New Plan to Process Cotton Domestically

The Tajik government’s new strategy for increasing domestic cotton processing will need additional work if it is to address the industry’s main problems, say NBCentralAsia analysts.



On August 4, the government approved a 500 million US dollar programme to transform Tajikistan from an exporter of raw cotton into a textile manufacturer by 2015. The plan is to create the capacity to process up to 208,000 tons of cotton a year by then.



Currently, around 80 per cent of the 150,000 tons of cotton harvested in Tajikistan is exported in unprocessed form. The country’s 18 textile factories cannot handle more than 20 per cent of the crop because their equipment is old and worn out.



According to deputy energy and industry minister Mahmadsharif Haqdodov, this will be resolved by establishing 10 to 15 large textile factories, for which foreign direct investment will be sought.



According to the deputy minister of economic development and trade, Abdughafor Rahmonov, the government has already cancelled eight different taxes and customs levies to attract investors into light industry.



NBCentralAsia economic analysts say this will not be enough – in addition, the government needs to curb corruption to attract investors, to guarantee uninterrupted electricity supplies to the factories, and consider restricting foreign imports of textiles.



Economic analyst Sodiq Ismailzoda says reliable electricity supplies are vital to the cotton industry and the government must find a way around the winter shortages, when supplies are periodically cut off. He recalls that last winter’s energy crisis forced Tajikistan’s largest factory, Kabool-Tajik-Textiles, to shut down for a time and many other businesses suffered heavy losses.



Ismailzoda would also like to see restrictions placed on imports of cheap textiles from China and Turkey, and an end to the bureaucratic barriers that deter foreign investors.



Hojimuhammed Umarov agrees that corrupt bureaucratic practices are an obstacle to investment.



He believes the new strategy may result in a substantial increase in domestic textile manufacturing, but doubts it will achieve its aim of processing all the raw cotton that is grown in the country.



(News Briefing Central Asia draws comment and analysis from a broad range of political observers across the region.)