For a trade route billed as the 21st century's answer to the Silk Road, the Middle Corridor has spent most of its short life apologising for itself. Goods shipped by rail from China to Europe via the Caspian Sea and the Caucasus took anywhere from 38 to 53 days door-to-door, competitive on the face of it with the Northern Route through Russia that it is supposed to replace, but far less so when the inefficiencies at ports, border crossings, and rail gauge switches are considered. The most recent evidence arrived this month in the unglamorous form of a customs pilot.
For the first time, Azerbaijan, Turkmenistan and Uzbekistan carried out a cross-Caspian consignment by utilizing the eTIR system, which consists of an innovative process of electronic transit replacing a pile of documents traditionally stamped at each border crossing point. An eastbound consignment departed from Azerbaijan, traveled via ferry across the Caspian Sea to Turkmenbashi, and after crossing Turkmenistan reached Uzbekistan at Farap, covering over 1,200 km by land, sea and rail in one digital process. Perhaps his technological feat is more limited in scope than what its announcement implies: a single trial shipment does not make an operational corridor.
However, what counts is the direction of travel. Freight shipments traveling through three different customs borders, via sea, using only one single electronic transit document as opposed to a paper document stamped anew at each border point, is exactly the sort of interoperability that the World Bank and Asian Development Bank (ADB) see as constraining Middle Corridor development, and that by most accounts more than a lack of rail capacity. Azerbaijan Railways (ADY), the state operator that sits astride the corridor's western end, has treated that diagnosis as instruction.
Since 2022, the corporation has overhauled its digital infrastructure from virtually scratch: an information security policy, project management software such as MS Project and Atlassian Jira, and a "single window" solution called ADY Smart, through which cargo owners can track their goods on real-time instead of having to make calls over the phone chasing for the paperwork. This has yielded quantifiable results. Cargo handling that would previously take an entire working day now takes just 20 minutes, according to ADY, courtesy of digital permit process that has almost wiped out paperwork.
An integrated CIM/SMGS electronic consignment note has been created to smooth the transition of customs transfer. However, this is not the end of software development by the company, since in August this year, the company held a tender to purchase cloud-based software for human resources, SAP SuccessFactors, in addition to the parallel acquisition of SAP’s ERP system, which will bring financial accounting, asset management, materials logistics, maintenance scheduling and human resource services into a single enterprise core. The cost of digitalisation of the company is 60.5 million dollars, out of which the Asian Development Bank has financed 47 million dollars, with the rest being financed by Baku.
Money is also going into steel and copper, as well as code. For instance, an ADB loan worth $350 million is being used for the electrification, signaling and telecommunications works on the Bilajari-Yalama railway line of ADY’s network, which is the portion of track from the international sea port in Baku all the way to the Boyuk-Kesik border crossing with Georgia, in other words, the back bone of the Corridor in Azerbaijan. Work is expected to commence in February 2027, while ADB tendered for the consulting contract in mid-August.
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