If you have the following static route in R1:
ip route 192.168.2.0 255.255.255.0 gigabitethernet0/1
then the following will take place:
- The packet with a destination of 192.168.2.2 will reach R1, and the routing table lookup will match this static route.
- Because this exit interface is Ethernet which is a multi access technology, there may be many hosts (potential next hop routers) connected to it. Because it doesn’t know the next hop IP, R1 will send out an ARP request for the destination IP of the packet. (If this was a serial link, which is a point to point technology, the packet would be sent out the interface directly).
- The ARP request would reach R2. If proxy ARP is enabled on R2, it will then send out ARP requests which will reach H2 and it will get a response. If proxy ARP is not enabled, the ARP request will not be responded to, and the routing will fail. Proxy ARP is enabled by default on Cisco routers.
- R2 will then respond to R1’s ARP request with its own MAC address, allowing the packet to be routed.
I’ve seen this setup used in some large private networks. The one I have in mind is specifically a private government network. Each entity, such as a municipality, is provided with an IP address range such as 10.96.0.0/21 for example. The edge router for the entity advertises this address range to the private network, but it has no knowledge about how this range is further subnetted and routed within the municipality itself. Any packets destined for the internal network of the municipality will match a static route with an an exit interface (the interface facing the internal municipality network), and the edge router will send an ARP request towards the internal network to ask for a MAC address. The internal router will then use proxy ARP, and will send its own MAC address as the next hop MAC.
Such a setup allows the operators of the main network to route traffic to an internal entity, such as a municipality network in this case, without having to know the internal routing nor having to participate in any internally configured dynamic routing protocol.
I hope this has been helpful!