- Are there any other ways to verify if the issue is on Azure side or elasticsearch side for testing?
I don't think you need to do that. The issue clearly is with your settings not loading properly since the default client is not found, this is an error that's going to be raised before any connection attempt to Azure is made.
Yes, For testing purposes, the client settings have been baked into the elasticsearch-keystore at the time of docker image creation itself
Maybe the issue is somewhere with that. Maybe try the same steps to set up the keystore settings in a shell and then start ES. I just tried your steps locally and it worked just fine, so I'm assuming the issue is with the Docker setup here.