Today, the political processes taking place in the international arena have significantly contributed to the transformation of the perception of the importance of the South Caucasus on the geopolitical map, as well as changed the ideas of a number of leading geopolitical players (for example, Iran, India, China, etc.) about their own place and role in the given region.
In addition, the “initiative policy” of the mentioned actors, which actually replaced the policy of “maintaining the balance of power”, significantly affects the transport-logistics image of the South Caucasus region, which is reflected in the initiated and actively promoted transport-logistics projects, which are based not only on economic, but also on the political and ideological fundamental interests of the region and, in general, the biggest players in the international arena.
In this context, the geopolitical and transport-logistics competition between the two largest transport and logistics projects, MTM “North-South” and TRACECA, is of particular interest.
2000 In September, within the framework of the II Eurasian Transport Conference held in St. Petersburg, Russia, Iran and India signed an agreement on the creation of the “North-South” international transport corridor. According to some experts, the annual cargo transportation potential of the “North-South” MTR (which plays a key role in the EAEU transport system and connects the Nordic countries and the northwestern EAEU countries with the Persian Gulf and Indian Ocean states, passing through the Caucasus and Central Asia) is 14, from 6 to 24.7 million tons.
Another large-scale transport corridor in the region, which is presented as a project to revive the Great Silk Road and connect the countries of Europe, the Caucasus and Asia (which does not involve Russia) is TRACECA, on which the agreement (with a number of reservations) was signed in 1998 by Turkey , by the leaders of Azerbaijan, Armenia, Georgia, Moldova, Romania, Bulgaria, Kazakhstan, Tajikistan, Uzbekistan, Kyrgyzstan and Ukraine, and which, in fact, is in direct competition with the above-mentioned “North-South” MTM.
Thus, the South Caucasus region is an arena of geopolitical confrontation for two large transport-logistics projects at once, and against the background of ongoing processes of transformation of the system of modern international relations and ideological confrontation, it is of particular importance for international players with their own interests in the region. Moreover, the geopolitical realities emerging as a result of the 44-day war also contributed to the redefinition of the level of competition between the “North-South” MTU and the “West-East” MTU, significantly strengthening the political role of the said MTUs.
“North-South” and “West-East” MTF in the context of Iran’s priorities
The results of the 44-day war in Nagorno-Karabakh not only changed the balance of power in the South Caucasus region, causing a number of new contradictions and threats, but also served as a basis for strengthening the influence of some international actors in the South Caucasus and rethinking their role in the region. In particular, we are talking about the Islamic Republic of Iran, which is the most important link of the aforementioned global projects of the region’s transport-logistics architecture and international transport corridors in general.
In this context, several factors can be singled out that affect the formation of Iran’s priorities related to the North-South Treaty.
- Relations with Azerbaijan.
Despite the activation of the dialogue between the official Tehran and Baku on the formation of a common transport and energy agenda (in particular, in November 2021, an agreement was signed on the swap supply of up to 1.5-2 billion cubic meters of natural gas from Turkmenistan through the territory of Iran to Azerbaijan, which was preceded by a series of negotiations , mutual visits, as well as the official statements of Tehran about the involvement of Baku in the intelligence work of the Iranian part of the Caspian Sea) there is an increase in tension in Iranian-Azerbaijani relations, which is due, in particular, to the active military cooperation within the framework of Azerbaijani-Israeli relations, as well as to the active policy of Azerbaijan, the so-called Regarding the implementation of the “Honey Corridor” project, which, if implemented, will essentially deprive Iran of a direct land connection with Armenia, which is an important transit partner of the Republic of Iran in the region.
2. Iran’s active policy of cooperation with EAEU, as well as the desire to expand trade relations with Russia, China and India.
Thus, on May 17, 2018, the EAEU countries and Iran signed the temporary agreement on the formation of the Free Trade Zone (extended in March 2022). As a result, the average customs duty on a number of products was significantly reduced, which contributed to the activation of trade between Iran and EAEU. According to the statement of the representative of the Customs Department of Iran, Ruhollah Latifi, the volume of goods turnover between Iran and EAEU countries in 2021. from March to 2022 in the period between March, it was 5.6 billion dollars (increase: 66%). At the same time, the Russian Federation is the main trading partner of Iran both in terms of import and export.
In this context, the implementation of the “North-South” MTM project will shorten the route of transportation of goods between Iran and the EAEU, in particular, Russia, significantly increasing the turnover of goods between these countries, which is of particular importance in the face of anti-Russian and anti-Iranian sanctions (according to official representatives, the turnover of goods may increase five times, reaching $30 billion) under the conditions.
In this context, it should also be noted about the undesirability of the “Honey Corridor” operation for Iran, because Armenia, as a EAEU member country, is the most important link for Iran in terms of cooperation with the EAEU.
In addition to the above, the implementation of the “North-South” MTR project is complimentary to Iran’s initiative to create the “Persian Gulf-Black Sea” international transport corridor, which will allow Iran to activate trade with the EAEU. Regarding this issue in 2021 In November, the Iranian Embassy in Armenia noted the importance of Armenia’s participation in the “Persian Gulf-Black Sea” MTR project in the context of the construction of the North-South highway.
3. Growing regional ambitions of Turkey in the South Caucasus.
Today, Iran’s main trade between Russia and Europe is carried out through the territory of Turkey and Azerbaijan. At the same time, the main part of the transit between Azerbaijan and Nakhichevan, as well as Baku and Ankara, is carried out through the territory of Iran. Taking into account the political contradictions between Iran, Turkey and Azerbaijan (in particular, for example, active cooperation between Azerbaijan and Israel), Iran is interested in creating conditions for the diversification of transport and logistics routes passing through the territory of the South Caucasus, so that it is possible to maintain the balance of power in the region (for example, ” The commissioning of the Yeraskh-Horadiz railway will deprive Iran of the status of the main transport contractor between Azerbaijan and Nakhichevan, which will negatively affect Iran’s political role in the region.
In this context, it is important for Iran to exploit the Tehran-Julfa-Yerash-Yerevan railway route (and then to the Black Sea), which will allow Iran not only to maintain a key role in the transport and logistics framework of the South Caucasus, weakening the influence of Turkey and Azerbaijan, but also creating opportunities to optimize transport and logistics connections with EAEU, as well as with India and China.
These, as well as a number of other factors (the most important of which is, in particular, the collective Western sanctions pressure on Iran) determined Iran’s priorities in choosing between competing transport corridor projects.
Thus, in May 2021, Iran’s Foreign Minister Mohammad Javad Zarif emphasized the Iran-Julfa-Yerash road, going through Georgia to the Black and Mediterranean seas (bypassing Turkey and Azerbaijan), to the markets of Asia and India (which also shares this approach). The need to speed up the implementation of the Nakhichevan-Armenia railway project and the operation of the Julfa-Yerash section will enable Iran to effectively integrate into the “North-South” MTR, increasing cargo turnover with Russia, and increasing the efficiency of the transport-logistics policy in this direction.
Moreover, as a logical continuation of the political vision of the logic and structure of the South Caucasian transport system, the Minister of Roads and Urban Development of Iran, Rostam Ghasemi, in 2021. In October, he announced on his Twitter microblog the launch of the “Caucasian Corridor” project (some experts saw this as a bid to create an alternative to the “Honey Corridor” to counterbalance the geopolitical ambitions of Turkey and Azerbaijan).
The place and role of Hdkastan in the transport-logistics system of the South Caucasus
The transformation of the modern system of international relations has significantly expanded the cooperation between Iran, Armenia and India in the field of transport and logistics, which, as in the case of Iran, is also due to a number of political and economic factors.
Thus, one of the most important factors in terms of deepening both economic and political cooperation is the desire to expand cooperation with EAEU.
The Republic of India, with a population of about 1.4 billion, is among the leaders in terms of economic growth and over the years has confidently maintained its position among the ten largest economies in the world. However, despite the country’s high rate of economic growth and the intensification of relations between India and the EAEU (which, in particular, is due to the transformation of the system of political dominance in the international arena), the rate of mutual trade between them is relatively low.
Thus, according to official statistics, in 2021, India took the 13th place in the foreign trade of the Union, which is only 1.9% of the EAEU’s foreign trade turnover. In India’s foreign trade turnover, the share of goods turnover with EAEU countries was 1.8%. However, the parties are interested and are taking active steps to expand mutual trade and cooperation.
A key role in this matter is played by the “North-South” trade fair, the launch of which will not only make it possible to almost halve the time of delivery of goods from India to the EAEU countries, in particular, the Russian Federation, as India’s main trading partner in the EAEU (today, various according to the data published by brokerage companies, the average delivery time of goods is 50-55 days (for example, the transportation of goods on the route “Javaharlal Nehru Port-Vostochny Port”), will also contribute to the activation of economic relations with Russia, Central Asia and Europe.
In addition, some researchers point out that India’s integration into the North-South FTA project also has a strong political implication due to India’s desire to limit China’s influence in West Asia.
Regarding the operation of the “North-South” corridor, the Iranian port of Chahbahar (which is unique in a number of indicators) is of particular interest to India, the development and operation of which will create an opportunity to carry out trade with Iran and then to the countries of Central Asia, bypassing Pakistan.
The operation of the mentioned port and the existence of land communication between Iran and Armenia will promote trade with Russia and European countries as well. In this regard, the Ambassador of India to Iran in 2021. made a statement about the prospects of using Iran’s Chahbahar port and the intention to include Armenia in the “North-South” transport corridor passing through Iran’s Chahbahar port.
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- The official page of the Minister of Roads and Urban Development of Iran Rostam Ghasemi in the “Twitter”. URL: https://twitter.com/RostamGhasemi/status/1445823447129411589?cxt=HHwWisCi4fmwzJAoAAAA
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- In the same place.