The signing of a bilateral commercial agreement on internet traffic transit between Baku and Yerevan marks one of the most significant practical steps towards cooperation in the South Caucasus in recent years.

Under the agreement between AzerTelecom and Telecom Armenia, the two companies will exchange international internet traffic through each other’s infrastructure. The deal also provides for the possible construction of a fibre-optic link connecting mainland Azerbaijan with Nakhchivan via Armenian territory.  Although the agreement comes amid the ongoing peace process, it does not amount to a comprehensive political settlement. Experts say it creates new economic and infrastructure interdependence between the two countries and could strengthen the region’s digital resilience.

Under the agreement, AzerTelecom will route international internet traffic destined for Armenia through its network. In turn, Telecom Armenia will provide transit services for internet traffic destined for Azerbaijan. One of the agreement’s most significant practical outcomes is that it could allow Azerbaijan to establish a fibre-optic connection with the Nakhchivan Autonomous Republic via Armenian territory.

Both operators say the agreement expands the region’s transit routes and improves network resilience.  Vugar Bayramov, a member of Azerbaijan’s Milli Majlis, describes the agreement as Azerbaijan’s contribution to building lasting peace in the South Caucasus.  According to Bayramov, Armenia wants to diversify its imports of various services, including internet connectivity, and is strengthening cooperation with Azerbaijan as part of that effort. He argues that agreements of this kind also reinforce Azerbaijan’s geopolitical position and help shape a new model of regional cooperation.