Business setup in Tajikistan: opportunities, risks, and choosing the optimal structure

Tajikistan remains one of the least developed economies in Asia. However, ambitious entrepreneurs can find significant growth potential here. The government is actively working to attract foreign investment, particularly as part of the National Development Strategy through 2030.

Opportunities for Foreign Investors

1. Priority Sectors
According to the 2030 strategy, key investment areas include:

• Manufacturing and industry;

• Infrastructure projects;

• Energy (including hydropower);

• ICT and healthcare services;

• Mining (gold, silver, coal);

• Agriculture.

The country’s abundant natural resources and limited expertise in their extraction create broad opportunities for foreign companies.

2. Advantages of Free Economic Zones
To stimulate business, the government has established free economic zones offering:

• Simplified registration with minimal bureaucracy;

• 100% foreign ownership;

• Free transfer of funds abroad;

• Zero corporate tax, VAT, and export customs duties;

• Employee income tax (8–13%) and social contributions (20%);

• Legal protection for investors.

3. Low Operating Costs
Rent, salaries, utilities, and logistics are significantly cheaper than in other Central Asian countries.

4. Geographic Location
Although landlocked and mountainous, Tajikistan is geographically and politically close to two major markets—China and Russia—as well as Kazakhstan, Pakistan, and Turkey.

5. Ease of Opening a Bank Account
Corporate account registration takes about one week, with no personal presence required.

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Main Risks and Challenges

• Corruption: Tajikistan is considered one of the most corrupt countries, affecting fairness in tenders, legal disputes, and interactions with government authorities.

• Limited Infrastructure: Poorly developed roads and railways complicate import and export.

• Legal Restrictions: All land is state-owned, with only usage rights granted.

• Political Instability: Risks are linked to proximity to Afghanistan and potential regional conflicts.

• Language Barrier: Conducting business without knowledge of Tajik or Russian is challenging.

• Restrictions for Foreigners: Directors and banking signatories require work visas, which can take up to three months to obtain.

Comparison of business legal forms in Tajikistan

There are four key forms available for entering the market: Limited Liability Company (LLC), Joint Stock Company (JSC), Branch of a foreign company, and Representative office.

	Limited Liability Company (LLC)	Joint Stock Company (JSC)	Branch	Representative Office
Best use	All products and services	Investor-owned business	Implementation of parent company projects	Marketing and research
Limited liability	Yes	Yes	No	Yes
Minimum share capital	$1	$1	$1	$1
Capital contribution within one year	$105	$1050	-	-
Tax certificate	Yes	Yes	Yes	No
Local director requirement	No	No	Yes	Yes
Minimum number of shareholders	1	1	Parent company	Parent company
Bank account opening	2 weeks	2 weeks	3 weeks	2 weeks
Employee income tax	8-13%	8-13%	8-13%	-
Corporate tax	18% standard rate, 13% for manufacturing companies	18% standard rate, 13% for manufacturing companies	18% standard rate, 13% for manufacturing companies	-
VAT	18%	18%	18%	-

Tajikistan combines high investment potential with significant risks. To succeed in this jurisdiction, foreign investors should:

• carefully choose the legal form of their business;

• take into account the specifics of local legislation;

• be prepared for bureaucratic and infrastructure challenges;

• secure the support of professional advisors.

With the right approach, investors can take advantage of free economic zones, low operating costs, and the country’s strategic location, while minimizing associated risks.