Clusters to receive more opportunities for development
Tashkent, Uzbekistan (UzDaily.com) - A video conference on the development of the cluster system in agriculture was held on 27 October under the chairmanship of President Shavkat Mirziyoyev.
At the beginning of the meeting, Shavkat Mirziyoyev expressed gratitude to our people for their support in the elections of the President of the Republic of Uzbekistan and assured that all the goals and objectives set in the election program will be implemented.
In particular, big plans have been identified in the direction of agriculture. Over the next five years, it is planned to increase yields by at least 2 times, ensure deep processing of raw materials, increase exports to US$7 billion, and increase employment and incomes of the population.
In this case, the leading role is assigned to clusters. This system, in a short time, created the basis for great changes. Thus, in cotton growing alone, fiber processing increased 2.5 times and reached 100 percent. In addition, the production of yarn has doubled, finished products - tripled, their exports by the end of the year will reach US$3 billion.
Some 125 new enterprises were created with a full production cycle with a total value of US$2 billion and 150 thousand permanent jobs.
The clusters brought more than 5 thousand units of high-performance equipment, introduced water-saving technologies on 126 thousand hectares.
This innovative approach also increases productivity. Many clusters have harvested 35-40 centners of cotton per hectare this year.
The head of state stressed the need to continue this work and expand the capabilities of clusters to increase productivity in agriculture and the agro-industrial complex.
At pre-election meetings on the ground, farmers and dehkans, cluster leaders voiced many of the problems they face. These issues were systematized and proposals for their solution were developed.
“The main problem is the outdated method of financing,” the President said. - It does not meet the requirements of the industry development. Cotton-textile clusters ask for longer loan terms and increased amounts. Currently, loans to clusters are provided for a period of 11 months. It takes at least 24 months to grow and process raw cotton. Although the preparation of the land for planting begins in October, the loan is considered for 3-4 months and is allocated from January to February. This old system will now be completely overhauled.
As noted at the meeting, now funding for the harvesting of cotton will begin with the beginning of arable land, that is, in October. From now on, loans to clusters will be allocated for a period of 24 months, and their grace period will be increased from 11 to 18 months.
The cluster will repay the loan after the raw materials are converted into finished products - not earlier than they will be processed into yarn or fabric. 10 trillion soums will be allocated from the budget for the implementation of this system. To this end, an additional US$100 million will be allocated to the Agriculture Support Fund by the end of the year.
Financial grants in the amount of 1 million soums per hectare of cotton fields will be allocated for measures such as increasing soil fertility and productivity, switching to new irrigation technologies, protecting plants, creating modern laboratories, training farmers.
The Ministry of Finance and the Central Bank were instructed to introduce the specified system.
It is planned to increase the level of yarn processing in clusters from the current 50 to 70 percent in the next two years. In this regard, new cluster support mechanisms have been announced.
So, for the purchase of equipment for dyeing fabrics and the production of mixed fabrics, financial grants are provided from the state, depending on the capacity of the enterprise. Another US$150 million will be allocated to finance such projects.
A new US$100 million low-rate credit line will be opened by the government to support the export of dyed fabric and finished goods businesses. For clusters and other textile enterprises that export at least 80 percent of such goods, the social tax rate is set at 1 percent for a period of 3 years instead of the current 12 percent. They will also be given the opportunity to pay property tax with a three-year grace period. Due to this, at least 500 billion soums a year will remain at the disposal of enterprises.
Another convenience - starting next year, clusters will be given the opportunity to take out loans secured by raw cotton and fiber.
At the meeting, instructions were given to further strengthen the legal guarantees for the activities of the clusters.
As you know, the transition to market relations in the production and sale of grain continues. The President noted that from next year grain clusters and farmers will have the right to freely sell wheat at market prices.
At the same time, clusters and farms will have to put up 2.5 tons of grain from each hectare for exchange trading within 3 years, and they will be able to sell the rest of the crop at their discretion.
Grain processing enterprises within Uzdonmahsulot will be put up for auction to create grain-growing clusters on their basis.
Responsible persons were instructed to make a full payment for grain within two weeks.
The meeting also discussed measures to create additional opportunities for fruit and vegetable clusters and cooperatives. The importance of concessional lending to these entities through the Agriculture Support Fund was emphasized. In particular, the fund will allocate credit resources for the working capital of fruit and vegetable clusters at a rate of 10 percent for a period of 1 year.
Starting next year, a competition for insuring fruits and vegetables against weather risks will be held among insurance companies. For clusters and farmers with export contracts, 50 percent of the insurance premium will be covered by the state.
It is planned to reduce 200 thousand hectares of low-yielding areas of cotton and grain. They will be provided to the population on a long-term lease on a competitive basis.
The head of state pointed out the need to pay special attention to low-income families, train them in housekeeping and provide appropriate assistance.
For this, loans will be provided for fruit and vegetable projects worth up to 100 million soums on the terms of the "Every family is an entrepreneur" program.
The Ministry of Agriculture was instructed to provide infrastructure for fruit and vegetable clusters and processing enterprises, as well as create agrological centers based on public-private partnerships.
The issue of modernization of agricultural machinery was also touched upon. To support farmers and clusters, from next year, payments on loans for the purchase of equipment in excess of 10 percent will be covered by the state.
In addition, imported equipment, components and spare parts will be exempted from customs duties for a period of 3 years. As a result, clusters and farmers will be able to save up to 35 percent when purchasing equipment.
At the same time, it is envisaged to provide benefits for laser leveling, planting new disease-resistant varieties of agricultural crops, development of seed production, and the use of water-saving technologies.
In general, it is planned to allocate 25 trillion soums for these purposes annually.
The task was set to develop draft decrees and resolutions on the implementation of the initiatives put forward at the meeting.