The State of Israel recognized the state independence of the Republic of Azerbaijan on December 25, 1991. Diplomatic relations between the two countries were established on April 7, 1992.
On March 29 2023 Azerbaijan first time ever opened its embassy in Tel Aviv – a significant step in the relationship between the world’s only Jewish state and the strategic Muslim country in the South Caucasus.
Economic cooperation between Israel and Azerbaijan has been growing significantly. As Azerbaijan deregulated its industries and liberalized its economy in the early 1990s, Israeli companies penetrated Azerbaijani markets. Many companies have invested in service industry. One example is Bezeq, a major Israeli telecommunication provider. Through a trade contract bid in 1994, Bezeq bought a large share of the telephone operating system.
Besides, Azerbaijan and Israel co-operate closely in the field of energy: Israel buys 40 percent of its oil from Azerbaijan.
Further, Israel is an important exporter of arms to Azerbaijan: according to research of the Stockholm International Peace Research Institute, Israel accounted for 27 percent of Azerbaijan’s major arms imports from 2011 to 2020 and from 2016 to 2020, Israel accounted for 69 percent of Azerbaijan’s major arms imports.