"Kyrgyzstan-India Ties Boost Business Opportunities"

Kyrgyzstan and India share an ancient and rich history, rooted in traditional values. The long-standing cultural interactions highlight the deep bonds between the peoples, which grow stronger each year. In Kyrgyzstan, Indian culture is well-known and cherished—Kyrgyzstanis enjoy Indian cuisine, watch Indian films, and host over 17,000 Indian students. India has resumed regular flights on the Bishkek-Delhi-Bishkek route, with a travel time of only two and a half hours. The countries have also agreed to cooperate in preserving cultural heritage, protecting historical and cultural monuments, safeguarding protected areas, and preserving manuscripts through joint archaeological research.
There is a high level of political trust between the countries, reinforced by regular mutual visits at the highest levels. During Indian Prime Minister Narendra Modi's visit to Kyrgyzstan in 2019, the bilateral relations advanced to a new stage, achieving the status of a strategic partnership. The Bilateral Investment Agreement between the Kyrgyz Republic and India, along with amendments to the Agreement on the Avoidance of Double Taxation signed during this visit, have facilitated successful and mutually beneficial cooperation among the business communities.

In the agricultural sector, the Kyrgyz Republic can produce ecologically clean agricultural products that meet all necessary standards. It is encouraging to see the export of Kyrgyz agricultural products to India increasing in recent years. The textile and clothing industries are the most developed sectors within Kyrgyzstan's light industry. Given the small domestic market, it is export-oriented, with over 90% of products labelled "Made in Kyrgyzstan" being exported to Russia and Kazakhstan. This sector holds immense potential for further development.
Kyrgyzstan also boasts significant potential in hydropower, with an annual capacity of 142 billion kWh. Currently, only 10% of this potential is being utilised. Considering the global shift towards clean energy sources, Kyrgyzstan encourage all partners to explore and invest in Kyrgyzstan's hydropower potential, offering vast opportunities for foreign investors. Kyrgyzstan is also rich in tourism potential, thanks to its unique natural beauty. The country has numerous reserves, biosphere zones, resorts, and recreational facilities, offering tremendous opportunities for ecotourism, mountain tourism, mountaineering, hunting, and other outdoor activities. For Indian tourists, Kyrgyzstan offers a visa-free regime for those holding EU, USA, or British visas. Additionally, many Indians visit Kyrgyzstan to enjoy its nightlife, including nightclubs and casinos, with the benefit of lower prices compared to neighbouring countries.
The Kyrgyz government established the state enterprise “Kyrgyzpharmacy.” Representatives from this enterprise have visited India multiple times to establish contacts and secure contracts for the direct supply of pharmaceutical products. To facilitate business, it is crucial to establish direct correspondent relationships between Kyrgyz and Indian banks. Currently, 17,000 Indian students and about 200 medical tourists from Kyrgyzstan visit India annually for medical procedures and recovery. However, they must carry cash because Kyrgyz banks do not have direct correspondent or peer-to-peer relationships.

Mining, especially gold extraction is a politically sensitive yet highly appealing sector for foreign investors due to significant market opportunities. In 2022, the Kumtor mine, the largest gold mine in the region, produced nearly 556,375 ounces (approximately 17,305 kilograms) of gold. Central Asia, including the Kyrgyz Republic, also possesses substantial mineral deposits essential for clean energy technologies. There is a robust demand for information and communications technology (ICT) services in both the public and private sectors within the Kyrgyz Republic. Opportunities abound in software and service provision (including cloud storage) for government entities, the sale of IT equipment, construction of broadband and wireless internet infrastructure, cybersecurity solutions, and various services aimed at digitalizing in-person processes. In 2021, the Kyrgyz government established a Ministry of Digital Development and created preferential tax regimes through the "High Tech Park" and "Creative Industries Park" in 2011 and 2023, respectively. The government is actively seeking partners to help digitize citizen services nationwide.
Energy, particularly hydropower, is a key priority for the government, which is looking for external investment to develop small hydropower plants and modernize existing large ones. While solar, geothermal, and biomass markets are still in their infancy, solar energy is the most advanced, with several major solar farm projects announced that are currently seeking financing. The popularity of electric vehicles (e-vehicles) is on the rise, benefiting from various tax incentives for imports. The banking sector also presents opportunities for foreign companies. There is a strong demand for correspondent accounts from Kyrgyz banks and businesses. The government has collaborated with foreign banks to formulate plans for sovereign bond issuances. Following Russia's invasion of Ukraine in 2022, market demand has increased as businesses shift their banking operations to avoid international sanctions.

Erkinbek Kamalov