Uzbekistan, Tashkent, May 23 / Trend, D. Azizov /
The Singapore-based Indorama Industry Pte ltd will invest $ 25 million in the second stage of textile production in the Ferghana region of Uzbekistan, a source close to the project told Trend on Thursday.
As reported, the first stage of textile production for processing of cotton worth about $30 million was commissioned by Indorama in September 2011. The supply of equipment to the textile complex was undertaken by the Swiss company Rieter.
Production capacity of the unit created on the basis of the Kokand Textile Mill totals 10,000 tons per year.
Following the commissioning of the second phase worth $31 million, the annual capacity will increase by 5,000 tons to 15,000 tons of cotton. Completion of the second stage of the production is scheduled for late 2013-early 2014.
Funding for the project is provided through direct investment of the Singapore-based company and loans from foreign banks involved in the project financing.
As previously reported, in June 2011, the State Property Committee of Uzbekistan implemented at zero cost, the project for property complex of the Kokand Textile Mill state enterprise for the joint venture Indorama Kokand Textail, created by the Singapore-based company and the National Bank for Foreign Economic Activity of Uzbekistan.
The joint venture was established with a registered capital of $20 million, where Indorama has a 75 percent stake, the National Bank for Foreign Economic Activity - a 25 percent stake. According to the founding documents, the authorized fund will be formed within three years.
The government of Uzbekistan provided the join venture with customs exemptions on imported technological equipment, tooling, spare parts, accessories and building materials until 2016.
According to the program of development of the industry, Uzbeklegprom Public Joint Stock Company implemented 106 investment projects worth $1.678 billion in 2011-2015.
Uzbekistan is the sixth world producer and the third largest exporter of cotton. an average of 3.5-3.7 million tons of raw cotton is harvested and 1-1.2 million tons of cotton fiber produced in the country annually. More than 75 percent of produced cotton fiber is exported.
According to official statistics, in 2012, Uzbekistan has collected 3.35 million tons of raw cotton against 3.5 million tons in the previous year, while production of cotton declined by 0.6 percent to 1.095 million tons.