Azerbaijan’s victories in its 2020 and 2023 conflicts with Armenia over Nagorno-Karabakh has had important repercussions in the South Caucasus. One such development is momentum towards the establishment of a regional transit corridor. While opposition from Iran previously constituted an obstacle to transit proposals, recent changes have seen Baku and Tehran find common ground. The two sides signed an agreement in Oct. 2023 to construct a road and railway from Azerbaijan to its Nakhchivan exclave via Iranian territory, known as the Aras Corridor.

The initiative offers a way forward amid tension over the Zangazur Corridor, a competing route deeply opposed by Iran as it would cut Iranian access to its ally Armenia. By enabling a route from Azerbaijan to Turkey without impacting the Iran-Armenia land connection, the Aras Corridor is a boost to...