Azerbaijan’s victory in the 44-day war marked a watershed moment not only in military and political terms but also in the geo-economic landscape of the South Caucasus. With the restoration of territorial integrity and the withdrawal of Russian peacekeepers in 2023, the region entered a fundamentally new phase—one in which Baku gained the ability to independently shape the parameters of regional architecture and manage key transport and logistics processes. This transition laid the foundation for a new Eurasian transport system, positioning Azerbaijan not merely as a transit country but as a central coordinator of connections linking Europe, South Asia, and the Middle East.
One of the most dynamic components of this transformation is the International North–South Transport Corridor (INSTC). Spanning roughly 7,200 kilometers, it has already proven its economic efficiency in practice: delivery times are reduced by two to three weeks, and transport costs are nearly one-third lower than the traditional maritime route via the Suez Canal. Recent meetings in Baku between representatives of Azerbaijan, Russia, and Iran confirmed that the project is moving beyond conceptual discussions and entering the stage of practical implementation. A key element of this effort is the 162-kilometer Rasht–Astara railway line, whose construction is being financed through a $500 million loan from Azerbaijan to Iran. Once completed, the corridor will provide a continuous rail link from the Indian Ocean to the Baltic Sea, solidifying Azerbaijan’s role as an indispensable component of this route.
The growing volume of freight traffic already reflects the country’s rising importance. In 2023–2024, transit through Azerbaijan’s segment of the corridor increased by more than 35 percent, setting record figures for the ports of Baku and Alat. Azerbaijan is thus evolving into a major junction connecting Iran, Russia, Central Asia, and Europe, as well as one of the principal hubs of Eurasian logistics.
India, for its part, views the North–South Corridor as a strategic opportunity to strengthen its ties with Europe and Russia while bypassing traditional maritime chokepoints. New Delhi has invested over $250 million in the development of Iran’s Chabahar Port, expecting it to play a key role in the route’s logistics network. Yet India’s political and military decisions—including arms supplies to Armenia and an increasingly Islamophobic domestic narrative—have strained its relationship with Baku. In the post-conflict reality, where Azerbaijan controls the region’s main overland arteries, such a policy has effectively sidelined India from the emerging logistics ecosystem.
Meanwhile, the Azerbaijan–Turkey–Pakistan axis has been gaining clear strategic depth. Since 2020, this trilateral partnership has expanded from defense cooperation to include energy and infrastructure initiatives. The 2021 Shusha Declaration elevated Azerbaijani–Turkish relations to the level of a formal alliance, while Pakistan, maintaining flexibility in its regional diplomacy, continues to uphold unwavering strategic solidarity with Baku. As a result, India—despite its investments and diplomatic efforts—finds itself as a bystander in a process where it once had the potential to play an active role.
Thus, in the aftermath of Azerbaijan’s victory, the regional logistics system is undergoing a fundamental realignment. A new Eurasian network is taking shape around three interlinked routes—the East–West, the North–South, and the Zangezur corridor—with Azerbaijan setting both the pace and direction of development. Unless India revises its current course and recalibrates its policy toward Baku, it risks remaining on the periphery of one of the most promising transport projects on the continent.
