Russian ministry to change agricultural subsidies system in 2015
IZHEVSK. July 14 (Interfax) - Russia's Agriculture Ministry plans to change the process of subsidizing lending for agricultural producers as of January 1, 2015, Agriculture Minister Nikolai Fyodorov said at a meeting on the development of dairy farming in Izhevsk.
"As of January 1 we plan to simplify and accelerate the receipt of subsidies [for loans] so that they go directly [to agricultural producers], and we will settle up with banks so as not to burden producers," Fyodorov said.
At present, farmers pay the whole interest rate on loans, including the part of the interest rate subsidized by the government. They have to wait months for the subsidies to be reimbursed from the federal budget. For investment loans, the period for receiving compensation for part of the interest costs has already reached two years.
Agriculture market experts have said repeatedly that subsidies on loans should be paid directly to farmers.
Fyodorov also said that there are plans to reconsider distribution of subsidies away from producers who export raw materials.
"We have no business subsidizing and stimulating exports of raw materials, cheap raw materials. We need to export dairy products, sausage, intensively processed meat. And through this keep jobs, taxes and so on here," Fyodorov said.
However, the minister did not provide a timeframe for the implementation of these changes.
Interest rate subsidies on loans amount to about 70% (taking into account small-scale farming) of government support for agriculture. The government spent 52.5 billion rubles on this in 2012 and 48.7 billion rubles in 2013, and plans to spend 44.6 billion rubles in 2014.
