IMPLEMENTATION LEVEL

National

AFFECTED FLOW

Inflow

ANNOUNCED AS TEMPORARY

No

NON-TRADE-RELATED RATIONALE

No

ELIGIBLE FIRMS

all

JUMBO

No

TARIFF PEAK

No
← back to the state act
Inception date: 23 Apr 2010 | Removal date: open ended
Still in force

Instrument unclear

The Russian government approved the car-making industry development strategy until 2020. The strategy outlines in detail the grandiose plans for Russia's carmakers and their foreign partners. The plan starts off describing the situation in the domestic auto industry as "ambiguous." The state of the industry, especially in the passenger car segment, is "critical" and will completely disintegrate in three to five years unless the government takes decisive systematic measures.
 
The Russian government plans to invest US$6 billion in its domestic automotive industry by 2020 as it looks to modernize and improve the competitiveness of the domestic industry's infrastructure. The Russian government sees around US$60 billion being invested in total during the period in question but with the majority of that investment coming from foreign and domestic businesses and automotive component suppliers.
 
The Cabinet estimates the capacity of the car market in Russia will increase to 3.6 million units a year, with the share of imported cars at 20 percent, and exports at 8 percent. The strategy introduces stimuli for the demand, tax and insurance measures, tariff and non-tariff stimuli, and measures to support domestic auto makers. In addition, it provides for stimuli in high-tech productions, subsidized interests rates on loans, five-year deferment on loans, state guarantees for loans and setting up a research infrastructure.
 

Russian domestic producers are expected to get by 2020 up to 80% of the Russian domestic market for light cars, up to 97% of the domestic market for tracks and up to 99% - for buses.
 
The government's decision to pour unprecedented funds into a mostly Soviet-era technological base rather than opening the borders and making foreign cars affordable is dictated by social pressures and interest in economic security. The restructuring the auto industry is part of Russia's long-held goal of diversifying its economy away from its current dependency on natural resources.
 
Prior to its crash in 2009, the auto industry contributed about 1 percent of gross domestic product, and its share should grow to 2.38 percent by 2020, according to the Cabinet's plan. The government expects the market to return to pre-crisis levels by 2013-14. Return on its investment is expected within five to 10 years.
 
 
 

AFFECTED COUNTRIES

MAP
TABLE
EXPORT

AFFECTED SECTORS AND PRODUCTS

435 Lifting & handling equipment & parts
8709 Works trucks, selfpropelled, not fitted with lifting or handling equipment, of the type used in factories, warehouses, dock areas or airports for short distance transport of goods; tractors of the type used on railway station platforms; parts of the fore
870911 Electrical
870919 Other
444 Machinery for mining, quarrying & construction; parts
8704 Motor vehicles for the transport of goods.
870410 Dumpers designed for offhighway use
491 Motor vehicles, trailers & semi-trailers; parts
8702 Motor vehicles for the transport of ten or more persons, including the driver.
870210 With compressionignition internal combustion piston engine (diesel or semidiesel)
870290 Other
8703 Motor cars and other motor vehicles principally designed for the transport of persons (other than those of heading 87.02), including station wagons and racing cars.
870310 Vehicles specially designed for travelling on snow; golf cars and similar vehicles
870321 Of a cylinder capacity not exceeding 1,000 cc
870322 Of a cylinder capacity exceeding 1,000 cc but not exceeding 1,500 cc
870323 Of a cylinder capacity exceeding 1,500 cc but not exceeding 3,000 cc
870324 Of a cylinder capacity exceeding 3,000 cc
870332 Of a cylinder capacity exceeding 1,500 cc but not exceeding 2,500 cc
870333 Of a cylinder capacity exceeding 2,500 cc
8704 Motor vehicles for the transport of goods.
870421 g.v.w. not exceeding 5 tonnes
870422 g.v.w. exceeding 5 tonnes but not exceeding 20 tonnes
870423 g.v.w. exceeding 20 tonnes
870431 g.v.w. not exceeding 5 tonnes
870432 g.v.w. exceeding 5 tonnes
870490 Other

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