racing the trajectory of attacks at the Red Sea, one could argue that since November 2023, Yemen’s Tehran–backed Houthi rebels have forced central Asian economies (among other states at the international level) to consider opening alternate trade routes and maintain supply lines, further greasing the wheels of their economies. Interacting with scholars and policy makers from Central Asia, the authors measured enthusiasm for the ambitious Central Asian trade network popularly known as the Middle Corridor. The corridor is creating lucrative opportunities, not just for regional economies in Central Asia, but potentially countering temporary trade blockages in the Red Sea by offering shippers cheap alternate trade routes and greater opportunities for direct trade with Tehran and Beijing.
In a November 2023 video teleconference, representatives from Iran, Kazakhstan, Turkey, Turkmenistan, and Uzbekistan deliberated hastening the development of the Middle Corridor’s second major transportation route, between Turkmenistan and Uzbekistan. During the authors’ interaction with Iranian stakeholders, one policy maker reiterated the statement made by the Iranian minister, echoing the necessity of a third transport network, connecting Tehran with the second major transportation route between Turkmenistan–Uzbekistan.
In the initial deliberations on the Middle Corridor in the early 2000s, its key transit trade route passed through Turkey, crossed over the Caucasus Mountains and the Caspian Sea, entered Kazakhstan, and finally made its way into China. Commonly referred as the Trans–Caspian International Transport Route by Central Asian economies, it was presented by regional states as the most viable alternative to the Eurasian East–West trade routes, the Trans–Siberian railway (commonly known as the Northern Corridor) as well as the Indian Ocean (also known as the Southern Corridor). Looking for an overland trade route, the Middle Corridor fits the bill for Europe, which could directly access East Asia while bypassing Russia.
An economic lifeline between Tehran to Beijing
The ambitious Turkmenistan–Uzbekistan route has elevated hopes in the region. It not only means greater economic prospects for the two states, but reduces their reliance on Moscow. Extending the transport route from Turkmenistan–Uzbekistan to Iran (including potentially the Gulf) and China would make those two nations even greater beneficiaries. If implemented, the transit route would not only offer a new economic lifeline to Tehran, potentially linking it to Beijing via a direct land route, it would expand trade with the regional powerhouse by offering a potential alternative to the Red Sea.
The trade route would give Iran new points of access at a time when roughly 85% of its international trade share occurs via maritime transportation. During discussions between the authors and a confidential source regarding Iran’s search for new access to trade routes (especially overland), the source mentioned Tehran discussing regional trade expansion with certain leadership in Beijing. This could result in Tehran strengthening its plan to become a regional transportation hub.
Will Tehran join the Middle corridor?
Joining the Turks and Uzbeks on a transit route would enable Tehran to potentially reverse the effect of economic sanctions imposed by the West. This would mean Tehran proposing more trade with Beijing—a state which signed a comprehensive strategic partnership with Tehran in 2016 and a 25-year cooperation agreement in 2021. The transport route could enable Beijing to fulfill its hunger for raw materials and energy resources from Africa and the Middle East and benefit Tehran in doing so.
By adding a combination of small to medium sub–transit–trade spurs to the Turkmenistan–Uzbekistan route, Tehran could potentially provide Beijing with alternative rail transport opportunities. Beijing could then limit maritime cargo in the Indian Ocean, focusing on land–based transportation in South Asia. This could relieve Beijing from the Malacca Dilemma—the most vulnerable part in its trade, especially in the transportation of imported oil and natural gas by providing a potential choke point for the Americans. In the light of ongoing tensions between Beijing and Washington over Taiwan and the South China Sea, a land–based trading route could limit the use of the Malacca Strait, reducing Washington’s leverage and strengthening Beijing’s position. With existing infrastructures delivering almost no economic benefits, either through the Belt and Road Initiative or the much–hyped China–Pakistan Economic Corridor, the combination of such smaller/medium transit routes could provide a second chance for Beijing to maximize trade opportunities with regional economies, at least in South Asia.
What does it mean for the Middle Corridor?
If the Houthis escalate their attacks in the Red Sea , the Middle Corridor could potentially cut in half the amount of maritime cargo that transits the sea.
The potential renewal of hostilities between Armenia and Azerbaijan in the Caucasus could skyrocket freight insurance rates through the region, making the Middle Corridor instantly less lucrative for truckers/shippers. This would make the trade corridor between Turkmenistan and Uzbekistan particularly lucrative, garnering more support to link with Tehran via the new transit–trade route.
Expanding transit routes would give Tehran an opportunity to strengthen its strategic engagement with Beijing, potentially worrying Washington and its allies. Turkmenistan and Uzbekistan would slide away from their traditional stance of neutrality in regional and international politics, moving them closer to Beijing. The trade link could counter the effect of Western economic sanctions imposed on either state, potentially strengthening not just Tehran, but Beijing, which could bolster China’s influence in Africa and the Greater Middle East.
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Mapping the potential trade route between Iran and China
Ashgabat, Turkmenistan. There is talk of expanding the existing Turkmenistan–Uzbekistan trade corridor to include China and Iran. Photo by Dovlet on Unsplash.
March 19, 2024
There is talk of expanding a trade route—which currently runs between Turkmenistan and Uzbekistan—to include China and Iran. The economic and geopolitical implications of such a move would be significant, in those regions and beyond, write Anant Mishra and Dr. Christian Kaunert.
T
racing the trajectory of attacks at the Red Sea, one could argue that since November 2023, Yemen’s Tehran–backed Houthi rebels have forced central Asian economies (among other states at the international level) to consider opening alternate trade routes and maintain supply lines, further greasing the wheels of their economies. Interacting with scholars and policy makers from Central Asia, the authors measured enthusiasm for the ambitious Central Asian trade network popularly known as the Middle Corridor. The corridor is creating lucrative opportunities, not just for regional economies in Central Asia, but potentially countering temporary trade blockages in the Red Sea by offering shippers cheap alternate trade routes and greater opportunities for direct trade with Tehran and Beijing.
In a November 2023 video teleconference, representatives from Iran, Kazakhstan, Turkey, Turkmenistan, and Uzbekistan deliberated hastening the development of the Middle Corridor’s second major transportation route, between Turkmenistan and Uzbekistan. During the authors’ interaction with Iranian stakeholders, one policy maker reiterated the statement made by the Iranian minister, echoing the necessity of a third transport network, connecting Tehran with the second major transportation route between Turkmenistan–Uzbekistan.
In the initial deliberations on the Middle Corridor in the early 2000s, its key transit trade route passed through Turkey, crossed over the Caucasus Mountains and the Caspian Sea, entered Kazakhstan, and finally made its way into China. Commonly referred as the Trans–Caspian International Transport Route by Central Asian economies, it was presented by regional states as the most viable alternative to the Eurasian East–West trade routes, the Trans–Siberian railway (commonly known as the Northern Corridor) as well as the Indian Ocean (also known as the Southern Corridor). Looking for an overland trade route, the Middle Corridor fits the bill for Europe, which could directly access East Asia while bypassing Russia.
An economic lifeline between Tehran to Beijing
The ambitious Turkmenistan–Uzbekistan route has elevated hopes in the region. It not only means greater economic prospects for the two states, but reduces their reliance on Moscow. Extending the transport route from Turkmenistan–Uzbekistan to Iran (including potentially the Gulf) and China would make those two nations even greater beneficiaries. If implemented, the transit route would not only offer a new economic lifeline to Tehran, potentially linking it to Beijing via a direct land route, it would expand trade with the regional powerhouse by offering a potential alternative to the Red Sea.
The trade route would give Iran new points of access at a time when roughly 85% of its international trade share occurs via maritime transportation. During discussions between the authors and a confidential source regarding Iran’s search for new access to trade routes (especially overland), the source mentioned Tehran discussing regional trade expansion with certain leadership in Beijing. This could result in Tehran strengthening its plan to become a regional transportation hub.
Will Tehran join the Middle corridor?
Joining the Turks and Uzbeks on a transit route would enable Tehran to potentially reverse the effect of economic sanctions imposed by the West. This would mean Tehran proposing more trade with Beijing—a state which signed a comprehensive strategic partnership with Tehran in 2016 and a 25-year cooperation agreement in 2021. The transport route could enable Beijing to fulfill its hunger for raw materials and energy resources from Africa and the Middle East and benefit Tehran in doing so.
By adding a combination of small to medium sub–transit–trade spurs to the Turkmenistan–Uzbekistan route, Tehran could potentially provide Beijing with alternative rail transport opportunities. Beijing could then limit maritime cargo in the Indian Ocean, focusing on land–based transportation in South Asia. This could relieve Beijing from the Malacca Dilemma—the most vulnerable part in its trade, especially in the transportation of imported oil and natural gas by providing a potential choke point for the Americans. In the light of ongoing tensions between Beijing and Washington over Taiwan and the South China Sea, a land–based trading route could limit the use of the Malacca Strait, reducing Washington’s leverage and strengthening Beijing’s position. With existing infrastructures delivering almost no economic benefits, either through the Belt and Road Initiative or the much–hyped China–Pakistan Economic Corridor, the combination of such smaller/medium transit routes could provide a second chance for Beijing to maximize trade opportunities with regional economies, at least in South Asia.
What does it mean for the Middle Corridor?
If the Houthis escalate their attacks in the Red Sea , the Middle Corridor could potentially cut in half the amount of maritime cargo that transits the sea.
The potential renewal of hostilities between Armenia and Azerbaijan in the Caucasus could skyrocket freight insurance rates through the region, making the Middle Corridor instantly less lucrative for truckers/shippers. This would make the trade corridor between Turkmenistan and Uzbekistan particularly lucrative, garnering more support to link with Tehran via the new transit–trade route.
Expanding transit routes would give Tehran an opportunity to strengthen its strategic engagement with Beijing, potentially worrying Washington and its allies. Turkmenistan and Uzbekistan would slide away from their traditional stance of neutrality in regional and international politics, moving them closer to Beijing. The trade link could counter the effect of Western economic sanctions imposed on either state, potentially strengthening not just Tehran, but Beijing, which could bolster China’s influence in Africa and the Greater Middle East.
