Corridor system: EAEU and Iran will complete the development of the North–South Transport Corridor

The EAEU and Iran will solve problems related to the development of the North–South transport corridor, Arzybek Kozhoshev, Minister of Energy and Infrastructure of the Eurasian Economic Commission, told Izvestia. According to him, this route is becoming particularly important against the background of problems with the Suez Canal and rising prices. According to experts, the MTK will start operating at full capacity in 2027-2029. To do this, it is necessary to remove all barriers and complete the construction of the Rasht–Astara railway section. In the future, cargo traffic here may reach 35 million tons, and the corridor will become one of the leading trade routes in Eurasia.

The North–South corridor: what is its advantage

Against the background of increased Western sanctions against Russia, alternative transport routes are becoming increasingly important. One of them is the North–South international transport corridor, which connects Russia via Iran with the ports of the Indian Ocean.

However, the development of this corridor is facing challenges. The key obstacle remains the absence of the last link of the Rasht–Astara railway. Significant administrative barriers related to customs procedures, technical standards, and trade regulations between Iran and the EAEU (Eurasian Economic Union) countries still remain.

This union includes Armenia, Belarus, Kazakhstan, Kyrgyzstan and Russia. The EAEU has a single economic space without customs borders and barriers to ensure the free movement of goods, services, capital and labor. Therefore, relations in the field of trade and transport with other states are largely built jointly.

The EAEU and Iran will resolve issues related to the development of the North–South transport corridor, Arzybek Kozhoshev, Minister of Energy and Infrastructure of the Eurasian Economic Commission (EEC), told Izvestia.

— The Suez Canal is having big problems now, and prices have increased. Therefore, "North–South" is an archived issue, it will develop. I think that our Iranian colleagues and I will come to the conclusion that we will resolve many issues, including the issue of multimodal routes, railways, tariffs. <...> Negotiations are currently at an early stage," said Arzybek Kozhoshev.

In his opinion, Iran plans to join the EAEU in the future. Currently, Tehran has an observer role in the organization. By the way, a full-scale free trade agreement between Iran and the European Union came into force in May. It replaced the temporary one that had been in effect since 2019.

However, even after the entry into force of the free trade agreement, bottlenecks remain related to differences in national standards, duplication of control procedures, and the lack of a single digital cargo tracking circuit. These factors reduce the speed of border crossing and offset some of the economic advantages of the corridor, Farhad Ibragimov, a political scientist and lecturer at the Patrice Lumumba Faculty of Economics at the RUDN University, told Izvestia.

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When will the North–South MTC be fully operational?

The problems of the Suez Canal, the main route from Europe to India, are related to the situation in the Red Sea, where the Yemeni Houthis have made passage through the canal unsafe for most Western container ships. By the beginning of 2025, Egypt's revenue from the canal had fallen by more than 50-60%, and rates for container shipments from Asia to Europe had increased 2.5–3 times compared to the level of 2023.

In these conditions, the attractiveness of the North–South corridor is growing. It has obvious advantages: most of the route passes overland, and there is already a well-developed infrastructure. The total volume of traffic in 2023 increased from 19 million to 22.6 million tons, and in 2024 it reached 26.9 million tons. By 2030, it is planned to increase the capacity of the corridor to 32-35 million tons.

Iran is extremely interested in making the project work at full capacity. Given the ongoing pressure on Tehran from Western countries, participation in the global logistics route (and Iran is considered an important link where several transport arteries converge at once) increases the country's resilience to external challenges.

Despite the fact that disagreements remain between the EAEU and Iran on the project, mainly related to the bureaucratic component of the process, both Tehran and the union countries are interested in removing barriers and forming an expanded Eurasian economic space. An orientalist, consultant to the program "Prospects and Potential of cooperation between Russia and the Persian Gulf states in Global Security and High Technologies" (PIR Center), told Izvestia about this. Leonid Tsukanov.

"Given the current trend, we can expect that most of the issues will be resolved within the next three to four years," the expert believes.

According to Farhad Ibragimov, the full capacity of MTK North–South is possible in the medium term, approximately in 2027-2029.

— It is during this period that logistics chains can become really fast, predictable and cost-effective, — said the political scientist.

Full-scale work in this direction is already underway. Engineering and geological surveys have started at the Rasht–Astara site. Russia, Iran, Azerbaijan and other partners are working on a unified electronic system for exchanging documents and customs control data, which will significantly reduce border crossing time.

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What are the prospects of the project

The idea of the corridor arose as a search for the shortest route from India to Europe through Iran and Russia. In September 2000, at the Second Eurasian Transport Conference in St. Petersburg, representatives of Russia, Iran and India signed an intergovernmental agreement that initiated the creation of the ITC. Later, Azerbaijan, Armenia, Kazakhstan, Belarus, Oman, Turkey, Syria, Tajikistan and Kyrgyzstan joined it. Interest in the project was expressed in Pakistan, Qatar and the UAE.

Gradually, three main routes were formed. The western route passes through Azerbaijan via railways and highways. The trans-Caspian route includes sea transportation between the ports of Russia (Astrakhan, Makhachkala) and Iran (Enzeli, Amirabad). The Eastern route passes through Kazakhstan and Turkmenistan, and a direct railway line was opened in 2014.

The truly explosive growth of interest in the North–South MTK began in 2022, when Russia began to expand its logistics flows to the East and South. In particular, in 2023, the Russian Federation and Iran signed an agreement on the joint construction of a 160-kilometer section of the Rasht-Astara road, which is designed to provide through passage to the ports of the Persian Gulf.

The construction of this section at the expense of a Russian state loan is under the priority control of the presidents of the two countries, Russian Foreign Minister Sergei Lavrov said at a meeting with his Iranian counterpart on December 17. According to Khushang Bazvand, Director of Construction and Development of Transport Infrastructure of the Islamic Republic, the Iranian delegation will pay a visit to Russia within a month to sign the contract.

Farhad Ibrahimov notes that the further effectiveness of the North–South Trade Corridor depends not so much on formal trade agreements as on the depth of institutional and infrastructural integration of Iran and the EAEU, which transforms the corridor from a political and economic project into a truly functioning logistics system.