After drone attack: Baku suspends cargo traffic with Iran

A serious incident in Nakhchivan made sharp adjustments to the agenda of economic relations between Baku and Tehran and led to an instant freeze of established trade ties.

Against the backdrop of the rapidly escalating situation due to an Iranian drone attack, the government moved to decisive measures in the sphere of logistics and transport security. The suspension of international cargo flow became a direct consequence of a gross violation of the principles of good neighborliness and regional stability. After all, when the inviolability of state borders is under threat, economic calculations inevitably take a back seat, writes the newspaper "Caspian".

More important than profit

Our government is making it clear: no commercial gain can be a subject of compromise when it comes to the country's sovereignty and the safety of its citizens. Especially since under such conditions, trade itself carries heightened risks.

Under these circumstances, additional security measures were promptly adopted. Baku partially closed its airspace for 12 hours following the drone attack on the territory of Nakhchivan. At the same time, our government decided to temporarily suspend the movement of cargo vehicles across the state border with Iran. The restriction applies to bilateral and transit cargo flows.

The Cabinet of Ministers' decision has already been communicated to carriers and border services. The ban is in effect at all checkpoints on the Azerbaijani-Iranian border. Thus, the movement of all road freight transport between the two countries, including transit through the territory of our republic, has been effectively suspended.

Crisis of trust

The suspension of heavy freight transport is a clear signal. Stable trade is only possible where the letter of the law is observed and there is mutual respect. Incidentally, shortly before, the neighboring state decided to hold back food supplies within the country to guarantee feeding its citizens under wartime conditions. Food exports from Iran were halted, and local entrepreneurs tried to adjust to the new realities without undue fuss, gradually establishing supplies from other countries in the region. Reorientation helps avoid shortages on the shelves of our stores and allows keeping the situation under control.

Experts believe that changes in the supply structure will not significantly affect daily life and the usual rhythm of the domestic market. Local importing companies have already begun working out alternative routes and searching for new partners in other regions. This approach is especially important, asserts parliamentarian and expert Vugar Bayramov, since Iran had maintained its status as a key trading partner of Azerbaijan for many years and served primarily as a major supplier of food products.

- Last year's statistics demonstrate the stability of ties, - he states. - Trade turnover between our countries amounted to $644 million compared to $647 million a year earlier. Nevertheless, the trade structure points to a serious imbalance. The bulk of the turnover, amounting to $624 million, came from imports from Iran, while Azerbaijani exports totaled only $20 million.

Thus, the analyst says, supplies from our republic account for only about 3% of the total volume of operations, which has created a negative balance of $604 million for the country. The dominance of Iranian imports is confirmed by long-term statistics as well.

A bet on resilience

Iran's share in our country's foreign trade turnover is only 1.3%, and its share in the import structure is about 2.6%. Thanks to this, the parliamentarian says, possible technical difficulties in trade will practically not affect the republic's export revenue, although they may require attention to the supply of the domestic market.

- Last year, a significant portion of supplies from Iran consisted of food products, - he noted. - The list of key purchases included oranges, potatoes, table salt, and eggplants. Confectionery products, butter, peppers, dates, and various vegetables — from onions and carrots to cabbage and cheese — were also actively imported. The amounts for each of these items ranged from three to nine million dollars, forming the usual assortment on store shelves.

However, the main volume of purchases traditionally fell on products for industry and construction. Technical gases such as nitrogen and argon, as well as construction gravel, marble chips, quality cement, and various chemical raw materials were actively transported from the neighboring country. Disruptions in the supply of construction materials and ordinary household goods may begin. Finding replacements for these purchases in other markets is quite feasible, but in a short timeframe such restructuring may lead to price increases.

A separate risk is associated with logistics. Iran played a key role in transport links with Nakhchivan, and any military actions could complicate this route, increasing transportation costs. In addition, major projects are called into question, including the "North-South" corridor. Its western branch, passing through our country, is the most prepared and promising route for connecting Russia and Europe with the ports of the Persian Gulf.