Ayaz Museyibov, Head of department at CAERC

After the implementation of mega regional projects such as Baku–Tbilisi–Ceyhan oil pipeline, the Southern Gas Corridor and the Trans-Caspian International Transportation Route, Azerbaijan is committed to pursue steady strategic policies in order to be a regional digital hub in addition to its existing roles as strategic energy and logistic hubs in Euro-Asian economic relations. Apparently, certain countries and power centers support Azerbaijan’s initiatives owing to the balanced policy tracked by the country. Hence, Italy's first international service provider and one of the world's leading operators Sparkle, and Azerbaijan's leading wholesale telecommunications operator AzerTelecom have signed a Memorandum of Understanding on cooperation within the Digital Silk Road project aimed at creating digital telecommunications corridor connecting Azerbaijan and Europe (azertelecom.az, 21 April 2022). Previously, leading telecommunications operators of Azerbaijan, Kazakhstan, Kyrgyzstan and Uzbekistan signed two memorandums to cooperate in the Trans-Caspian Fiber-Optic Cable Line project (azertelecom.az, 12 October 2021).

Two major policy directions attract attentions towards the realization digital initiatives. Furthermore, fostering digitalization reforms in Azerbaijan are intended to improve the general digital ecosystem, contribute to economic welfare and aspire for being a regional digital hub. In order to achieve the goals of becoming a digital center and encourage economic development, relevant reforms have been carried out in the public administration. Thus, the launch of State Control Information System, Azerbaijan Digital Trade Hub, Electronic Agricultural information System, Electronic Procurement platform, e-court system, e-health care, e-education, e-social services, e-property and land cadaster systems, and others during the last decade are the obvious examples in this context (vergiler.az, 31 May). Especially, owing to the Digital Trade Hub (dth.az) project Azerbaijan is the first country in the world to offer m-Resident, the second after Estonia to offer e-Resident (ereferoms.gov.az, February 22, 2017). Furthermore, to strengthen the position of the Republic of Azerbaijan in the Fourth Industrial Revolution, “analysis and Coordination Centre for the Fourth Industrial Revolution” public legal entity was established  by the special presidential decree on January 6, 2021 (president.az, 06 January 2021). The Centre, which implements certain functions of the Davos World Economic Forum, is the first in CIS countries (bbn.az, 02 April 2021). Additionally, On April 27, 2021, developing a digital transformation concept and reconstructing the activities of major telecommunications companies in Azerbaijan was tasked to the relevant ministries (president.az, 27 April 2021). The concept of digital transformation of Azerbaijan has already been developed and is being discussed within the Government of Azerbaijan (azertag.az, 08 December 2021). Thus, with this document digital transformation has been declared as one of the main priorities for Azerbaijan for the next 10 years.

Additionally, Azerbaijan is applying a completely new management approach on the liberated lands, and the entire architecture of management will be designed based entirely on the concept of “smart city” and “smart village” in these regions (e-qanun.az, 19 April 2021).

Furthermore, along with the domestic digitalization reforms, Azerbaijan implements trans-regional digital mega projects. One of such projects is the “Digital Silk Road” project, which has been implemented since 2018 and is considered in some panels as one of five best infrastructure projects in Asia. This initiative aims to develop a modern transit fiber-optic infrastructure network connecting Europe through Georgia and Azerbaijan to the Central and South Asian markets. The “Digital Silk Road” will develop the region’s digital ecosystem in accordance with the world’s most advanced standards, reduce dependence on foreign internet providers and improve access to various digital services for 1.8 billion people in aforementioned Asian regions. The Project, implemented within the framework of the “Azerbaijan Digital Hub” program, envisages the construction of a main fiber-optic cable line between Azerbaijan and Central Asian countries along the bottom of the Caspian Sea. In general, the Digital Silk Road between Europe and Asia, which will pass through Azerbaijan, consists of two directions – Azerbaijan-Kazakhstan and Azerbaijan-Turkmenistan routes (azvision.az, 14 April 2020) Therefore, AzerTelecom together with Kazakhstan started laying Trans Caspian Fiber Optic (TFCO)  cable line on the bottom of the Caspian Sea (neqsolholding.com, 2018). For this purpose, “AzerTelecom” on the Azerbaijan side and “TransTeleCom” and “KazTransCom” on the Kazakh side established a consortium to lay a Trans-Caspian highway with a total length of 380-400 km, a joint working group was set up, and a relevant construction contract was signed. An interstate agreement was signed between Azerbaijan and Kazakhstan for the implementation of the project.

On November 28 of 2019, an interstate agreement was signed between Azerbaijan and Turkmenistan on the construction of a main fiber-optic cable line along the bottom of the Caspian Sea (azertag.az, 28 November 2019). The construction of such a main cable line between Siyazan (Azerbaijan) and Turkmenbashi (Turkmenistan) with a total length of 300 km cable line will form a Digital Silk Road between Frankfurt and Mumbai, which will pass through Azerbaijan. The main line will enable the transmission of internet traffic from Europe through Azerbaijan to Turkmenistan and then to Uzbekistan, Afghanistan, Pakistan and India. (adh.az, 15 November 2021)

It is expected that providing advanced digital services to the Caucasus, Middle East, Central Asia and South Asia, as well as other surrounding regions, project will contribute to the aspirations of Azerbaijan to be a telecommunication corridor under China’s “Belt and Road” initiative. Therefore, it has a strategic purpose for Azerbaijan which is being one of major central positions in the fiber-optic backbone infrastructure network from European continent to China (fed.az, 10 April 2019).

Obviously, within the framework of these projects, it is aimed to create a digital corridor between Europa and Asia through Azerbaijan and turn Azerbaijan into a Digital Hub in parallel with the regional energy and transport hubs. The current biggest geopolitical and geo-economic changes in the European continent since the Second World War also give additional impetus to these initiatives. Frankly, in the context of present realities, this is not only about Azerbaijan, but is one of the indications of developments of diversifying policies of transport, energy and digital corridors in parallel with the historically existing trade routes between the East and Europe. Along with Azerbaijan, there are new opportunities and chances for Georgia, Kazakhstan and other Central Asian countries, as well as responsibilities.