Taliya Minullina: ‘In the current situation, the investment agenda is especially complicated’
Tatarstan investors seriously puzzled the Investment Council in 2023. Master Cleaning holding from Moscow working under the brand of Cotton Way and Iriston Kama road structures producer from Mendeleyevsk offered to switch to long-term offset public contracts providing demand for services and products during 10 years. But at the moment the republic can provide a firm guarantee only for three years, noted head of the Tatarstan Investment Development Agency (TIDA) Taliya Minullina. Only Alabuga Special Economic Zone got the unconditional right to get a plot of land they wanted without auctions, while Nefis’s application for lands in Zelenodolsk Districts was sent for improvement. The Investment Council’s meeting was behind closed doors. Taliya Minullina talked about some of its details at the end, Realnoe Vremya’s correspondent says.
88.5 billion rubles through 2030
Russian businesspeople and investors gathered for this year’s first meeting of the Investment Council only in late March, but they managed to surprise both with their generosity and insistence in softly pushing the state to mutual commitments. A total of eight projects for 88.5 billion rubles were approved, but entrepreneurs are no longer happy about habitual preferences like land parcels given without auctions, tax concessions. New bonuses are needed urgently — guaranteed sale in the region that will provide long-term demand and a business’s workload. In other words, the problem of switching to offset contracts was again voiced during debates of the Tatarstan Investment Council, Realnoe Vremya was said by its members after the meeting (Editor’s note: the meeting itself was closed for the press).
“In the current situation the investment agenda is especially complicated,” noted Taliya Minnulina. “When risking their capital now private investors must be sure that game rules won’t change in the course of a project. We discussed stabilisation clauses, public commitments. As a region we can sign offset contracts. The first projects will provide over 1,000 jobs, plus, it is a big amount of private capital funding. Perhaps, such meetings aren’t frequent, but they are crucial for the economy because we can both develop a territory and improve the quality of services and products made for the population in exchange for investments thanks to private injections.”
In other words, investors ask to switch on a mechanism of guaranteed demand in exchange for private investments in the region.
Nefis offered to be located near M12 highway
Logistic projects turned out to be the biggest in terms of investment. A construction project of a logistic facility of Alabuga SEZ in Tukay District for 12 billion was easily approved without disagreement. According to TIDA’s head Taliya Minullina, Alabuga Development management company was the only applicant to be granted the right to the land without auctions.
An investment application of Nefis Cosmetics for the construction of a warehouse for 7.5 billion rubles in Zelenodolsk District was sent to be improved. The cause is that it was offered to consider a more favourable location along the M12 highway.
“At first we applied for the location in Zelenodolsk District, but Mr Minnikhanov offered another site near the M12 as more favourable for freight transportation. In the end, the final decision hasn’t been made,” the head of TIDA said.
According to her, the agency intends to defend the first location.
“We will stick to the decision we prepared for Zelenodolsk,” she assured the audience.
The boom of investments in logistics, as Minullina noted, is linked to production expansion.
“Logistic complexes are needed very much now because production expands. Nefis Cosmetics has four warehouses. It isn’t enough for them, this is why they are choosing a site,” she said.
Arctic Burlak coming to Alabuga
The project of entrepreneur from Kurgan Vladimir Ufimtsev creating Arctic off-road vehicles Burlak turned out to be the fastest from the perspective of launching production. The vehicles operate in Chukotka, Khany-Mansi and Yamalo-Nenets autonomous districts, Komi and Yakutia as well as in the Antarctic.
Seven off-road vehicles are used in the Southern Pole in the construction of a new Vostok Antarctic station. The Kurgan entrepreneur decided to relocate the plant to Alabuga SEZ to expand the production.
“Off-roads are the first out of eight to be sold. We have ready-to-use areas for rent, agreement to get the status of Alabuga resident will start soon (perhaps, online, we consider them very quickly),” Taliya Minullina explained.
Investments total about a billion rubles. The entrepreneur himself will get tax concession as a SEZ resident. Why did he want to settle in Alabuga? According to the head of TIDA, the republic doesn’t have alternatives in readiness of rent areas.
“We always work across the republic, consider all the districts that have such areas, technical characteristics they need to have. But nowadays the republic simply doesn’t have alternatives to Alabuga SEZ in ready facilities, this is why the project landed in this zone. It has a lot of other concessions, but today they are competitive because of having ready facilities for rent,” noted Taliya Minullina.
One of KazanExpress founders Linar Khusnullin’s project is one of approved logistic projects — an e-commerce town in Verkhny Uslon District. But here he is a private investor who implements a project for 350 million rubles of borrowings. He asked for 19ha of land in Verkhny Uslon District. “We asked the rais to lease and later buy it, without auctions,” he said. The construction of the town will start with an industrial park for storing products. Its area is 10,000 square metres. Sellers with a revenue of over 500,000 will be its tenants. The rent rate is 450 rubles per square metre. The project is expected to be launched later this year, explained Khusnullin.
Offset for three years?
Master Cleaning holding from Moscow working under the brand of Cotton Way and Iriston Kama road structures producer from Mendeleyevsk offered to switch to long-term offset public contracts providing demand for services and products for 10 years.
“Unfortunately, a public order for our services in the long-term was impossible. Amendments to the federal law No. 44 on the addition of services to the procurement list, not only equipment and appliances, were made in 2022. This has never happened anywhere in the country yet. We hope the first practice will be in Tatarstan, which will allow us to deal with innovations,” said owner of Master Cleaning Alexander Utkin.
According to him, if the company gets a contract for 10 years, then there will be an opportunity to “improve and experiment” and do something bigger. The company has been providing cleaning services to Tatarstan for 11 years.
“We participate in contests once a year, three years and win them. In this regard, nothing will change — the amount in health care won’t change. Even if there was made a decision to use an offset contract for our services, we would anyway develop our activity for kindergartens and the social sphere. But the offset contract will give more freedom in using administrative solutions,” Utkin explained to Realnoe Vremya.
He hopes Tatarstan will be the first region in the country to launch offset contracts.
The likelihood of the appearance of offset contracts is high, but a limited three-year budget planning term is the obstacle.
“Earlier, federal legislation set a high bar that was unattainable for small companies. Now the investment threshold for offset contracts with the only supplier is about 10 times lower — from a billion to 100 million rubles,” said the head of TIDA. “What restricts us? This three-year budget planning, while an offset contract is signed for 10. How can the state guarantee what it doesn’t manage? This is a bone of contention for all the regions. Unless budget planning is long-term, there can’t be agreements with private companies,” she noted.