Explanation:

To perform a key transfer, a user performs following steps:
Generate KEK.
Retrieve the public key of the KEK.
Using HSM vendor provided BYOK tool - Import the KEK into the target HSM and exports the Target Key protected by the KEK.
Import the protected Target Key to Azure Key Vault.
Step 1: Generate a Key Exchange Key (KEK).
Step 2: Retrieve the Key Exchange Key (KEK) public key.
Step 3: Generate a key transfer blob file by using the HSM vendor-provided tool.
Generate key transfer blob using HSM vendor provided BYOK tool
Step 4: Run the az keyvault key import command
Upload key transfer blob to import HSM-key.
Customer will transfer the Key Transfer Blob (".byok" file) to an online workstation and then run a az keyvault key import command to import this blob as a new HSM-backed key into Key Vault.
To import an RSA key use this command:
az keyvault key import
Reference:
https://docs.microsoft.com/en-us/azure/key-vault/keys/byok-specification

Explanation:

Instead run the Invoke-RestMethod cmdlet to make a request to the local managed identity for Azure resources endpoint.
Reference:
https://docs.microsoft.com/en-us/azure/active-directory/managed-identities-azure-resources/tutorial-windows-vm-access-arm

Explanation: