Agro-industrial reforms: from clustering to digitalization

Agro-industrial reforms: from clustering to digitalization

The Minister of Agriculture Jamshid Khodjaev told the Economic Review magazine how agricultural clusters and cooperatives are developing, the digitalization of the agricultural and food industry in Uzbekistan and the launch of an innovative system that determines a favorable time for planting or harvesting crops.

— What is the role of agriculture in the economy of Uzbekistan and what is the significance of the reforms carried out in this sector?

— Agriculture is an important sector of Uzbekistan's economy, accounting for approximately 28.5% of GDP. It employs about 4.2 million people, accounting for more than 30% of the country's total employment. The main agricultural crops are cotton and grain, but the abolition of quotas and price control in 2020-2021 is already actively contributing to the diversification of crops, a phased transition to the cultivation of other crops, fruits and vegetables. Exports of agricultural products provided approximately 9.8% of Uzbekistan's external revenues in 2019.

Uzbekistan is carrying out dynamic reforms and transformation of the economy. Large-scale reforms are also taking place in the agri-food sector, which opens up significant new opportunities for further expansion and diversification of the agri-food sector. The important role of agriculture in the economy of Uzbekistan determines the key function of agricultural reforms in the economic success of the Republic. Thus, Uzbekistan was one of three countries in the Europe and Central Asia (ECA) region that maintained positive economic growth in 2020 despite the pandemic.

The government expects that the ongoing reforms will increase the productivity of agriculture through the introduction of new technologies, including resource-saving and the further development of processing and packaging in order to increase the cost of domestic and export products. It is planned to develop the textile sector of the country, improve the value chain. According to forecasts, due to the introduction of scientific and innovative ideas, the volume of production of fruits, vegetables, potatoes, legumes and oilseeds, meat by 16%, milk by 13%, eggs by 27%, fish by 2 times, honey by 30% will increase annually. The level of processing of fruits and vegetables increases to 15%, meat from 9 to 15%, milk from 14 to 18%.

Minister of Agriculture Jamshid Khodjayev answered questions about the potential of the country's agricultural sector.

— Can you tell us about the main goals and directions of agricultural development in the next five years?

— We operate within the framework of the 10-year Strategy for the Development of Agriculture, developed by the Ministry of Agriculture of the Republic of Uzbekistan with the support of the EU, the World Bank, FAO, as well as other international organizations and experts. In accordance with the "Strategy for the Development of Agriculture in Uzbekistan for 2020-2030", nine areas are prioritized.

  1. Ensuring food security of the population. In a short period of time, the "malnutrition index" in Uzbekistan dropped unprecedentedly from 15% to 2.4%, becoming one of the best results in the region.
  2. Improving the agribusiness environment and creating value chains.
  3. Reducing state participation in the industry and increasing investment attractiveness.
  4. Ensuring the rational use of natural resources and environmental protection.
  5. Development of modern systems of public administration.
  6. Diversification of public spending to support the sector.
  7. Development of the agrarian science, education, information and consulting services.
  8. Development of rural areas.
  9. Development of a transparent system of industry statistics.

Moreover, work is already underway to develop agricultural knowledge, services and innovations on the basis of a new flexible modern AKIS system and multifunctional centers created within its framework in all regions of the Republic. In these extensive centers, farmers are already beginning to receive agricultural services, use mobile laboratories, participate in educational activities. Local and foreign producers get the opportunity to present their products first-hand, as well as advise their target audience. In the AKIS infrastructure there are demonstration and experimental fields where you can conduct research, test and demonstrate agricultural technologies and much more. In 2022-2026, centers will be created in all regions and large areas, providing more than 100 agricultural services.

The development of scientific and expert potential, it should also be noted that new formats of training are being introduced to improve the literacy of agricultural producers, including online and the branches of the agrarian institute in the regions are becoming separate institutes, expanding the directions for training, the theoretical and practical base.

Much attention is paid to the digitalization of agriculture, as well as the widespread introduction of technologies for the rational use of water and land resources within the framework of the Smart Agriculture program. For example, such a moisture-loving crop as rice will be grown in all repeated fields by the seedling method by 2026. Since this year, as an experiment, sprinkler and drip irrigation of this agricultural crop has been introduced, and machine planting of rice seedlings has been organized.

Much attention is also paid to the development of lands that have come out of agricultural circulation, improving the quality of agricultural land, which is achieved mainly through the introduction of new technologies - resource-saving and improving soil fertility and productivity. In general, by 2026, it is expected that the agricultural land put into circulation will be about 900 thousand hectares, land with the water-saving technologies will amount to 1.2 million hectares, including 445 thousand hectares of drip irrigation. In 2022-2026, cotton growing yields and the production of cereals will also increase. At the same time, sown areas will decrease, but their productivity will increase.

On the basis of the development of local research potential, as well as attracted foreign expertise, seed production is developing in Uzbekistan. In the coming years, it is planned to create 53 elite seed farms with the allocation of up to 5 thousand hectares of agricultural land. A modern system of export of agricultural seeds under the national brand "Uzbek seeds" will be created. Leading foreign experts (Turkey, the Netherlands, Israel and other countries) are involved in strengthening the breeding work.

A separate topic is diversification, which is gradually being implemented in our country due to the specialization of individual districts in each region of the Republic for certain agricultural crops.

— Agricultural clusters and cooperatives are now actively developing in Uzbekistan. How are reforms in this direction developing?

— The development of a cluster and cooperative system with modern infrastructure and advanced technologies is one of the priority areas of reforms in agriculture. This system provides an integral production chain: from the field to the consumer. The clusters pay special attention to increasing producers' incomes through high yields. As a result of the scientific and innovate achievements and advanced technologies clusters in 2016-2020, it was possible to increase the yield of cotton from 26.4 centners/ha to 30 centners/ha, grain yield from 57.8 centners/ha to 63.5 centners/ha. Material interest of producers increased by 1.5 times, the average monthly salary of one employee increased by 2.4 times compared to 2018. Over the past 3 years, more than 152 thousand new jobs in the regions were created on the basis of clusters.

In 2018-2020, investments in the amount of US $1.4 billion were attracted to create a value chain in the clusters. In 2019-2020, intensive orchards with an area of 10.8 thousand hectares and vineyards with an area of 19.7 thousand hectares were formed. On 250 thousand hectares of land, water-saving technologies and resource-saving modern equipment were introduced for a total of 1.5 trillion soums.

— In December 2020, a digitalization plan for the agri-food industry was presented until 2023. Please tell us more about this area of reform.

— Today, all over the world, Big Data and their analysis are coming to the aid of farmers and agronomists - to determine the favorable time for planting or harvesting, calculate the fertilization scheme, monitor, predict the harvest, and much more. Digital technologies allow you to control the full cycle of crop production, animal husbandry - smart devices measure and transmit the parameters of soil, plants, microclimate. Received data from sensors, space images, drones, weather stations and other equipment form Big Data analyzed by special applications and placed on geoportals.

In Uzbekistan, comprehensive measures are also being implemented to actively develop the digital economy, as well as to widely introduce modern information and communication technologies in sectors of the economy, including agriculture. In particular, in December last year, the “Strategy for the Development of Smart Agriculture Technologies” and the “Action Plan for the Implementation of the Strategy for the Development of Smart Agriculture Technologies in the Period 2021-2023” were approved, which provide for 3 main areas: digitalization of agriculture; automation of management processes, monitoring and accounting of water resources; support for business start-up projects in the agricultural sector. At the same time, in the structure of the Ministry of Agriculture, a separate complex has been created that is responsible for the issues of accelerated programs for the development of digitalization in the agrarian sector.

— The action plan identifies specific digitization projects. Please introduce them more in detailed.

— By the end of the year, 9 information systems will be launched, aimed at simplifying entrepreneurial activities in the agro-industrial complex, facilitating contacting government agencies on various issues. I will briefly dwell on the most priority ones.

One of the major projects is the launch of the Ministry of Agriculture's own geographic information platform. At the moment, contract negotiations are being completed and by November of this year it is planned to launch the system in test mode. The system based on satellite images and other materials obtained with the help of drones using artificial intelligence technologies, will allow to determine the favorable time for planting or harvesting, calculate the fertilization scheme, monitor, predict the harvest of agricultural crops, timely identify their diseases and much more.

The next major project is the creation of the Unified Agro-Industrial Complex Integration Platform, where the business processes of about 20 ministries and departments will be integrated. This project is financed by the World Bank and a tender is being held to determine the architect of this system. The result of the work in 2022 will be the launch of the Agro-platform similar to the "Single Window", where farmers will be able to receive all the services and information necessary for their activities online.

Also, at the moment, the development of the E-IJARA TANLOV system is underway, which will ensure maximum transparency in the allocation of agricultural land resources. In accordance with the recent Presidential Decree "On measures to ensure equality and transparency in land relations, reliable protection of land rights and turning them into a market asset", from August 1, 2021, agricultural land will be allocated only on the basis of a lease right based on the results of open electronic tenders.

Another important project is the creation of a unified state information system for the allocation of subsidies in the agricultural sector. It will be possible for farmers to receive 18 types of subsidies, as well as to monitor their intended use. Subsidies are allocated by the state to support farmers for the purchase of agricultural equipment, the use of water-saving technologies, the cultivation of vineyards and intensive orchards, the development of the livestock industry to improve pedigree breeding, and much more.

The main goal of the implementation of information systems is to ensure a technological breakthrough in the agro-industrial complex, strengthen food security, efficient water management and achieve productivity growth in agricultural enterprises.

— Now the development of organic farming is gaining popularity in the world. Please tell us about the potential of Uzbekistan in this direction.

— In the publication of the Scientific Research Institute of Organic Agriculture and the International Federation of Organic Agriculture Movements on the World Organic Agricultural Statistics 2019, the Republic of Uzbekistan is included in the list of 10 countries in the world that have favorable conditions for fruit production and favorable land areas for growing organic fruits.

Organic farming is a global trend today. According to experts, over the past 5 years, an average growth of 15 percent has been achieved in the global market for organic products; trade turnover in 2022 is projected at $212 billion (20 percent of total world agricultural production).

This practice occupies a special place in the history of agriculture in our country. The traditional culture of vegetable growing and horticulture, which has evolved over the centuries, is based on the principles of biological dehkanism, involving the use of natural fertilizers. This makes it possible to grow organic (environmentally friendly) fruits and vegetables with high nutritional value, unique taste and consumer characteristics without the use of gene modification technologies.

At present, the republic has all the conditions favorable for the development of organic agriculture, namely: the possibility of increasing the income of the population through the export of organic products grown in household plots; opportunities to increase employment of the population through the development of systems of agro-cluster production, logistics and cooperation in organic production; the possibility of analyzing the quality of agricultural products by improving laboratories.

And this potential is already beginning to be actively realized. In 2017 - 2019, Sunny Fruit Production LLC in our republic produced 1,848 tons of organic raisins exported to the Russian Federation, France, Germany, Holland, Italy and Greece at prices that are 14.7 percent higher than the prices for the traditional type of raisins with extraction of net profit more than 4.1 times.

It is planned that by 2025, organic raw cotton will be grown on 5% of Uzbekistan's cotton fields. Organic cotton is much more expensive than usual. So, in 2019, 1 ton of organic raw cotton in the US markets was priced at $225, while traditional cotton was priced at $155.

In conclusion, I would like to emphasize once again that the potential for the development of agricultural production in Uzbekistan is very high, both in relation to the traditional cultivation of crops and in relation to the use of new innovative formats and technologies. And the ongoing reforms are aimed at the full development of the existing potential, at increasing the competitiveness of both agricultural products and the competitiveness of the entire agro-industrial complex.

In-country / Agricultural sector

Ziyoda Rizaeva, Viktor Abaturov, CERR

Magazine "Economic Review" №8 (260) 2021

Share this post

Similar news