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Karakalpakstan (a sovereign republic within Uzbekistan) will become the first region to introduce a new system for supporting intellectual projects and startups. In particular, an IT university and a technopark will be established on the basis of the Youth Socio-Economic Center. In addition, $5 billion in foreign investment is planned to be attracted for the development of artificial intelligence (AI) and data processing technologies.
These initiatives were discussed at a meeting on improving quality of life in the region chaired by President of Uzbekistan Shavkat Mirziyoyev, according to the presidential press service.
Continuing the topic, the head of state instructed officials to launch 10 startup projects worth $1 million each and to allocate 30 billion soums (approximately $2.5 million) annually from the Science Financing and Innovation Support Fund for these purposes.
Other sectors of the economy were also reviewed. In particular, by the end of 2027 it is planned to establish in Kungrad an Aral International Logistics Center meeting international standards, which will operate with the status of a “dry port.”
According to the president, 150 billion soums ($12.3 million) will be allocated this year for infrastructure projects in Karakalpakstan. In subsequent years, an additional 2.2 trillion soums ($181 million) will be directed toward improving centralized water supply. Another $200 million will be attracted for the construction of drinking water and sewage networks, water distribution and treatment facilities, and roads.
It was noted at the meeting that the republic, which possesses significant mineral reserves, has enormous investment potential. Over the past eight years, major changes have taken place. Whereas the region previously ranked last in Uzbekistan in terms of per capita economic output, it has now risen to seventh place. The share of industrial exports increased from 4% to 30%, and total exports of goods and services more than tripled to $2.1 billion.
However, the authorities emphasized the need to accelerate growth further. Over the next five years, the region’s economy is expected to expand to 102.5 trillion soums ($8.4 billion), compared to 54.3 trillion soums (about $4.5 billion) in 2025. Projects in industry and services totaling $7.2 billion are also planned.
Exports, which reached $435 million last year, are targeted to grow to $900 million.
Reforms are expected to have a tangible social impact. By the end of this year, unemployment is to be reduced to 4.2% and poverty to 3.2%. The city of Nukus, the Kungrad and Chimbay districts, as well as 109 mahallas (local communities) across Karakalpakstan, are to become territories free of unemployment and poverty.
The president supported extending previously granted incentives aimed at attracting investment and fostering entrepreneurship in the region. With this in mind, a new target has been set to increase foreign investment 2.5 times. Last year, the figure stood at $2.5 billion.
Mirziyoyev was also briefed on the most promising projects, including initiatives in IT, light industry, automotive manufacturing, and gold and coal mining.
Special attention was paid to the rational use of land resources, as around 16 million hectares remain unused. It was decided to identify crops suitable for the local climate, conduct cultivation experiments, grow medicinal herbs in demand in pharmaceuticals, and develop livestock breeding in designated areas. To oversee the program, a new position of Deputy Chairman of the Council of Ministers of Karakalpakstan for the efficient use of pastures and livestock development will be introduced.
Tourism is expected to become a key driver of the regional economy. A tourist and recreational zone will be created near the Barsakelmes salt deposit, and glamping areas (a form of outdoor recreation combining hotel-level comfort with proximity to nature) will be developed in locations resembling Martian landscapes in the Aral Sea region and on the Ustyurt Plateau. Plans also include modernization of the Aral Sea History Museum.
Local officials have been tasked with attracting 500,000 foreign tourists and 3 million domestic tourists to Karakalpakstan this year. Tour operators actively bringing visitors to the republic will be granted additional incentives.
