27.06.2024 Author: Alexandr Svaranc

International transit communications: economic gains and geopolitical differences in the Southern Caucasus

the Southern Caucasus

The Southern Caucasus is increasingly becoming an arena for conflicting interests of global and regional players. International Transit Communications (ITCs) projects throughout the region are a consequence of the multipolar world that has emerged. However, while the prospects for gains from the implementation of the ITCs are obvious, threats of new conflicts remain. 

The geographic attractiveness of the Southern Caucasus

The geography of the Southern Caucasus (Transcaucasia) has historically made this region a connecting point for Eurasia. However, ethnic diversity and a number of internal contradictions, on the one hand, combined with the interests of major players, on the other, has often created difficulties in natural competition and cooperation.

In various periods of history and depending on the political status of the region at that time, Transcaucasia saw less confrontation, becoming a province of a major player, or, at other times, was a hotbed of conflict due to its advantageous geography. It is no coincidence that with the collapse of the USSR, the Southern Caucasus – just as in was the first quarter of the twentieth century – is regaining competitive importance in regional geopolitics. The conflict potential of Transcaucasia, combined with its attractive geography and natural resources, created the necessary conditions for defining a new status quo with the participation of major players (including Russia, USA, UK, EU, China, India, Turkey and Iran).

For Russia, Transcaucasia remains a priority of southern geopolitics and economic integration, taking into account the historical Russian presence in the region, centuries-old friendly relations and cohabitation in a single state, security interests, mutually beneficial transit of goods and the advantages of a multipolar world.

The US, UK and EU aim to limit Russian influence and presence in the Southern Caucasus, initiating various projects to squeeze Russia out of the region, establish control in the region themselves, export natural resources and enter the adjacent region of Central Asia.

China and India plan to use the territory of Transcaucasia to implement their own ITCs to reduce the delivery time of goods to Europe, absorb the region economically and increase their own competitive opportunities.

Turkey views the Southern Caucasus in the context of expanding its own status as a regional power, implementing the doctrine of neo-pan-Turanism, playing an important role in the transit of strategic energy resources (oil and gas) to the European market, as well as receiving and preferential prices.

Iran is trying to restore its own influence in Transcaucasia, hoping to shatter its economic isolation, implement profitable ITC projects to enter the markets of Europe and Russia, as well as to eliminate threats to its own security emanating from the Turkish doctrine of neo-pan-Turanism and the strategy of NATO expansion into the post-Soviet East.

Considering the web of internal and external differences between them, Azerbaijan, Armenia and Georgia are currently in a state of determining their foreign policy and economic vector; their security and prospects of economic growth are dependent on this vector.

Contemporary ITC projects in Transcaucasia 

The processes taking place in Russia in the 1990s made it possible for the UK to revive the strategy of the ‘Great Game’ and, together with the US and Turkey, begin gradually pushing Russia out from Transcaucasia. Transit communications projects bypassing our country have become one of the instruments of this policy.

The period 1994-1999 saw the implementation of the first stage of London, Washington and Ankara’s joint plan to enter Transcaucasia via Azerbaijan and Georgia. As a result, this route for the transit of Azerbaijan’s oil and gas resources through Georgia to Turkey and Europe bypassed Russia to its South. This is how communications without Russian involvement appeared, e.g. the Baku-Tbilisi-Ceyhan oil pipeline, the Baku-Tbilisi-Erzurum gas pipeline and the Baku-Tbilisi-Kars railway.

In the 2000s, Azerbaijan, Georgia and Turkey formed the Southern Transport Corridor (STC) for the export of resources from the Caspian basin to Europe via Turkey and the Black Sea. The STC aligns with the interests of the UK, US, EU, Turkey, Azerbaijan and Georgia. This allows supplier and transit countries (Azerbaijan, Georgia, Turkey) to sell oil and gas to Europe, receive preferential energy prices and profit from transit. EU countries and UK and US companies receive raw materials, profit from trade and the opportunity to realise their geopolitical ambitions in Transcaucasia and Central Asia.

Russia, Iran and Armenia were left out of these communications projects. After the defeat of Armenia in the second Karabakh war in the autumn of 2020, the implementation of future ITC projects (namely the Chinese BRI, Indian transit, the Russian North-South route, the Middle (Turan) and Zangezur corridor) faced a new reality.

Economic gains and geopolitical differences vis-à-vis new ITC projects in Transcaucasia 

Following the Turkish-Azeri military success in Nagorno-Karabakh in November 2020, the balance of power in the region shifted. Ankara is taking advantage of the current international situation, established partnerships with Russia and its (Russia’s) economic interest in the Turkish market, as well as the British strategy of the ‘Great Game’ for a long-term breakthrough to Central Asia while localising the treat of conflict on the way to Turan. For this reason, Turkey is actively promoting the project of the Middle (Turan) Corridor within the framework of the Chinese ‘One Belt, One Road’ initiative, which will allow Ankara to gain access to the resources of the CIS countries and form a Turanian axis in the multipolar world.

Azerbaijan, Central Asian republics, China and Russia are also interested in such a project, as it will increase the transit of goods and resources in the East-West and North-East directions, as well as stimulate trade relations and the development of the concept of a multipolar world.

However, for Russia this ITC project may also be a threat, since it will provide China with a transport corridor to Europe bypassing Russia. Also, Turkey will have the shortest route to the Turkic world via the Armenian Zangezur and, with the support of the West, will implement the geopolitical Turan project through the export of local resources. The US, UK and NATO will through Turkey be able to enter Turan, which no longer seems unrealistic after 2020.

Therefore, Moscow may be interested in the Middle Corridor if it were to establish control over the connecting link of this route, i.e. the Zangesur. There are also legal grounds for this, if one takes into account paragraph 9 of the trilateral (Azerbaijan, Armenia, Russia) statement from November 9, 2020, which stipulates unblocking communications in the region with the participation of the Russian FSB border troops.

Iran is an opponent of the Middle Corridor, as it does not want to strengthen the Turkic influence on its northern borders, fears the growth of ethnic separatism of the Turkic population centred in Tabriz and excludes Armenia’s loss of control of the Zangezur corridor, which provides Tehran with access to Georgia, Russia and Europe. Tehran also does not want to lose control over Nakhichevan and the dependence of Azerbaijan, a consequence of the Karabakh conflict.

India is an indirect competitor of the Chinese-Turkic ITC through the Zangezur corridor, taking into account its own plans for transit along the Iran-Armenia-Georgia-Russia-Europe route. In addition, New Delhi has contradictions with China, Pakistan, Azerbaijan and Turkey.

Georgia fears that with the opening of the Zangezur corridor, which is beneficial for Turkey and Azerbaijan, the volume of transit of goods and passengers through the Southern Caucasus will decrease, which will significantly undermine the stability of the Georgian economy.

Moscow proposes the creation of a 7.5 thousand km long North-South ITC, which will connect Europe and Russia (through Azerbaijan) with Iran, the Persian Gulf and provide access to the Indian Ocean. Azerbaijan supports this project because it will increase the traffic of goods and strengthen constructive ties with Russia and Iran. Accordingly, Baku has modernised and built the necessary infrastructure (roads, bridges, customs posts, etc.) at the Astara border with Iran on the Aras River.

However, Tehran is in no hurry to complete the construction of its part of infrastructure along the Rasht-Qazvin-Bandar Abbas direction. At the same time, Moscow is ready to invest and participate in the joint construction of the road. It is obvious that Iran does not want Azeri influence to grow, but perhaps links the North-South project with the implementation of the Indian ITC through Armenia.

The head of the International Association Trans-Caspian International Transport Route Gaidar Abdikerimov notes: “We have a North-South corridor: Astara-Rasht-Qazvin. This corridor was announced long ago, but even now, it is not moving forward. Azerbaijan, for its part, has fulfilled all obligations… But there is no road on the Iranian side yet, and this slows down the development of the route”.

There is high US interest in Indian transit; the US supports India’s counterbalancing China. Therefore, Washington repeatedly denies Tel Aviv in escalating to a large-scale war against Iran, perhaps expecting future Iranian gas exports. The US is trying to get Armenia under its control, offering Yerevan a strategic partnership and approving the Armenian ‘Crossroads of Peace’ project.

The economic gains of the new ITC projects in Transcaucasia are obvious, but contradictory interests of its participants may spark new hotbeds of conflict.


Alexander SVARANTS – Doctor of Political Sciences, Professor, exclusively for the online magazine “New Eastern Outlook

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