Mechanisms to encourage investment process in the Astrakhan region

The Government of the Astrakhan region uses different mechanisms to

stimulate investment process in the region combining administrative (investment
law improvement, assessment and monitoring of investment projects) economic
(government support for priority projects by tax benefits, budget guarantees,
subsidies, mechanisms of depreciation and capital charges) and institutional
mechanisms to create and support a number of institutions necessary for subjects
of regional investment system and to implement the investment strategy of the
region.
1. Creating an enabling regulatory environment for investment
An Investment Council under the Government of the Astrakhan Region is
established in the region as a coordinating, inter-agency body for investments with
the view to improve the investment climate and interaction with investors. The
Council is chaired by the Vice-governor - Chairman of the Government of the
Astrakhan Region and formed from the heads of relevant executive authorities of
the Astrakhan region
Non-Profit Partnership "The Caspian Investment Agency" is defined as a
strategic partner of the Government in the field of investment promotion and
investor relations.
It has the following main functions: to create positive image and
attractiveness of the Astrakhan region in Russia and abroad; regularly search and
attract investors; develop promising investment areas; create project teams to
support specific investment projects as well as to develop proposals for improving
the investment climate.
The main emphasis by the Government of the Astrakhan region is on
improving the regional investment legislation.
A new adopted Law of the Astrakhan region No.17/2011-Z dated
13.04.2011 "On public support of investment activity in the Astrakhan region",
allows the Government of the Astrakhan region to use new mechanisms to
stimulate investment activity including tax benefits, public investment, subsidies
from the regional budget, state guarantees as well as to provide property of the
Astrakhan region as security for loan obligations of investors in the
implementation of significant projects in the region.
Currently, the Agency for State Property Management of the Astrakhan
region defines a list of the regional property objects to be included in the mortgage
fund of the Astrakhan region as well as determines how to transfer these objects to
guarantee fulfillment of loan obligations of subjects of investment activities who
have no property, property rights, allowing them to enforce the obligations in full.
In addition, the new law provides informational support to investment
activity in the Astrakhan region as well as quality monitoring of investment
projects by heads of executive bodies and local authorities with their personal
responsibility for the implementation of projects.

2. Creating the infrastructure prepared for investments

Territories of the integrated development (TID) with infrastructure prepared
for investments are formed in the Astrakhan region in order to create conditions for
industry and agriculture development including new production and the most
advanced technologies.
In accordance with the Resolution of the Government of the Astrakhan
region No. 147-P dated 31.03.2010 On the procedure for creating territories of the
integrated development of the Astrakhan region municipalities form isolated areas
and within their boundaries by the respective budgets carry out land management,
put the land to the state cadastre, register land rights and supply it with energy,
engineering, transport and telecommunications infrastructure.
Currently, two territories of integrated development have already been
formed in the Astrakhan region. They are the following: Industrial and
Commercial park Zaboldinskiy (Astrakhan, Leninskiy district) and Agroindustrial park Alcha (Alcha settlement, Jubileyninskiy selsovet,
Krasnoyarskiy district of the Astrakhan region). Local authorities of the Astrakhan
region are the projects initiators.
3. Formation of financial mechanisms to attract and support investment
The Government of Astrakhan Region actively works with local and
international development institutions, investment and venture capital funds,
banks, foreign government investment agencies, specialized financial institutions
and organizations to promote various investment projects.
It has entered into cooperation agreements with the State Corporation "Bank
for Development and Foreign Economic Affairs (Vnesheconombank),
Rosnanotechnologies, JSC "Russian Venture Company, as well as a non-profit
partnership National Association of Business Angels of Russia.
4. Tax Incentives for investment
In accordance with the Law of the Astrakhan region On state support of
investment activity in the Astrakhan region investment projects with a status of
investment project, approved by the Government of the Astrakhan region and
particularly important investment project are provided with exemptions for
income and property taxes in accordance with the regional legislation.
Income tax
Status name

Basic rate

particularly important
investment project
investment project,
approved by the
Government of the
Astrakhan region

Property tax

Concessionary rate Basic rate Concessionary rate

0,2 % (on all
property)

13,5 %
20%

2,22%
15,5 %

1.1% (on the

property involved
in the project)

Investment projects with a status of investment projects implemented in the

territory of the integrated development are supplied with transport and (or)
technical infrastructure for their realization on the territory of the integrated
development.
There are 223 investment projects being currently implemented in the region
with total investment of 317.7 billion rubles.