Uzbekistan is one of the most relevant states in Central Asia as it plays a pivotal role in regional affairs. First, it has a central position, which means it is bordered by all the other countries from the region. Also, Uzbekistan is the second largest state from the region and the first in terms of population; precisely, more than half of the entire region’s population lives in Uzbekistan. Additionally, its wealth in oil and gas is an important advantage, as well as the positive perspectives for investments in the agricultural sector.
One of its central objectives is its technological development. In 2017 the Ministry of Innovative Development was established by decree, and on that occasion a strategy for sustainable development was formulated and approved for the period 2017-2021. The key points of the strategy include:
- introducing innovation in public administration to simplify access to public services and improve the final results;
- creating a modern infrastructure that meets the needs of the society and promotes development;
- granting and implementing investments in development;
- stimulating research and development, but also encouraging young people to join in key areas of research;
- establishing new scientific and experimental laboratories;
- changing the focus from traditional energy to green technologies and energy saving;
- introducing advanced technologies for health and early detection of health problems, timely treatment, and prevention of symptoms.
There is particular focus on to agriculture as part of this strategy. One of the most important points of it implies the identification and introduction of new technologies in the agrarian sector and the identification of new species of plants. This aspect of the strategy aims to increase the export capacity and ensure food security in Uzbekistan.
Partnerships and projects
This strategy also requires the country’s research institutes to identify new opportunities for cooperation with other states in the field of research. An important step was taken in May 2018, when the United Nations Industrial Development Organization (UNIDO) established a meeting with the Uzbekistan Natural Fibrous Research Institute and the German company Festo Group to initiate a special co-operation program in the industrial field. Even though the Republic of Uzbekistan’s accession to UNIDO has been achieved in 1994, this is the first notable project of cooperation between these two entities.
There has been important progress in the economic field and particularly in the banking sector. Uzbekistan concluded a partnership with the World Bank. The cooperation between these two entities is based on providing technical advice to improve Uzbekistan’s economic and financial management. The most important three key points addressed by the World Bank in this partnership include: increasing competitiveness and the private sector, modernizing the agricultural sector, and developing public services.
Nonetheless, the focus is placed on agriculture because Uzbekistan has a huge potential in this regard, and this sector can have a decisive contribution to the sustainable growth of the state’s economy. In this case, the World Bank supports the development of irrigation infrastructure, efficient management of land and water resources.
National industrial entities consider that it’s of particular importance to identify foreign strategic partners to render the projects they have planned. In May, Rostselmash, the Russian-owned company, began assembling its equipment at the Chirchik Factory in Uzbekistan. It is estimated that the first batch of Russian combined harvesters made in Uzbekistan will count 20 copies. Production will gradually increase according to upcoming requirements.
Some similar partnerships are scheduled to be concluded between Uzbekistan, Belarus, Pakistan and South Korea. The Uzbek part is in talks with potential partners, trying to show them the benefits of solid collaboration.
Additionally, one of Uzbekistan’s future projects involves the use of drones in agriculture, with the aim of monitoring crops on fields, vegetables, but also of evaluating the levels of germination. These drones will also be able to identify uncultivated arable land areas and to perform a soil quality evaluation in order to identify the level of complexity of the agricultural needs in order to obtain a certain amount of harvest. The first drones used in tests are named Ptero G1.
Other areas of interest
Another important field for Uzbekistan in terms of technological development is defence, which is why government authorities are looking for opportunities in order to collaborate with other entities. They are planning to allocate 4 percent of GDP to the military field and refresh the military industry. For a coherent vision, the new Doctrine of Defence, which is still in force today, was adopted in 2017. The ultimate goal of the strategy is to turn the Uzbek army into a modern one, in order to be able to effectively fight against terrorism. The Presidential Administration of Uzbekistan wants to strengthen and intensify its relations with Russia and China in order to equip the army with modern weaponry purchased from them. The allocation of 4 percent of GDP in the defence sector in 2018 demonstrates the state’s efforts to revive and develop the national arms industry.
Alongside defence, industry, agriculture and the banking system, another area of strategic importance is the energetic one. Uzbekistan is fully independent energetically due to its oil and gas reserves. In 2017, the government adopted a special five-year program to increase gas production up to 53.5 billion m³ and oil production by 1.9 million tonnes by 2022. There are some planned investments for the financing and construction of petrochemical facilities, in order to change the focus from the exports of raw materials to the exports of value-added products. Other measures in this field are related to the use of alternative energy. For example, the first solar station in the region is located near Samarkand and produces 100 million MW / year. By 2022, there will be finished other four solar stations.
Furthermore, Uzbekistan’s development strategy for the upcoming years includes the implementation of innovations in the field of telecommunications and informatics as well as a series of measures to encourage research in this field.
One of the proposed measures is the tax exemption for IT workers by 2020. The eligibility is given by their registration in the national register. In addition, if the number of finished products exported exceeds 50% of the total sales, the tax exemption is extended by two years. Those entities that will purchase software and new equipment will also be exempt from taxes.
The Uzbek Embassy in New Delhi describes the country as an attractive place for foreign investors for some reasons: political and macroeconomic stability; the advantageous location in relation to other Central Asian countries, but also with Afghanistan; the existing free trade agreements between Uzbekistan and members of the Commonwealth of Independent States (CSI); well-developed territorial infrastructure; the presence of multiple free economic zones in various parts of the country; the existence of special public policies designed to ensure the protection of foreign investors; stable banking system, but also a well-established educational system.
Uzbekistan’s development after the end of the Soviet era cannot be disputed. It is a state that has identified its potential and has precisely studied the causes of the development of the Occidental countries. Beyond favourable geographic factors, this state understood that research is the central element of development, and investments in research brings many benefits in the future. The development and innovation policies applied in key areas such as infrastructure, industry, defence, banking, agriculture and energy will surely transform Uzbekistan into a regional leader, not only in terms of power and influence, but also as an example of development for the other states in this region.
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