Uzbekistan has approved a plan to attract up to $400 million in foreign loans to finance the purchase of agricultural machinery and equipment, according to a presidential decree signed on March 13.
The initiative is intended to increase the level of mechanization in the agricultural sector, with particular emphasis on cotton harvesting. Officials have set a target of achieving a 70% share of machine-assisted cotton picking in 2026, aiming to improve efficiency and reduce labor intensity.
Under the decree, commercial banks will distribute foreign credit lines provided under state guarantees to farmers and agricultural enterprises. The loans will have a maturity period of up to 10 years, including a two-year grace period. Interest rates will be set at the Central Bank’s base rate plus a 4% margin charged by participating banks.
Payments for cotton and grain harvesters supplied through these preferential loans and leasing arrangements in 2026 will be scheduled twice a year, on January 31 and July 31.
Uzbekistan has officially abolished Soviet-era practices of forced labor and eliminated state cotton production quotas in 2020. The government has also cooperated with the International Labour Organization to monitor labor conditions in the sector.
In March 2022, the international coalition Cotton Campaign lifted its boycott of Uzbek cotton, citing the elimination of systemic forced labor that had previously prompted more than 330 global brands to avoid sourcing from the country.
