Against this backdrop, ensuring water security is becoming a key challenge for countries in the region. What measures are needed to modernize water supply systems? How to attract investment and introduce advanced technologies? How to establish regional cooperation in water resource management?

These issues were discussed by participants of the panel session “Decreasing Water Resources: Solutions, Strategies and State Priorities” at the IV Tashkent International Investment Forum. Gazeta correspondent Sabina Davletmuradova collected the main theses of experts and also discussed the priorities and prospects of the water sector with representatives of companies working in the field of water supply modernization.

The main challenges of the water sector in Uzbekistan

Agriculture remains the backbone of Uzbekistan’s economy, accounting for about 50% of employment and approximately 25% of GDP. In such an economic structure, water security issues are issues of sustainable development for the entire country.

“Uzbekistan is a landlocked country, and 96% of water resources are not used for drinking water supply. Only 4% of water is intended for drinking purposes.”

Moreover, 86% of the available water is surface water coming from transboundary rivers. Dependence on them is high, which creates additional risks.

Khurshid Rakhmatullaev. Photo: Tashkent International Investment Forum.

According to him, a large-scale program to modernize the water supply system is being implemented in Uzbekistan. It covers 20 major projects worth more than $2 billion. Another 15 projects are in the preparation stage. By 2040, the total investment in the industry could reach $4 billion. But along with the growth of the investment portfolio, the issue of resources is becoming acute:

“The question arises: will there be enough water to implement them?” asks Khurshid Rakhmatullaev.

One of the key tasks of Uzsuvtaminot is to reduce water losses, both technical and commercial. Losses of non-revenue water today officially amount to about 30%, according to unofficial data – higher, the company’s deputy chairman said.

“We don’t hide it. We have to work with consumers to get the message across: water is not free, it needs to be used rationally.”

Uzsuvtaminot has developed a Water Sector Development Strategy until 2030. Its goal is to increase the level of drinking water supply coverage from 80% to 95% in five years.

“This is an ambitious task. We are negotiating with the World Bank, the Asian Development Bank and other partners. In a few weeks, we plan to present the strategy to the country’s president,” Khurshid Rakhmatullaev noted.

World Bank Lead Water and Sanitation Specialist Odette Duarte-Mushimpua noted that the WB is ready to mobilize up to $1.7 billion in investments through cooperation with other financial institutions and the private sector to help Uzsuvtaminot achieve 95% drinking water coverage by 2030.

Odette Duarte-Mushimpua. Photo: Tashkent International Investment Forum.

A serious challenge, according to the expert, is related to the large-scale lack of infrastructure and insufficient efficiency of water resources management.

“About 7 million people in Uzbekistan do not have access to reliable, managed water supply and sanitation. Only a third of wastewater is treated, and only a few cities have effective wastewater treatment facilities. Water supply coverage is currently around 80%, while sanitation coverage is only 30%. It is very important not only to build, but also to create an effective management system.”

In an interview with Gazeta, Odette Duarte-Mushimpua recalled that a World Bank project is being implemented in Uzbekistan , aimed not only at developing water supply and sanitation services (sewage), but also institutional support.

According to her, Uzbekistan’s key needs in this area include the development of infrastructure, human resources, and an effective financing mechanism.

The expert noted that the decline in available water resources in the region is a global trend, exacerbated in Uzbekistan by transboundary dependence . Water losses in irrigation and water supply systems can reach 40-50%, so it is also necessary to modernize the infrastructure and change the culture of water use.

“With resources shrinking, the country cannot afford to lose half of its water. Every drop must be used efficiently.”

In the medium term, she said, current investments and reforms will leave Uzbekistan much better prepared to face the challenges of climate change.

“The country is demonstrating a commitment to reform, the government has clearly defined its strategy, and Uzsuvtaminot has become a strong partner. This provides good prospects for the future.”

According to Khusan Khasanov, field representative of the Islamic Development Bank in Uzbekistan , water security challenges need to be considered in a regional context.

“There are issues of transboundary water management, competition between the needs of hydroelectric power plants and the agricultural sector, and the impact of climate change,” he noted.  “The rapid melting of glaciers in the Pamir and Tien Shan mountains threatens long-term water supplies, and droughts and floods are becoming more frequent.”

In addition, up to 50% of water is lost in old irrigation systems, and water-intensive crops, which consume 90% of regional water resources, continue to dominate agriculture.

The Islamic Development Bank supports the sector in several areas:

• modernization of infrastructure (irrigation, treatment facilities);

• development of climate resilience (drought-resistant crops, flood protection);

• promoting sustainable agriculture;

• increasing the capacity of local communities.

The bank’s portfolio contains more than $1.5 billion in investments in the region. Of these, $320 million has already been directed to Uzbekistan’s water sector. Projects worth another $200 million are in the development stage, said Khusan Khasanov.

“Supporting the water sector is our strategic priority in Uzbekistan,” the expert emphasizes.

For the future strategy, the Islamic Development Bank proposes to develop integrated water resources management, introduce real-time monitoring, improve policies and regulations, expand co-financing, and support innovative approaches and pilot projects.

Potential of the private sector and international partners

Investments must play a catalytic role because they cannot fully meet all water and infrastructure needs. Therefore, the government should engage businesses in water security issues, said Shea Flynn, Chief Sustainability Officer at The Coca-Cola Company .

Shea Flynn. Photo: Tashkent International Investment Forum.

Silvere Delaunay , Suez’s Senior Vice President for Central Asia and the Caucasus, noted that developing water infrastructure requires not only investment, but also the development of human capital. According to him, it is important to train local engineering and technical personnel – you can’t rely only on expats.

“Water is a complex system. We need qualified engineers and technicians. It is important not just to build, but to be able to manage the entire water supply chain.”

Suez operates in the water supply sector and is a partner of Uzsuvtaminot. During its first year of operation in Tashkent, Suez helped identify and eliminate water leaks, saving 25 million cubic meters of water — the equivalent of the consumption of a city with a population of 400,000 people.

Silver Delaunay. Photo: Tashkent International Investment Forum.

“The main challenge is to change the mindset: it is important to take into account not only the politically set tariff, but also the real cost of water and all associated costs – from production to wastewater treatment,” Delaunay emphasized.

“If you convert it into money, then with the cost of drinking water being about $1 per cubic meter, this is a saving of about $25 million ,” noted Delone.

Political will is already a plus, now we need clear rules

Almar Water Solutions Vice President Arancha Mencia stressed that political will is essential for private investors to enter the market. In Uzbekistan, she said, it exists thanks to the clear position of the president and the country’s leadership. However, to speed up the implementation of projects, clear rules of the game are important.

“There is money – private investors, international banks are ready to invest. The problem is not the money. The problem is the lack of ready-made projects and the fact that private companies need clear regulatory guidelines and coordination from the state,” Mencia said.

It is important not only to attract investments, but also to give private companies the opportunity to come up with ready-made solutions. Arancha Mencia noted to Gazeta that the company has already tested this model of work in Latin American and African countries. “Instead of participating in classic tenders, we offer the country a ready-made project – as is already being done in those regions.”

According to her, the main needs of the water sector in Uzbekistan include the construction of new treatment facilities, reconstruction of existing networks and provision of safe drinking water. She rated the country’s water supply system as a “seven” on a ten-point scale.

“There are challenges, but the government has the right vision and international agencies are actively involved. I am very optimistic about the region’s prospects – development will proceed actively. Our projects are designed for 20-30 years. In addition to capital, we bring technological expertise and long-term operational reliability. But for this to be possible, the private sector and government agencies must work in close partnership.”

As a positive example, she cited Uzbekistan’s success in the energy sector, where an effective public-private partnership (PPP) model has been created in recent years. But the water sector has its own specifics, and a separate strategy and a single coordinating body are needed here.

Among the priority measures, Mencia cited the need for clear regulation and policy mandates so that private companies can operate in a transparent and sustainable environment.

“The decline of water resources is, unfortunately, an inevitable process. We need to be prepared for it. The technologies exist – desalination, water reuse. We used to think that water stress would increase closer to 2050, but now we understand: it can happen earlier,” she concluded.

Government, Business and International Institutions: Cooperation for Water Security

Today, Uzbekistan has already created a legislative and institutional framework for large-scale infrastructure projects, including water resource management. However, it is in this area, according to experts, that the country will have to go through a path similar to the one it has successfully completed in the renewable energy sector.

Chetan Kapoor , a partner at financial consultancy Synergy Consulting, shares a similar opinion . He noted that there is a clear path forward in the renewable energy sector, but the government still has more to do when it comes to water.

At the same time, there is interest from investors. The water supply and wastewater sector is currently a priority area for investment funds: “Companies like TAQA Water Solutions, ALPERIA are very keen to invest in this market,” said Chetan Kapur.

According to Abdulwahab Sharif, a representative of TAQA Water Solutions, companies should be encouraged to implement water-saving technologies. It is necessary to modernize outdated infrastructure and use modern solutions – for example, AI-based systems that allow tracking the path of every drop of water. He also named the reuse of purified water as a promising direction – in Abu Dhabi, the share of such resources reaches 80%, in Uzbekistan, according to his assessment, there is also potential.

Abdulwahab Sharif. Photo: Tashkent International Investment Forum.

Deputy Chairman of the Board of Uzsuvtaminot Khurshid Rakhmatullaev added that the water sector requires an individual approach. Tariff issues are extremely sensitive and depend on the region and the specific project. In his opinion, installing smart meters in Karakalpakstan is impractical if a family pays $20 a year for water, and the equipment costs $200. Projects should also take into account the social accessibility of services.

Sylvain Delaunay (Suez) noted that solutions for cities and rural areas must be different. It is important not to copy models from other industries, but to build long-term partnerships, develop local competencies, relying on a pragmatic approach.

WB expert Odette Duarte-Mushimpua stressed that private partnerships should bring real value to both the state and the people. It is important to work with infrastructure data, transparency of rules, and use financial guarantee mechanisms to reduce risks. At the same time, it is necessary to form an understanding among the population: it is worth paying for a quality service.

As one participant noted, research shows that it is the poor who are more willing to pay for reliable water supply – but only if such a service is actually provided.

Many participants in the session stressed the importance of regional cooperation. No financial institution or government body can cope with this large-scale challenge alone, Sachdev Ramakrishna, director of strategic initiatives at Marco Polo Ventures, told Gazeta .

Sachdev Ramakrishna. Photo: Tashkent International Investment Forum.

“We are currently creating a multi-stakeholder platform within the World Bank’s Water Resources Group. This means that government agencies, private companies with technology and financing, and local communities themselves, such as mahallas, are all involved. In the context of climate change and population growth, it is important for all parties to work together to shape a common future in the area of ​​water use.”

Ramakrishna assesses the future of the region with cautious optimism: “If nothing is done, the consequences will be serious: agriculture will suffer, the quality of products will decrease, which will lead to a deterioration in the health of the population and a decrease in the country’s GDP. But given the political will and creativity of society, there is every chance to cope with the challenges. The main thing is to work ahead of the curve today and build a fair water management system where everyone will be guaranteed access to water .”

https://www.gazeta.uz/ru/2025/06/19/water-crisis/

Machine Translated by Google