Editor's Note: This article is part of an ongoing RANE series on the shifting patterns of global trade. The first installment provided a broad overview of the geopolitical and economic implications of these shifts. Other installments have examined the Americas, the Strait of Hormuz, Japan and South Korea, India, Turkey, Congo, ASEAN countries, data flows, Mercosur, maritime chokepoints (part one and part two), digital trade, East Africa (part one and part two), and de-dollarization.

Central Asia's strategic location between Russia, China and Europe will enhance its role in evolving Eurasian trade routes, but rival agendas, uneven financing, weak regional coordination, and governance and security risks will limit the region's rise as a true continental hub. Russia's war in Ukraine, persistent shocks to global supply chains and China's recalibrated Belt and Road Initiative (BRI) have positioned Central Asia from a peripheral transit zone into a central area of great power competition. The region's five states — Kazakhstan, Kyrgyzstan, Tajikistan, Turkmenistan and Uzbekistan — now sit at the junction of competing east-west and north-south corridors, where the build-out of transport and energy infrastructure creates strategic opportunities but also heightens exposure to geopolitical fragmentation and external pressure. Despite this renewed external attention, Central Asian states' landlocked geography imposes some of the world's highest trade costs, making improved connectivity an economic imperative. Compounding this geographic challenge, long-standing institutional and regulatory barriers continue to inhibit meaningful intraregional trade, leaving Central Asian economies more integrated with external partners than with each other. Fundamentally, this internal fragmentation reflects decades of infrastructure investment decisions driven largely by external actors, primarily China, Russia and the European Union, that prioritized long-haul transit serving their own trade. 

• Data from the World Trade Organization indicates that Central Asia's landlocked geography imposes a severe economic penalty on the region's countries, with trade costs 1.4 times higher than those of coastal developing nations. The logistical difficulty of moving goods across the region's very long distances adds costs equivalent to a 300-350% tariff, depending on sector and distance. Additionally, local elites often utilize non-tariff barriers, informal border fees and rent-seeking, rendering cross-border trade prohibitively expensive.
• China and Russia remain Central Asia's largest external trade partners, followed by the European Union, Turkey, South Korea and Gulf Arab states. Regional exports are dominated by a narrow set of commodities, primarily hydrocarbons (crude oil and natural gas), precious and industrial metals (gold, copper, aluminum and uranium), and agricultural staples, such as cotton and wheat. Cumbersome border procedures and overlapping regulations continue to stifle local connectivity, keeping intraregional commerce below 10% of the region's total trade.
• Historically, Central Asian infrastructure reflected a Soviet-era design engineered to channel raw materials northward to industrial centers in Russia. Since 1991, this legacy architecture has been overlaid by a patchwork of competing external frameworks, including the EU-backed Transport Corridor Europe-Caucasus-Asia (TRACECA), China's BRI, and, more recently, the Trans-Caspian International Transport Route (the Middle Corridor), with multilateral lenders such as the Asian Development Bank, the World Bank, and the European Bank for Reconstruction and Development financing individual transport and trade facilitation projects. This leaves Central Asia with corridor systems that are optimized for external markets but weakly integrated with one another.

Since 2013, when Chinese President Xi Jinping announced his BRI strategy, Central Asia has become the focal point of Beijing's efforts to secure overland trade redundancy, utilizing elevated diplomatic regional partnerships and expanded investment to insulate China's supply chains from maritime vulnerabilities. China's expanding role in Central Asia reflects long-term strategic requirements and persistent geopolitical vulnerabilities in its external trade architecture. Beijing views its dependence on maritime chokepoints, particularly the Strait of Malacca, as a major strategic vulnerability. This has long driven sustained Chinese efforts to build overland redundancy that can preserve trade flows in a crisis and secure land-based access to Europe, the Middle East and South Asia. Renewed U.S. tariff pressure, fears of decoupling and the threat of a wider economic containment strategy have only intensified this imperative, prompting Beijing to prioritize near-abroad connectivity under its "good-neighborliness" policy. Beijing has formalized Central Asia's priority status through the "Treaty on Eternal Good-Neighbourliness" signed at the June 2025 China-Central Asia Summit in Astana, Kazakhstan. To underpin this diplomatic elevation, China accelerated BRI financing for key rail and energy corridors, leveraging this infrastructure investment to deepen integration with Xinjiang and shape a compliant security environment along its western frontier. Notably, recent data indicate not only a rebound in volumes of investment but also a sectoral shift, with BRI financing increasingly directed toward green energy, critical minerals and high-tech manufacturing. This shift has also amplified fiscal risks, as Central Asian states must assume significant new debt from Chinese policy banks to finance these capital-intensive projects.

• China relies on two principal westbound corridors that traverse Central Asia to reach European markets. The majority of China-Europe rail traffic (roughly 80-88%) still moves along the Central Eurasian corridor, which passes through Kazakhstan, Russia and Belarus. The secondary route is the multi-modal Trans-Caspian "Middle Corridor," which connects China to Europe via Kazakhstan, the Caspian Sea, the South Caucasus and Turkey.
• Beijing's decision in 2024 to green-light the 523-kilometer (325-mile) China-Kyrgyzstan-Uzbekistan (CKU) railway marked a key expansion of its overland strategy. The $8 billion project, first proposed in the 1990s but previously blocked by Russian objections, will provide China's first direct rail link to Uzbekistan. While not formally part of the Trans-Caspian Middle Corridor, the CKU railway will function as a strategic southern feeder, bypassing Russian territory to channel China-Central Asia traffic into the Middle Corridor network.
• Between 2013 and 2023, China financed over 25 major BRI projects in Central Asia and provided approximately 25% of all external infrastructure capital entering the region. In the first half of 2025, Central Asia's share of newly announced BRI financing spiked sharply, accounting for roughly 43% of China's global BRI commitments during that period, the region's highest share on record.
• Signed in June 2025, the Treaty on Eternal Good-Neighbourliness formalizes a security-focused partnership between China and Central Asian countries. It legally mandates the signatories to "prevent activities" within their borders that undermine sovereignty and territorial integrity, and to expand cooperation in defense and broader security matters. By institutionalizing political consultations, the agreement secures Chinese access to Central Asian infrastructure, thereby codifying Beijing's structural dominance over the region's long-term security and economic architecture.
• As of December 2025, total trade turnover between China and Central Asia is on track to surpass the $100 billion threshold for the first time, driven by surging trade volumes with Kazakhstan and Uzbekistan.

Since the invasion of Ukraine in 2022, Central Asia has also emerged as a critical operational lifeline for Russia, serving as the primary mechanism to circumvent Western sanctions and reorient energy and trade flows. While Russia has historically treated Central Asia as a secondary strategic theatre within its broader sphere of influence, the post-2022 geopolitical reality has rendered the region operationally indispensable to Russia's efforts to offset the impact of Western sanctions related to its war in Ukraine. Western export controls on technology, machinery and industrial components have transformed Central Asia into Russia's primary re-import hub for dual-use and restricted goods previously sourced directly from Europe. Facilitated by the growing integration of ruble-based payment systems and the customs-free borders of the Eurasian Economic Union with Kazakhstan and Kyrgyzstan, Russia has successfully institutionalized these parallel supply chains to bypass restrictions on the SWIFT financial messaging system. Simultaneously, the sharp reduction in European market access has pushed Moscow to redirect hydrocarbon exports toward China and explore southbound transit options through Central Asia that are less exposed to Western restrictions. To operationalize this pivot further, Russia is also expanding energy and transit linkages through Central Asia: it has initiated reverse gas flows to Uzbekistan via Kazakhstan, signed exploration agreements with Astana to explore a potential eastbound Russia-Kazakhstan pipeline, and is in discussions to expand oil transit volumes through Kazakhstan's existing pipeline infrastructure into China. This reorientation also explains Moscow's renewed focus on the International North-South Transport Corridor, a 7,200-kilometer (4,470-mile) multimodal network of rail, road and maritime routes linking Russia's Baltic Sea ports, the Caspian basin, Iran and India. Much of this focus has concentrated on the corridor's eastern branch through Kazakhstan and Turkmenistan to Iran, which offers Russia an overland alternative to both the Suez Canal and the unstable Black Sea route, providing access to Middle Eastern, South Asian and Indian Ocean markets. The corridor's strategic value, however, comes at a high cost, as Moscow must heavily subsidize transit rates to maintain competitiveness against cheaper maritime alternatives, effectively underwriting an economically marginal corridor for geopolitical access. 

• The International North-South Transport Corridor is built around three main legs: the Western route via Azerbaijan and Iran, the Central route across the Caspian Sea, and the Eastern route through Kazakhstan and Turkmenistan. The western leg is effectively non-operational due to the unfinished Rasht-Astara rail link in northern Iran, which prevents continuous rail movement and renders it commercially unviable. In November 2025, Russian Railways (RZD) extended aggressive tariff discounts through 2026 to force-stimulate traffic on the corridor's eastern branch via Kazakhstan and Turkmenistan. This includes a 50% slash in transport fees for ferrous metals and a 20% discount on container traffic, alongside a long-term strategic subsidy for grain exports locked in until 2030.

For their part, the United States and the European Union are leveraging diplomatic engagement to check Russia and China's growing economic influence in the region. Washington and Brussels are both deepening engagement with Central Asia to prevent the region's full consolidation into a Sino-Russian economic bloc. Recognizing they cannot match China's infrastructure financing or Russia's geographic proximity, Western actors have instead pursued asymmetric strategies centered on regulatory architecture and high-value technology partnerships. This has primarily manifested as technical assistance for the Middle Corridor (e.g., setting digitization standards and streamlining customs procedures), with the goal of making non-Russian transit routes commercially viable without massive construction investment. The West is also actively seeking to expand partnerships for critical raw materials by offering Central Asian countries downstream processing technology and market access that aligns with their industrialization objectives. Additionally, mechanisms like the U.S.-Central Asia C5+1 format and the European Union's Global Gateway initiative serve as diplomatic, rather than financial, counterweights to Chinese and Russian influence. This, in turn, provides Central Asian governments with strategic flexibility by validating their sovereignty claims and enhancing their negotiating leverage against Moscow and Beijing. 

• While the European Union pledged to mobilize 10 billion euros ($10.8 billion) for the Middle Corridor in January 2024, actual disbursement of funds remains incremental and relies primarily on future credit lines rather than direct grants and immediate liquidity. Similarly, while Brussels formalized strategic raw materials partnerships with Kazakhstan (2022) and Uzbekistan (2024), current financial support primarily targets feasibility studies and technical assistance rather than large-scale industrial capital.
• At the first EU-Central Asia summit in Samarkand in April, the European Union formalized a 12 billion euro ($13.2 billion) Global Gateway investment package targeting energy resilience (6.4 billion euros), Middle Corridor infrastructure (3 billion euros), critical raw material supply chains (2.5 billion euros), and digital connectivity to bypass Russian networks (100 million euros). Despite elevating the bloc's relationship with Central Asia to a "Strategic Partnership," disbursements as of late 2025 remain limited to loan guarantees rather than direct liquidity.
• In November 2025, U.S. President Donald Trump hosted Central Asian leaders for the second C5+1 summit at the White House. The summit produced a joint declaration signaling a mutual intent to "fully develop" the Middle Corridor and align it with the proposed "Trump Route for International Peace and Prosperity" via Armenia. The declaration also set goals for advancing the U.S.-Central Asia Critical Minerals Dialogue, with a specific focus on downstream processing.

Despite this growing international interest, Central Asia's trade outlook will remain constrained by its exposure to external geopolitical shocks, which will compel the region to move away from sole reliance on traditional partners toward a more resilient, multi-hub logistics network. Central Asia's dependence on Russia- and China-linked transit corridors creates two distinct vulnerabilities. First, its continued reliance on Russian logistics infrastructure exposes the region to revenue losses and political risk stemming from any escalation in sanctions enforcement, operational disruptions inside Russia's logistics system, or potential (though currently unlikely) breakdowns in Russia-China coordination. Secondly, China-Europe rail volumes — central to the region's transit revenue model — will likely continue to contract due to several factors. These include European nearshoring efforts to shift production to Eastern Europe (thereby dampening demand for transcontinental rail freight), European protectionist efforts to curb Chinese imports via tighter regulations, and China's ongoing efforts to scale back rail subsidies. These compounding vulnerabilities will likely push Central Asian governments to accelerate the development of alternative westbound and southbound corridors, pursuing a broader transition from the current Russia- and China-dependent architecture toward a multi-hub logistics configuration. Under this emerging structure, the northern route via Russia will likely retain most bulk industrial cargo. Meanwhile, the Middle Corridor and the China-Kyrgyzstan-Uzbekistan railway, once operational, will function as specialized channels for higher-value goods and strategic commodities such as uranium and other critical minerals. This alternative network will prioritize resilience over speed, with longer transit times than the pre-2022 system. But it will also help reduce Central Asian countries' dependence on the trans-Russian corridor and lower their exposure to external disruptions. Yet even a diversified corridor system will remain sensitive to external trade cycles, underscoring the need for Central Asian states to complement transit revenues with stronger domestic industrial capacity and deeper intraregional production networks. This strategic imperative will drive the "Made in Central Asia" initiative to double regional trade by 2030 through harmonized, cross-border value chains. To further accelerate this value chain shift, regional governments will increasingly attempt to capitalize on the global race for critical minerals and enforce localized industrial policies, leveraging these resources to demand that foreign partners invest in domestic processing capacity rather than raw extraction. But Central Asia's capacity to fully capitalize on its resource wealth and strategic position will depend on overcoming deep-seated domestic constraints, including pervasive corruption, weak regulatory enforcement and bureaucratic inertia. 

• Russia's February 2022 invasion of Ukraine and the subsequent sanctioning of Russian Railways have severely impacted China-Europe rail container volumes. These volumes have halved since 2021, dropping from 513,746 twenty-foot equivalent units (TEUs) between December 2020 and October 2021 to 255,409 TEUs between December 2024 and October 2025. Individual routes have experienced even steeper declines, with reductions ranging from 80% to 91%.
• Growing regulatory headwinds are also increasingly weighing on China-Europe rail volumes by reducing demand in both markets. These headwinds include Chinese rail subsidy cuts, the end of the European Union's 150 euro de-minimis threshold in 2026, the rollout of the EU Customs Data Hub to tighten compliance screening in 2028, and the bloc's ongoing near-shoring to Eastern Europe.
• Another risk factor is the European Union's Carbon Border Adjustment Mechanism coming into force in January 2026. While the mechanism targets heavy industry, the continued exclusion of primary energy commodities shields Central Asia's broader economy at least through 2030, leaving less than 2% of the region's key exports to the bloc (e.g., Kazakh steel and Tajik aluminum) exposed to carbon levies. Central Asia is also set to benefit from EU technical assistance to modernize local emissions monitoring and industrial efficiency. Successful decarbonization could unlock significant market access, including potentially replacing Russian aluminum imports when the EU decouples in 2027.
• In November 2025, Central Asian trade ministers, joined by Azerbaijan, finalized the roadmap for a unified "Made in Central Asia" industrial brand, scheduled for international launch in 2026. The initiative, which aims to double intra-regional trade to $20 billion by 2030, establishes a framework for harmonized customs standards and digitized transit permits, designed to replace raw material exports with joint manufacturing value chains in the automotive, textile and agro-industrial sectors. The initiative's success, however, will depend not just on Central Asian states' political commitment but on their ability to overcome entrenched bureaucratic resistance, combat customs corruption and build institutional capacity for managing complex cross-border value chains.

Central Asia will continue to actively pursue logistics diversification, but persistent infrastructure deficits, endemic corruption and geopolitical volatility will restrict the scalability of these corridors. In the coming years, Central Asian states will accelerate infrastructure diversification, focusing on the Middle Corridor and southbound routes through Afghanistan and Iran, to reduce dependence on northern transit corridors via Russia. Priority investments will be financed through a mix of state capital, foreign direct investment and multilateral loans. These investments will include expanding capacity at Caspian Sea ports (Aktau and Kuryk in Kazakhstan; Baku in Azerbaijan), advancing customs harmonization with the South Caucasus, developing joint logistics platforms and targeted rail upgrades, and deploying digital tools to reduce cargo dwell times. Such measures will expedite transit times for higher-value and politically sensitive goods, but structural impediments — e.g., the declining water levels of the Caspian Sea, port congestion, multimodal transfers, limited throughput for bulk commodities and pervasive corruption at border checkpoints — will nonetheless restrict the route's overall capacity. This throughput ceiling will continue to be a critical vulnerability in a bifurcating global economy, threatening to foreclose Central Asia's integration into Western supply chains, while leaving the region exposed as a captive market for diverted Chinese industrial overcapacity. To mitigate at least some of these risks, Central Asian governments will also expand the Kazakhstan-Turkmenistan-Iran (KTI) railway, the region's only functional southbound rail connection to the Gulf and Indian Ocean ports. Although growing investment flows from Gulf states will draw more regional cargo toward the route, persistent constraints — including volatile Iranian customs procedures, sanctions compliance exposure for Central Asian banks and carriers, and structural bottlenecks at key border crossings — will prevent the route from scaling materially. In parallel, Uzbekistan will pursue southward access through the high-risk, high-reward Trans-Afghan corridor. However, progress will remain incremental due to limited external financing, weak institutional coordination and security risks along the Afghan segment and at the Afghanistan-Pakistan border. Taken together, these initiatives will not yield fully viable logistical alternatives to Russian routes in the near term, but the diversification effort itself will provide Central Asian states with a degree of political optionality and strategic autonomy.

• Central Asia's connectivity challenges reflect not only geographic and geopolitical factors but also governance deficits that differentiate Central Asia from more successful transit regions. According to the World Bank's 2023 Logistics Performance Index, all five Central Asian states rank in the bottom half globally. Transparency International's 2024 Corruption Perceptions Index similarly places the region in the bottom third globally.
• The Trans-Afghan Railway project aims to link Central Asia with the Arabian Sea, cutting transit times from 35 to 4 days. In April, Kazakhstan pledged $500 million for the 900-kilometer western section of the corridor, connecting Afghanistan's Torghundi to Spin Boldak via Herat and Kandahar. This route targets access to Pakistani ports and a potential link to Iran's Herat-Khaf line, slated to open in 2026. Separately, Uzbekistan is pursuing a northern link to Herat and the primary Mazar-i-Sharif to Pakistan line. Despite an agreement signed by Afghanistan, Pakistan and Uzbekistan and potential Russian backing for the project, progress remains stalled by financing gaps, security threats stemming from Afghan and Pakistani jihadists, and the international isolation of the Afghan Taliban government. 

Central Asia will expand its push for strategic autonomy beyond transport, developing parallel energy and digital infrastructure networks designed to reduce external leverage, break dependencies and enhance regional autonomy. In the energy sector, ambitious, longer-horizon projects, such as the Turkmenistan-Afghanistan-Pakistan-India (TAPI) and the Trans-Caspian gas pipelines, will remain on regional agendas because they represent the only large-scale alternatives for accessing South Asian and European gas markets. However, both will continue to face substantial security risks, financing gaps and geopolitical obstacles, such as Russian and Iranian opposition to the Trans-Caspian route, and the paralyzing India-Pakistan rivalry that is stalling TAPI. More feasible initiatives will advance in the interim, including the CASA-1000 project linking surplus hydropower from Kyrgyzstan and Tajikistan to Afghanistan and Pakistan (expected to be operational after 2027). Progress will also be made on the 400-kilometer (248-mile) Trans-Caspian fiber optic cable, scheduled for completion in 2026, which will establish Central Asia's first direct digital connection to the European Union. This digital link is strategically significant, as it will enable the region to bypass Russian networks that currently carry and, in practice, control Central Asia's international internet traffic. When viewed in conjunction with the transport shifts, these emerging projects will gradually shift the region's strategic position. While a diversified corridor system will dilute Moscow's leverage over physical transit, southbound electricity and fiber-optic routes will simultaneously begin to erode Russia's control over energy and data flows. Ultimately, none of these initiatives will eliminate Central Asia's external vulnerabilities, but collectively they will reduce single-point dependencies, broaden the region's geopolitical options and move it toward a more autonomous posture within an increasingly fragmented Eurasian connectivity landscape.

• The TAPI is a planned 1,814-km(1,127-mile) pipeline extending from Turkmenistan's Galkynysh field through Afghanistan and Pakistan to Fazilka on the India-Pakistan border. The pipeline's initial capacity is projected to be 27 billion cubic meters (bcm) per year, with plans to increase to 33 bcm per year thereafter.
• Construction of the Turkmen-Afghan section began in September 2024, but the project continues to face significant challenges, including funding constraints and security uncertainties in Afghanistan. Only 14 km of the 774-km Afghan section has been completed, with full operational status still distant. Additionally, India has not confirmed its support, and New Delhi's ongoing tensions with Islamabad will likely cause further delays.
• The proposed Trans-Caspian Gas Pipeline would run roughly 300 kilometers (184 miles) under the Caspian Sea from Turkmenistan to Azerbaijan, feeding into the Southern Gas Corridor for delivery to Europe, with an ultimate planned capacity of around 30-32 bcm per year. While the European Union has repeatedly signaled political backing (including by granting the pipeline Project of Common Interest status), no final investment decision has been made, largely due to long-standing Russian and Iranian opposition and unresolved financing.
• CASA-1000 is a $1.2 billion regional power transmission project designed to export up to 1,300 megawatts of surplus summer hydropower from Kyrgyzstan and Tajikistan to Afghanistan and Pakistan via 1,400-km (870-mile) high-voltage lines and converter stations. As of 2025, most infrastructure in Kyrgyzstan and Tajikistan is reported as substantially complete, with Pakistan's section expected to finish in 2026. The remaining Afghan works are progressing, but remain exposed to security risks. 
• The Trans-Caspian Fiber-Optic Cable project is a 380-km (236-mile) subsea fiber optic line along the Caspian seabed, linking Sumgait (Azerbaijan) and Aktau (Kazakhstan) as part of the broader "Digital Silk Way" initiative. The system will create the first direct high-capacity fiber link between Central Asia, the South Caucasus and EU networks, with construction targeted for completion in 2026.