A new vertically integrated silk complex is due in Namangan.

The new facility will be created on the base of Vodiy Ipagi LLC. In 2012-2016, a Singaporean company Verigrow Rte. Ltd. is investing not less than $10 million in the project, including $5 million in the first three years. By the end of 2012 the complex is planned to produce 240 tons of raw silk and 2 million square meters of silk fabrics a year. Over 80% of output will be exported. After reaching its full capacity the company will create 700 new jobs. Verigrow Rte. Ltd. also plans to create specialized mulberry plantations on 200 hectares of land allocated by Namangan regional administration.

In 2012-2014, the Ministry of Agriculture and Water Resources of Uzbekistan will supply the new company with not less than 400 tons of dry cocoons annually for the production of raw silk. In turn, silk reeling enterprises of the republic will sell it silk threads for hard currency at a price not lower than the world ones at a zero VAT rate, provided that not less than 80% of products will be exported.

Until January 1, 2020 the company is exempt from land tax in terms of land under mulberry trees, the tax for the use of water resources for the amount of water used to irrigate lands, as well as the mandatory sale of foreign currency raised from sales of products for export.

In addition, until January 1, 2020 the company is exempt from customs duties on technological equipment, spare parts, components, accessories and building materials not manufactured in the country and imported under the project, as well as the elite and the super-elite silkworm eggs of up to 1.5 thousand boxes and mulberry trees.

This season, 44 thousand farmers in Uzbekistan produced 443,500 boxes of silkworm eggs and each received an average of 57 kg of yield.

The bulk of the harvest was of higher grades. In the first quarter of 2012, silk enterprises in Uzbekistan produced 563 thousand square meters of silk fabrics. (Source: “Uzbekistan Today” newspaper)