The former Soviet central Asian state of Kyrgyzstan has a burgeoning textile and clothing industry, and is pushing ahead of regional competitors, a specialist from Harvard Business School has told just-style.

"Unlike other regional competitors - Tajikistan and Uzbekistan- Kyrgyzstan is more specialised downstream on apparel which has higher profitability margins [around 25%]," said Umar Shavurov, co-author of a Harvard report Textile and Apparel Cluster in Kyrgyzstan 2012.

"Nearly 700 SMEs [small and medium-sized enterprises] provide fertile ground for competition and agility to respond quickly to trend changes. The apparel sector rivals gold and precious metal in terms of share of GDP and export growth rate," she said.

However, the industry still faces several challenges, noted Shavurov. "Labour supply is a major headache for the companies. Seasonality is an issue - as businesses have no reliable demand forecasts and poor management skills."

The country's textile and garment industry grew by 49.5% in 2011 - the latest year for which data is available - according to Kyrgyz National Statistics Committee. The industry is worth US$160m, and represents 2.7% of GDP according to the committee.

The Harvard report concluded that textiles and apparel were "the fastest growing segment of the economy over the last decade and hold special promise as a contributor to future economic development."

It documented how the industry is concentrated around Bishkek, which is the base for 96% of textile companies, with small and medium-sized firms of up to 50 employees making up the majority of these enterprises. In all, 300,000 people - 12% of the labour force - are employed in the industry.

Women's apparel represents 40% of production, followed by undergarments at 30%, according to the authors of the study.