New Delhi: Russia and Azerbaijan have agreed to boost the Azerbaijan route of the International North-South Transport Corridor (INSTC), a decision taken during Russian President Vladimir Putin’s two-day visit to Baku this week which will enable Russian to increase volume of trade with India.During a joint presser on Monday, with Putin by his side in Baku, Azerbaijan President Ilham Aliyev said the implementation of the INTSC project has been of exceptional importance for interstate relations as well as for joint efforts in leveraging regional transport corridors and routes.“I must say that both the railway and automobile segments of the North-South corridor have been fully implemented and are successfully operating on the territory of Azerbaijan,” Aliyev said. “At the moment, we are actively modernising the railway segment of this corridor to increase its throughput capacity. We are considering the possibility of transporting up to 15 million tonnes of cargo per year, with the potential to increase this to 30 million tonnes.”Meanwhile, Uzbekistan has sent its first cargo to India via INSTC recently. The Azerbaijan route is the original route of the three INSTC routes for Indo-Russian trade via Iran, but Azerbaijan has been slow in boosting infrastructure. Since the Ukraine war, the INSTC emerged as a key route for Indo-Russian trade and has contributed to the increase in bilateral trade. Armenia wants to join the INSTC, making it the fourth route for trade between India, Russia, Eurasia and Europe. Aliyev also revealed plans for enhancing the throughput capacity of the INSTC’s railway segment through Azerbaijan. “This year we have already allocated approximately $120 million for the modernisation of this railway section to achieve the required throughput capacity,” he said.Putin highlighted the joint plans of Russia and Azerbaijan for implementation of the INSTC project, which, according to him, will allow the two nations to reach the shores of the Indian Ocean and utilise transport cooperation for mutual benefit and interest. The INSTC was a key item on the agenda when Putin met the Indian PM at the annual summit in Moscow in July.The INSTC contains three main routes relative to the Caspian Sea, including the Trans-Caspian Route through the ports of Astrakhan, Olya and Makhachkala in Russia, and the ports of Bandar Anzali, Amirabad and Nowshahr in Iran. India-Russia trade has been primarily taking this route.The second is the Eastern Route along the existing railway line through Kazakhstan, Turkmenistan and Iran. Some consignments to India came via this route from Eastern Russia.The Western Route extends from Astrakhan through Samur across Azerbaijan to the Astara station, and through Iran via the under-construction Astara-Rasht-Qazvin line.In May 2023, Russia and Iran signed an intergovernmental agreement to team up for the construction of the 162-km Rasht-Astara railway line. The project provides for €1.3 billion Russian allotment to Iran. The project, estimated at €1.6 billion, is scheduled to be completed in 2027-28.In May, Azerbaijan Railways completed the reconstruction of the cargo yard located in the Astara region of Azerbaijan to ensure faster handling of significantly increasing cargo transshipments along the INSTC. “According to preliminary estimates, the operation of the renovated Astara Terminal will increase transit cargo transportation along the INSTC by 10-15% by the end of this year,” said a recent report in Caspian News. “The terminal is expected to start full operations by the end of this year. After the Astara-Rasht railway line in Iran is put into operation, the volume of transit cargo accepted through both Astara terminals is expected to grow significantly.”India also plans to join the INSTC with Iran’s Chabahar Port, and there are plans to join the INSTC with the Arctic.
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