Investment opportunities / By Province

Bukhoro province

1. Geographical location, territory, climate

Bukhara Province is situated in the southwest of the Republic of Uzbekistan and borders with Kashkadarya and Navoi Provinces and Republic of Turkmenistan. Total area of this province amounts to 40.3 thousand sq. km. Population is 1639,7 thousand people.

Province includes 11 districts: Alat, Bukhara, Vabkent, Gijduvan, Jondor, Kagan, Karakul, Karaulbazar, Peshku, Romitan and Shafirkan.

City of Bukhara located in the southwest of Bukhara Province is the administrative centre with population of 270.0 thousand people.

Territory of the province is represented by the desert plain with some hills.

Climate of the province is sharp continental with severe winters, and hot and dry summers. There 300 sunny days a year in average.

2. Historical excursus

City of Bukhara has a rich 2500-year history. City was first mentioned by Chinese travelers in II century B.C.

Narshakhi, historian of X century, who was born in Bukhara, wrote that no city had had as many names as Bukhara had. Chinese and Uyghurs called it Bukhar, which means the location of idols. Famous Russian scholar Bartholde thought that Bukhara originated from the Sanskrit and means monastery.

Excavation materials give every reason to suppose that this city was founded not later than I century B.C.

Natural resources of the Bukhara oasis drew attention of neighboring states and foreign conquerors. In VI century B.C. Cyrus, the king of Persia, and later Darius conquered the Bukharan lands. Rule of Persian kings on the territory of Bukhara lasted until 330 B.C.

In 329 B.C. the Bukhara’s (Soghdiana’s) territory like other places of Asia went to the Greeks’ possession after conquest of Iran by Alexander of Macedonia. Local population showed active resistance to the conquerors who ruled in Soghdiana until II century B.C.

Arabs, who took over Iran, Palestine, Egypt and other countries within short period of time, came to historical stage in VII century. In 709 after bloody storm, Arabs conquered the City of Bukhara. Prior to Arabs’ conquest, the City of Bukhara was the Central Asia’s large trade and cultural center.

Arabs started introducing the religion of Islam by force, which, in turn, caused popular revolts. One of the biggest revolts of that time under leadership of Khashim-ben-Khakim (Muqanna), so called “Movement of People in White”, was also suppressed.

Samanids, large landowners from Balkh, called by the name of its founder Ismail Samani became rulers of Bukhara in IX century. Extensive feudal state, which occupied the territory of almost whole Central Asia with capital in the City of Bukhara, had been formed. Appearance of the city had sharply changed. Registan square became an administrative centre of the city.

In X century Bukhara became the heart of high feudal culture. Many world-famous scholars, writers, artists such as historian Narshakhi, poets Rudaki, Dakiki, medic and mathematician, person of encyclopedic knowledge Abu Ali Ibn Sina (Avicenna), historian Belasuri, Tabari, Ben-Miskaveikh lived and worked here.

In 999 territory of contemporary Bukhara was conquered by the Karakhanids who ruled until 1141.

In early XIII century wealth of Bukhara oasis (Soghd) drew the attention of new conquerors – Mongols. In 1220 Chengiz-Khan occupied Bukhara due to treachery of clergy and commanders. Having undertaken the city, the Mongols ransacked it, and its inhabitants had been turned into slavery.

Bukhara started being gradually restored in the second half of the XIII century. Italian traveler Marco Polo who visited Bukhara at that time called it the city of big grandeur. However, the people couldn’t accept their difficult position and often initiated revolts against the Mongols.

In 1370, during the start of Amir Temur’s (Tamerlane’s) rule, Bukhara was included in the Timurids’ state. Bukhara had lost its political importance because Samarkand became the capital city. Under Ulughbek, Amir Temur’s grandson, Bukhara became the cultural centre of the feudal world.

In 1506 Bukhara was conquered by Sheibanids, new dynasty established by settled and nomadic Uzbek tribes. Starting from the second half of XVI century under Abdullakhan’s rule (1557-1598) Bukhara became the state’s political center after which the name of Bukhara Khanate was fixed. Substantial economic growth of Bukhara Khanate was observed under the Sheibanids’ rule. Majority of architectural structures, which define the old city’s appearance, were built during this period.

In 1595 the new dynasty of Ashtrakhanids named after the Astrakhan Khans started ruling the Bukhara Khanate. By the end of this dynasty’s rule (XVII century) the Bukhara Khanate lost its economic and cultural importance.

In 1740 Nadir, King of Persia undertook the campaign against Bukhara. After conquest of the Bukhara Khanate, the new dynasty – Mangyt Khanate, which existed until 1920, was founded. Period of the Mangyts’ rule was the gloomiest one in Bukhara’s history. Useful arts, science and poetry fell into decay. Tradewasreduced.

In 60-70s of the XIX century the Tsarist government of Russia started the occupation of the Bukhara Emirate. In 1868 the Bukhara forces were defeated near Zerabulak. Peace was made at the Emir’s request and Russia established the protectorate over the Bukhara Emirate.

On September 2, 1920 the Bukhara People’s Revolution broke out, and, as a result, the Bukhara People’s SovietRepublic was announced and it existed till 1924. Then Bukhara was included in the UzbekSocialistRepublic as an administrative centre of BukharaProvince.

In 1991 Bukhara was included in the UNESCO’s World Heritage List. And 2500^th anniversary of the city was widely celebrated in 1997 at international level under the UNESCO’s leadership.

3. Social economic development

Type of the province’s economic development is agricultural and industrial, share of agriculture in gross regional product of the province is equal to 29.6%, and industry’s share – more than 18%. Tendency of reducing share of the agricultural complex in the GRP and growth of industrial and services share is  observed.

In 2010 gross regional product of the province amounted to UZS 3376,0 billion (USD 2046 million) and growth against 2009 reached 109.6%.

External trade turnover in 2010 amounted to USD 639.7 million (197.1% against 2009), including exports – USD 336.9 million (166.4% against 2009) and imports of USD 322.6 million (240% against 2009).

Foreign investments and loans in total amount of USD 866.8 million, including foreign direct investments in amount of USD 861.1 milllion and government guaranteed investments in amount of USD 5.7 million were attracted in 2010.

Great importance is given to development of small and private business share of which in the GRP amounts to 64%. Nearly 27,8 thousand companies operate in

 the small business sphere and all necessary conditions including preferences and privileges in accordance with national legislation currently in force are created.

3.1. Population

Number of population of Bukhara Province as of January 1, 2011 amounted to 1639.7 thousand of which 325.9 thousand live in urban and 1313.8 thousand people - in rural areas. Population’s density is equal to 40 persons / sq. km.

There are 2 big cities in the province – Bukhra and Kagan. Population of the City of Bukhara is 270.0 thousands and that of Kagan is 55.9 thousands.

Number of able-bodied population is nearly 967,4 thousands people.

3.2. Banking and financial systems

13 banks which funded loans in amount of UZS 366.5 billion (USD 222.1 million) in 2010, including UZS 127.0 billion (USD 76.9 billion) in small and private entrepreneurship operate in Bukhara Province.

In addition, 4 state insurance companies function in the province.

3.3. Development in agricultural sector

Share of agriculture in the GRP in 2010 amounted to 29.6%. Agricultural production is territorially differentiated into two districts: south and catlle-farming north.

Cotton and grain farming are the leading branches of crop production. Nearly 150 thousand tons of fruits, 354 tons of vegetables, 79 thousand melons and gourds, 99 thousand tons of grapes are produced annually. Nowadays only 45 percent of produced fruits and vegetables are processed. 342 thousand tons of cotton and 620 thousand tons of grain were produced in 2010.

Area of irrigated lands in Bukhara Province is equal to 200.4 thousand ha, of which are used for crops.

Taking into account the arid plain-and-steppe nature of the territory, a cattle farming is widely developed in the province. Leather processing and production of finished leather goods have the significant potential. Bukhara Karakul is world-famous. More than 333,3 thousand pieces of Karakul skins and 2775,5 tons of wool are annually procured in the province.

5 agricultural processing enterprises function in the province. JV “Agromir Bukhara”, JV “Gala River”, JV “Bukhara-Aliyans” and JSC “Shakhrud” are the largest among them.

3.4. Mineral and raw materials potential

Bukhara Province has substantial natural resources, and there is nearly 31 resource deposits in the province, of which 19 deposits are currently developed. Rich deposits of natural gas, oil, graphite, bentonites, marble, granite, gypsum, sulfur, limestone and raw materials for construction materials were discovered on the terrritory of the province.

There are deposits of the following natural resources in the province:

- gas and condensate – 360.6 billion cubic m and 2,104 thousand tons in Qalat and Karaulbazar Rayons;

- petroleum – 9,119 thousand tons in Karaulbazar district;

- technical salt – 100 thousand tons in Alat district;

- crushed stone and crushed solution – 375 thousand cubic м in Kagan and Shafirkan districts;

- gypsum – 46.3 thousand tons;

- limestone – 21,100 thousand tons;

- quartz – 35,900 thousand tons;

- graphite –805.9 thousand tons.

3.5. Industrial potential

Major branches of industry such as textile, silk and ginning industries, as well as extraction and processing of crude oil, natural gas and precious metals also take substantial place.

29 large industrial enterprises function in the province: Bukhara Oil Refinery (oil processing), Foreign Interprices “DAEWOO Textile Bukhara” (textile industry), JSC “Shakhrud” (alcohol production), JV “Bukharagyps” (gypsum production), JV “Uzcarpet”, JV “Bukharagilam”, JV “Textile Spectrum Colors” JSC “Kogonyog’”, JSC “Bukhorodon” (production of foodstuffs). In 2010 industrial enterprises produced goods in amount of UZS 1376.5 billion or more than USD 834 million, which exceeds the 2009 indicator by 110,3%.

Textile industry, agricultural sector, torism industry, construction, transport and communications development are the most promising branches.

Oil and Gas Industry

The province is one of the large areas of fuel-energy industry of Central Asia.

Bukhara Oil refinery which processes 2.5 million tons of oil and condensed gas annually functions in this province.

Bukhara Oil refinery produces high quality gasoline, black oil, aviation kerosene and other oil products. The enterprise’s products are exported to foreign countries.

Textile Industry

Bukhara cotton is an excellent raw material for textile industry. 106.7 thousand tons of cotton fiber were produced in this province in 2010. Currently only 36% cotton fiber are processed in the province’s enterprises.

Investment attractiveness of this branch consists of extension of preferential mode of management, which enables the investors to attain additional profit upon investing in establishment of new and modernization of existing facilities.

Production of Construction Materials

Mineral and raw materials base of the province consists of 31 deposit, of which 19 are under development. These include the graphite, capstone, limestone, mortar sand and brick-and-tile raw stock deposits.

Mineral Resources of BukharaProvince

Gypsum produced in the province is considered as the one of the best in the world by its quality. Joint Uzbek-German Venture “Bukhorogyps” functions here, and also foreign enterprise “Knauf gyps Bukhara” is created.

3.6. Transport infrastructure and communication

A-380 and M-37 highways cross the province’s territory and link Iran, Turkmenistan and Afghanistan with Uzbekistan. Total length of highways is equal to 3994 km, including 3557 km are asphalt roads. In 2010 volume of freight traffic by motor transport amounted to 1242.9 million tons/km.

Total length of the province’s rail roads is equal to 452.4 km. Bukhara branch of Uzbekistan Railways is constantly increasing the number of routes.

Infrastructure of the City of Bukhara meets international standards, including the recently reconstructed world class airport. And also according to degree of the President of the Republic of Uzbekistan passenger terminal of airport is constrcting in Bukhara city.   

Several companies provide mobile communications services in Bukhara Province: MTS Uzbekistan, Beeline, Perfectum Mobile, U-Cell and communication is accessible at all settlements of the region. Quality urban communication is also provided by the “BukharaTelecom” Company.

3.7. Social infrastructure and recreation services

There are 75 hospitals, 457 policlinics, 127 clubs, 12 museums, 2 theaters, 31 school of musics and arts, 7 recreation parks and 1 natural reserve in Bukhara Province.

There are 443 preschool institutions, 541 general secondary schools and 88 academic lyceums and vocational colleges, 3 higher education institutions in the education sphere, which train highly qualified specialists for food, oil-gas, light industries and medicine.

There are a Theater named after S.Ayniy, puppet show, amusement parks, recreation area as well as the Resort and Recreatin Center named after Sitori Mohikhosa”, 10 sports complexes, 12 museums, libraries and movie theaters in the province.

26 stadiums, 48 sports schools for children and teenagers, 6 swimming pools function in this province. There are total of 3436 sports facilities in the province.

More then 1511.3 km of gas and more then 1521.4 km of water pipeles were commissioned for operation in Bukhara Province during the period from 2000 to 2008. 96% of the province population are connected to power supply.

While being one of scientific and cultural centers of Uzbekistan, Bukhara is known to the whole world for its unique historical and architectural monuments, which draw the attention of foreign tourists and religious pilgrims from all over the world. Monuments of all historical epochs starting from IX century A.D. are located on the province’s territory.

There are total of 997 historical and architectural monuments in the province, and among them are world-famous ones such as Samanids’ Mausoleum, Kalyan Minaret and Mosque, Ark Fortress, Lyabi-Khauz Ensemble, Sitorai Mokhi Khosa – summer residence of the Bukhara Emir, Chor Bakr Complex, Ulugbek’s Madrassah, and Chor Minor, which are masterpieces of the world culture.

In 1991 Bukhara was included in the UNESCO’s World Heritage List. 2500^th anniversary of the city was widely celebrated in 1997 at international level under the UNESCO’s auspices.

Currently there are 46 hotels and 13 tourist firms functioning in this province. Nearly 81 thousand foreign tourists visit Bukhara annually.