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Rogun Hydropower Plant

Tajikistan Approves Use of Central Bank Reserves to Fund Rogun Hydropower Plant

Tajikistan’s lower house of parliament on January 22 approved a draft law allowing funds from the reserve fund of the National Bank of Tajikistan to be used to finance construction of the Rogun Hydropower Plant, a project viewed as central to the country’s long-term energy strategy. The decision was reported by Sadoi Mardum, the official newspaper of the lower chamber. According to the publication, the bill was introduced at the initiative of President Emomali Rahmon. Speaking before lawmakers, Finance Minister Faiziddin Qahhorzoda said the legislation creates a legal mechanism for channeling reserve fund resources through the state budget toward completion of Rogun, which authorities describe as a strategically important facility. Qahhorzoda explained that the law provides for the transfer of 916 million Tajik somoni (approximately $100 million), representing the remaining balance of the National Bank’s reserve fund generated from its financial performance in 2024. He told deputies that the measure is intended to help Tajikistan achieve energy independence by 2027 and reduce reliance on external loans and grants. The minister also pointed to broader budgetary support for the energy sector. Under the state budget for 2026, around 15 billion somoni (more than $1.6 billion) has been allocated for fuel and energy projects, with the majority of those funds earmarked for completion of the Rogun dam. The parliamentary decision follows earlier reports highlighting financial oversight challenges surrounding the hydropower project. As previously reported by The Times of Central Asia, an independent audit of Rogun’s 2024 financial statements identified serious concerns related to financial reporting and internal controls. The audit was conducted by Baker Tilly Tajikistan, a member of the international Baker Tilly network, and resulted in a qualified opinion. Auditors said they were unable to fully confirm the accuracy of the company’s accounts and cited several material issues, including a possible understatement of share capital. They also noted that they did not participate in scheduled inventories of cash, fixed assets, or other holdings as of December 31, 2024, limiting their ability to verify parts of the company’s assets.

Nuclear Power

Uzbekistan Clarifies Nuclear Plant Timeline After Reports of Delay

Uzbekistan’s plans to begin construction of its first nuclear power plant have come under renewed scrutiny following the publication of a draft state program suggesting the start of work could be postponed until December 2026. The draft made public on the regulation.adliya.uz portal prompted widespread media speculation. According to the document, Uzbekistan intends to spend 2026 negotiating, signing, and registering an additional agreement with Russia’s state nuclear corporation, Rosatom. The proposed agreement would revise the configuration of the integrated nuclear power plant project, combining a large-capacity VVER-1000 reactor with small modular RITM-200N reactors. Some outlets interpreted this language as a sign that the pouring of the first concrete might not occur until the end of 2026. In response, the Uzatom nuclear energy agency issued an official clarification, stating that previously announced timelines remain unchanged. In a statement released after the draft’s publication, Uzatom stressed that the document does not stipulate any postponement of construction. The agency noted that the December 2026 date reflects a conservative planning scenario in which all preparatory and licensing procedures are finalized by that time. Uzatom emphasized its adherence to national legislation and international standards on nuclear and radiation safety. It added that the first concrete pouring, considered a key milestone, will only proceed after receiving all necessary permits and approvals from relevant authorities. “We clearly understand the level of responsibility involved in this stage,” the agency said, adding that work on the project is advancing across all areas. The clarification comes amid sustained public interest in Uzbekistan’s nuclear energy plans. Speaking at World Atomic Week in Moscow in September last year, Uzatom Director Azim Akhmedkhadjaev stated that Uzbekistan aims to fully commission a high-capacity nuclear power plant by 2035. According to him, the first small modular reactor in the Jizzakh region is expected to begin operations in 2029, with a second unit following six months later. The first reactor of the large-scale facility is scheduled to come online in 2033, with full capacity reached by 2035, though Akhmedkhadjaev noted that final timelines are contingent on the completion of contractual agreements. Uzatom said it will continue to provide timely updates as the project progresses through its key phases.

Agriculture

Kazakhstan to Increase Grain Processing Nearly Tenfold by 2028

Kazakhstan plans to increase its deep grain processing capacity nearly tenfold by 2028, as part of a broader strategy to shift from raw material exports to the production of high value-added agricultural products. The initiative includes five major investment projects for wheat and corn processing, with a combined annual capacity of 4.8 million tons of grain. According to the Ministry of Agriculture, the projects will be located across the northern, southern, and central regions of the country and are expected to become a cornerstone of Kazakhstan’s agro-industrial transformation. These priorities were outlined during the fourth meeting of the National Kurultai in March 2024, where President Kassym-Jomart Tokayev emphasized the need for industrial diversification and greater economic resilience. Currently, Kazakhstan processes just over 510,000 tons of grain annually in the deep processing segment. The country has three specialized enterprises that produce starch, gluten, molasses, bioethanol, and other high value-added products. The five new projects are expected to attract $2.6 billion in investment and create approximately 3,300 jobs. Key developments include a wheat processing plant with a capacity of 415,000 tons per year in the Kostanay region; corn processing enterprises in the Turkestan and Zhambyl regions; and new production facilities in Astana and Akmola region focusing on starch, gluten, bioethanol, and amino acids. A significant share of these products will be exported to the U.S., Europe, China, India, the Eurasian Economic Union member states, the Middle East, and Africa. As previously reported by The Times of Central Asia, Kazakhstan harvested a record crop of grains and oilseeds in 2024, providing the raw material base for this upcoming industrial expansion.

Finance

Uzbekistan’s Central Bank Reaffirms Commitment to Reforms and Free Exchange Rate

Uzbekistan’s central bank has reiterated that the som’s exchange rate will be left to market forces, arguing that a 'free float' is key to its inflation-targeting framework. In a statement released this month, the Central Bank of Uzbekistan said the exchange rate should be treated as an indicator, not a policy target. Attempts to hold the currency at a chosen point, it warned, can build pressure that later unwinds in sharper moves. Any foreign exchange operations, it added, would be aimed at smoothing excessive, short-term volatility, rather than steering the market. The stance continues a shift that began with the 2017 liberalisation of the currency market, which gave more access to foreign exchange, and narrowed the gap between official and black market rates. Recent fluctuations in the som have been closely watched. An earlier report on why the som has held up at times pointed to remittance inflows, export earnings and a tighter domestic monetary stance. Uzbekistan adopted inflation targeting in 2020, using the policy rate as its main lever. The central bank has kept the key rate at 14% since December 2025. It is due to review it again on January 28. In its monetary policy guidelines for 2026–2028, the bank projects headline inflation easing to about 7% by the end of 2026 and returning to a 5% medium-term target in 2027, assuming monetary conditions remain restrictive, and external price pressures fade. A floating rate can cushion swings in commodity prices, remittances and trading partner demand. But it also passes currency shifts more directly into the cost of dollar-priced imports, from consumer goods to industrial inputs. That risk is heightened when energy shortages and higher fuel costs feed broader price pressures, as described in coverage of the region’s growing energy deficit. International lenders have broadly backed Uzbekistan’s direction, while urging deeper reforms. In late 2025, the IMF welcomed greater exchange-rate flexibility and called for continued structural changes, according to its latest review.

Renewable Energy

Chinese Investor Plans 500 MW Solar and Wind Power Plants in Tajikistan

Chinese company Dayu New Energy Limited plans to develop solar and wind power plants in the Kubodiyon and Jaihun districts of Tajikistan’s Khatlon region. With a combined installed capacity of 500 megawatts, the project would rank among the largest renewable energy initiatives in the region. During negotiations, it was emphasized that Khatlon has been strengthening its economic ties with Chinese firms and offers favorable conditions for the construction of infrastructure and energy facilities. The region is seen as a key zone for attracting foreign direct investment. Dayu New Energy CEO David Liu noted that the company has operated in the renewable energy sector since 2018, specializing in the construction and operation of solar and wind power stations. He added that the firm is currently implementing wind energy projects in Georgia and Kazakhstan, underscoring its practical experience and technological capacity. Following the meeting, the head of the Khatlon region expressed support for the project and confirmed his willingness to facilitate its development. As previously reported by The Times of Central Asia, Tajikistan has significantly accelerated its transition to green energy. The country has already launched its largest solar initiative to date: the construction of two photovoltaic power plants with a combined capacity of 500 MW, an unprecedented move for the republic. In a related development, the Asian Development Bank recently approved a $1 million grant to support technical assistance for floating solar photovoltaic systems in Tajikistan.

Economic Growth

Tajikistan Reports Strong 8.4% Economic Growth in 2025

Tajikistan’s economy grew by 8.4% in 2025, according to official data released by the country’s statistical authorities, marking one of the strongest growth rates in Central Asia last year. President Emomali Rahmon announced the figure during a year-end address to parliament, saying gross domestic product reached approximately 173 billion somoni, or about $18.8 billion. Official data shows growth was driven primarily by industry, construction, agriculture, and services. The Statistical Agency under the President of Tajikistan reported that industrial production increased by more than 20% year-on-year, supported by mining, metallurgy, cement production, and food processing. Construction activity also expanded, reflecting continued state investment in roads, housing, and energy infrastructure. Authorities highlighted ongoing work on the Rogun hydropower project as a central pillar of economic policy. The dam is expected to secure the domestic electricity supply and boost exports once fully operational, particularly to neighboring markets. Remittances remained a key contributor to economic growth in 2025. Transfers from Tajik migrant workers, most of whom are employed in Russia, rose during the year, supporting household consumption and helping offset external economic pressures. According to the World Bank, remittances have accounted for a very large share of Tajikistan’s GDP, with personal remittances near 48% of GDP in recent years, leaving the economy highly exposed to labor market conditions abroad. Foreign trade turnover also increased. Exports of electricity, metals, and agricultural products rose, while imports of machinery, fuel, and construction materials expanded alongside investment activity. Regional media reported that China, Russia, and neighboring Central Asian states remained Tajikistan’s main trading partners in 2025. Despite the strong headline growth, international financial institutions have continued to flag structural weaknesses. The International Monetary Fund has warned that sustaining high growth will require reforms to improve governance, strengthen the banking sector, and expand the role of the private sector in the economy. Analysts also note that rapid growth partly reflects a low statistical base and heavy reliance on state-led investment. Job creation in higher-value sectors remains limited, contributing to continued labor migration and leaving the economy vulnerable to external shocks. The government has set similarly ambitious targets for 2026, with officials emphasizing industrialization, infrastructure development, and energy exports. Whether Tajikistan can maintain its pace of growth while addressing long-standing structural constraints will remain a key test for the country’s economic trajectory in the coming years.