How to attract investments: Minullina calls for increased spending on roads to industrial parks

“There is a lot of money in the country, it is difficult to withdraw it”

Tatarstan is among the top 10 regions of Russia in terms of attracted investments, but it lacks just a little bit to break into the top five, they noticed at a visiting meeting of the Committee on Economy, Investment and Entrepreneurship of the State Council of the republic on 18 November. For the first time in several years, Tatarstan parliamentarians of the new convocation arrived at the “investment lullaby” of the republic to devote almost four hours to it. Among the honoured guests, there were the grandees of big businesses — CEO of Nizhnekamskneftekhim Marat Falyakhov, head of Ak Bars Shipbuilding Corporation Renat Mistakhov, as well as respected guru — economist Marat Galeev. Moreover, they were concerned not so much about Tatarstan's winning positions in the ratings, as about the prospects for further attracting investments into the republic's economy. Indeed, in the conditions of a three-fold increase in the Central Bank's key rate (from July 2023 to November 2024), it is easier for an investor to put money on deposit and “cut coupons” than to build new production facilities in the regions, the participants of the meeting agreed. Should we expect investment growth? What should be done to stimulate private capital inflows?

So far, the results of the first half of 2024 do not give cause for alarm. According to the Investment Development Agency, Tatarstan took the sixth place in attracting investments in GRP, collecting 521.5 billion rubles. St. Petersburg (579.9 billion rubles) and Moscow Region (635.8 billion rubles) are ahead. The top three are Moscow (2 trillion), Khanty-Mansi Autonomous Okrug — Yugra (799 billion) and Yamalo-Nenets Okrug (744 billion). Tatarstan is moving in the dynamics of 2023, when the republic managed to double the result, Talia Minullina noted.

According to her, investments in the republic are directed to manufacturing industries. Still, the slight lag behind Saint Petersburg stings a little. As Talia Minullina stated, there is a lot of money in the country, it is difficult to bring them abroad, so investors will invest. Logistics (warehouses), innovative technologies, medicine are trending sectors, she listed.

How investors' dreams crash on a 'broken road'

They invest in Tatarstan by creating production facilities in industrial parks. But weak, undeveloped infrastructure spoils the situation, and disappointed investors flee. An instructive case was brought from Almetyevsk. In the summer of this year, a Russian resident engaged in glass production left a private industrial park owned by individual entrepreneur Gaiutdinov. The reason is a damaged access road, which caused the products to shatter into pieces during transportation.

“A large shipment of glass from Moscow made it all the way to Kazan intact, but it shattered as it approached the industrial park," said Bulat Timerbaev, CEO of Proekty Tatarstana, recalling the summer incident.

The investor could not survive such a loss and terminated the agreement. Although it was necessary to lay an asphalt road, neither the management company nor the resident had money.

“Not only do new residents not come there, but they also leave. The road is in terrible condition," Talia Minullina highlighted the “case of the moment”. “They don't just want beautiful and smooth asphalt. They couldn't work without it.

Many industrial parks cannot benefit from weak infrastructure, so it is necessary to increase spending for these purposes. Currently, the budget of the Ministry of Economy of the Republic of Tatarstan is modest.

"500 million rubles are [given] for everyone, and there is a serious struggle between industrial parks [at the competition of the Ministry of Economy on the distribution of subsidies for engineering infrastructure, — ed.]. This volume is definitely not enough," the head of the Investment Development Agency appealed to parliamentarians for support.

Over the past two years, only two parks have received state support for road construction. These are the Menzelinsk industrial zone and the Vesna industrial park in Vasilevo. Now, the industrial park of individual entrepreneur Stakheev in Chistopol is next in line. Today, 17 private industrial parks are under the supervision of PT JSC, and about 114 residents work in them.

“Most parks do not have a ready-made engineering infrastructure, this requires significant additional financial investments, which neither the management company nor the residents have. Basically, everyone needs asphalting of territories," Bulat Timerbayev said.

500 million rubles for everyone is nothing

In confirmation, the leadership of Zelenodolsk stated that with the support of the authorities (it does not matter whether federal or regional), the park begins to work and operate.

“Here we supported the Vesna industrial park for 50 million in terms of roads — and new residents immediately came. At first, there were four of them, and now there are eight. But all that happened was an access road inside the site," said Anastasia Bauer, the first deputy head of the executive committee of the Zelenodolsk district.

According to her, local authorities are currently discussing the construction of a new industrial park, Turbina, with an investment of 1 billion rubles, but 200 million is required to connect to electric grids. “We will apply for the program of the Ministry of Economy for 200 million rubles, while 500 million rubles are allocated for all parks. Of course, they can tell us: guys, you’re doing just fine, join the line at the back, the others have been waiting much longer. Of course, 500 million rubles is nothing," she agreed.

However, industry representatives called for regulating the “proliferation” of industrial parks, arguing that they are simply “draining resources from the defense sector”.

“We industrialists always have two problems: the first is no orders, the second is orders appeared," the head of Ak Bars shipbuilding Corporation, Renat Mistakhov, joked at first.

He advocated that the construction of industrial parks be streamlined.

“I am for private businesses, you need to keep in mind that 'the defence industry is being exposed.” The heads are tasked with increasing the number of industrial parks, and we, industrialists, bring personnel from afar. Here I have 400-500 people — visitors, they are living in a hostel. But they “eat up” the cost, I reduce investments in my plant. Something needs to be done with the personnel," he asked.

In response, the head of the agency assured that soon the placement of industrial parks will be carried out centrally. The map with their placement is prepared by the Institute of Spatial Development of the Republic of Tatarstan.

“There is an opportunity to raise road costs, but we need to look for sources, not all at the expense of the budget," Marat Galeev, a deputy of the State Council, summed up in conclusion.

According to him, the parliament will take the initiative to complete the construction of engineering infrastructure, including roads. In addition, the issue of building dormitories is being considered to attract personnel.

“Now the growth of sales of investment apartments will sharply slow down, construction companies will have excess capacity. There is an option to switch capacities to the construction of rental housing and dormitories," he said.

In addition, the deputies are going to adjust federal laws on PPP and concession agreements. It is possible that these issues will be submitted to the next session on November 28.