Home MOREBUSINESS & ECONOMY Transport services in Uzbekistan: analysis & projection by Zarina Kosimova & Sharofiddin Shamsiddinov

Transport services in Uzbekistan: analysis & projection by Zarina Kosimova & Sharofiddin Shamsiddinov

by EUToday Correspondents
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The efficient operation of the transport sector is very important for the stability of economic development, the welfare of the population, and ensuring the national security of any country. This industry is a complex economic system that covers all passengers on air, land, water transport, as well as cargo transportation. About what was done last year in this area and what is planned this year.

Results of 2022

In 2022, the volume of services rendered in the transport sector increased by 12.4%, motor transport services — by 6.5%, passenger turnover — by 5.6%. Meanwhile, the growth rate in terms of cargo turnover has slowed down from 11.8% in 2021 to 0.5% in 2022.

Resumption of international bus service. Since April 12 last year, regular international bus routes between Uzbekistan and Kazakhstan have been restored. Since April 15, 2022, the Tashkent—Bishkek international bus route to the Kyrgyz Republic has been resumed, 2 flights are made every day. The Tashkent—Khojand international bus route in Tajikistan has been resumed. On February 20, the regular international route Kokand—Khojand was opened, and on June 3, Yangiyer—Istaravshan and Tashkent—Istaravshan. Bus service to Russia has been restored. In particular, since July 18, 2022, regular international bus routes Tashkent—Moscow, Tashkent—Kazan, Tashkent—St. Petersburg, Tashkent—Novosibirsk, Tashkent—Nizhny Novgorod, Tashkent—Omsk and Tashkent—Perm have been resumed.

In addition, on September 8, 2022, for the first time through an electronic information system e-tender.uztrans.uz an open tender was held for regular international bus routes (9 lots), as a result of which the winners were determined and contracts were signed.

In the field of public transport, 85 medium-sized SAZ LE-60 buses and 190 large-capacity MAN buses were also purchased, 17 new ground public transport routes were introduced and the capacity at 50 busy intersections was increased.

In the field of air transport in January-November 2022, Uzbekistan established new flights with countries such as the USA, Great Britain, Germany, Egypt, India, Georgia, Tajikistan, Afghanistan, Iran, Kuwait, Saudi Arabia, Latvia, Azerbaijan, South Korea, Russia, Turkey, UAE, Kazakhstan, Kyrgyzstan and Belarus. Accordingly, the number of foreign airlines operating regular flights to Uzbekistan has been increased to 31, and the number of routes has been increased to 59.

In April, on the eve of the visit of the President of Turkey to Uzbekistan, the aviation authorities of the two countries reached an agreement on the implementation of additional flights on the currently operating routes (Tashkent—Istanbul 14+3, Samarkand—Istanbul 3+1, Fergana—Istanbul 2+1, Urgench—Istanbul 1+1).

As part of the implementation of the Eastern Hub program, in order to create favorable conditions for residents of the Fergana Valley who frequently fly from the airport of the neighboring city of Osh, regular flights from Namangan and Fergana to a number of cities of the Russian Federation have been established since February 2022.

Since January 2022, after a long break in the pilgrimage tourism program due to the pandemic, Uzbekistan Airways JSC, together with the Muslim Board, has resumed daily flights for Uzbek pilgrims to the cities of Jeddah and Medina within the framework of the Umrah-2022 program.

As another significant event in the field of air transport, the opening of the new airfield complex of the Samarkand International Airport on March 18 should be highlighted, and since October 1 of this year, the “Ochik Osmon” (“Open Sky”) regime has been introduced at the Samarkand International Airport.

Along with the above-mentioned events, a new business model of Uzbekistan Airways was developed jointly with experts of the World Bank. The airline switched to a hybrid business model and launched new low-budget transportation services Uzbekistan Express, as a result of which fares, compared to other routes, were reduced by an average of 20%.

Within the framework of the current Pilgrimage Tourism program, discounts of up to 50% have been introduced to the announced tariffs for the main types of ground services provided to aircraft of foreign airlines for passenger transportation. Currently, Uzbekistan Airways, Qanot Sharq and Humo Air operate regular flights on domestic lines of the Republic of Uzbekistan.

In the field of development of international transport corridors, logistics and transit, in January 2022, within the framework of the visit of the Ministry of Transport of the Republic of Tajikistan, an Uzbek-Tajik joint Commission was established to discuss and develop cooperation between the parties in the field of international road transport. In January, a draft memorandum on the creation of an international transport and transit corridor using the Chabahar port was also developed and sent to the Iranian side. In addition, an agreement on international road transport has been signed between the Government of the Republic of Uzbekistan and the Government of the Republic of Azerbaijan.

For 9 months of last year, the share of the volume of goods transported along the main transport corridors of our country is as follows:

Uzbekistan—Kazakhstan/Kyrgyzstan—China — 41.3% (13.5 million tons)

Uzbekistan—Kazakhstan—Russia—European countries — 23% (7.5 million tons)

Uzbekistan—Kazakhstan—Russia — 19% (5.9 million tons)

Uzbekistan—Turkmenistan/Kazakhstan—Azerbaijan—Georgia—Turkey — 8% (2.6 million tons)

Uzbekistan—Turkmenistan—Iran — 7.7% (2.5 million tons)

Uzbekistan—Afghanistan—Pakistan—India — 2% (0.6 million tons)

Last year, a number of works were carried out in the field of further development of international railway corridors.

To develop a feasibility study of the project for the construction of the Mazar-i-Sharif—Kabul—Peshawar railway, an orthophotoplan (initial photographic site plan) was drawn up along the route and a field expedition was conducted in the third quarter of 2022.

On September 14, a trilateral agreement on cooperation on the China—Kyrgyzstan—Uzbekistan railway construction project was signed within the framework of the SCO Samarkand Summit. A feasibility study of this project was also developed by the First Design and Research Institute of the China Railway Construction Corporation.

The Turkish side has joined the signed 5-party Protocol on the development of the multimodal route China—Kyrgyzstan—Uzbekistan—Turkmenistan—Azerbaijan—Georgia, which provides for the application of up to 70% discounts on rail fares between the countries.

On October 28, 2022, during the 6th meeting of the Ministers of Transport of the Organization of Turkic States, the project of the electronic exchange of permit forms (E-permit) between the Ministry of Transport of the Republic of Uzbekistan and the Ministry of Transport and Infrastructure of Turkey was launched.

Plans for 2023

In order to continue the reforms in the transport sector in the coming year, it is planned to implement the following measures.

In the field of railway transport, in order to create convenience for national exporters when transporting goods by rail, it is planned to maintain discounts on rail fares on major international routes, increase the efficiency of Uzbekistan Temir Yullari JSC and reduce customer service time by at least 30% due to digitalization, create an online information system for monitoring passenger train movements and introduce “passenger loyalty program” electronic ticket sales systems.

In order to widely involve the private sector in the railway industry, it is also planned to separate the natural monopoly and competitive segments of this sphere from each other and develop separately the monopoly part and competitive areas that can attract private sector investment.

In the field of air transport, new flights from Tashkent to China and the Czech Republic will be opened, and the number of flights to New York, Delhi, London, Frankfurt, Paris and Milan will be increased from 17 to 23 per week. It is planned to establish more than 30 weekly flights from Samarkand to countries such as Indonesia, Malaysia, Bangladesh, the UAE, Saudi Arabia, India, China, Israel and Turkey.

The number of resident airlines operating in our republic will be increased to 5 (4 of them with a share of the private sector). As a result, resident airlines will operate regular flights to 45 domestic and 120 international destinations. To meet the demand for domestic and international flights, 5 resident airlines of Uzbekistan are planning to import 20 aircraft.

Humo Air will operate 32 regular weekly flights from Tashkent to Bukhara, Urgench, Fergana, Qarshi, Nukus, Namangan, Samarkand and Termez. In addition, measures will be taken to modernize the international airports “Bukhara” and “Urgench” on the basis of public-private partnership.

Currently, for the development of domestic and inbound tourism, Uzbekistan Airports JSC is working on the creation of a new subsidiary of Silk Avia (a low-cost airline). It is planned to operate flights on ATR72-600 aircraft (a turboprop aircraft designed for transportation up to 1300 km), which can carry 70-78 passengers, and thanks to the launch of a new airline, connect all major cities of our republic with connecting flights on domestic routes.

In the direction of transport corridors, negotiations will be held between the transport departments of Uzbekistan and Afghanistan to reduce fees, ensure security, maintain the infrastructure of the Salang pass in proper condition and an agreement on the development of the Uzbekistan—Afghanistan—Pakistan transit corridor will be developed. For the construction of the Mazar-i-Sharif—Kabul—Peshawar railway, negotiations will be held with international financial organizations to determine the sources of financing for the development of a feasibility study.

Within the framework of the China—Kyrgyzstan—Uzbekistan railway construction project, it is planned to reach an agreement with the parties to determine the sources of financing and complete the development of a feasibility study of the project in the first half of 2023. Negotiations will also be held with EU countries (Latvia, Lithuania, Poland, Germany, etc.) to obtain additional permits for international road transport and increase quotas set for 2023.

Public transport. In order to increase the coverage of the population by public transport, the scheme of existing 4,945 routes in the regions will be revised, taking into account the demand of the population, and 48 new passenger transport routes will be opened. Also, in order to develop public transport infrastructure, it is planned to build and reconstruct 25 bus stations and bus stations in the regions.

To update the structure of public transport, carriers will purchase 1,120 buses and 580 minibuses. The import of new buses and minibuses will be subject to an interest-free installment of value added tax for two years.

Gradually, environmentally friendly electric buses will be used on urban passenger transportation routes. Preferential long-term loans from foreign financial institutions under a state guarantee will be attracted for the purchase of 453 modern electric buses and chargers. In order to support the purchase of electric buses by business entities, a system will be introduced to cover part of their cost from the state budget.

In order to further develop the public transport system in Tashkent, it is planned to complete the II stage of construction work and put into operation the Qoyliq—Kuruvchilar section, consisting of 7 stations of the 12.3 km-long elevated ring metro line.

As a result, the metro network will cover 82 thousand residents in 21 mahallas and 9 large objects (Tashkent INDEX shopping complex, Tashkent Metallurgical Plant, Tashkent Examination Center, IMZO plant, Infectious Diseases Hospital, etc.). In addition, 52 new ground public transport routes will be created (4 trunk, 5 ring, 30 connecting and 13 delivery routes). Also in 2023, it is planned to replenish the Tashkent public transport fleet with 1,000 new buses.

In order to increase the efficiency of financial and economic activities of public transport enterprises and improve the quality of transport services provided, a new system of financing carriers will be developed based on the volume of work performed according to the criteria “distance traveled” and “quality”. In order to increase the efficiency of carriers and improve the quality of road transport, a rating of carriers will be introduced.

In conclusion, it should be noted that the measures planned for 2023 in the transport industry will serve the development of the country’s economy and will contribute to further improving the welfare of the people.

Zarina KosimovaSharofiddin ShamsiddinovCenter for Economic Research and Reforms under the Administration of the President of the Republic of Uzbekistan

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