Volume 04 Issue 09-2024
34
American Journal Of Applied Science And Technology
(ISSN
–
2771-2745)
VOLUME
04
ISSUE
09
Pages:
34-37
OCLC
–
1121105677
Publisher:
Oscar Publishing Services
Servi
ABSTRACT
The article is devoted to the experience of Uzbekistan in organizing the activities of regional cotton-textile clusters. It
analyzes the capabilities of regional clusters in the economic development of industries and regions. The goals of
clustering the cotton-textile industry in Uzbekistan and the measures being implemented to achieve these goals are
described.
KEYWORDS
Regional cluster, integration, synergistic efficiency, cotton-textile clusters, contract farming, value chain.
INTRODUCTION
Since 2017, clusters have been established in various
sectors of the economy in Uzbekistan as a means of
“expanding intersectoral cooperation, modernizing
and diversifying the economy and increasing the
production and export potential of underdeveloped
regions”[1]. In this regard, “r
egional agro-industrial
clusters are considered a key factor in achieving goals
such as the efficient use of land and water resources,
the development of agricultural and industrial
cooperation, and ensuring the balanced development
of regions”[2]. From 20
22 to 2026, through the
development of cotton-textile clusters, Uzbekistan
plans
to
“double
the
volume
of
sectoral
production”[2], including “increasing the processing
rate of cotton fiber and yarn to 100% and quadrupling
export volumes”[3]. Based on the i
nformation
provided above, it can be concluded that the rapid
development of the cotton-textile sector through
clusters in the regions, and the improvement of
Research Article
EXPERIENCE OF UZBEKISTAN IN ORGANIZING THE ACTIVITIES OF
COTTON-TEXTILE CLUSTERS
Submission Date:
Sep 20, 2024,
Accepted Date:
Sep 25, 2024,
Published Date:
Sep 30, 2024
Crossref doi:
https://doi.org/10.37547/ajast/Volume04Issue09-06
Sodikov Avazbek Madaminovich
Head of the Department of "State and Corporate Strategies" at the National University of Uzbekistan named
after Mirzo Ulugbek, Doctor of Economics, Professor, Uzbekistan
Journal
Website:
https://theusajournals.
com/index.php/ajast
Copyright:
Original
content from this work
may be used under the
terms of the creative
commons
attributes
4.0 licence.
Volume 04 Issue 09-2024
35
American Journal Of Applied Science And Technology
(ISSN
–
2771-2745)
VOLUME
04
ISSUE
09
Pages:
34-37
OCLC
–
1121105677
Publisher:
Oscar Publishing Services
Servi
mechanisms for organizing production using the
cluster method, are of critical importance.
A regional cluster is a group of interrelated enterprises
located in a specific area that are part of the main
technological chain of value creation. These
enterprises
achieve synergistic benefits
from
collaborative
activities
and
ensure
regional
development through the efficient use of resources.
Clusters are considered a key factor in driving
economic growth in regions, primarily due to their
ability to organize the effective utilization of local
resources[4]. As a result of developing and
implementing an effective policy for regional economic
growth based on the cluster approach, economic
growth points are formed at the regional level[5].
Clusters create an efficient value-added chain in
economic sectors by making rational use of a region's
natural and economic potential. They increase the
income of economic agents by producing high value-
added products[6]. Clusters act as unique "growth
points," becoming the driving force behind regional
economic development and stimulating the growth of
related and interconnected industries. Through
innovation
diffusion,
clusters
also
accelerate
innovative processes in the region, which in turn
fosters economic growth[7].
According to the operating principle of clusters, all
available resources in the region must be fully
processed. Cluster theory envisions creating a
production structure where one sector's product can
be utilized by another sector[8]. The joint use of
regional resources through a unified technology,
alongside the establishment of long-term, stable
relationships between raw material suppliers,
processors, and service providers, increases resource
efficiency and drives the development of sectors and
the regional economy. Vertical integration in clusters
reduces product costs stabilizes production and sales
processes and creates competitive advantages in
production, raw material supply, sales, and pricing,
while also improving the adaptability of enterprises to
market changes[9].
These characteristic and advantages have led many
countries to choose clusters as a key tool for
developing their economies at national, regional and
sectoral levels. In Uzbekistan in the new phase of
economic reforms, clusters are being established as a
means of developing industries, sectors, and regions,
and producing high value-added finished products.
Reforms in clustering have been especially dynamic in
the agro-industrial complex, with rapidly growing
regional cotton-textile clusters being particularly
noteworthy.
In our country, out of the 437 clusters established to
date, 133 are regional cotton-textile clusters . The
development of the sector based on the cluster model
is linked to the positive multiplier effects of regional
cotton-textile clusters. These clusters become
economic growth drivers in the regions, increasing the
gross regional product, positively
influencing
employment, and contributing to the development of
social and production infrastructure. They also provide
the population with affordable and high-quality
products while enhancing the natural and economic
potential of the region. Based on this, cluster projects
aimed at efficiently utilizing raw material and labor
potential, and promoting the socio-economic
development of regions, are being implemented in the
country, taking into account the unique natural and
economic characteristics and specializations of each
region.
The cotton-textile cluster model created in Uzbekistan
has no equivalent in other cotton-producing countries.
While Western Europe and Asian countries with
Volume 04 Issue 09-2024
36
American Journal Of Applied Science And Technology
(ISSN
–
2771-2745)
VOLUME
04
ISSUE
09
Pages:
34-37
OCLC
–
1121105677
Publisher:
Oscar Publishing Services
Servi
advanced light industries have successful textile
clusters, there has not been an integration of cotton
producers, processors, product distributors, suppliers,
and service providers into a single group as seen in
Uzbekistan. Globally, “contract farming” relationships
have been established to strengthen the ties between
cotton producers, processors, and exporters. In
developing countries, this model is used to integrate
small farmers into modern production and supply
chains. Under cluster contracts, technical and financial
assistance is provided to farms with the future
purchase of their products guaranteed. However,
issues arise when farmers, seeking quicker or higher
profits, breach contracts and sell to other traders. As a
result, processors, who are insufficiently protected by
legal systems, lose interest in providing advances and
technical support to farmers. This leads to financial
shortages for the farmers.
Cotton-textile clusters in Uzbekistan cultivate raw
cotton by directly leasing agricultural land, while farms
voluntarily affiliate with a cluster. Legal protection of
the parties' interests ensures that textile enterprises
recover their investments made in financially and
technically supporting the farms. Farmers receiving
financial support from textile companies gain the
ability to increase production volume and improve
product quality. Although farmers in clusters may not
receive a higher price for raw materials compared to
contract farming, the efficiently organized value-
added chain brings greater economic benefits.
Clusters are established at the initiative of textile
companies, a practice not implemented in other
countries. Regional cotton-textile clusters can be
formed either as a single legal entity or without
creating one. Organizing and managing cotton-textile
production through a cluster approach involves inter-
enterprise cooperation, where agreements are made
on principles such as supply, production, sales, and
collaboration. This enables the active participation of
both large investors and private enterprises of various
sizes in the clustering process. In both cases, clusters
maintain active cooperation with infrastructure
facilities and state administrative bodies. Cotton-
textile clusters cultivate raw materials based on direct
leasing of agricultural land, contracting with farms, or
using both methods simultaneously. There is a
particular focus on creating a full technological chain
for processing raw materials and producing high value-
added products. As the value-added chain extends and
develops, the efficiency of production and resource
utilization increases.
The organization and management of cotton-textile
clusters, as well as their relationships with other
economic entities, are regulated by relevant legal
documents. According to the Regulation on the
Procedure for Organizing the Activities of Cotton-
Textile Clusters, a 10-step system has been developed
for establishing these clusters in various regions[10]. A
four-party agreement is signed between the Ministry
of Agriculture, the Uzbekistan Cotton-Textile Cluster
Association, regional authorities, and applicants for a
duration of 30 years (25 years for foreign applicants).
Clusters are permitted to work with farmers under
contract in their areas, and they are prioritized when
leasing land plots.
The model developed in Uzbekistan for advancing the
cotton-textile sector aims to establish textile
enterprises not in major cities, as is common in
developed Asian countries, but around smaller towns
and rural districts. This approach helps mitigate the
disadvantages associated with high concentrations of
enterprises and addresses the socio-economic
challenges faced by these regions.
Volume 04 Issue 09-2024
37
American Journal Of Applied Science And Technology
(ISSN
–
2771-2745)
VOLUME
04
ISSUE
09
Pages:
34-37
OCLC
–
1121105677
Publisher:
Oscar Publishing Services
Servi
CONCLUSION
In conclusion, the goal of establishing cotton-textile
clusters in Uzbekistan is to create an optimal
production structure that facilitates effective
collaboration between producers, research and
educational institutions. This will enhance the diffusion
of innovations and improve the efficiency of utilizing
the natural and economic potential of the regions.
Uzbekistan has created a unique model for cotton-
textile clusters, with no analogs in other cotton-
producing countries worldwide.
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