Page 119 – The Times Of Central Asia

12 Sep 2025

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Opinion: A Railway to the Future – Uzbekistan’s Bold Path to Connectivity and Carbon Cuts

September 12, 2025
By Times of Central Asia

I still remember the thrill of boarding the sleek high-speed train from Tashkent to Bukhara. What could have been an ordinary journey turned into something unforgettable – the kind of experience that stays alive in the memory long after the trip ends. The speed, the comfort, and above all, the hospitality of Uzbekistan Railways revealed more than just modern engineering; it was a glimpse into the vision of a country determined to connect its people and its future to the wider world.

The resonance of this project is deep. The Silk Road was once the artery of global exchange, moving not just goods but ideas, cultures, and entire civilizations between East and West. From Xi’an to Samarkand, Bukhara, and Tashkent, caravans carried silk, porcelain, and paper eastward, while wool, stones, fruits, and glassware travelled west. The CKU Railway is not simply another infrastructure project; it is the revival of this legacy, adapted for the 21st century. By shortening transport routes by nearly 900 kilometers and halving transit times, it promises to transform Uzbekistan’s geographic disadvantage into a strategic strength. For a landlocked country, this is more than steel on tracks – it is a lifeline to global markets.

That is where railways carry an underappreciated advantage. Beyond the economics, rail is also a climate solution. The International Energy Agency (IEA) has found that rail freight is three to four times more energy-efficient than trucks. Trains use 65–80% less fuel per kilogram of cargo. The European Environment Agency calculates that a ton of freight moved by train emits 14–20 grams of CO₂ per kilometer, while the same tonnage on trucks produces 60–120 grams. That is a four- to fivefold difference. If the 20th century belonged to highways, the 21st must belong to railways.

To grasp what this means for Central Asia, consider the region’s emissions profile. According to the EDGAR 2023 dataset, annual greenhouse gas emissions (excluding LULUCF, 2022) stand at roughly 320 MtCO₂e for Kazakhstan, 214 MtCO₂e for Uzbekistan, 99 MtCO₂e for Turkmenistan, 22 MtCO₂e for Kyrgyzstan, and 21 MtCO₂e for Tajikistan. Transport is responsible for around a tenth of that, and road freight dominates. The opportunity for reductions through a modal shift is therefore enormous.

Take Uzbekistan as a case in point. The country moves about 90 billion ton-km of freight annually, within a regional total of some 350 billion. At present, 70% of this moves by road and 30% by rail. Imagine that by 2035, half of current road freight shifts to electrified rail – around 32 billion ton-km. On trucks, that freight would generate 2.9 MtCO₂e per year. On electrified trains, it would produce only 0.54 MtCO₂e. The savings: 2.4 MtCO₂e annually, or more than 1% of Uzbekistan’s entire national emissions. For a single infrastructure project, that is an extraordinary return in climate terms.

The regional potential is just as striking. If similar shifts occurred across Central Asia, annual savings would reach 7–9 MtCO₂e by 2035 – the equivalent of removing two million cars from the road. Projected out to 2050, the cumulative impact could exceed 200 MtCO₂e, a number that should command attention in any discussion of global decarbonization.

What makes this feasible is that Uzbekistan is already ahead. As of 2024, between 52–55% of Uzbekistan’s network is electrified, though the government plans to reach 65% by 2030. With a push to reach full electrification by 2035, this could set a model for its neighbors. Coupled with the country’s vast solar and wind resources, Uzbekistan has the potential to operate a renewable-powered, zero-carbon rail system – a showcase of climate leadership on a global scale.

The implications ripple outward. Shifting freight to electrified rail reduces dependence on imported diesel, strengthening energy security and insulating supply chains from oil price shocks. It cuts logistics costs, making exports more competitive. It diversifies trade routes, reducing reliance on traditional corridors and giving countries more geopolitical autonomy. And it delivers measurable, sector-specific emissions reductions, reinforcing Uzbekistan’s credibility in international climate negotiations.

This is also about relationships. China remains Uzbekistan’s largest trading partner and one of its most important investors. By partnering on the CKU Railway, the two countries are deepening their ties. But critically, they are doing so in a way that embeds climate considerations into infrastructure investment. That is the essence of what the Belt and Road should be in its next phase – a framework not only for connectivity but for sustainability.

When I think back to my own journey from Tashkent to Bukhara, I realize that what impressed me most was not just the technology but the feeling of momentum, of a country on the move. The CKU Railway now promises to extend that feeling across borders, carrying prosperity and resilience in equal measure. The Silk Road once bound continents together with caravans of silk and spices. Today, Uzbekistan is reviving that role, not with camels and caravans but with high-speed, climate-smart railways.

Every kilometer shifted from truck to train is a victory for climate security. Every electrified line is a statement of intent. The steel tracks being laid across Central Asia are not simply infrastructure; they are lifelines of a sustainable future, channels of trust and cooperation, and proof that history can guide us toward a greener tomorrow.

The China–Kyrgyzstan–Uzbekistan Railway embodies this vision. It is a bridge between the past and the future, between economics and environment, between commerce and climate responsibility. It shows that with the right leadership, connectivity and climate action are not opposing goals but reinforcing pillars of progress. For Central Asia, and especially for Uzbekistan, this railway is more than a route. It is a statement of destiny.

The views expressed in this article are those of the author and do not necessarily reflect the official policy or position of the publication, its affiliates, or any other organizations mentioned.

12 Sep 2025

Home, Uzbekistan, Turkmenistan International Affairs, Turkmenistan, Uzbekistan Features, International Affairs, Kazakhstan International Affairs, Turkmenistan Features, Features, Uzbekistan International Affairs, Kazakhstan Featurees

The Power of Siberia 2 Project and Central Asia’s Gas Bargaining Power

September 15, 2025
By Dr. Robert M. Cutler

The proposed Power of Siberia 2 (PoS-2) pipeline from Russia to China has re-entered the headlines on the strength of a new memorandum between Gazprom and CNPC. Russia calls the memorandum “legally binding,” but China has avoided the phrase, because the only thing that is legally binding is an agreement to negotiate.

The memorandum affirms a design capacity up to 50 billion cubic meters per year (bcm/y), a route via Mongolia, and a total trunk length of roughly 2,600 kilometers (km) on the Russian side before crossing Mongolian territory. Feasibility work has highlighted a 1,420-millimeter (56-inch) pipe diameter, and an indicative cost cited in some trade reporting near $13–14 billion.

The political signaling is strong, but pricing terms remain unresolved. For Central Asia, the significance is immediate: even without a final sales contract, the expectation of future Russian volumes tightens China’s negotiating posture with Turkmenistan, Kazakhstan, and Uzbekistan, the three states already connected to China by the Central Asia–China Gas Pipeline (CAGP).

Central Asia’s Gas Supplies to China

China’s westbound import corridor from Central Asia consists today of three parallel pipelines that together provide a nominal capacity of 55 bcm/y (Lines “A” and “B” at 15 bcm/y each, and Line “C” at 25 bcm/y). Construction of the first two lines began in 2008, with operations starting in 2009–2010; Line C entered service in 2014. Line D, planned at 30 bcm/y through Uzbekistan–Tajikistan–Kyrgyzstan to China, has been delayed for years; if completed, it would raise corridor capacity toward 85 bcm/y.

Turkmenistan is the anchor supplier. The Oxford Institute for Energy Studies (OIES) estimates its deliveries to China at 32.9 bcm in 2022 (roughly 81% of the country’s gas exports that year), with long-term sales structured on formulas linked to the price of oil. Interfax reports that in the second quarter of 2025, the price for Turkmenistan’s gas fell below $290 per thousand cubic meters (mcm). This figure is consistent with oil-price linkage rather than hub-indexed European benchmarks. Recent industry and regional reporting puts Turkmenistan’s deliveries averaging approximately 35 bcm/y in the mid-2020s.

Kazakhstan had committed to supply up to 10 bcm/y, but domestic constraints have kept actual flows lower. S&P Global cites 4.4 bcm in 2022 and 5.86 bcm in 2023, with winter interruptions to protect domestic consumers; of the 29.8 bcm of commercial gas produced in 2023, 19.4 bcm was consumed at home.

Uzbekistan’s volumes have been more variable as Tashkent balances domestic demand, imports, and swap operations. Jamestown noted a fall in Uzbek gas export value to China from $1.07 billion in 2022 to $563.5 million in 2023, before a rebound in 2024 and 2025 according to Chinese customs-based press summaries.

PoS-2’s Route, Mongolian Gatekeeping, and Central Asian Implications

The geography of the route matters for Central Asia. On the Russian side, public summaries describe a corridor from Yamal via Urengoy through Krasnoyarsk and Irkutsk, then across Buryatia toward Kyakhta near the Mongolian border. In Mongolia, official communications stress underground installation across the steppes and local economic benefits, but final investment and ownership arrangements remain pending, and the project’s schedule still depends on a binding Russia–China gas sales agreement that has eluded negotiators for more than a decade.

A critical near-term reality is policy prioritization in Ulaanbaatar. In August 2024, multiple outlets reported that Mongolia omitted PoS-2/Soyuz Vostok from its National Development Plan through 2028, signaling caution. In 2025, Russian and Mongolian officials have emphasized progress on the environmental assessment and intergovernmental cooperation, but the earlier omission underscores the project’s non-inevitability.

Prospects for PoS-2 affect Central Asia in three ways. First, it provides a reference for competition: even without physical deliveries, a credible future Russian option of 50 bcm/y gives Beijing bargaining leeway in price talks with Turkmenistan, Kazakhstan, and Uzbekistan. Second, it enables Chinese portfolio hedging by providing a stabilizer against spot volatility in LNG procurement cycles. Third, the Mongolian gating window gives other suppliers leverage, as physical gas remains years away.

Geography and System Interaction

There would be significant system-level changes if PoS-2 were to proceed. First, the entry-point would shift, as would China’s reliance on the single Xinjiang entry for Central Asian gas. Second, a new corridor would increase China’s flexibility to arbitrage among LNG, PoS-1, PoS-2, and CAGP inflows. Third, Mongolian transit would decrease the relative strategic premium of Central Asian transit.

The hardest commercial issue for PoS-2 has always been price. Europe historically provided Russia with high profitability metrics on pipeline gas. China has resisted paying European-like prices for Siberian volumes, preferring oil-linked formulas. The latest memorandum trumpets route and capacity while avoiding a published price formula. Pricing remains unsettled: a core reason why PoS-2 has slipped repeatedly.

Yet China’s westbound pipeline system already gives Beijing physical optionality across three Central Asian suppliers, with Turkmenistan dominant by volume. The existing 55 bcm/y corridor, and the possibility of even a delayed Line D, would expand China’s portfolio negotiating space even before any Russian gas arrives via PoS-2.

Lessons for Central Asia

Central Asian gas diplomacy has usually been bilateral. A shift toward “managed oligopoly” involving coordinated production, synchronized maintenance, and aligned transit rules would change the arithmetic for Beijing. Even rudimentary steps could have an effect. The distant prospect of PoS-2 increases the penalty for disunity, because even the shadow of 50 bcm/y of Russian gas magnifies China’s walk-away option.

For Central Asia, this matters in two ways. First, every month without a Russia–China price is a month when Turkmenistan can stress proven delivery, Kazakhstan can sell seasonal firmness, and Uzbekistan can market reliability. Turkmenistan’s own contracts, linked to oil price, and the recent realized price under $290/mcm illustrate that Central Asian sellers already work within a pricing regime that fits Beijing’s preferences.

The bottom line for Central Asia is that their leverage resides not in hypothetical flows from Russia that lack a public price formula, but rather in what already flows and what Mongolia has not yet approved. The Central Asian governments can convert this reality into improved terms by emphasizing dependability, modest coordination, and credible optionality. Together, these tactics aggregate into a strategy that will determine whether PoS-2 functions as a long-term constraint on Central Asian gas diplomacy or as a short-term bargaining chip that Central Asia turns to its own advantage.

12 Sep 2025

Home, Environment, Kyrgyzstan Environment, Kyrgyzstan

Earthquake Shakes Bishkek; No Major Damage Reported

September 12, 2025
By Stephen M. Bland

A magnitude-4.3 earthquake struck near Besh-Kungey, about 19 km southeast of Bishkek, on September 12, 2025, at around 2:00 PM local time. The quake was very shallow – just 1 km deep – making its tremors strongly felt across the city.

Local media outlet AKIpress described the quake as “strong,” with residents reporting shaking windows, rattled dishes, and minor panic, though no serious damage or injuries have been confirmed. The tremor’s intensity surprised many, given its moderate magnitude. No statement has yet been issued by the Kyrgyz Seismological Service confirming the depth or epicenter of the quake. Seismo.kg lists the event among recent felt tremors, but details remain scant.

While the earthquake was clearly perceptible, especially in Bishkek, there are so far no reports of serious damage, injury, or casualties. Local authorities are monitoring the situation. Given Kyrgyzstan’s high seismic risk and known vulnerability in older or poorly constructed buildings, experts caution that even moderate quakes could carry elevated risk for such structures.

This event underscores the seismic risk facing areas along fault lines in Central Asia. Though moderate in scale, it serves as a reminder of the importance of earthquake preparedness and resilient infrastructure in seismic zones.

11 Sep 2025

Local Politics, Kazakhstan Local Politics, Kazakhstan, Opinions, Kazakhstan Opinions

Opinion: Kazakhstan in the Digital Era: Human Capital and AI as Foundations for Regional Leadership

November 12, 2025
By Times of Central Asia

On September 8, in his annual address to the nation, President Kassym-Jomart Tokayev outlined key initiatives in forming a new institutional framework for the country’s digital transformation. These steps signify a qualitative shift from fragmented digital solutions to a more systemic approach to artificial intelligence and advanced technologies.

A New Phase: Institutionalizing the Digital Agenda

The Ministry of Artificial Intelligence, to be established by presidential order, will become a specialized government body responsible for developing, implementing, and monitoring AI policy. The ministry’s core task will be to balance innovation with risk oversight, including ethical, economic, and social considerations.

A Digital Code, to be adopted, will serve as the primary legal instrument in the digital sphere. It will consolidate norms relating to personal data, digital rights, AI regulation, electronic platforms, and digital identity. This will enable Kazakhstan to move from fragmented legislation to a codified, resilient legal system for the digital economy.

The State Digital Asset Fund under the National Bank is being established to build a crypto reserve and finance key digital infrastructure projects. This model promotes independent financing for innovation, with a focus on sovereignty, resilience, and long-term investment.

The Regulatory Intelligence Center, also announced in the address, will act as a ‘policy lab’ for testing new regulatory models within the digital economy.

The town of Alatau, envisioned as a national hub of innovation and business activity, is set to become the first fully digital city in the region, combining advanced Smart City technologies with a highly livable urban environment. President Tokayev’s address emphasized the need to establish a special legal status for Alatau City via presidential decree, granting it direct subordination to the government, followed by a dedicated law regulating its governance and financial model.

Drawing inspiration from global examples such as Shenzhen, the project will involve a leading Chinese company that participated in building that renowned technopolis.

As the president underlined, this special legal status is not a privilege, but a necessary institutional tool, without which the vision of Alatau City risks remaining on paper. The city is intended to become a symbol of Kazakhstan’s future, reflecting the country’s technological ambitions and commitment to human- centered innovation.

The use of the digital tenge, the National Bank’s digital currency, also deserves attention. It is already being used to fund projects through the National Fund. In his address, Mr Tokayev instructed that its use be expanded across the entire public finance system, including national and local budgets and state holdings. The digital tenge is thus becoming not only a technological innovation, but also a tool of macroeconomic policy, supporting a more flexible and digitally-driven financial model.

All of these initiatives are integrated into the national program Digital Kazakhstan, the update and redesign of which has been assigned to the government. The renewed program will span key areas, from artificial intelligence and digital education to infrastructure and cybersecurity, reflecting Kazakhstan’s pivot toward a fully digital transformation.

These steps create a system-wide architecture for integrating AI into the economy, education, governance, and infrastructure. For the first time in Kazakhstan’s history, digitalization and artificial intelligence are gaining a clear institutional framework and becoming key pillars of sovereign development policy.

Over the past few years, Kazakhstan has positioned itself as a country striving to become the digital hub of Central Asia. Strategic government documents, presidential initiatives, and the rapid development of the national IT ecosystem are shaping a positive image of a nation that moves in sync with global digitalization trends.

Kazakhstan’s Position in Global Digital Rankings

Kazakhstan’s performance in international digital indices shows steady and confident progress:

In the 2024 UN E-Government Development Index (EGDI), Kazakhstan ranked 24th out of 193 countries, placing it among the top 10 nations for Online Service Index (OSI) alongside global leaders like South Korea, Denmark, and Estonia. The country surpassed China, Germany, and Australia, and is now on par with France and Japan in terms of digital service quality.

In the IMD World Digital Competitiveness Ranking 2025, Kazakhstan ranked 34th out of 69 economies, showing marked improvement in the Future Readiness category, which reflects preparedness for adopting new technologies.

In the 2024 Global Innovation Index, Kazakhstan ranked 78th among 133 countries, while placing in the top three in Central and South Asia, alongside India and Iran, a testament to Kazakhstan’s growing regional competitiveness in innovation.

This upward trajectory reflects Kazakhstan’s move toward a coherent national digital agenda, creating new opportunities for integration into global value chains.

Digitalization as a Driver of Systemic Development

International organizations increasingly view digitalization as a lever for structural transformation. A 2025 OECD review, based on theoretical literature and early empirical data, emphasizes that AI is emerging as a General-Purpose Technology (GPT), capable of driving productivity and innovation, but only with thoughtful deployment and agile regulation.

Another OECD study across 21 countries shows that the growth of digital financial services, including fintech ecosystems, directly contributes to efficiency gains across other sectors.

Country-specific experiences also illustrate the value of integrated approaches. A 2024 study by the Asian Productivity Organization highlights how Bangladesh, Cambodia, and India have leveraged digital agriculture solutions and SME programs to boost employment, productivity, and human capital simultaneously.

As Alikhan Baimenov, Chairman of the Steering Committee of the Astana Civil Service Hub, notes: “New technologies enhance the value of human capital” and highlight the need for professionals who can thrive in complex, fast-changing environments.

In his book Public Administration in the New Reality (2025), Baimenov argues that modern public service demands a new kind of civil servant, adaptable, analytically savvy, and capable of operating under uncertainty.

The Global AI Effect: Productivity, Inclusion, and Risk Management

The OECD’s 2025 report highlights that generative AI can significantly increase performance, with gains of up to 25% in support services, programming, and consulting. Interestingly, the largest benefits are seen among less experienced users, while seasoned professionals benefit only when AI complements their expertise. The report stresses the importance of understanding AI’s limitations, evaluating its output, and ensuring human oversight, which requires enhanced digital literacy and institutional safeguards.

According to the IMF (2025), the benefits of AI are highly uneven. Advanced economies already enjoy major advantages in infrastructure and data access, while many emerging markets and low-income countries lag behind. However, the IMF’s Working Paper WP/2025/076 emphasizes that developing economies can close the gap by investing in digital infrastructure, human capital, and open access to AI tools and datasets. Kazakhstan, categorized as an emerging market, ranks in the middle tier for AI readiness, above India and Vietnam, but below Malaysia and China.

Ultimately, a balanced approach, blending technology investment, flexible governance, and education, is key to sustainable leadership in the AI era.

Kazakhstan’s key initiatives in digitalization and artificial intelligence

The development of KazLLM, the first Kazakh-language large language model, introduced in 2024, marked a symbolic milestone: Kazakhstan is not merely adopting foreign technologies, it is creating its own.

In 2025, updated versions of Sherkala (8B) and Sherkala-Chat (8B) were released, multilingual LLMs based on LLaMA 3.1, specifically fine-tuned for the Kazakh language. These models have shown strong results across NLP benchmarks in Kazakh, Russian, and English. They address the lack of digital tools for Kazakh-language processing and strengthen its presence in the global digital environment.

Also in 2025, Central Asia’s most powerful supercomputer, capable of up to 2 exaflops, began operating in Astana. Integrated into the Alem.cloud platform, it now serves as the backbone for Kazakhstan’s national AI development.

The launch of Alem.AI, an international artificial intelligence center, further reinforced Kazakhstan’s ambitions. It supports AI innovation, startup incubation, applied research, and capacity building, with plans to train up to 200,000 citizens annually in AI-related skills. The center also fosters international collaboration and knowledge exchange between Kazakhstani and foreign experts.

Banking as a Digital Transformation Engine

Leading players such as Kaspi.kz are at the forefront of a transformation in banking. The company’s “super app” combines payments, e-commerce, transport, and public services, effectively making it a component of the country’s digital infrastructure.

Globally, this mirrors a dual trend, on one hand, institutions like the OECD and FSB note the rapid integration of AI into finance, from fraud prevention to improved customer service through ML and generative AI.

On the other hand, they underscore the need for robust digital infrastructure, higher digital literacy, and ethical regulatory frameworks to mitigate systemic risks and build public trust.

For Kazakhstan, already in the top three Central and South Asian countries in the 2024 Global Innovation Index, these insights offer valuable direction.

Kazakhstan’s fintech ecosystem and government service digitalization now position the country not only to follow global trends but to scale its solutions across Central Asia.

Human Capital: The Core of Kazakhstan’s Digital Strategy

Education and talent development are the foundation of transformation. Kazakhstan emphasizes that people are the main drivers of transformation.

A flagship initiative, Al Sana, aims to engage up to 100,000 students in high-tech and innovation projects. Alongside Qazaq Digital Mektebi, it builds a system of continuous digital education starting from the school level.

Kazakhstan has made AI education a national priority. In 2024, 15 universities launched AI courses with Google’s support. By 2025, all 93 universities in the country had made AI a compulsory subject. Additionally, 20 more universities opened 25 specialized educational tracks, demonstrating rapid expansion of digital competencies.

As part of the Tech Orda program, almost 10,000 IT professionals have received free education in the field of information technology.

In October 2025, Astana will open a TUMO Center for Creative Technologies (ages 12–18), hosted by the Alem.AI center, teaching youth creative and digital skills.

The Tomorrow School project pilots peer-to-peer learning models and digital tool integration in the classroom.

International research supports early involvement in STEM. For instance, a retrospective analysis of the Stony Brook University (USA) program showed that 92% of participants completed STEM degrees and pursued careers or graduate studies in related fields.

Kazakhstan’s Emerging Digital Labor Market

Kazakhstan is witnessing the emergence of a new digital labor segment. According to a pilot analysis of 39 open vacancies (hh.kz, July 2025, used as “illustrative material”), there is growing demand for specialists in: Programming languages: Python, Go, Java, Kotlin, Scala, Data science and analytics, Networking, DevOps, Kubernetes, Docker, Cybersecurity, SRE (Site Reliability Engineering), CRM systems, process automation, and no-code platforms.

These job descriptions often combine technical and soft skill requirements, such as teamwork, communication, analytical thinking, and stress resilience. This aligns with LinkedIn’s Global Talent Trends 2024, where 92% of talent professionals said that soft skills are as important as hard skills.

While preliminary, this data suggests Kazakhstan’s labor market is becoming more aligned with global demand, and businesses are increasingly willing to invest in workforce development.

Kazakhstan’s Digital Nomad Strategy

A standout initiative is Kazakhstan’s effort to attract digital nomads. In 2024, the country introduced the Neo Nomad Visa, allowing remote workers with a verified income of $3,000/month to live and work in Kazakhstan. In 2025, the government launched a new B9 residence permit option for long-term stays.

This policy mirrors global best practices. By 2024, over 40 million digital nomads were working remotely worldwide, seeking countries with advanced digital infrastructure. With global competition for talent intensifying, Kazakhstan is offering timely and competitive solutions to attract professionals and integrate into the global digital economy.

Building the Architecture of Digital Sovereignty

Kazakhstan is adapting swiftly to the demands of the digital age. The commitment to becoming a fully digital nation is reflected in several bold initiatives: Establishment of the Ministry of Artificial Intelligence and Digital Development (at Deputy Prime Minister level), accelerated adoption of the Digital Code, expansion of the digital tenge (national e-currency) to all budget levels, launch of the State Digital Assets Fund (as a crypto-reserve), construction of Alatau City, a fully digital urban district, mass-scale digital literacy and workforce training.

These initiatives lay the foundation for institutional and financial architecture of digital sovereignty.

Toward Eurasian Digital Leadership

Grounded in strategic national vision, informed by global expertise, and guided by localized analysis, Kazakhstan is not merely keeping pace with global trends, it is shaping its own model of digital leadership in Eurasia.

This model is globally engaged, yet rooted in national priorities and innovation potential.

If implemented consistently, Kazakhstan has every chance to reinforce its strategic foundations and emerge as one of Eurasia’s leading digital and innovation centers, open to the world and attractive to global talent.

***

The views expressed in this article are those of the author and do not necessarily reflect the official policy or position of the publication, its affiliates, or any other organizations mentioned.

11 Sep 2025

Cultural Heritage, Silk Road Treasures, Central Asia, Home, Life & Culture, Kazakhstan Life & Culture, Kazakhstan, Features, Kazakhstan Featurees, Kazakhstan Home

“A Road Not for the Faint-Hearted”: How Austrian Prisoners of War Built a Tourist Path in East Kazakhstan

September 11, 2025
By Vagit Ismailov

A winding mountain road in East Kazakhstan has become a point of fascination not only for tourists but also for historians, filmmakers, and researchers. Known variously as the Old Austrian Road, the Austrian Route, or Irek Zhol (“Winding Road”), this nearly 50-kilometer path connects the Katon-Karagai and Markakol districts, cutting through pristine wilderness in a national park and a state reserve. Today the path is being restored, but the road’s true value lies in a dramatic and little-known past that stretches back over a century.

A New Chapter for an Old Road

In July 2025, authorities announced the launch of extensive repair work on the Old Austrian Road. With a budget exceeding $1 million from the regional government, the project includes rebuilding a damaged bridge near Katon-Karagai, replacing culverts, reinforcing slopes, and rehabilitating impassable sections.

The most challenging terrain lies near Lake Markakol, where the route crosses swampy stretches, sharp switchbacks, and granite outcroppings. Yet these obstacles have not deterred growing numbers of visitors, off-road enthusiasts, cyclists, hikers, and even horse riders, eager to explore the wild beauty of Eastern Kazakhstan.

Image: TCA/Yulia Chernyavskaya

The Road’s Origins in War and Captivity

Though few know it, this scenic mountain route has deep strategic and historical roots. Long before the 20th century, locals used it as a trail for horses and carts. But by the early 1900s, the Russian Empire decided to formalize the path, partly due to the road’s proximity to the Chinese border.

Between 1914 and 1916, the road was reconstructed, largely by Austrian prisoners of war, mainly ethnic Czechs, Slovaks, Hungarians, and Galicians, captured during World War I. According to Vienna-based historian Lana Berndl, who has conducted extensive research on the topic, roughly 800 prisoners were transported from Austria via St. Petersburg and Omsk to the Irtysh River and then forced to march to the village of Altai (now Katon-Karagai). Around 600 reached their destination.

Construction began simultaneously from Katon-Karagai and Alekseevka. Despite working only in the warmer months, the prisoners built a road whose difficulty rivals Alpine passes. During the harsh winters, many worked on local farms and integrated into village life. Some even married and remained in Kazakhstan permanently.

Image: TCA/Yulia Chernyavskaya

Tragically, several were later repressed during Stalin’s purges. Among them was Ludwig Fritzen, a Hungarian prisoner who stayed, married a local woman, and was executed in 1937 after being accused of espionage.

Remnants of this history remain: roughly 30 graves with Gothic-scripted crosses can still be found in old cemeteries throughout the region, silent testimonies to those who built the road under extreme duress.

Film Rekindles Forgotten History

In 2016, Austrian filmmaker Ruslana Berndl released a documentary titled The Austrian Road, which brought global attention to the forgotten story. She first learned about the road from a brief mention in a German travel guide that described it as “not for the faint-hearted” and built by Austrian POWs.

Intrigued, Berndl, then a doctoral student at the University of Vienna’s Institute of History, traveled to Kazakhstan. Her documentary, based on interviews with descendants, local elders, and on-the-ground research, was screened in Austria, Germany, Switzerland, Greece, and cities across Kazakhstan, including Almaty, Ust-Kamenogorsk, and Altai (formerly Zyryanovsk).

Berndl noted the difficulties in uncovering the truth. “There is no specific list of those who built the road. Some records exist, but access to the NKVD and KGB archives remains restricted,” she said during a 2016 screening.

Image: TCA/Yulia Chernyavskaya

Her film managed to reveal the identity and fate of Ludwig Fritzen, one of the road’s builders, and helped raise broader awareness. Following its release, interest in the road surged dramatically. At the time, rumors even circulated that Arnold Schwarzenegger’s great-grandfather may have been among the prisoners involved in its construction.

A Journey Through Nature and Memory

The Old Austrian Road is not only a historical monument but also one of Kazakhstan’s most stunning natural routes. It winds past Lake Markakol, the Kara-Koba River, and the Burkat Pass (2,141 meters), offering sweeping views of the Bukhtarma Valley. Adventure travelers describe it as a place where history and nature collide in breathtaking fashion.

“It’s something inside you,” said Olga and Igor Chernenko, frequent visitors to the road. “It’s not just a road, it’s the breath of the earth. You feel like you’re driving into the past. One mistake, and you’re looking at cliffs and ravines. It’s fear and admiration at the same time.”

With renewed attention from tourists and historians alike, the Old Austrian Road stands as a rare fusion of natural beauty and poignant historical memory, one that continues to challenge, inspire, and endure.

11 Sep 2025

Home, Business & Economy, Kazakhstan, Kazakhstan Business & Economy, Features, Kazakhstan Featurees

Kazakhstan Factories Under Strain as Costs Bite, Economy Shows Mixed Signals

September 17, 2025
By Stephen M. Bland

Kazakhstan’s manufacturing sector slipped further in August, with the latest Purchasing Managers’ Index (PMI) falling to 47.9. That was down from 49.9 in July and 49.7 in June, keeping the index below the neutral 50 mark for a third straight month. It also marked the sharpest deterioration in manufacturing activity since March 2022, according to S&P Global and Freedom Holding Corp.

From Highs to Lows

The striking downturn comes on the heels of a banner year. In December 2024, the PMI reached a record 53.9, capping 11 straight months of expansion. Buoyed by post-pandemic recovery and government support, manufacturing output grew by 6.8% in 2024, the fastest pace since 2011, helping push GDP growth to 5%.

But momentum cooled as 2025 began. The PMI slipped to 51.5 in January, reflecting slower expansion after the year-end surge. By June and July, it hovered just under 50, signaling stagnation. Seasonal shutdowns for repairs in August contributed to weaker output, but analysts say the slide points to deeper structural pressures.

Kazakhstan’s PMI peaked at 53.9 in December 2024 but slid steadily through 2025, falling into contraction territory below 50 by mid-year and hitting 47.9 in August — the sharpest deterioration since March 2022.

Orders Dry Up, Costs Rise

The August report revealed broad-based weaknesses. New orders fell for the first time in 19 months, ending a growth streak that began in early 2024. The decline reflected lower demand from both domestic and export markets. With fewer orders, factories scaled back staffing and cut input purchases.

At the same time, costs surged. A weak tenge and fuel inflation made imports more expensive, while logistics delays lengthened supplier delivery times. These pressures forced firms to raise output prices at a faster pace, risking competitiveness.

“August saw another sharp decline in business activity in Kazakhstan’s manufacturing sector,” said Yerlan Abdikarimov of Freedom Finance Global, which partners with S&P on the survey. He cited weak demand, volatile commodity markets, rising costs, and currency and tax pressures.

Taxes have indeed become a burden. A new code passed in mid-2025 raised the extraction royalties on metals, hitting downstream metallurgy. Inflation stood at 12.2% in August 2025, with the National Bank keeping its policy rate high at 16.5% in a bid to tame prices. That leaves financing costly for businesses, resulting in squeezed margins and thinning confidence. The August survey showed business confidence at its lowest since 2021. While firms still expect growth over the next year, their optimism is increasingly cautious.

Industry Responses and Government Initiatives

Some executives see hope in the government’s industrial policy. A $400 million cotton-to-textile cluster is under construction with Chinese partners in Turkestan, aiming to process domestic cotton into textiles at scale. Officials say the project, due to start production by late 2025, will create thousands of jobs and expand exports. Light industries, such as textiles and apparel, posted strong growth in the first half of 2025, with clothing up about 5.6% and textiles 5.7% according to official data. Chemicals and construction materials also expanded, though these gains risk being overshadowed if the overall PMI remains in contraction.

In the meantime, many companies appear to be conserving cash and pushing for reforms such as tax relief or export incentives. The government has emphasized macro stability while promoting diversification projects, a balancing act that may not provide immediate relief.

Regional Comparisons

Kazakhstan’s struggles stand out in the region. Uzbekistan reported its industrial sector grew by about 6.5% in the first quarter of 2025, as overall GDP rose 6.8% year-on-year, while forecasts for the year remain firm at around 6.5–6.7% growth. Construction, services, and exports have been expanding, with the Center for Economic Research and Reforms reporting that Uzbekistan’s Business Activity Index jumped 15.9% in July 2025 and a further 2.9% in August, indicating sustained momentum.

Kyrgyzstan has also reported robust growth, with its composite business-activity index rising to 60.9 in spring 2025, powered by strong performances in agriculture, trade, and services. While not a pure manufacturing PMI, the index signals broad economic momentum and underscores the contrast with Kazakhstan’s manufacturing downturn.

Kazakhstan’s PMI of 47.9 contrasts with Uzbekistan’s 6.5% industrial growth index (106.5) and Kyrgyzstan’s business activity index of 60.9, highlighting the country’s relative slowdown compared with its Central Asian neighbors.

The difference lies partly in structure. Kazakhstan’s manufacturing is heavily tied to metals and heavy industry, leaving it vulnerable to global price swings and taxes, while its neighbors benefit from more diversified or service-led growth. This structural gap means that while Kazakhstan’s factories are exposed to volatility in commodities; over half of its exports are oil-based, while its neighbors are seeing growth driven more by services, construction, and manufacturing, which smooths out external shocks.

Outlook: Balancing Risk and Opportunity

The International Monetary Fund projects Kazakhstan’s GDP growth at 4.9% in 2025, backed by strong mining and industrial output. Government plans include implementing 190 new industrial projects in 2025 worth about 1.5 trillion tenge ($2.78 billion) and expected to create more than 23,000 permanent jobs, with dozens already launched in metallurgy, chemicals, and special economic zones. Services and construction also remain resilient, helping to offset pressure in manufacturing. External conditions may provide some relief: global commodity prices have steadied, and the tenge regained ground in early September. A rebound in Russian or Chinese demand could also support factory orders.

Despite weak PMI readings, recent macro data paints a more nuanced picture. Industrial output expanded by 6.9% in the first seven months of 2025, driven by mining and manufacturing. Mining expanded 8.5% in the first seven months of 2025, though there are indications that growth could moderate later in the year. Overall GDP grew by 6.5% through the first eight months of 2025, supported by trade, industry, construction, and services. At a policy level, the government has introduced a Register of State Support Measures with over 100 tools to assist businesses, while reforms to special economic zones and new investments in rare-earth production reflect efforts to diversify and add value.

Significant risks remain, however. Persistently high inflation could keep borrowing costs elevated, limiting investment, while any downturn in global markets would weigh on exports. Analysts caution that recovery will depend on stabilizing the macroeconomic environment and ensuring that planned projects move from blueprints to production.

For now, the August PMI data serves as a wake-up call. A sector that was expanding just months ago is now under pressure from weaker demand, rising costs, and tighter financing. Kazakhstan’s path forward will depend on whether policymakers can restore stability while accelerating diversification, turning long-term industrial plans into real output gains.