Azerbaijan Accelerates Caspian Sea Transport Infrastructure, Expanding Middle Corridor with Central Asian Nations
In the summer of this year, Azerbaijan has been actively accelerating the construction of transportation projects across the Caspian Sea, while announcing a series of initiatives aimed at expanding the Middle Corridor trade route with Central Asian countries. These initiatives seek to create a more efficient connectivity network, promoting multimodal trade and transportation within the region.
Energy and Trade Cooperation with Turkmenistan
In late June, Azerbaijan and Turkmenistan signed a series of agreements promoting energy cooperation and establishing regular freight flows between the two nations. This is considered a significant step in Azerbaijan's broader strategy to connect Central Asia with Europe through its transportation network.
Expanding Cooperation to Kazakhstan and Uzbekistan
From early July, Baku has launched similar initiatives with Kazakhstan and Uzbekistan. Notably, Uzbekistan's Minister of Trade Khurram Teshabayev, in an interview published by Azerbaijan's state media, revealed that Tashkent and Baku plan to construct and operate a common cargo fleet across the Caspian Sea.
The two countries are also working to simplify tax regimes and transit procedures for sea freight transport. Teshabayev stated: "These initiatives will improve multimodal transportation efficiency, make logistics chains more sustainable, and reduce transportation costs for exporters." He emphasized: "The volume of goods transported along this route has shown stable growth, and the range of export products is expanding."
Joint Logistics Center Project
According to Teshabayev, trade officials are planning to develop a joint logistics center in the area near Baku Port, integrated with Azerbaijan's railway network. The center is expected to reduce transit time for Uzbekistan-bound goods heading toward the European market. He described the proposed center as "one of the most important priority projects for developing bilateral transportation and infrastructure."
Uzbek-Azerbaijan Trade Statistics
According to data from Uzbekdata, trade volume between Uzbekistan and Azerbaijan increased by nearly 43% in the first quarter of 2026 compared to the same period last year, reaching $80.1 million. The two countries are targeting an annual trade volume of $1 billion by 2030.
| Indicator | 2025 (same period) | 2026 (Q1) | Growth | 2030 Target |
|---|---|---|---|---|
| Trade volume (million USD) | 56.0 | 80.1 | +43% | 1,000 |
| Main commodities | Diversified | Diversified | Expanding | Diversification |
Digital Permit System for Road Transport
Meanwhile, Kazakhstan and Azerbaijani officials have introduced a digital permit system for road transport to eliminate paperwork-related delays. The new system will be effective in 2027, promising increased efficiency and reduced waiting times at borders.
Challenges with Caspian Sea Submarine Power Cable Project
Notably, contrary to the expansion trend, Teshabayev indicated that the Caspian Sea submarine power cable project for exporting electricity from solar and wind power from Uzbekistan and Kazakhstan to Azerbaijan and subsequently to the European market may face difficulties in achieving initial export targets.
Both Kazakhstan and Uzbekistan are striving to implement ambitious economic growth plans but currently face electricity shortages. The two countries have numerous projects at various development stages, including green energy initiatives, and the construction of nuclear and coal power plants, to meet rapidly increasing domestic electricity demand. However, it remains uncertain how much surplus electricity will be available for export via the Caspian Sea submarine power cable.
Initial projections suggested the Caspian Sea submarine power cable could transmit up to 5 gigawatts (GW) of electricity by 2030. However, Teshabayev noted that Uzbekistan's electricity export capacity might only reach 2 GW, without specifying a timeframe.
| Project | Participating Countries | Objective | Challenges | Timeline |
|---|---|---|---|---|
| Cross-sea cargo fleet | Uzbekistan, Azerbaijan | Increase maritime transport | Operational cooperation | Being implemented |
| Logistics center | Uzbekistan, Azerbaijan | Reduce transit time | System integration | Planning phase |
| Digital permits | Kazakhstan, Azerbaijan | Reduce paperwork | Digital transformation | Implementation in 2027 |
| Submarine power cable | Uzbekistan, Kazakhstan, Azerbaijan | 5 GW by 2030 | Domestic electricity shortages | Uncertain |
Future Vision
Azerbaijan's initiatives reflect a long-term strategy to position the country as a significant trade and logistics hub connecting Europe with Asia. The Middle Corridor, supported by infrastructure projects like those being implemented by Azerbaijan, could transform global trade flows and reduce dependence on traditional routes.
However, challenges in energy and the increasing domestic demand of Central Asian countries may affect the implementation speed of certain projects, particularly those related to energy exports. The balance between domestic economic development and export opportunities will be a determining factor in the success of these initiatives.
In the context of intensifying geopolitical competition, building efficient transportation and energy networks not only brings economic benefits but also strengthens the strategic position of participating nations.