Kazakhstan Business & Economy - The Times Of Central Asia

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Coal

Kazakhstan’s Largest Coal Mine to Increase Production from 2026

Bogatyr Kömir LLP, the operator of Kazakhstan’s largest coal mine in Ekibastuz, in Pavlodar region, plans to gradually increase production beginning in 2026, the Ministry of Energy reports. The company, which uses open-pit mining, is the country’s largest supplier of coal to the domestic market, accounting for about 38% of total coal output. According to the ministry, coal production in Kazakhstan reached 120.5 million tons in 2025. With balance reserves estimated at 2.4 billion tons, the company is positioning itself for long-term growth. Under current plans, output is expected to rise from 42.7 million tons in 2024 to 45.2 million tons by 2026, reaching 56.5 million tons annually by 2032. The expansion will be backed by a $733 million investment program for 2026-2032. Funds will be allocated to capital construction and technological upgrades, including the introduction of cyclic-flow technology at the Severny open-pit mine and the development of new spoil tips. The company also plans to modernize its mining transport fleet and reconstruct and overhaul existing facilities to ensure stable fuel supplies to the energy sector. The Ministry of Energy links the production increase to the implementation of a national project to expand coal-fired power generation. The Pavlodar region already plays a central role in the country’s energy system, accounting for about 42% of Kazakhstan’s total electricity generation last year. Key elements of the program include expanding the Ekibastuz GRES-2 power plant, increasing its installed capacity from 1 GW to 2.1 GW; constructing a new Ekibastuz GRES-3 power plant with a capacity of 2.64 GW using “clean coal” technologies; and modernizing the GRES plant in Aksu. According to the ministry, a significant increase in power generation requires advance expansion of the raw material base. Additional electricity demand is also expected from digital infrastructure projects. As previously reported by The Times of Central Asia, authorities plan to create a “valley” of data centers in the Pavlodar region focused on digitalization and high-performance computing.

Kazakhstan to Launch AI Fund Backed by National Bank

Kazakhstan will establish a dedicated Artificial Intelligence Fund to finance digital and educational initiatives, Deputy Prime Minister and Minister of Artificial Intelligence and Digital Development Zhaslan Madiev announced at an expanded government meeting. According to Madiev, the fund will be capitalized using resources from the National Bank, with the government currently finalizing its financial and organizational structure. The fund is expected to serve as the main vehicle for identifying and supporting priority AI and digitalization projects, as well as educational programs. Madiev cited international precedents, noting that leading technological nations allocate between 4% and 6% of GDP to digital development and artificial intelligence over three years. Based on ministry projections, such investments could yield a multiplier effect of 5 to 1, with the potential to contribute up to 1.5% of GDP annually in additional economic growth. One of the fund’s key focuses will be integrating AI solutions into Kazakhstan’s public and quasi-public sectors. Simultaneously, the country is pursuing international tech partnerships. With presidential backing, Kazakhstan has approved the creation of a joint venture with Chinese artificial intelligence firm 01.AI. Scheduled to launch in March, the venture will operate the National Artificial Intelligence Platform and focus on developing AI agents to enhance public sector decision-making. 01.AI is a startup founded by former Google China CEO Kai-Fu Lee. The company is best known for its open-source language model Yi-34B, positioned as an alternative to ChatGPT. At the meeting, President Kassym-Jomart Tokayev emphasized that AI is a foundational pillar of Kazakhstan’s emerging economic model. Anticipated benefits include increased labor productivity, growth in export-oriented industries, higher production of high value-added goods, and deeper integration into global digital networks. However, Tokayev also cautioned against using insufficient digitalization as a scapegoat for systemic inefficiencies. “Technology should not serve as an excuse for management shortcomings,” he noted. As previously reported by The Times of Central Asia, Kazakhstan joined OpenAI’s “Education for Countries” initiative, aimed at integrating AI tools into national education systems.

Economy

Kazakhstan Targets Raising Wage Share of GDP to 40%

The Kazakh government is preparing a series of measures aimed at accelerating wage growth and increasing the overall wage fund, with the goal of raising its share in the country’s GDP to 40%, Prime Minister Olzhas Bektenov announced during an expanded government meeting. According to government estimates, household incomes are currently growing more slowly than the broader economy and corporate profits, including those generated with state support. At present, wages account for roughly 31% of Kazakhstan’s GDP, a figure considered relatively high by Central Asian standards but still below the levels seen in developed economies, where wage funds typically exceed 40% of GDP. Kazakhstan’s GDP growth in 2025 reached $20.1 billion in monetary terms, with the economy expanding at an annual rate of 6.5%, according to official data. To address the income gap, the government is developing a comprehensive package that includes financial, tax, and regulatory incentives for employers to raise wages. The initiative also prioritizes the creation of new, decently paid jobs, upskilling of the workforce, and reducing the financial burden on citizens. Real income growth has been designated a key economic policy priority for 2026. A complementary role will be played by the upcoming Joint Action Program for 2026-2028, developed by the Cabinet, the financial regulator, and the National Bank. The program aims to stabilize the macroeconomic environment and improve public welfare, setting a target of household income growth at a rate of at least 2-3% above inflation each year. According to official statistics, the average monthly salary in Kazakhstan stood at approximately $873 by the end of the third quarter of 2025. However, earlier reports indicated that the minimum wage will remain frozen at $172 in 2026, despite prior commitments to increase it.

Data Centers

Kazakhstan to Establish International Computing Hub in Pavlodar Region

Kazakhstan plans to develop an international computing hub centered in the Pavlodar region, based on the emerging “data center valley” in Ekibastuz, one of the country's key energy production zones. The announcement was made by Deputy Prime Minister and Minister of Artificial Intelligence and Digital Development Zhaslan Madiev during an expanded government meeting. The government had earlier unveiled plans to establish a cluster of high-performance data centers in Ekibastuz, a city that hosts extensive coal-fired power generation and robust energy infrastructure. Madiev now says the project will evolve beyond a national cluster into a full-fledged international computing hub. According to Madiev, two critical enablers for the project are affordable electricity and cross-border telecommunications infrastructure. A land plot has already been designated for development, and 300 megawatts of power capacity have been reserved at Ekibastuz GRES-1. Negotiations are ongoing with international investors. AI Center to Anchor Digital Expansion The hub’s anchor facility will be a 50 MW AI-focused data processing center currently under construction by national telecom provider Kazakhtelecom. Scheduled for commissioning in mid-2027, the new facility is expected to be ten times more powerful than Kazakhstan’s recently launched state supercomputer facility. Astana is already home to Central Asia’s most powerful supercomputer, unveiled earlier this year, marking a significant step in the country’s digital infrastructure ambitions. Officials envision this computing expansion as the foundation for a new economic model driven by artificial intelligence and big data. Concerns Over Domestic AI Model Usage At the same government session, President Kassym-Jomart Tokayev expressed dissatisfaction with the uptake of the national large language model, KazLLM. He noted that public interest remains limited, with many users favoring international platforms such as ChatGPT. Madiev acknowledged that while KazLLM is used by approximately 600,000 people, about 3% of the population, foreign AI tools enjoy far broader adoption. He emphasized the importance of ongoing training and updates to local AI models, aligning with global best practices. In addition to KazLLM, a second model, Alem LLM, is also under development. Both systems have already been integrated into numerous digital platforms, including search engines and services targeted at students and IT enterprises.

Healthcare Technology

Kazakh Scientists Launch Medical Exoskeleton for Stroke Rehabilitation

Researchers at Nazarbayev University have completed development and secured state registration for a medical exoskeleton designed to aid stroke rehabilitation. The device is now ready for clinical use and mass production, according to the university’s press service. Named the Astana Gait Exoskeleton Assisted Rehabilitation (A.GEAR), the system is intended to help restore motor function in stroke survivors and individuals with musculoskeletal disorders. It received official certification following a positive evaluation from the National Center for Expertise of Medicines and Medical Devices. Nazarbayev University stated that this is one of the few high-tech medical solutions developed domestically that has received full clinical approval. Cost efficiency is cited as A.GEAR’s main competitive advantage. According to project estimates, the exoskeleton is several times more affordable than foreign alternatives, reducing Kazakhstan’s reliance on imports and increasing accessibility to modern rehabilitation tools. Professor Prashant Jamwal, the project lead, noted that it took just four years to progress from a lab concept to a certified medical product far shorter than the global average of 10 to 15 years. He added that the system could not only replace imported equipment but also reduce public expenditure on rehabilitation technologies. The project began in late 2021 at the university’s Medical Robotics Competence Center. Clinical trials took place in Karaganda and Astana, involving stroke patients and adolescents with cerebral palsy. Following the successful trials, the team began negotiations for a long-term contract with SK-Pharmacy LLP and sought a commercial distributor. Commercialization is being overseen by Robotics and Artificial Intelligence, led by Nazarbayev University graduate Shyngys Dauletbayev. In 2026, the university’s technopark aims to produce at least five exoskeleton units, with plans to scale production for distribution to medical institutions nationwide. University President Professor Waqar Ahmad highlighted that Nazarbayev University researchers rank among the top 2% of scientists globally, based on a bibliometric analysis by Stanford University. According to the Ministry of Health of Kazakhstan, approximately 40,000 people in the country suffer strokes annually, underlining a consistent demand for advanced rehabilitation solutions. As previously reported by The Times of Central Asia, Kazakhstan is also expanding the use of artificial intelligence for early diagnosis of strokes and cancer.

Pakistan

Opinion: The New Silk Road to the Sea – Connecting Central Asia to Karachi and Gwadar

A historic shift is quietly but decisively reshaping the economic geography of Eurasia. On 5 February 2026, Pakistan and Kazakhstan agreed to elevate their bilateral relationship to a Strategic Partnership during the state visit of President Kassym-Jomart Tokayev to Pakistan— the first such visit by a Kazakh head of state in 23 years. This moment marked far more than a diplomatic renewal; it signaled a potential turning point in regional connectivity, one that could unlock long-suppressed economic potential across Central Asia and South Asia by overcoming longstanding geographical and logistical barriers. For decades, Central Asia’s landlocked status has imposed structural constraints on its economic growth. High transit costs, dependence on distant or politically sensitive routes, and extended distances to global markets have eroded competitiveness and limited diversification. These challenges were not the result of a lack of resources or ambition, but of geography itself. However, geography need no longer be destiny. Through strategic foresight—particularly under President Kassym-Jomart Tokayev—Kazakhstan and the wider Central Asian region have begun to convert constraint into opportunity by redefining connectivity. President Tokayev has consistently emphasized connectivity as the cornerstone of Kazakhstan’s long-term economic and strategic vision. During his engagements with Pakistan’s leadership, he demonstrated a clear understanding that sustainable prosperity for Central Asia depends on reliable, cost-effective access to warm-water ports. This conviction underpinned the decision to elevate Pakistan–Kazakhstan relations to a Strategic Partnership, recognizing Pakistan not merely as a bilateral partner, but as a gateway to global markets via the Arabian Sea. From a financial and logistical perspective, the implications are profound. Karachi and Gwadar are among the closest seaports to much of Central Asia, significantly closer than many traditional routes to global markets. Every additional kilometer of overland transit results in higher freight costs, longer delivery times, and reduced margins. By connecting Central Asia to Pakistani ports, Kazakhstan and its neighbors stand to substantially lower transportation costs, enhance export competitiveness, and attract greater foreign investment into manufacturing, mining, agriculture, and value-added industries. The most immediate and strategically sound connectivity model emerging from this partnership bypasses the troubled terrain of Afghanistan, long viewed as a chokepoint for regional trade. Under this framework, goods could move seamlessly from Karachi through Pakistan’s railway network to Haripur, then onward via the Karakoram Highway into China. From there, the cargo would seamlessly integrate with the China–Kazakhstan railway system through the established Dostyk–Alashankou corridor. This route is not theoretical; it builds on existing infrastructure, proven logistics, and political stability across all participating states. Financially, this corridor offers predictability—an essential ingredient for trade and investment. Reduced insurance premiums, fewer delays, and stable regulatory environments translate into lower transaction costs. For Central Asian exporters, particularly Kazakhstan, this means improved access to South Asian, Middle Eastern, and African markets. For Pakistan, it positions Karachi and Gwadar as indispensable nodes in Eurasian supply chains, generating port revenues, transit earnings, employment, and industrial growth. At the same time, Kazakhstan’s leadership has demonstrated pragmatic flexibility by supporting additional connectivity options. Regional discussions have included the possibility...