Horadiz-Aghband railway to enhance global trade & regional connectivity

Despite Azerbaijan having garnered significant international recognition for its achievements in the energy sector, the country’s influence is also expanding rapidly in the field of transport. In recent years, particularly after the liberation of Garabagh, Azerbaijan has embarked on several ambitious large-scale transport projects. Among these, the Horadiz-Aghband railway line stands out as a project with the potential to reshape regional and international trade dynamics by directly connecting Europe and Asia. This initiative, part of the broader Zangezur Corridor, is not merely a regional transportation link, but rather a critical infrastructure project with vast economic implications for Azerbaijan and its neighbors.

The Zangezur Corridor, which will facilitate an efficient rail connection between Azerbaijan's mainland and the Nakhchivan Autonomous Republic, is strategically important for fostering trade between East and West. More than just providing a new route for freight transportation, this railway line is poised to become a pivotal corridor for global trade, facilitating fast and secure transport of goods between major economic regions, including China, India, South Korea, and Europe. As these Asian economies continue to grow in global significance, their trade with Europe has become increasingly important. In this context, the Zangezur Corridor offers a highly competitive and viable solution for transporting goods overland at lower costs and in less time.

Economic impact and regional connectivity

From an economic standpoint, the Horadiz-Aghband railway line stands to significantly bolster Azerbaijan’s position as a transit hub. As a key connector in this transport corridor, Azerbaijan will capture substantial transit revenues, facilitating greater economic integration into the global marketplace. Preliminary estimates suggest that, should 10-15% of cargo pass through the Zangezur Corridor, Azerbaijan could generate $3-3.5 billion annually in transit fees. These revenues would substantially contribute to the national budget, fueling further investment in infrastructure and economic development.

Additionally, the railway will create a ripple effect throughout the economy. The flow of foreign currency into Azerbaijan’s economy will be accompanied by the establishment of offices and branches of international companies in Baku, leading to the creation of new job opportunities. Such developments will further stimulate local economies and contribute to the overall improvement in the social welfare of the population, particularly through enhanced employment prospects and better living standards.

Moreover, Azerbaijan’s role as a transit country will position it as a vital player in broader geopolitical and economic processes. This will enhance the nation’s negotiating power in international forums, strengthening its influence on the global stage. Importantly, the diversification of Azerbaijan’s economic activities into transit services will help reduce the nation’s reliance on the energy sector, thereby fostering a more resilient and balanced economy.

Regional cooperation and long-term strategic advantages

The Horadiz-Aghband railway line is poised to deliver far-reaching benefits that extend well beyond Azerbaijan’s borders, creating a foundation for broader regional growth and collaboration. President Ilham Aliyev has rightly characterized the Zangezur Corridor as a “fundamental element of regional peace,” highlighting its transformative role not only as an economic asset but also as a catalyst for regional stability. This railway will act as a critical bridge, physically linking Azerbaijan with Nakhchivan, while symbolizing strengthened relations between Azerbaijan, Armenia, and other neighboring nations. Such developments lay the groundwork for broader political dialogue and could serve as a model for future collaborative projects aimed at ensuring long-term peace and stability in the South Caucasus.

The Zangezur Corridor’s efficient transportation network will provide a significant reduction in both travel time and transportation costs for goods moving between China, Turkiye, and Europe. By offering a faster and more affordable alternative to traditional routes, this corridor will lower shipping expenses, making products from the region more competitive on the global stage. As a result, it will enhance the economic prospects of all countries connected by the corridor. Furthermore, the improved access to the East-West trade route will not only boost regional trade volumes but also benefit landlocked nations, such as Armenia, by providing them with a more viable pathway for international trade. This broader connectivity promises to unlock new economic opportunities for all involved, fostering deeper regional integration and long-term prosperity.

Project status and future prospects

The design and construction of the Horadiz-Aghband railway line is progressing steadily, with key milestones already achieved. According to the latest reports, 83% of the design work has been completed, and 62% of the construction and installation works have been finalized, including earthworks and the construction of artificial structures. The demining process along the railway corridor has also been completed, ensuring a safer route for future operations. A significant portion of the railway, 72 km along the main axis and 83.4 km including side tracks, has been completed, with 65.6 km of long-gauge rails already installed. Notably, the construction of one tunnel has been completed, with excavation continuing on the second tunnel.

With a total length of 110.4 km (140.6 km including side tracks) and the construction of 534 engineering structures, the railway is set to open new economic frontiers for Azerbaijan and its regional partners. The project’s completion will mark a key achievement in Azerbaijan’s infrastructure development and will serve as a catalyst for increased trade, economic growth, and regional cooperation.

In conclusion, the Horadiz-Aghband railway line is not merely a transport infrastructure project; it is a strategic initiative that will have lasting economic, political, and social impacts on Azerbaijan and the wider region. The Zangezur Corridor will not only position Azerbaijan as a central transit hub in the global economy but also foster regional cooperation, peace, and stability. By capitalizing on the growing demand for efficient transportation routes between Asia and Europe, Azerbaijan is poised to reap substantial economic benefits, strengthen its international position, and ensure a prosperous future for its citizens.