Terraform is a popular infrastructure as code (IaC) tool that allows you to define and provision infrastructure resources in a declarative manner. When it comes to Azure, Terraform provides a powerful way to automate the deployment of resources and manage your infrastructure using code. Here’s how Terraform works with Azure:

1. Terraform Configuration:

   • You define your infrastructure resources and their configurations using HashiCorp Configuration Language (HCL) within Terraform configuration files (usually with a .tf extension). These configuration files specify what Azure resources you want to create, configure, or manage.

2. Provider Configuration:

   • You specify the Azure provider in your Terraform configuration, which tells Terraform to interact with Azure. Azure provides an official Terraform provider (azurerm) that you can use to interact with Azure resources.

3. Resource Declarations:

   • Within your Terraform configuration, you declare the Azure resources you want to create or manage. For example, you can define virtual machines, storage accounts, networks, and more.

4. Variables and Outputs:

   • Terraform allows you to define variables to parameterize your configurations and outputs to capture values from the deployed resources for use in subsequent Terraform runs or for reporting purposes.

5. Terraform Commands:

   • You use Terraform commands to interact with your configuration files. Common commands include terraform init (to initialize the working directory), terraform plan (to preview changes), and terraform apply (to create or update resources).

6. State Management:

   • Terraform maintains a state file (usually stored remotely) that tracks the current state of your infrastructure. This file helps Terraform understand the differences between the desired configuration and the actual resources in Azure.

7. Execution Plan:

   • When you run terraform plan, Terraform generates an execution plan that shows the proposed changes to your infrastructure. It provides a preview of what resources will be created, updated, or destroyed.

8. Resource Deployment:

   • After reviewing the execution plan and ensuring it matches your intentions, you can apply the changes using terraform apply. Terraform communicates with Azure to create, update, or delete resources as needed.

9. Automation and Version Control:

   • Terraform configurations can be version-controlled using tools like Git, making it easy to collaborate on infrastructure changes and track revisions over time.

10. Modularization:

    • Terraform allows you to modularize your configurations, making it easier to reuse and maintain infrastructure code across different projects or environments.

11. Provider Updates:

    • As Azure services evolve, the azurerm provider is updated by HashiCorp to support new features and resources. You can update your Terraform configurations to take advantage of these updates.