Kazakhstan’s industrial sector has shown its strongest growth in years. From January to August 2025, the Industrial Production Index (IPI) rose to 107.6% compared to the same period last year. This marks a clear shift: industry is once again becoming the main engine of the country’s economy. The surge was driven by two key pillars – mining and manufacturing. Positive growth was recorded in most regions, showing that the industrial map of the country is gradually becoming more balanced.
In just eight months, Kazakhstan produced nearly 39.4 trillion tenge worth of industrial goods. Almost half of this came from manufacturing, while mining accounted for around 46%. This marks an important turning point. The economy is starting to rely less on raw materials and more on domestic processing that creates added value. This approach boosts resilience, reduces vulnerability to global price swings, and creates jobs within the country.
Mining was the strongest growth driver. The sector’s output rose by nearly 10%. Coal production increased by more than 11%, crude oil by over 13%, and natural gas by about 15%. This provided a large inflow of foreign currency and sparked growth in related sectors such as logistics, processing, and energy. The resource sector has once again become a major economic engine – but this time, it is not the only one.
Manufacturing also picked up speed, growing by 6.5% from January to August. This is one of the broadest and most sustained expansions in recent years. Machinery and fabricated metal products led the way, both increasing by over 15%. Food products, tobacco, petroleum refining, chemicals, rubber and plastics also showed strong growth. For the first time in many years, manufacturing is showing stable progress across multiple segments. This suggests Kazakhstan’s economy is beginning to diversify for real, reducing its dependence on raw material exports and creating more jobs at home.
Electricity, gas, heat, and water services are growing more slowly but steadily. Electricity generation and distribution increased, as did gas supply and hot water delivery. This sector provides the infrastructure backbone for the entire industry, so its stability is crucial. However, aging networks could become a bottleneck if investment does not keep up with rising demand.
Amid this overall growth, one weak link stands out – water supply and waste management. This segment saw a decline, with its index dropping to 93.9%. Water intake and distribution fell sharply, as did waste collection and recycling. These processes are critical for many industrial operations, and their decline could become a barrier to further expansion. Without investment in water and environmental infrastructure, industrial development could stall in several regions.
Industrial growth has spread across most of the country. Fifteen regions reported positive dynamics, with especially strong gains in Atyrau, Zhambyl, North Kazakhstan, and Turkistan regions, as well as in the cities of Almaty and Shymkent. Growth there reached double-digit levels. Meanwhile, production fell in five regions – Abai, Akmola, Kyzylorda, Ulytau, and East Kazakhstan. This shows that new industrial hubs are emerging on Kazakhstan’s map, while regional imbalances persist. Addressed industrial policies will be needed to narrow these gaps.
The most striking feature of the current upswing is how close the output of the mining and manufacturing sectors has become. Not long ago, Kazakhstan’s industry relied almost entirely on raw materials. Now, the share of manufacturing is nearly equal to mining. This structural shift makes the economy more stable, reduces exposure to external shocks, and broadens the tax base in the regions. Moving from raw extraction to processing makes growth more resilient and less dependent on global commodity cycles.
Still, this growth remains fragile. Weakness in water infrastructure could limit the expansion of new factories. Power grids are overloaded and need modernization, or the risk of failures will rise. Industrial activity is also concentrated in a few regions, widening the gap between richer and poorer areas. Without action, these vulnerabilities could slow growth in the medium term.
Even so, industry is once again becoming a system-forming sector – not just generating quick revenues from raw exports, but also providing stable growth through processing. This momentum is already lifting other sectors like transport, construction, and trade. The economy has gained a new push, and industry is becoming the anchor of Kazakhstan’s growth model.
If the current pace continues, Kazakhstan has a chance to lock in its diversification trend, increase non-resource exports, speed up infrastructure modernization, and reduce dependence on volatile commodity cycles. This will require investment in processing, infrastructure, and human capital. For now, the industrial sector is proving it can be the main driver of the economy in the coming years. The 107.6% index is not just a number – it’s a sign that Kazakhstan is shifting from a resource-based model toward an industrial economy. If the momentum holds, industry could become the key pillar of stability and future growth.
Lina Yegil kizi, expert of the portal EconomyKZ.org
