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Azerbaijan Allocates $2.35 Billion for 2025 Karabakh Reconstruction, Totaling $10.3 Billion Since Liberation

By Yaver Kazimbeyli November 27, 2024

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A residential complex built in Shusha, Karabakh region of Azerbaijan, May, 2024 / President.Az

The government of Azerbaijan has increased funding for post-war reconstruction and restoration projects in the Karabakh (Garabagh) and Eastern Zangezur regions.

On Tuesday, Azer Amiraslanov, Chairman of the Parliamentary Committee on Economic Policy, Industry, and Entrepreneurship, announced that the draft state budget for the next year allocates AZN 4 billion (USD 2.35 billion) for these projects.

“This funding will contribute to economic growth, the development of the non-oil economy, and employment in the medium term. The next year’s state budget demonstrates a growth-oriented dynamic,” Amiraslanov stated.

Since the liberation of the Karabakh and Eastern Zangezur regions from Armenian occupation in 2020, Baku has directed AZN 17.5 billion (USD 10.3 billion) toward post-war restoration and reconstruction efforts. In 2023 and 2024, the relevant budget allocations amounted to AZN 5.6 billion (USD 3.29 billion) and AZN 4.8 billion (USD 2.82 billion), respectively. From January to October of this year, 64.4 percent of the budget allocations have been utilized to complete, accelerate, or initiate reconstruction projects.

As of September 2024, over 8,000 former internally displaced persons (IDPs) have returned to the liberated territories, including Shusha, Fuzuli, Jabrayil, Zangilan, and Lachin, with extensive government support.

Azerbaijan’s Ministry of Ecology and Natural Resources reports USD 265 billion in environmental and natural resource damages caused by the Armenian occupation. Preliminary calculations from the Military Prosecutor's Office suggest the total material damage across all sectors amounts to USD 819 billion.

The government of Azerbaijan has funded numerous infrastructure projects in the liberated territories. Extensive mine clearance operations have been conducted on 161,000 hectares (398,000 acres) since 2020, neutralizing over 160,000 explosives and unexploded ordnance.

In the transport sector, key projects include the construction of Fuzuli, Zangilan, and Lachin airports; major roads such as Toghanali-Kalbajar-Istisu, Fuzuli-Shusha (“Victory Road”), Barda-Aghdam, Horadiz-Jabrayil-Zangilan-Aghband (Zangezur Corridor), Fuzuli-Hadrut, and Kalbajar-Lachin; and railway lines such as Horadiz-Aghband and Barda-Aghdam.

Energy infrastructure projects include the construction of power stations and substations in Fuzuli, Shusha, Lachin, Kalbajar, Zangilan, and Jabrayil; the installation of new high-voltage lines; planning for solar and wind energy projects in Jabrayil and Fuzuli; and the construction of gas pipelines to Fuzuli, Shusha, Lachin, and other areas.

Water supply and irrigation initiatives focus on ensuring access to drinking water in Kalbajar, Lachin, and Shusha; constructing new water pipelines in Zangilan and Gubadli; and repairing and commissioning reservoirs, including Khachinchay, Sarsang, Sugovushan, Khudafarin, and Giz Galasi.

In the social and residential sectors, the government has implemented the “Smart Village” project in the Aghali village of Zangilan, initiated technology-based development projects in Shusha, and constructed residential complexes, schools, hospitals, and socio-economic facilities for former IDPs in Shusha, Khojaly, Fuzuli, Jabrayil, Aghdam, Kalbajar, and Gubadli. Efforts have also included building infrastructure in various villages and settlements.

Communication and telecommunications improvements include the installation of fiber-optic internet lines in the region.

Agricultural, economic, and industrial development projects include the creation of modern agro-parks in Zangilan, Jabrayil, Fuzuli, and Aghdam; the construction of the Aghdam Industrial Park and the Araz Valley Industrial Park in Jabrayil; and the planning of the Zangilan Logistics Center.