In a show of the pragmatic good relations that continue between Russia and Uzbekistan, Russian Prime Minister Mikhail Mishustin praised the economic and trade ties between the two countries at the plenary session of the fifth Tashkent International Investment Forum (TIIF) on June 17.

“Russia is among the leading investors in Uzbekistan’s economy with about 3,000 Russian companies working here on some 150 major investment projects whose total worth has already exceeded RUB4 trillion.”

During his stay in Uzbekistan, the Prime Minister also participated in several meetings and negotiations to expand multifaceted cooperation. Trade turnover between the two countries has grown strongly on the back of Uzbekistan accelerating economic growth, increasing by 20% since the beginning of the current year.

“The global economy is undergoing a profound transformation these days amid growing turbulence and escalating trade wars, the wide application of protectionist measures and unfair competition. Of course, all this means that we, our countries, must work on systemic objectives. The way we address them will define whether we succeed in fostering steady economic development for our countries and improving the quality of life for our people,” Mishustin said.

Locked out of Europe due to an extreme sanctions regime, as IntelliNews reported, Central Asia has been one of the big winners from the war, sparking a manufacturing and FDI boom as companies step into the breach to supply what is by far the biggest consumer market in Europe.

“It is for this reason that we are taking a closer look at the manufacturing, technological and logistics chains, developing new financial and investment tools, and reinforcing interstate partnerships for working together on responding to the challenges we face today,” Mishustin continued. “We have elevated our bilateral cooperation to a whole new level. Economic ties have been expanding, there is more cooperation in manufacturing, and region-to-region ties have also been enjoying positive momentum.”

Investment ties

Russian companies have always had a strong presence in Uzbekistan and today more than 3,000 firms are active in the country, the prime minister said, while the Russian state development agency VEF.rf is actively promoting mutual trade and investment, via its affiliate, the Russian Export Centre.

Most recently, on the sidelines of the St Petersburg International Economic Forum (SPIEF), Presidents Vladimir Putin and Shavkat Mirziyoyev signed off on the construction of Uzbekistan’s first 2.1-GW nuclear power plant as part of Uzbekistan energy diversification plans. Once fully operational, the facility is expected to generate approximately 17.2bn kWh of electricity annually, which is projected to meet up to 14% of Uzbekistan's total electricity demand.

Uzbekistan and Russia signed a new commercial gas deal in June 2023 to boost imports of gas after suffering for several years from an energy crisis. Initial deliveries of 2.8bn cubic metres of natural gas via the Central Asia-Centre pipeline commenced on October 7, 2023, rising to 6.5bcm last year. Since then the government continues to roll out more renewable energy resources, but now will add nuclear capacity to underpin the energy system.

Russia is continuing to help Uzbekistan develop its energy system further, according to Mishustin. Russian companies are participating in expanding the petrol station network in the country. A joint centre for managing drilling operations has been created, and there is a massive project to upgrade the Central Asia Centre gas pipeline to increase its capacity with an effort to develop new hydrocarbon deposits within the country.

“All this ensures that people and businesses benefit from stable energy and power supply, while also providing a powerful impetus for the related sectors. There are many similar examples of mutually beneficial initiatives, and there can and should be even more,” Mishustin said.

Russian companies are also investing in other sectors of the economy, including by developing joint technology parks, which have already opened in the Tashkent and Jizzakh regions, as well as an industrial park in Navoi. Construction is also underway on a railway rolling stock manufacturing cluster, as well as assembly facilities for the production of commercial vehicles.

“Russian businesses are present across virtually the entire territory of the republic. We can already see the results of our joint efforts: new jobs are being created and the output of in-demand products is growing,” Mishustin said.