28 January 2020

Tuesday, 17:32

CURRENCY

NEW GATES BETWEEN NORTH AND SOUTH

New bridge over the Samur River boosts trade and economic relations between the regional states

Author:

01.01.2020

On December 24, Russia and Azerbaijan celebrated a very important event in the Azerbaijani-Russian relations by commissioning an automobile bridge over the Samur River on the border between the two countries. The opening ceremony of the bridge was attended by Azerbaijani Deputy Prime Minister Shahin Mustafayev, Russian Minister of Economic Development Maxim Oreshkin, Head of the Republic of Dagestan Vladimir Vasiliev, Azerbaijani Ambassador to Russia Polad Bulbuloghlu, Russian Ambassador to Azerbaijan Mikhail Bocharnikov and other officials.

A bridge was built across Samur at the Yarag-Kazmalyar checkpoint area, which is an important part of the North-South international transport corridor. The project was implemented as part of the agreement signed in August 2013 between the governments of Russia and Azerbaijan. The 325.3 m long and 17.5 m wide bridge will replace the existing one built in 1957. Russia and Azerbaijan have evenly financed the project (about $ 21.5 million).

"This bridge unites not only two banks of the Samur River, but also our peoples," S. Mustafayev said at the opening. Stressing that Azerbaijan and Russia are united by strategic ties, the Deputy Prime Minister added that the new bridge creates even greater opportunities for implementing international projects. He noted that the commissioning of the new bridge, as well as the simplification of customs procedures and the introduction of the Green Corridor system, will serve to bring closer ties between residents of border regions and expand trade between the two countries.

Deputy Prime Minister of Azerbaijan emphasised that the bridge is an important component of the North-South transport corridor. According to Mustafayev, over the ten months of 2019, the volume of cargo transportation along the North-South transport corridor increased by 60%, and by 53% along the North-West route.

Maxim Oreshkin noted that the construction and commission of the new automobile bridge was a joint initiative of the presidents of Russia and Azerbaijan. According to him, the final decisions were reached on September 1, 2018 at the meeting between President of Azerbaijan Ilham Aliyev and Russian President Vladimir Putin in Sochi. "After more than a year, these works ended with a wonderful bridge," Oreshkin said.

According to Mr. Oreshkin, the trade turnover between Russia and Azerbaijan increased by 25% in 2019. This figure is one of the highest indicators among foreign trade relations. "We do not have similar indicators with other countries. This confirms the progressive development of our relations with Azerbaijan," M. Oreshkin said.

 

Cross-border cooperation

Both Azerbaijan and Russia have been waiting for the opening of the bridge over the Samur River for several years. Two-way traffic lane with the possibility of opening the third lane in rush hours, as well as a pedestrian crossing intensifies transport links between the two countries. In addition to boosting trade relation between the two countries, it also helps to expand the transit potential of Azerbaijan and Dagestan, stimulating cross-border interaction. This will contribute to the development of local business, because of the 190 Russian transport companies that participated in cargo transportation in this direction only in 2018, the majority were Dagestan companies.

It is enough to note that the coastal provinces of Iran maintain relations with the Russian Republic of Dagestan also largely through Azerbaijan. According to estimates, 30% of Iranian goods are transported by land and by sea to Russia through Dagestan. It is very likely that the role of this region increase in the near future. The significant share of transported commodities goes through the territory of Azerbaijan using roads and railways. According to 2019 data, the volume of trade between Iran and Dagestan in absolute terms was 400,000 tons per year. For Dagestan, Iran as a whole is a good market for its products, in particular meat. The coastal Iranian provinces of Gilan and Mazenderan play a large role in trade between Russia and Iran.

Speaking about the development of transport links between Azerbaijan and Dagestan, in April 2018, the authorities of Dagestan and Russian Railways OJSC began considering the issue of a new railway link on the route Makhachkala-Baku. At the end of October 2018, it was reported that Dagestan and Azerbaijan would be connected by a permanent railway connection. According to the head of Dagestan Vladimir Vasiliev, it is planned to launch a high-speed train Baku-Derbent-Makhachkala in 2020, which will contribute to the development of tourist communication between Russia and Azerbaijan. One of the plans is also to launch a direct flight between Makhachkala and Baku.

 

Between North and South

In general, the development of transport communications linking the Caspian littoral countries is an indispensable condition for the intensification of both interstate relations and interregional cooperation, such as the introduction of a multimodal transport route North-South, in particular, its western branch connecting Russia, Azerbaijan and Iran with extra-regional players. By the way, 2020 will mark the 20th anniversary of the North-South multimodal transport corridor project.

As part of the project, Azerbaijani built a complex in the Iranian Astara border with Azerbaijan, which consists of four terminals: a cargo terminal for general cargo, containers, grain products and oil. This also includes the implementation of an investment agreement signed in 2017 on the construction and operation of a terminal in Astara. According to the agreement, Azerbaijan Railways CJSC leases a terminal for a period of 25 years, the border section of the railway line for 15 years, and then returns them to Iran. The initial capacity of the terminal was supposed to be 2 million tons, however, the possibility of increasing it to 5 million tons is already being considered.

So far, this is the only large joint project of Azerbaijan and Iran in the border zone. However, we can assume that it can have a stimulating effect on subsequent cross-border cooperation projects. It is noteworthy that most of the goods supposed to be stored at the terminal will be from Russia.

 

Encouraging results

The opening of the bridge across the Samur River has become one of a number of significant events in 2019 in Azerbaijani-Russian relations. In particular, the November visit of the First Vice President of Azerbaijan, Mehriban Aliyeva, to Moscow, the holding of the 10th anniversary forum of interregional cooperation, significantly contributed to the development of relations between Azerbaijan and Russia. A few weeks after the Moscow forum, the Governor of the Astrakhan Region Igor Babushkin visited Baku.

In general, Azerbaijan is in second place among Russia's trade and economic partners in the Caspian. At the same time, the issue of development of the North-South transport corridor remains a priority for the leaders of Azerbaijan and Russia. During a telephone conversation on the opening day of the bridge, presidents Aliyev and Putin spoke about the importance of joint projects for the two countries. On December 24, Vladimir Putin called his Azerbaijani counterpart to wish him a happy birthday. According to the press service of the President of Azerbaijan, speaking about the importance of joint projects implemented by the countries, the leaders "noted that the opening of a new automobile bridge across the Samur River will greatly contribute to deepening expanded cooperation."

President Aliyev also stated this at his meeting with Maxim Oreshkin in Baku. He called symbolic that 2019 ends with the opening of a bridge, which connects our two countries. "I consider this a very significant event. Because all the years of both the Soviet period and the post-Soviet Russia and Azerbaijan were connected only by one bridge, although it cannot be really called a bridge, which has long become obsolete. The new bridge is a new gateway for business, for cooperation, for mutually beneficial international cooperation, for the transport corridor," Ilham Aliyev said.

In general, the development of communications between our countries is of great regional importance, as the extensive network of railways and highways, developed sea and air communications make the Caspian region a single organism, an integral region.

Interregional cooperation in the Caspian is likely to develop in the future. Large-scale infrastructure projects implemented in the region, primarily transportation projects, will have a significant impact on the nature of interregional relations, hence contributing to the growth of their influence on the nature of economic cooperation of the Caspian states. It is nice to note that the Azerbaijani-Russian interaction plays one of the important roles in this process.



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