On 22 August the Iranian Deputy Minister of Industry, Mine and Trade Mohsen Salehinia announced that Iran and Azerbaijan are working towards creating a joint industrial zone. Speaking at the opening ceremony of a new industrial zone near Ahwaz in Iran, he pointed out that the industrial zones created in the border regions with neighboring countries are usually very efficient.

“The negotiations on the creation of industrial zones are held with Azerbaijan and Turkey and agreements have already been reached,” he said. He also stressed that mutually beneficial cooperation relations with Azerbaijan are increasingly developing, adding that taking advantage of this opportunity will bring great benefits to both countries. Salehinia also noted that favorable conditions will be created in this industrial zone to facilitate investment and start the production process.

Currently, there are 900 free trade and industrial zones in Iran. Azerbaijan has five industrial parks - Sumgayit, Garadagh, Mingachevir, Pirallahi and Balakhani, as well as three industrial districts - Neftchala, Masalli and Hajigabul. In addition, work is under way to launch the Sabirabad industrial zone.

Ten days earlier, on 12 August, the Iranian Minister of Economic Affairs and Finance Farhad Dejpasand announced that his country is working with Azerbaijan towards developing ties in the insurance sector. The countries are also planning to create a joint investment fund. According to him, expanding ties between the two countries in the insurance sector will help citizens and companies create their own businesses. In turn, the countries will guarantee the integrity of their real estate and finances, which will increase the volume of mutual investments.

A day later, on 13 August, on a phone call with the Azerbaijani President Ilham Aliyev, the Iranian President Hassan Rouhani described the relations between the two countries as friendly, brotherly and developing. He also stressed the importance of efforts by both countries to promote the overall relations between Tehran and Baku.

Three weeks earlier, on 22 July, the Azerbaijani Minister of Transport, Communications and High Technologies, Ramin Guluzade and the Iranian Minister of Roads and Urban Development, Mohammad Eslami, discussed the issues of joint transport project implementations (Caucasus Watch reported). 

Trade between Iran and Azerbaijan amounted to $400 million in 2018 and it is expected to exceed $600 million this year. Over the past years, food products, construction materials and other goods accounted for the largest part of the turnover. In subsequent years, the structure of trade is expected to change, and its basis will be finished products. The industrial products will contribute to the trade turnover between the two countries. It is set as a milestone that in 7-years the trade turnover between the two countries will reach $2 billion.

Iranian companies already successfully operate in Azerbaijan. The two countries cooperate within the joint car production plant in the Neftchala Industrial Zone, they also have a joint pharmaceutical plant operated by Caspian Pharmed in the Pirallahi Industrial Park and the Khudaferin and Maiden Tower hydro power plants. Recently, the Iranian Trade Center opened in Baku to support trade relations between the businessmen of the two countries and help them solve their problems. Azerbaijan is also planning to build four terminals in the Iranian city of Astara.

The Azerbaijani-Iranian relations have developed and reached a new stage over the past four years as a result of mutual efforts. So far, more than 150 documents have been signed between the two countries. More than 1,000 Iranian companies are registered in Azerbaijan in industry, construction, services, communications, trade, transport, agriculture and other spheres. Currently, Iranian investments in Azerbaijan exceed $3.4 billion.