Azure-ARM Packer powershell provisioner doesn't work for me

Hello, I’m trying to use packer to build a windows image on azure.
Copying files and setting registry entries work fine except for the huge amount of time copying files over winrm.
However if I want to change something on the OS like installing powershell modules or Windows Features powershell simply hangs and no output is provided. Already tried with elevated_user and the result is the same.
Also tried multiple versions of packer and the result is always the same.

==> azure-arm: Pausing before the next provisioner . Press enter to continue.
2020-08-14T09:54:36+01:00: ==> azure-arm: Provisioning with Powershell…
2020-08-14T09:54:36+01:00: ==> azure-arm: Provisioning with powershell script: C:\Users\z003yu2b\AppData\Local\Temp\powershell-provisioner929808231
2020-08-14T09:54:42+01:00: azure-arm: Creating folder Scripts
2020-08-14T09:54:42+01:00: azure-arm:
2020-08-14T09:54:42+01:00: azure-arm:
2020-08-14T09:54:42+01:00: azure-arm: Directory: C:
2020-08-14T09:54:42+01:00: azure-arm:
2020-08-14T09:54:42+01:00: azure-arm:
2020-08-14T09:54:42+01:00: azure-arm: Mode LastWriteTime Length Name
2020-08-14T09:54:42+01:00: azure-arm: ---- ------------- ------ ----
2020-08-14T09:54:42+01:00: azure-arm: d----- 8/14/2020 8:54 AM Scripts
2020-08-14T09:54:42+01:00: azure-arm: Creating folder BuildAgents
2020-08-14T09:54:42+01:00: azure-arm: d----- 8/14/2020 8:54 AM BuildAgents
2020-08-14T09:54:42+01:00: azure-arm: Creating folder Binaries
2020-08-14T09:54:42+01:00: azure-arm: d----- 8/14/2020 8:54 AM Binaries
2020-08-14T09:54:42+01:00: azure-arm: Installing Module AZ

Stays in the last step forever.

Code:

{

"builders": [{

  "type": "azure-arm",

  "client_id": "XXXXXXXXXXXXXX",

  "client_secret": "XXXXXXXXXXXXXXXXXXXX",

  "tenant_id": "XXXXXXXXXXXXXXXXXX",

  "subscription_id": "XXXXXXXXXXXXXXXXXXXX",

  "managed_image_resource_group_name": "XXXXXXXX",

  "managed_image_name": "buildserver",

  "os_type": "Windows",

  "image_publisher": "MicrosoftWindowsServer",

  "image_offer": "WindowsServer",

  "image_sku": "2016-Datacenter",

  "communicator": "winrm",

  "winrm_use_ssl": true,

  "winrm_insecure": true,

  "winrm_timeout": "5m",

  "winrm_username": "packer",

  "azure_tags": {

      "dept": "Engineering",

      "task": "Image deployment"

  },

  "build_resource_group_name": "XXXXXX,

  "vm_size": "Standard_D2_v2"

}],

"provisioners": [

    {

        "type": "powershell",

        "inline":[

            "Write-Host \"set strong cryptography on 64 bit .Net Framework (version 4 and above)\"",

            "Set-ItemProperty -Path 'HKLM:\\SOFTWARE\\Wow6432Node\\Microsoft\\.NetFramework\\v4.0.30319' -Name 'SchUseStrongCrypto' -Value '1' -Type DWord",

            "Write-Host \"set strong cryptography on 32 bit .Net Framework (version 4 and above)\"",

            "Set-ItemProperty -Path 'HKLM:\\SOFTWARE\\Microsoft\\.NetFramework\\v4.0.30319' -Name 'SchUseStrongCrypto' -Value '1' -Type DWord" 

        ]

    },

    {

        "type": "windows-restart"

    },

    {

        "type": "powershell",

        "inline":[

            "Write-Host \"Creating folder Scripts\"",

            "New-Item -ItemType Directory -Name Scripts -path C:\\",

            "Write-Host \"Creating folder BuildAgents\"",

            "New-Item -ItemType Directory -Name BuildAgents -path C:\\",

            "Write-Host \"Creating folder Binaries\"",

            "New-Item -ItemType Directory -Name Binaries -path C:\\",

            "Write-Host \"Installing Module AZ\"",

            "Install-Module Az -AllowClobber -Force"

        ]

    },

    {

        "type": "file",

        "source": ".\\Scripts\\ipins-windows-installation-master.zip",

        "destination": "C:\\Scripts\\"

    },

    {

        "type": "file",

        "source": ".\\Scripts\\trendmicro-windows-installation-master.zip",

        "destination": "C:\\Scripts\\"

    },

    {

        "type": "file",

        "source": ".\\Tests\\image.tester.ps1",

        "destination": "C:\\Scripts\\"

    },

    {

        "type": "powershell",

        "inline":[

            "Invoke-Pester C:\\Scripts\\image.tester.ps1 -OutputFile TestResults.xml -OutputFormat NUnitXml"

        ]

    },

    {

        "type": "file",

        "source": "TestResults.xml",

        "destination": "TestResults.xml",

        "direction": "download"

    }

]

}

Is internet access allowed for the VM, i.e. no NSG’s on the subnet or route table changes and any VM on that network can get direct internet access?