Uzbekistan is transforming its transport sector through rail electrification, road upgrades, and fuel diversification—strategies that offer valuable lessons for other landlocked and developing economies.
Uzbekistan seeks to become Central Asia’s main transit hub. The doubly landlocked country sees modern roads, railways and logistics links as the engine to lift it to upper-middle-income status by the decade’s end. But our assessment shows both tailwinds and headwinds.
The transport sector punches above its weight in Uzbekistan. It contributes 8% to GDP directly and employs more than a million people. Labor productivity in this sector has tripled over the past three decades, showcasing substantial progress. Even with these gains, it still lags behind the average in Asia and the Pacific.
On the ground, roads dominate the network, making up 97% of transport infrastructure. Further, 95% of these roads are paved, and 83% are in good condition. But dig deeper, and the cracks appear. Uzbekistan’s road density lags behind that of developed economies, and past investments have prioritized infrastructure expansion over maintenance.
Furthermore, despite substantial government revenue from fuel taxes and duties, these funds are not explicitly earmarked for roads. This leaves a gap between what’s available and what’s actually needed.
The ‘tyranny of distance’ weighs heavily on Uzbekistan. The domestic cost of transport is on par with its neigbours but it faces greater distances to global supply chains and higher international transport costs. Without bold action on international transit costs these could derail Uzbekistan’s transit dreams.
The future means a much tougher ride. The road network needs to expand by more than five times by 2030, and then by more than 13 times by 2050, to accommodate projected freight volumes.
Railways (only 3% of the network) are more than just a cog. They’ve recently gained attention due to their efficient and dominant logistics role – an antidote to long distances. More than half of the nearly 4,718 kilometers of heavy rail is electrified. However, the challenge lies in aging infrastructure: 90% of the rolling stock is nearing retirement and needs renewal within the next decade.
Urban rapid transit has expanded at a fast pace. Tashkent Metro has nearly doubled in length since 2017. Still, at 4 kilometers per million urban inhabitants, urban transit availability in the country trails significantly behind both Asian (8) and European averages (12). That’s a big, expensive gap to close.
Uzbekistan’s aviation sector exhibits a trajectory of modest, yet consistent growth. International air connectivity has seen significant improvement, though its role as a transit point for onward air travel is still in its early stages. The infrastructure improvements over the past decades have yielded substantial returns.
Uzbekistan has improved the efficiency of its supply chains, as indicated by the Logistics Performance Index, jumping from 129th in 2014 to 88th in 2023. In the future, it aims for a top 50 ranking.
Growth brings real trade-offs. The vehicle fleet expands faster than the road network, creating disproportionate reliance on roads for both passenger and freight. Transport energy consumption, dominated by road (97%), has grown 12% annually since 2010 – among the fastest in the world.
In theory, this should have led to a proportional increase in CO2 emissions. However, the actual growth in CO2 emissions has been noticeably lower, largely due to the ongoing energy transition. From just 2.7% of transport fuel in 2010, natural gas now powers 57% of the sector—one of the fastest transitions globally. Still, road transport accounts for 98% of the sector’s total emissions.
This dominance comes with a price. Road crashes cost the economy 3% of GDP. While emissions of particulate matter smaller than 10 micrometers in diameter (PM10) from transport have decreased, those from nitrogen oxides (NOx) have risen since 2015. This signals uneven progress in tackling air pollution.
Uzbekistan is addressing these issues with a basket of solutions and policy reforms that could be instructive to other countries in similar situations.
Their new transport strategy seeks to electrify railways, upgrade roads to boost transit cargo, and ensure 85% of rural roads are all-season by 2035.
Urban strategies are shifting focus towards public transit expansion, curbing private vehicle use, and promoting cycling. A landmark move in February 2024 scrapped labor code restrictions, allowing women to drive heavy vehicles and buses—a positive step in a male-dominated field.
Uzbekistan is also targeting a 35% cut in greenhouse gas emissions per unit of GDP by 2030, and the transport sector isn’t just a mere participant; it’s a cornerstone. The main building block of decarbonization is fuel diversification, especially the adoption of electric vehicles.
While the electric vehicle market is still in its nascent stages, sales are growing, and partnerships for local production are underway. However, a recent substantial increase in fees for imported electric vehicles could steer the market towards domestic manufacturing. It’s a strategic gamble with uncertain outcomes.
Building resilient transport infrastructure requires deep pockets. Significant infrastructure investments are necessary, not just to clear existing backlogs, but also to prepare for future demands. Strong policies with clear delivery time frames, backed up with earmarked investments are required.
Uzbekistan’s transport sector continues to evolve, facing the challenges and setbacks common in developing economies. Its goal of becoming a regional transit hub depends on building infrastructure that is not only new, but also efficient, resilient and environmentally responsible. The country’s approach offers lessons for other landlocked nations seeking to strengthen connectivity and spur economic growth.