Thanks to RDZ, Moscow also plays an important operational and financial role. For example, RDZ financed the electrification of Iran`s 495-kilometer Garmsar-Incheboron railway line, which extends to Turkmenistan and Kazakhstan, with $1.39 billion. The upgraded line was inaugurated on July 2, 2018. In April 2018, RDZ began talks with Iranian, Indian and Azerbaijani railway companies to establish a joint operator for end-to-end logistics along the INSTC. Such an agreement would reflect the experience of UTC Logistics, a joint venture between RDZ, KTZ (Kazakhstan) and BCh (Belarus) operating on the east-west route. RDZ has also signed an agreement with Indian Railways to develop cooperation on automatic traffic controls and safety systems. Under a separate agreement, RDZ will supply 100 cars to Indian Railways. On the other hand, Russia has intensified its cooperation with Iran and joint projects are being discussed, with Moscow having activated a $3 billion credit line for investments related to the INSTC. To this end, Armenia aimed to build the 550 km “North-South” transport route to facilitate communication with Iran and Georgia and beyond.

Part of the construction roads will be built by the Chinese company Sinohydro Corporation (under the 2009 loan agreement with the Asian Development Bank). Construction was scheduled to be completed in 2016, but began with a three-year delay. Under this agreement, Armenia received $40 million. The second tranche was $50 million; Negotiations on the third tranche are ongoing. In the south, Armenia has proposed the construction of the Armenian-Iranian railway concession, also known as the Southern Armenian Railway. The project remains without a financier on paper, as the economic feasibility is questionable, although Armenia continues to try to find sponsors and private investors to make the project more economically viable. Before the feasibility study was completed by Dubai-based investment company Rasia FZE, the Southern Armenia Railway was to be a 316-kilometer railway connecting Gavar, 50 kilometers east of Yerevan, near Lake Sevan, to the Iranian border near Meghri. After a meeting with former Armenian President Serzh Sarkisian on September 3, 2013, Russian President Vladimir Putin said that Russian railways could invest about 15 billion rubles in the development of Armenian railways.

The results of the feasibility study showed that the construction of the Southern Armenia Railway would cost about $3.5 billion; The lengths from Gagarin to Agarak have been reduced to about 305 kilometers, which corresponds to a basic operating capacity of 25 million tons per year. The railway will have 84 bridges with a length of 19.6 kilometers and 60 tunnels with a length of 102.3 kilometers, which represents 40% of the total length of the project. As the main missing link in the North-South international transport corridor, the Southern Armenia Railway would create the shortest transport route between Black Sea ports and Persian Gulf ports. According to the study, the Southern Armenia Railway would establish an important freight transit corridor between Europe and the Persian Gulf region, based on traffic forecasts of 18.3 million tons per year. In addition, the Armenian-Iranian branch of the railway is connected to the longer tabriz-Tehran-Gorgan branch (Iran) – Etrek-Bereket-Gyzylgaya (Turkmenistan) – Zhanaozen-Aktau-Nur-Sultan-Dostyk (Kazakhstan) – Urumqi (China). This railway is of strategic importance as it will connect Armenia as a member of the Eurasian Economic Union (EAEU) not only with other member states, but also with Iran, India and China. However, this could become a “pipe dream” as Armenia`s main regional partner, Iran, is reluctant to grant a loan for the construction of the Armenian part of the railway – which is about 250 kilometers long. The Iranian part of the railway is about 60 kilometers long. In addition, it should be noted that the Armenian State Railway Company is largely owned by the Russian “South Caucasus Railway”. That is, all developments depend on the political will of Russia and developments in Armenia. According to Mher Sahakyan, the implementation of the North-South road corridor has a geopolitical advantage, as it will also strengthen Armenia`s security.

It should be noted that one of the most important factors in winning a war is to facilitate the rapid movement of military units, equipment and supply routes. In this context, Sahakyan argues that the North-South route will strengthen Armenia`s security and the Armenian army`s combat readiness. However, Armenia is far from implementing this project in the short term, as Azerbaijan has become a strong competitor and trusted partner in the project. The International North-South Transport Corridor (INSTC) is a 7,200 km long multi-mode transport project for the transport of goods between India, Iran, Afghanistan, Armenia, Russia, Belarus, Bulgaria, Kazakhstan, Kyrgyzstan, Oman, Syria, Tajikistan, Turkey and Ukraine. This is a strategically important connectivity project in Central Asia and Europe. This is not a new concept, as the current INSTC project was initiated by Russia, India and Iran in St. Petersburg in September 2000. The agreement was signed on 16 May 2002.

Now all parties, especially India, Iran and Russia, are working to bring the INSTC to life. Last year, the Container Corporation of India (Concor) and the container transport subsidiary of russian railways RZD Logistics JSC signed a service contract for the transport of goods between the two countries with a single invoice. A Memorandum of Understanding to facilitate this was signed in 2019. Concor is committed to using the INSTC pathway to facilitate the export of goods, including pharmaceuticals, vegetables such as onions, spices and tea from India, which are in high demand in Russia. Unlike Armenia, Azerbaijan is heavily involved in the project, building new train lines and roads to complete the missing connections in the INSTC. The founder and director of the foundation “Center for the Development of Strategic Cooperation Armenia – Iran”, Pooya Hosseini, argued in an interview that Azerbaijan creates all the conditions and makes every effort to direct the corridor through its territories, thus strengthening its role in international and regional processes, while keeping Armenia under a new economic blockade and isolation. In 2005, Azerbaijan`s accession to the INSTC agreement paved the way for India`s connection with Russia via Iran and later Azerbaijan by connecting Iran`s railways to the western Caspian Sea. This railway has another positive factor that can connect India to Europe via Turkey by connecting the Iranian-Azerbaijani railways to the Baku-Tbilisi-Kars railway. Baku expects goods to pass through its territory in the range of 15 to 20 million tons at full capacity and has been particularly active in upgrading infrastructure and building new roads and railways by attracting foreign and local investment.

In 2019, Azerbaijan planned to invest $1 billion in its railway infrastructure by 2022. Azerbaijan has yet another advantage: a new railway built in Iran that covers a 164-kilometer route between Rasht and Astara via Anzali, the other major port city in the Caspian Sea in Iran. The line is also intended to allow travel between Baku and Nakhchivan. For this reason, Azerbaijan has agreed to jointly finance the project, with each party contributing US$500 million. According to a report by the Center for Strategic and International Studies, Baku also granted Iran a $1.5 billion low-interest loan for construction, which began in the first half of 2018 and will continue until 2022. Iran has begun construction work to complete the missing link of the Qazvin-Rasht-Astara road and railway (205 kilometers), including the Rasht-Astara section (164 kilometers). The project involves the construction of 369 kilometres of bridges and railway lines to connect the southern sections to the northern sections. Azerbaijan, although India`s great rival is Pakistan`s strategic partner, with its advanced railway systems, plays a more important role in implementing India`s Eurasian vision in the INSTC than Armenia, which desperately needs investment to revive its role in these trade networks. On July 28, 2012, Dubai-based Rasia FZE (an investment company of the Rasia Group) was awarded a concession contract for the feasibility, design, financing, construction and operation of a new 30-year rail link between Armenia and Iran with an additional 20-year extension right. The Armenian-Iranian Railway is called the Southern Armenia Railway Project and is the main missing link in the North-South international transport corridor between the Black Sea and the Persian Gulf. Before the completion of the feasibility study, the Southern Armenia Railway was to be a 316 km long railway connecting Gavar, 50 km east of Yerevan near Lake Sevan, to the Iranian border near Meghri.

[25] The eastern foothills are not officially part of the INSTC and were strengthened by the signing of the Ashgabat Agreement to Facilitate Multimodal International Traffic and Transit between Central Asia and the Persian Gulf, an agreement concluded in 2011 between Afghanistan, Iran, Oman, Qatar, Turkmenistan and Uzbekistan and in synergy with the INSTC and other corridors such as the Turkmenistan-Afghanistan-Tajikistan railway line. Afghanistan-Turkmenistan-Azerbaijan-Georgia-Turkey transport corridor and TRACECA. The treaty entered into force in 2013, after which Qatar unexpectedly withdrew. Kazakhstan joined in 2015, followed by Pakistan in 2016. Although the road is currently mainly used for transit between China and Iran, India`s accession to the Ashgabat agreement in 2018 seems destined to give it new impetus as a full-fledged north-south corridor. .