azerbaijan actively participates is the multimodal Middle Corridor (Trans-Caspian International Transport Route) connecting distant China with the European Union (EU) through Central Asia, the Caucasus, and Türiyke, which is a large-scale international project reflecting Azerbaijan's economic interests. One of the factors increasing the importance of this corridor is the current geopolitical situation in the world. Problems in supplying products from Asia to EU markets have increased interest in the Middle Corridor. In this regard, strengthening the corridor's operation is of great importance for Azerbaijan, which plays the role of a natural bridge between West and East.

The Middle Corridor, which is economically efficient and politically significant, has been one of the most discussed topics in the Eurasian region in recent years. As part of China's Belt and Road initiative, the Middle Corridor is also one of the most important components of the historical Silk Road. Therefore, China's interest in the corridor is also very high.

The volume of cargo transportation through the Trans-Caspian International Transport Route (TITR) has increased fivefold in the last 4 years. The volume of transportation through this corridor has increased from 800 thousand tons to 4.1 million tons during the mentioned period. During this time, the delivery time of cargo has decreased from 58-60 days to 13-15 days.

The Baku-Tbilisi-Kars (BTK) railway, considered one of the world's 100 largest projects, is an important part of the TITR. Operating for more than 7 years now, BTK has opened up extensive opportunities for intercontinental transportation as a crucial part of the East-West International Transport Corridor. This railway, which is the shortest route between China and European countries, continues to grow in importance. In this regard, in May 2024, repair, reconstruction, and expansion works of the 184-kilometer section of BTK passing through Georgia were completed. As a result of the work done, the annual freight capacity of this railway line has increased from 1 million tons to 5 million tons.

The favorable conditions created by BTK have attracted the attention of many countries, especially Eastern countries. BTK allows for reducing transportation time by more than half. The Baku-Tbilisi-Kars railway facilitates access to European and world markets for Central Asian countries - Turkmenistan, Kazakhstan, Uzbekistan, Kyrgyzstan, Tajikistan, and Afghanistan.

Kazakhstan's strategic goal is to increase the Middle Corridor's throughput capacity to 10 million tons by 2030. To facilitate these efforts, the mentioned country has signed roadmaps with Azerbaijan, Georgia, and Türkiye to eliminate "bottlenecks" and develop the Middle Corridor by 2027.

The victory achieved in the 44-day Patriotic War not only strengthened the Azerbaijani people's joy and the country's growing influence in the political arena but also created new economic realities. One of these realities is the Zangazur Corridor. Through this corridor, cargo transported from Azerbaijan to Türkiye will be able to reach European and Middle Eastern countries in a short time, and the Zangazur Corridor will further expand Azerbaijan's transit capabilities.

Railway infrastructure reconstruction and new line construction works are being carried out in the liberated territories. The Construction of the Barda-Aghdam railway line has been completed. The second phase of construction of the Aghdam bus terminal and railway station complex is ongoing. The complex is expected to be completed in the coming months. Sixty percent of the work on the construction of the Horadiz-Aghband railway line has been completed. One of the tunnels on the road is already complete, and excavation work has been carried out on the second tunnel. All project work related to the Horadiz-Agband railway line has been completed and construction continues.

The construction of new ships in the maritime transport sector is underway

It is impossible to imagine international economic relations without maritime transport. It is the cheapest mode of transportation in the unified transport system compared to other types of transport.

Many countries around the world invest in creating port hubs to take advantage of maritime trade opportunities. The Baku International Sea Trade Port has been operational since 2018. Along with port operations in Azerbaijan and abroad, the modernity of ships and high cargo capacity is one of the important issues.

Currently, Azerbaijan Caspian Shipping Company (ASCO) includes, along with its transport fleet, specialized fleet and ship repair yards.

Our transport fleet consists of more than 50 vessels, including 20 tankers, 13 ferry vessels, 15 universal dry cargo ships, two Ro-Ro, and two Ro-Pax-type vessels. The specialized fleet consists of more than 200 vessels.

In Azerbaijan, ships are regularly repaired and the fleet is equipped with new vessels to accelerate cargo transportation via the Caspian Sea and increase cargo volumes.

According to ASCO's Strategy and Action Plan to achieve zero emissions, Phase I (2024-2027) envisions the removal of 65 outdated and operationally inefficient vessels with a total deadweight of 26,595 tons from the fleet.

Taking into account previously ordered transition projects, the Baku Shipyard is currently constructing 11 vessels for Azerbaijan Caspian Shipping Company (ASCO) with a total contract value of $260.2 million.

Due to global processes, the role of the Baku International Sea Trade Port has increased. Azerbaijan, which is located in an important geostrategic position in the Eurasian space and has rich economic and trade relations, has entered a new, modern stage of maritime transport development after the opening of Baku port. Baku Port, which is one of the main branches of the Belt and Road megaproject, will have a huge impact on the development of world trade and relations between countries. Construction work for the second phase is being carried out to facilitate the process of receiving and transmitting increasing cargo volumes through Baku Port. As a result, up to 25 million tons of cargo will be handled through Baku port annually, and 500,000 TEU containers will be able to pass through.

Infrastructure under development for rapid transportation of cargo by road transport

The expansion of economic relations between countries and the acceleration of integration has confirmed that the transport system is one of the main pillars of each country's national economy. Researchers clarifying the socio-economic essence of transport services have long proven that this system is an important condition for expanded reproduction.

Over the past years, all planned infrastructure projects and social programs in Azerbaijan have been implemented at a high level, including continued projects related to the reconstruction of road infrastructure, construction of new roads, and major repairs of existing roads, which are considered important areas of social infrastructure. Along with road reconstruction for rapid cargo transportation, the issuance of permission is being simplified, the number of electronic scales is being increased, and favorable conditions are being created at customs checkpoints.

Since 2021 to date, more than 2700 km of automobile roads across the country have been reconstructed and repaired. More than half of this - 1430 km are roads of local importance.

According to the First State Program on the Great Return to the Liberated Territories of Azerbaijan, the number of projects implemented by the State Agency of Azerbaijan Automobile Roads in the liberated territories is 44, with a total length of 3,040.1 km.

In addition, the agency continues the construction of internal roads in six cities (Shusha, Fuzuli, Gubadli, Zangilan, Kalbajar, and Jabrayil), as well as roads leading to seven villages.

The agency has completed the reconstruction of 12 inter-village roads with a total length of 252 km, connecting 71 settlements with a population of 107,300. In connection with COP29 in Baku, major repairs have been carried out at 31 locations in the capital, including the 8 November Avenue with a length of 10 kilometers that required priority repairs. In total, during the current year, 382.7 kilometers of highways, avenues, and streets throughout the country have been reconstructed and repaired.

Baku airport is the regional leader in terms of cargo transportation and cargo terminal capacity

Air transport is one of the important sectors of the transportation system. In recent years, nine airports have been built or reconstructed in the republic. Currently, there are eight international airports (in Baku, Nakhchivan, Ganja, Lankaran, Gabala, Zagatala, Fuzuli, and Zangilan) and one domestic airport (Yevlakh) in Azerbaijan. Another international airport, Lachin airport, is planned to be commissioned in the liberated territories.

Air transport also has a share in cargo transportation in Azerbaijan. Heydar Aliyev International Airport is the region's largest airport in terms of cargo handling capacity and cargo terminal throughput.

Currently, passengers can travel from Baku to 68 cities worldwide through 38 airlines, including new destinations such as Greece, Switzerland, Spain, Austria, and others. Last year, WizzAir Malta, IndiGo, Georgian Wings, and Aegean Airlines were added to the list of airlines operating flights to Baku airport. Thus, passengers were offered new and unique destinations, including renewed partnerships with airlines such as China Southern, AirBaltic, Flyadeal, Air Cairo, and Iraqi Airways, as well as increased flight frequencies with WizzAir, WizzAir Abu Dhabi, and LOT.

In late 2024, there was a tragic incident in Azerbaijan's air transport that shocked the entire nation. On December 25, Azerbaijan Airlines (AZAL) flight J2-8243, an Embraer 190 aircraft en route Baku-Grozny, made an emergency landing three km from the city of Aktau. Many passengers lost their lives or were injured in the airplane crash. The AZAL aircraft that made the emergency landing had 67 people on board, including 62 passengers and 5 crew members.

According to an order of Azerbaijan's President Ilham Aliyev dated December 25, 2024, a day of mourning was declared in Azerbaijan on December 26 due to the numerous casualties resulting from the crash of the Embraer 190 passenger aircraft operating the Baku-Grozny flight.

Azerbaijan is interested in building a sustainable transportation system

2024 was also memorable for Azerbaijan with an important international event – COP29.

One of the main topics discussed at the event was the creation of a sustainable, green transportation system and integration into this system. Azerbaijan is also determined to build a sustainable transportation system.

Practical ways have been identified for planning and implementing green transport policies within Azerbaijan's Nationally Determined Contributions (NDC). This is very important for reducing emissions and improving citizens' quality of life.

Among Azerbaijan's commitments to combat climate change is a 35% reduction in greenhouse gas emissions by 2030. A mobility transformation program has been developed for Baku city to achieve this goal.

Under this program, it is planned to reduce climate and traffic-related emissions to 0.6 metric tons of CO2 per active mobile citizen by 2030.

The creation of 100 kilometers of infrastructure for micromobility is planned, and more than 30 kilometers of it has already been put into operation. Expanding public transport coverage to 90% of the population is one of the main priorities.

Significant steps have also been taken to expand the electric bus fleet. Recently, 160 electric buses have been added to the fleet, and the goal is to electrify all buses by 2030.