Jaishankar’s Baku Visit Opens a New Chapter in Azerbaijan–India Relations

The Jamestown Foundation | Vasif Huseynov

Indian External Affairs Minister Subrahmanyam Jaishankar visited Baku on 23 October, marking the first bilateral visit by an Indian foreign minister to Azerbaijan in eight years. The diplomatic engagement seeks to repair relations strained after Baku backed Pakistan following Indian military strikes in May 2025. Tensions had triggered a 56 percent drop in Indian tourist arrivals alongside diplomatic friction over Azerbaijan’s Shanghai Cooperation Organization bid.

Both governments are now prioritizing economic cooperation, with bilateral trade reaching approximately $600 million in nine months, up from $401 million in 2025. Azerbaijan exported 524,338 tons of crude oil to India during this period, representing a fourfold increase. Energy trade leads the bilateral economic recovery. Over 1,000 Indian companies currently operate in Azerbaijan, while ONGC Videsh holds a 2.925 percent stake in the Azeri oil fields. Transport connectivity along the International North-South Transport Corridor remains central to New Delhi’s strategy. However, unresolved Indian defense sales to Armenia continue to test the bilateral thaw.

Comment

New Delhi’s attempt to rebuild diplomatic leverage in Baku highlights the fundamental friction between its multi-alignment strategy and regional security dynamics in the South Caucasus. While access to the International North–South Transport Corridor via Azerbaijan provides India a land transit route to European and Central Asian markets bypassing maritime chokepoints, concurrent arms sales to Armenia create an enduring structural barrier. Azerbaijani security posture prioritises military deterrence against Yerevan, rendering commercial concessions insufficient to fully erase Baku's strategic distrust.

This structural tension operates through specific defense procurement mechanics. India's export of Pinaka multi-barrel rocket launcher systems and Akash air-defense batteries to Armenia directly intersects with Azerbaijani military planning around the Zangezur Corridor. Consequently, diplomatic normalisation along the INSTC remains strictly transactional, capping New Delhi's political influence in Baku so long as artillery transfers continue.

Strategic Question for Discussion

Which factor will exert greater influence on long-term South Caucasus transit infrastructure — India’s integration into the International North–South Transport Corridor or the geopolitical frictions generated by its Pinaka rocket sales to Armenia?

The trajectory indicates that commercial incentives tied to the International North–South Transport Corridor will preserve operational transit links, but security imperatives surrounding Armenian defense purchases will permanently ceiling bilateral political trust. While Baku will accept Indian freight volumes and energy investments out of economic self-interest, it will likely seek offsetting security assurances from Ankara and Islamabad whenever New Delhi expands artillery deliveries to Yerevan.

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