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Nazrin Abdul

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Following its decisive victory in the 2020 Second Garabagh War, Azerbaijan has swiftly transitioned from battlefield triumph to nation-building success. With sovereignty restored over its once-occupied territories, the country has launched an unprecedented reconstruction and restoration campaign aimed at transforming these regions into thriving economic and social hubs. The government’s strategic investments—amounting to billions of dollars—are breathing new life into the liberated lands, laying the foundation for long-term development, population resettlement, and economic integration.

In the first half of 2025, Azerbaijan has made significant strides in the reconstruction and restoration of its liberated territories, investing ₼1.6 billion ($0.91 billion)—representing nearly 39% of the annual allocation for these efforts. This financial commitment reflects the strategic prioritization of the Great Return policy, aimed at restoring life, infrastructure, and socio-economic functionality across the regions recovered following the 2020 Second Garabagh War.

According to the Finance Ministry, ₼1.5 billion ($0.88 billion) of the allocated funds were channeled into critical infrastructure projects. These included the design and construction of highways (₼1.1 billion or $0.65 billion), new residential complexes (₼239.5 million or $140.9 million), water and sanitation systems (₼33.7 million or $ 19.8 million), industrial park infrastructure (₼20.5 million or $12.1 million), and electricity supply to settlements (₼1.7 million or $1 million). Another ₼182 million ($107 million) was earmarked for social projects in education, health, culture, and sports, while ₼16.8 million ($9.9 million) supported ongoing demining operations.

This level of investment underscores the Azerbaijani government’s systematic and well-funded approach to post-conflict reconstruction. With ₼17.1 billion ($10.1 billion) of total state budget expenditures executed by mid-year—equal to 41.3% of the annual expenditure forecast—the reconstruction of Garbagh and Eastern Zangazur stands as a central pillar of national spending.

The budgetary execution also highlights fiscal discipline and economic resilience. State revenues in the first half reached ₼19.8 billion ($11.7 billion), exceeding forecasts by 3.7%, and marking a 5.1% increase over the same period in 2024. This solid fiscal performance provides the financial cushion necessary for sustained long-term investment in the liberated territories.

President Ilham Aliyev, speaking during the 3rd Shusha Global Media Forum in Khankendi on July 19, emphasized that Azerbaijan has entered a new phase of reconstruction. “...in the first four years we were mainly engaged in infrastructure projects. We have now almost completed the main part of them. All of Garabagh and Eastern Zangezur have already been provided with a circular electricity network and have also been connected to the traditional national electricity grid of Azerbaijan,” the president noted, highlighting that energy, transport, and communication infrastructure is largely in place.

Indeed, the completion of a circular electricity network and the integration of Garabagh’s grid with the national system mark a critical milestone. Hydropower plants in the region are now generating 280 megawatts of electricity—more than the current population requires—enabling surplus energy to be redistributed to other regions.

Meanwhile, transport infrastructure continues to expand rapidly. Roads that once took nine hours to navigate can now be covered in four. Seven tunnels have been constructed along the Fuzuli-Shusha route, spanning a total of 80 kilometers, with the 11.7-km Murovdag tunnel—one of the longest in the world—set to open in the coming months. Railway and cable car projects are also underway, boosting both logistical access and tourism potential.

While infrastructure development remains the foundation, the focus is gradually shifting toward resettlement. President Aliyev confirmed that 18 settlements have already welcomed returning IDPs, with new housing and social facilities enabling sustainable community life. In Khankendi alone, Garabagh University has enrolled 1,500 students, supported by a faculty of 300 professors—clear evidence of rapid social normalization.

This transition from physical rebuilding to societal revitalization is crucial. As Aliyev remarked, the success of the Great Return is not merely about capital investment: “No matter how much money you may have, if you do not have human capital, if people do not work with their hearts, it is impossible to achieve anything.”

Indeed, enthusiasm and national pride have become intangible but critical drivers of the reconstruction process. Many of the workers involved in the region’s development see their work as a patriotic duty, further accelerating the pace and quality of recovery.

Despite the progress, challenges remain. Demining is a costly and time-intensive process, and the continued presence of unexploded ordnance poses risks to returning populations. Moreover, sustaining momentum in housing, education, and employment will be essential to transforming temporary returns into permanent, thriving communities.

Nevertheless, the government’s multi-sectoral approach—linking infrastructure, economic opportunity, and public services—suggests a long-term commitment to integration and growth. The liberated territories are not just being rebuilt; they are being re-imagined as hubs of innovation, sustainability, and national pride.

The first half of 2025 demonstrates that Azerbaijan’s reconstruction of the liberated territories is not only progressing rapidly but is guided by strategic vision, fiscal responsibility, and an unwavering sense of national purpose. The Great Return is evolving from policy to practice, from ambition to reality—vividly reshaping the region and redefining post-conflict recovery in the 21st century.