TASHKENT

Uzbekistan is taking steps to modernise its agricultural industry, the largest in Central Asia, by investing $47 million in a joint project with the Minsk Tractor Plant to create agricultural engineering clusters that will boost the country’s production of farm machinery and bring agricultural methods in line with modern technology.

The country’s main tractor producer, the Tashkent Agricultural Machinery Plant, currently located in the capital, will be moved to the neighbouring town Chirchik, some 20 kilometres away, as part of a new industrial cluster that will also include Technolog and UzKlaas Agro enterprises.

Up to 3,000 tractors will be produced annually under the terms of the agreement, the president’s press service said. Up to 40 percent of the machinery produced next year will include localisation, the component which allows for an autonomous driving system, and 50 percent the following year, more than doubling the current proportion of tractor automation in the country.

Uzbekistan, a country of 35 million people, is reforming its economy to meet the demand of a growing population and an often outdated infrastructure that’s becoming increasingly inefficient and expensive to run. About a fifth of Uzbekistan’s labour force is employed in agriculture. The sector makes up a quarter of the country’s gross domestic product and provides a sizeable share – almost 10 percent in 2019 –  of its export revenue.  Uzbekistan’s principal crops are cotton and grain, but the government’s decision to scrap quotas and price controls means production is shifting towards higher-value cultivation such as fruit and vegetables.

The current proportion of tractors with automation is 20 percent, and the cost of domestically produced equipment is up to 15 percent more expensive than imported models.

Uzbek President Shavkat Mirziyoyev instructed the Finance Ministry to fund the initial costs of the project. It will help to increase production capacity to 85 percent and localisation to 50 percent. As a result, the cost of production is expected to fall by 20 percent and business profitability will increase by 10 percent, the press service said.