Uzbekistan to expand intensive orchards to boost food exports

Uzbekistan currently has 572,600 hectares of orchards and vineyards, generating $1 billion in annual exports and providing income for 882,000 people. The country aims to raise food exports to $10 billion by 2030, with the expansion of intensive industrial horticulture expected to play a key role in achieving this target.

The meeting reviewed the condition of existing orchards and vineyards. At present, 61,000 hectares of outdated orchards and 18,000 hectares of low-yield plantations require renewal. In some regions, such areas produce only around 5 tons per hectare, while annual income does not exceed UZS 10 million.

Officials cited Pop district, which has 1,200 hectares of old and unproductive orchards. It was said that yields and profitability could be significantly increased by planting export-oriented varieties and developing agri-logistics centers for drying, sorting, and packaging. They also pointed to an 84-hectare cherry orchard in the district as an example of intensive horticulture, where even young trees that have not yet reached full fruit-bearing capacity yield up to 7 tons per hectare, while produce is exported at around $8 per kilogram.

In this context, a new system for managing old and unsuitable orchards was proposed. The specialized agency would be authorized to issue assessments declaring orchards and vineyards unsuitable, establish industrialized orchards in their place, or reclassify such areas as arable land. If industrialized orchards are not established within 12 months, land and water tax rates will be increased, while continued non-compliance for another 12 months could result in restrictions on water use.

The president also stressed the need to digitalize land-use oversight. Authorities were instructed to introduce a satellite-based information system to monitor both outdated and newly established industrial orchards.

Support for households and farms was also highlighted. Households will be offered up to 50 seedlings or loans of up to UZS 2 million, while farms may receive loans of up to UZS 150 million for orchard renewal projects.

Over the next two years, Uzbekistan plans to establish 168,000 hectares of industrial orchards and vineyards. The initiative is expected to attract $2 billion in investment and create 258,000 jobs.

Nine commercial banks would be assigned to the regions to finance and support these projects. Alongside transferring ready-to-operate industrial orchards to entrepreneurs, the banks are set to provide agrotechnical, financial, and organizational support over a two-year period.

A separate support mechanism for entrepreneurs establishing intensive orchards was also approved. Under the scheme, Agrostar companies in the regions will work with entrepreneurs on an equity basis. Agrostar will hold up to a 50% stake through cash contributions, while entrepreneurs will contribute land lease rights.

Entrepreneurs will be allowed to gradually buy out Agrostar’s stake over seven years without revaluation. The system will also allow owners of old orchards to gradually repurchase shares using income generated from renewed orchards, ultimately becoming sole owners.

To implement such projects, banks will provide loans of up to UZS 120 million per hectare for 7 years, including a 3-year grace period, at an annual interest rate of 10%. If repaid on time, the state will cover half of the interest costs. In addition, UZS 5 million per hectare will be allocated over three years to support maintenance costs for industrial orchards.

Entrepreneurs will also be able to use Islamic finance instruments to acquire water-saving technologies, fruit seedlings, and agricultural machinery.

The meeting also approved proposals, including a zero VAT rate on fruit seedlings and rootstocks, and a UZS 1 water fee for orchards using water-saving technologies for five years.