The ‘Iron Silk Road’

The Baku-Tbilisi-Kars (BTK) railway line went into operation last week with a ceremony at the Port of Baku, attended by the presidents of Turkey, Azerbaijan, Georgia, Kazakhstan and Uzbekistan. The 826-kilometer rail link, also known as the “Iron Silk Road,” added another layer to the existing infrastructure projects between the three countries, including the Baku-Tbilisi-Ceyhan oil pipeline and the Baku-Tbilisi-Erzurum gas pipeline.

Though the idea of linking the three countries with a railway dates back to the early 1990s, the intergovernmental agreement to actually start the project was signed on Feb. 7, 2007 by the then Turkish Prime Minister Recep Tayyip Erdoğan and the then presidents of Azerbaijan and Georgia, Ilham Aliyev and Mikhail Saakashvili respectively. Although the construction started without much delay, completion was postponed several times for financial, logistical and political reasons.

The project cost about a billion USD, most of which was financed by the State Oil Fund of Azerbaijan. The line is expected to transport around a million passengers and 6.5 million tons of freight annually, thus becoming a key part of the Silk Road Project that aims to connect Beijing and London. It will also no doubt create incentives for regional businesses and economic cooperation.

Several issues still need to be dealt with, such as whether the railway will offer better logistical, economic and financial benefits to companies compared to the existing Russian route, and whether it would pay off the investment in a reasonable period.

More generally, we should also consider what its impacts will be on regional and wider geopolitical dynamics. For one thing, the railway is sure to further contribute to the isolation of Armenia from rest of the South Caucasus, while strengthening the Turkey-Georgia-Azerbaijan triangle. It will also, as seen clearly from the participating presidents at the commencement ceremony, tighten the connection between Turkey and the Central Asian countries, bypassing Iran.

As Russia has been consolidating its power over the Black Sea, South Caucasus, and Crimea, as well as increasing its presence in Eastern Mediterranean, since its moves in 2008 in Georgia and in 2014 against Ukraine, the larger geopolitical play between Russia, China and the U.S. will be important in determining the precise impact of the BTK railroad connection. While the Western sanctions against Russia encourage those who argue that Russian route will be replaced by the BTK line, it would be naïve to expect to move into a region that has effectively become a buffer zone between Russia and the rest of the word without Russian consent.

The fact that Turkey and Russia have developed a kind of rapport, able to withstand the crisis over the November 2015 downing of a Russian fighter jet by Turkey, indicates Russian acquiesce in the BTK project. The U.S. has not yet been able to develop a new concrete policy for the region following the 2008 Russian-Georgian War, but this may not mean that it has completely abandoned the region to Russian dominance. In fact, the projects like BTK railway also support U.S. priorities in the region, currently focusing on economic development and good governance.

China, on the other hand, has been searching for alternative routes to improve its connectivity across Eurasia with its “One Belt, One Road” strategy, initiated by Chinese President Xi Jinping in 2013. So far, it has been using the Russian route to reach Europe, connecting Chongqing in China to Duisburg in Germany in 16 days. The realization of London-Beijing connection in summer 2017 allowed frights to cover the route in 18 days. Should the BTK line prove able to decrease the duration even if only fractionally, it will definitely become financially viable and an attractive alternative, while decreasing Russian profits along the way.