Machinery manufacturing remains one of the key sectors of the manufacturing industry in industrially developed countries. In Kazakhstan, the development of this sector is viewed as a priority of state industrial policy and a tool for strengthening economic stability.

Financial instruments and incentive measures

Currently, both at the national and local executive levels, the country is continuing to implement state support measures under the “Comprehensive Plan for the Development of the Machine-Building Industry of the Republic of Kazakhstan for 2024–2028,” approved in 2023. State support is provided in the form of investments, export incentives, the creation of favorable conditions for leasing domestic engineering products, and other preferential financial instruments.

These measures are implemented through organizations that possess a wide range of financial instruments and support programs: JSC “Development Bank of Kazakhstan,” JSC “Industrial Development Fund,” JSC “Agrarian Credit Corporation,” JSC “KazAgroFinance,” and JSC “Damou Entrepreneurship Development Fund.” These institutions offer a wide range of tools—from preferential lending to export support.

The Kazakhstan Industry and Export Center Qazindustry plays a distinct role as the Ministry of Industry and Construction’s operator for the provision of state incentives.

QazIndustry reimburses a portion of enterprises’ costs in the following areas:

• certification of product and management system compliance;
• employee skills development;
• digital technology adoption;
• process improvement (including equipment procurement);
• production efficiency enhancement;
• domestic rail freight transportation.

Incentives for enterprises in SEZs

Additionally, machine-building companies operating within free economic zones (SEZs) receive significant tax and customs incentives for up to 10 years or more.

These benefits include the following:

• 0% corporate income tax;
• exemption from land tax and property tax;
• exemption from VAT and customs duties on imported raw materials;
• free provision of land and infrastructure;
• simplified procedures for hiring foreign workers.

A Focus on Localization and New Procurement Mechanisms

Efforts are ongoing to increase the share of Kazakhstani content in regulated procurement by large enterprises and subsoil users. A program to increase localization, with a focus on supporting small and medium-sized businesses, has been underway for three years. This allows machine-building enterprises to enter into long-term off-take contracts, increase production capacity utilization, and raise the level of localization.

In addition, as of January 1, 2026, the Register of Kazakhstani Manufacturers began operating, featuring automatic verification and priority access to procurement, replacing industrial certificates and ST-KZ certificates.

Export Potential and Challenges

At the same time, the production of electrical equipment remains the most export-oriented sub-sector in the country.

Thus, Kazakhstan exports the following annually:

• automotive batteries;
• transformer equipment;
• cable and wire products.

Export potential remains in the automotive industry (passenger cars, buses, commercial vehicles), agricultural machinery manufacturing (sprayers, mowers, livestock equipment), oil and gas machinery manufacturing (pumps, valves), as well as in the ventilation equipment segment.

Russia remains the traditional sales market. However, the current regional situation, along with payment and logistics challenges, necessitates the diversification of supplies and the strengthening of trade ties with Central Asian countries and Iran.

Key challenges in entering foreign markets include:

• insufficient price competitiveness;
• limited access to financing;
• a high degree of state support for manufacturers in other countries;
• administrative barriers and certification challenges.

“Machine building is the foundation of industrial sovereignty. Today, Kazakhstan has developed a set of tools that allow not only for the modernization of production but also for the stimulation of exports. The key task for the coming years is to strengthen localization, reduce import dependence, and increase the competitiveness of domestic products in foreign markets,” noted Toreadil Abdrakhmanov, Head of the Department of Electrical Engineering and Heavy Machinery Manufacturing at the Industry Committee of the Ministry of Industry and Trade of the Republic of Kazakhstan.

Development Prospects

It should be noted that the government is already implementing measures related to pre-export financing, export insurance, the organization of trade missions, and participation in international exhibitions and business forums.

Further reduction of administrative barriers, optimization of tax administration, and expansion of compensation mechanisms have the potential to significantly increase the country’s exports of engineering products and strengthen its position in global markets.

Source: Ministry of Industry and Trade of the Republic of Kazakhstan