Tatarstan prefers export to import substitution
For two years of economic sanctions against Russia, almost all regions have entered the race on the launch of import substitution productions, having managed to attract preferential loans of the Industrial Development Fund at 30 billion rubles. As it became known at a 'parliamentary hour', attended by the correspondent of Realnoe Vremya, Tatarstan has defended three projects at the total investment volume of 20 billion rubles. However, the Republic is not going to earn from the import substitution, it prefers to do it due to export.
Tatarstan is not the leader in import substitution
On 21 September, the Minister of Industry and Trade of Tatarstan Albert Karimov reported in the parliament on the course of the work of the import substitution in Tatarstan. The federal government announced about the competition in import substitution in the Russian economy immediately after the sanctions against Russia were imposed in 2014. Many sectors of the economy have suffered from the weak ruble, but also there are those that have managed to benefit from the devaluation of the national currency and even to return the lost competitive ability.
In the first place, we are talking about the import substitution domestic productions, which products after soared dollar rate turned out to be more affordable that foreign ones. For two years, the Industrial Development Fund have distributed about 30 billion rubles of preferential loans, issued at 5% per annum, for import substitution investment projects. According to the IDF, the leader regions are Saint Petersburg, Moscow Oblast and Moscow (see the table 'Top five in issued loan volumes')
Top five in issued loan volumes
NUMBER OF PROJECTS | LOAN AMOUNT OF IDF, BILLION RUB | AMOUNT OF ATTRACTED INVESTMENTS, BILLION RUB | TOTAL COST OF PROJECTS, BILLION RUB | |
Saint Petersburg | 5 | 1,9 | 4,2 | 6,1 |
Moscow Oblast | 6 | 1,9 | 1,2 | 3,1 |
Moscow | 5 | 1,7 | 2,5 | 4,2 |
Sverdlovsk Oblast | 6 | 1,5 | 3,8 | 5,3 |
Kaluga Oblast | 4 | 1,5 | 5,7 | 7,2 |
Mechanical engineering depends on import the most
As the Deputy Minister of Industry and Trade of Russia Vasily Osmakov stated at the forum 'Import Substitution-2016', for two years the industrial enterprises of Russia have manged to attract the investments at about 200 billion rubles (for every ruble of the IDF it was almost 7 rubles of private investments). What is more, the most part of the projects were directed to realize the import substitution mechanical engineering products for oil and gas companies, which have fallen first under the international embargo. Therefore, Russia started to slash the import of foreign technological equipment at the expense of the energy industry.
The Minister of Industry and Trade informed the deputies that the import has decreased to 179 billion rubles this year, in Tatarstan – to 27 billion rubles. According to his data, the lowest level of import at 25-27% — in the Tatarstan chemistry, and the highest – in the Tatarstan mechanical engineering (at the level of 40%), what is no wonder. According to him, Tatarstan is one of the first regions that started to create the sectorial plans of import substitution in industry. The renewed development plan was adopted by the government of Tatarstan on 13 September of this year.
'The return is expected in the form of 14 billion of taxes and 2 thousand jobs'
'Out of 2 thousand technologies that are included in the federal register of import substitution, about 120 of them are from Tatarstan,' he said. As the large-scale investment projects in this field he cited Ammonia OJSC, the ethylene complex of Nizhnekamskneftekhim PJSC and KZSC-Silicone. However, he said nothing of the federal support amount. Speaking about the results of the projects defend in the IDF, Karimov told the deputies that among the 77 approved projects there are Tatarstan ones.
In fact, only two of them have Tatarstan roots — Kama Technology for growing of sapphire and Safplet, belonging to AK Bars Holding. The third one — Interskol-Alabuga CJSC, which received almost 500 million rubles for the construction of a plant of power tools in the SEZ Alabuga, has only a Tatarstan residence permit. However, at the stage of obtaining a loan there is the fourth Russian project – Rostoner, which is planning to expand the production of toners and cartridges in the SEZ Alabuga.
Another channel of the financial support in import substitution is the participation in competitive selections for inclusion in the comprehensive investment projects in priority industries. As Karimov reported, 12 projects received subsidies for reimbursement of the investment credits cost. 'The return is expected in the form of 14 billion of taxes and 2 thousand jobs, including on the territory of single-industry towns,' said Karimov, without revealing either financial performance or the names of companies-winners.
The government does not support petrochemistry
However, the Tatarstan petrochemistry is working in the direction of import substitution without any state support. According to Karimov, in cooperation with Nizhnekamskneftekhim, Kazanorgsintez and Danaflex, they have managed to reduce purchases of imported raw materials to 20% for the production of food packaging, and the Zelenodolsk manufacturer of refrigerators POZIS refused from the Korean plastic in favor of Nizhnekamsk one.
The government of the Russian Federation is switching from budget interventions to healthy protectionism. Karimov pleased Tatarstan industrialists with the fact that from January,1 of this year, the domestic suppliers will receive a significant price advantage in government procurement. '5 days ago, it was adopted the resolution of the government of the Russian Federation No. 925, according to which domestic goods at the tenders will be considered 15% cheaper than foreign ones. We will discuss this mechanism,' he said simply, without explaining the essence of the idea.
At the end, Karimov noted that the displacement of imports from the Russian market is important but it is 'not a panacea for the Republic': 'At 50% the Tatarstan economy is based on exports, so on behalf of the President of RT, we are developing an export strategy.' Apparently, this document is still so raw that he again did not mention any striking figure. But the deputies didn't ask a single question on the issue of import substitution.