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The Jamestown Foundation

The Jamestown Foundation

Founded in 1984, The Jamestown Foundation is an independent, non-partisan research institution dedicated to providing timely information concerning critical political and strategic developments in China,…

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Lapis Lazuli Corridor Ushers In New Trade Opportunities For Eurasia

  • The Lapis Lazuli Corridor, which began development in 2018, aims to revolutionize regional transportation and bolster exports, expanding economic opportunities for countries like Afghanistan, Turkmenistan, Azerbaijan, Georgia, and Turkey.
  • Amidst instability in Afghanistan, participation in regional projects like the Lapis Lazuli Corridor is seen as key to mitigating security threats and resolving economic crises.
  • The corridor, with extension opportunities toward Pakistan and India, is predicted to boost regional integration and trade opportunities.
Eurasia

Via the Jamestown Foundation

During a regional conference held in Ashgabat, Turkmenistan, in May 2023, President Serdar Berdimuhamedov underscored the paramount importance of the Lapis Lazuli international transit corridor. He emphasized how further development of this landmark project would revolutionize the regional transportation system, propelling it to new heights of efficiency and connectivity (Turkmenportal.com, February 27; Khaama.com, May 30). The multimodal east-west corridor—which is still under development, though some parts are already being utilized—begins in Afghanistan and includes overland routes passing through Turkmenistan, followed by ferry connections across the Caspian Sea to Azerbaijan. From there, goods are transported by rail to Georgia, Turkey and potentially onward to Europe (Silkroadbriefing.com, August 21, 2022; Aze.media, December 22, 2022). Overall, the corridor aims to boost exports, expand economic opportunities and improve transportation infrastructure for all the countries involved.

With an initial investment of $2 billion, development of the project began in 2018, starting in Torghundi, Afghanistan; connecting with Turkmenistan’s railway network; passing through the ports of Baku, Poti and Batumi; and ultimately reaching Kars and Istanbul in Turkey. It is expected that the corridor, operating under the International Road Transport carnet, will be able to handle 80 percent of the products transported from South Asia to Europe (China-briefing.com, January 6). In January 2021, Turkmenistan, Azerbaijan and Afghanistan signed a tripartite roadmap to deepen cooperation on the Lapis Lazuli Corridor (Trend.az, January 24, 2022). After connecting the Lapis Lazuli route with the Baku–Tbilisi–Kars railway in 2018, goods from Afghanistan have already been transported from Turkmenistan to Azerbaijan and then onward to the West. The first test cargo sent from Afghanistan in December 2018 was delivered to Baku within 12 days. From January to May 2020, 55,500 tons of cargo were transported through Azerbaijan in the direction of Afghanistan as well as in the reverse direction (Report.az, September 8, 2022).

As it is known, instability in Afghanistan poses a significant threat to expansive transit projects in Central Asia, South Asia and throughout Eurasia, with economic and humanitarian crises contributing to radicalization. Thus, the inclusion of Afghanistan in regional cooperation is considered crucial to resolving these crises and mitigating security threats. The United States’ withdrawal and the Taliban’s takeover of Afghanistan has led to significant changes and constraints within the country, resulting in a lack of diplomatic relations with other nations and growing economic problems. Consequently, Kabul’s participation in regional projects such as the Lapis Lazuli Corridor may help improve the country’s domestic situation and regional standing

Furthermore, with the COVID-19 pandemic and Russia’s war against Ukraine, the countries of Central Asia and the South Caucasus, especially Azerbaijan, Georgia and Turkey, are actively deepening cooperation in the fields of logistics and transportation. These countries are focused on constructing and further developing alternative transit routes, including the Middle Corridor and the Lapis Lazuli Corridor. They are also engaged in negotiations with the Central Asian states on initiatives such as CASCA+ (Central Asia, South Caucasus and Anatolia). For example, the unification of transportation tariffs, the establishment of interconnected railway infrastructure and increased freight traffic are high on the agenda for Azerbaijan, Turkmenistan and others (Trend.az, May 25; Khaama.com, May 30).

Additionally, Ashgabat and Kabul have taken various measures to strengthen their cooperation, including the construction and modernization of transportation infrastructure and the improvement of border controls and customs procedures (Khaama.com, May 30). Turkmenistan is especially interested in the Lapis Lazuli project, as evidenced by its hosting of a regional conference in December 2022 to discuss the route’s implementation strategy. The event, organized by the Organization for Security and Co-operation in Europe, brought together more than 60 representatives from Turkmenistan, Azerbaijan, Georgia and Turkey—all signatories of the agreement to develop the route. This reflects not only these regional countries’ commitment to the project but also European countries’ active involvement in developing the Lapis Lazuli Corridor (Newscentralasia.net, December 13, 2022; Turkmenportal.com, May 2).

Notwithstanding that the Lapis Lazuli transport corridor was initially created to strengthen trade relations for landlocked Afghanistan and provide a secure route for transporting Afghan goods to European markets, the corridor’s significance extends well beyond Afghanistan and Turkmenistan. According to Batyr Annaev, deputy director general of the Agency for Transport and Communications of the Trans-Caspian International Transport Route, this corridor will serve as a key transit route from China to Europe (Trend.az, May 25). Keep in mind that the Middle Corridor, stretching from China to Europe, consists of two main lines: the northern line (China–Kazakhstan–Caspian Sea–Azerbaijan) and the southern line (China–Kyrgyzstan–Uzbekistan–Turkmenistan-Caspian Sea–Azerbaijan). As it continues to be developed, the Lapis Lazuli Corridor (Turkey–Georgia–Azerbaijan–Turkmenistan–Afghanistan) could be considered the third line with the potential to connect Afghanistan to the world’s oceans (Ankasam.org, September 20, 2022).

Additionally, the Lapis Lazuli route has extension opportunities toward Pakistan and India. Extending to growing powers India and Pakistan would offer significant economic and security benefits for the countries using the corridor (Ankasam.org, September 20, 2022). This could also lead to improved relations between Islamabad and New Delhi, as well as the opportunity for Uzbekistan to access European markets through the Trans-Afghan Transport Corridor.

In sum, the Lapis Lazuli transport corridor is expected to boost regional integration and create new trade opportunities, gaining increased significance amid the war in Ukraine and revitalization of the Middle Corridor. This route has gained special prominence due to international sanctions against Russia, thus presenting itself as an alternative transit route between Europe and China. Furthermore, the corridor is in line with the strategic interests of many European countries as it bypasses their three biggest regional rivals—Russia, China and Iran—and connects to the continent’s landlocked regions.

Moreover, the individual countries participating in the development of the Lapis Lazuli Corridor have their own interests at stake. Turkmenistan hopes to diversify its economy, Afghanistan seeks an alternative trade route and Azerbaijan aims to enhance regional connectivity. Generally, the transportation corridor is expected to intensify regional integration and trade opportunities for Afghanistan, Azerbaijan, Georgia and Turkey. The route’s potential extension to include Pakistan and India would offer critical economic benefits and enhanced access to the Indian Ocean. Nevertheless, further consultations with international partners and donors as well as increased investments are needed to realize the project’s full potential. Ultimately, with the improvement of infrastructure and regional connectivity, this transit project will likely enhance economic and political stability among the countries involved as well as in the regions where they operate.

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By Nuray Alekberli-Museyibova

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