28 Jul 2023 12:59

Russian govt expands subsidy program for Northern Sea Route shipping

MOSCOW. July 28 (Interfax) - Participants in the Russian government's program to subsidize cabotage shipping along the Northern Sea Route (NSR) can now use the ports of Arkhangelsk and Nakhodka in their routes, which will make shipping cargo more lucrative and attractive for cargo shippers, the government said.

Previously, only shippers who used the Big Port of St. Petersburg or the Port of Murmansk on their routes in the western sector of the NSR and the ports of Vladivostok and Vostochny as terminal points were eligible for the subsidies.

Participants in the program can now also use chartered vessels for shipments.

Russia annually allocates 560 million rubles for subsidies for scheduled cargo shipments along the NSR. Companies can offset foregone revenue due to discounted rates, as well as expenses related to a vessel's arrival at port.

Under a presidential order, cargo traffic along the NSR is supposed to increase to 80 million tonnes by 2024. Work to meet this target is being done under the Northern Sea Route Development federal project.

Incentives for NSR shipping were discussed during Prime Minister Mikhail Mishustin's visit to the Nadezhda Metallurgical Plant of Nornickel's Polar Division on Thursday. In talks with company head Vladimir Potanin, Mishustin said that using this route significantly reduces transportation costs, particularly amid the unprecedented economic sanctions imposed against Russia.