South Korean company Textile Technologies Group will spend $50 million to establish a textile mill near Uzbekistan’s capital Tashkent to produce yarn, fabric and garments from local cotton fiber, the fibre2fashion.com industry web site reported on Tuesday.

The firm will purchase land from the Uzbek government with unfinished buildings and facilities in the district of Yukori Chirchik in the Tashkent region for an additional cost of $400,000.

According to the terms of the agreement, Textile Technologies will invest $30 million this year and the remainder in 2012. Part of the money will be used to purchase the latest technological equipment from various countries, ship it to Uzbekistan and install it into the new facility which has yet to be built.

In 2013, the textile mill is expected to produce 6,000 tons of cotton, 80.7 million square feet of finished fabric and 5 million garments annually. Capacity will be raised to 8,000 tons of cotton fiber per year.

The South Korean company will export some 80 percent of the output.

Uzbekistan sees the investment as one of more than 100 planned projects in its textile industry development program for 2010-15.