Alongside with transport, communication connection also appeared in Baku. The cable lines began to work in the bottom of the sea (Baku-Tbilisi, 1868, Baku – Krasnovodsk, 1879). In 1886 the first telephone line was introduced in the town.
At the close of the XIX –beginning of the XX centuries the oil recovery increased even greater in Baku. In 1901 Baku provided more than half of the oil (667, 1 million poods) extracted in the world. Industrial branches and trade also were developing. Engineering, metallurgical plants, shipyards, plants making steam boilers, dockyards, a weaving-mill, tobacco factories, cement plants, breweries and distilleries were operating, electric machines, steam mills were working in Baku. The polygraphy was also developing in Baku.
The 28th of May is a great holiday of the Azerbaijan people. On this day the first Democratic Republic of Azerbaijan was proclaimed in the East. One of the founders of this republic was Mammad Amin Rasulzada. The DRA developed quickly under his direction. First, its capital was the city of Ganja. Later Baku was declared the capital of Azerbaijan. On the 15th of November, 1919 Baku State University was created.
On the 28th of April, 1920 the Soviet authority was established in Baku. On the thirtieth of December, 1922 Azerbaijan formed a part of the USSR (the Union of the Soviet Socialist Republics).
In the period of the Soviet authority Baku was keeping on developing. In 1920-21 the first institutes of higher education were opened in Baku: the Azerbaijan Pedagogic Institute, the Azerbaijan Polytechnic Institute, and the Azerbaijan Agricultural Institute. The central State library of Azerbaijan (now Republican Library named M. F. Akhundov) was created on the 23rd of May, 1923. The initiator and organizer of creation of the library was Govhar khanum Usubova, the widow of the general Ibrahim bay Usubov who was shot on the island of Nargin in 1920. This highly educated woman, who knew languages such as French, Russian, Arabian and Persian, had taken up her post as a head bibliographer of the eastern department of the library to her dying day (she died in 1944). On the 5th of June, 1923 there were about 20 thousand books in the funds of the library named Akhundov.
In 1923 the construction of electric tram-line began and early in February, 1924 it was put in commission.
In 1926 for the first time in Soviet Union the electric railway Baku-Sabunchu started working. In the period of the Second World War important work was conducted in connection with transfer of economy to military rails in the Republic. Light, spinning and food industry completely switched to the output of products for the front. In a short time Baku turned into one of the important arsenals of the belligerent army. 130 kinds of various weapons, ammunition were made here in 1942. Despite great difficulties, oilmen were selflessly toiling, providing the front and all branches of economy with fuel. Under the direction of the academician Yusif Mammadaliev a new technology of production of aviation gasoline was worked out, high-octane gasoline began to be output in Azerbaijan. In 1941 as a result of self-denying and intensive work of our oilmen the greatest quantity of oil, 23,5 million tons was extracted in the republic for all history of Azerbaijan that made 71,4 per cent of all oil extracted in the Union. In the years of war the Azerbaijan oilmen provided the country with 75 million tons of oil, 22 million tons of gasoline and other oil products. In January, 1945 the Academy of Sciences of the Azerbaijan Republic was created in Baku. On the 17th of November, 1988 a national liberation movement began in Azerbaijan. On the 20th of January, 1990 the Soviet Army committed a bloody massacre. 170 deceased, about 400 wounded. There were peaceful townspeople: youth, old men, women, children among them. The military personnel didn’t avoid victims either. So was the terrible result of the act of the tragedy, played in the streets of Baku on the night of January 20th, 1990. The Martyrs’ Avenue is located in the Mountainous Park.
Here there are graves of heroic daughters and sons of Azerbaijan who struggled for the independence of Azerbaijan. All the Azerbaijan people worship to the Martyrs’ Avenue. On the 30ies of August, 1991, after the disintegration of the USSR the Supreme Soviet of Azerbaijan adopted the declaration "About restoration of the State Independence of the Republic of Azerbaijan". On the 3rd of December, 1991 the referendum was realized and according to it a new independent state – the Azerbaijan Republic was formed.
On the 18th of October, 1991 the Azerbaijan Sovereign Republic was proclaimed. On the 12th of November, 1995 the Constitution of the Azerbaijan Republic was adopted. On the 9-10th of November, 2001 the first congress of Azerbaijanians of the whole world was held in Baku.
Both in the period of independence, and in the period of “sovietization” Baku was the capital of Azerbaijan.