Rosatom halves investment, endangering Central Asian nuclear deals

Rosatom is cutting its investment program by nearly 50 percent this year and aiming to reduce operating costs by 10 percent over the next 18 months. Chief Executive Alexei Likhachev cited "poor economic conditions" as the primary driver for the abrupt retrenchment. The scale of the pullback signals deepening financial strain within Russia's state-owned nuclear conglomerate.

The company is actively shelving or delaying initiatives to maximize short-term returns. "We immediately abandoned a number of projects or shifted the deadlines for their implementation to a later date, guided by several criteria, the main of which is efficiency in the horizon until 2030, that is, more profit and revenue per ruble of investment," Likhachev told Reuters.

Likhachev did not specify which projects will be affected, but the uncertainty threatens Rosatom's international portfolio. In Kazakhstan, the company holds a 2025 contract to build the country's first nuclear power plant at Lake Balkhash. The project has already faced disputes and delays widely attributed to Rosatom's inability to secure financing. This latest capex reduction raises serious doubts about meeting the mid-2030s completion target.

Uzbekistan faces similar risks. Rosatom has a preliminary agreement to construct small-scale nuclear plants there, and as recently as early 2026, officials attempted to soothe Tashkent's financing concerns by proposing an expanded nuclear cluster. The sudden investment freeze will likely amplify skepticism in the Uzbek government.

For energy investors and executives, Rosatom's retreat presents a clear commercial opening for rival nuclear technology providers. Both Central Asian nations have viable alternatives. Kazakhstan already has an agreement for a Chinese firm to build two nuclear plants. Additionally, both Astana and Tashkent have expressed interest in developing small modular reactors with US partners.

Rosatom's distress reflects a broader deterioration among Russia's traditional economic anchors, historically major cash cows for the Kremlin. International sanctions and the ongoing military campaign in Ukraine continue to drain state resources. This structural weakness was further underscored by the recent collapse of Gazprom's stock price, which has plummeted over the past three months, leaving the energy giant with a market capitalization of just $25 billion.