Agenda: expansion of the preferential car loan programme, amendments to the draft federal budget for 2024–2026, extension of the simplified permitting procedures for businesses, Russian Railways’ draft financial plan and investment programme for 2024.
Mikhail Mishustin’s opening remarks
Excerpts from the transcript:
Government meeting
Mikhail Mishustin: Good afternoon, colleagues.
Before we get to the agenda of the Government meeting, I would like to speak about a decision made on the development of the car industry.
The President noted that Russia having its own manufacturers at a level which would ensure the sector’s global competitiveness in general must become key in this industry.
About 30 billion roubles will be allocated to support Russian companies in this sector and increase demand for their products in the next three years. These funds will be used to implement the current car loan programme. It allows certain categories of citizens, such as medical workers, teachers, participants in the special military operation and their family members, to receive a discount of up to 25 percent of the cost of the car.
Now people with disabilities will also be able to take advantage of the discount offer.
When purchasing Russian electric vehicles on credit, the discount will increase to 35 percent. That is, the state will return up to 925,000 roubles to the buyer.
We hope that thanks to the measures taken, even more Russians will have the opportunity to purchase such cars, and this will also help improve the environmental situation.
Now moving on to our agenda for today. Let’s go over the amendments prepared by the Government to the draft federal budget for the next three years. As you know, it has already been approved by the State Duma in the first reading.
The amendments incorporate proposals from deputies, the Accounts Chamber, and the main managers of budget funds. They mainly concern the redistribution of resources among sections and target items. There are also a number of necessary clarifications, including with respect to the implementation of government programmes to provide people with affordable, comfortable housing and utilities; the development of healthcare; and education, which include priority funding for the construction of hospitals, outpatient clinics, and increasing school enrollment capacity.
Preferential lending for technologically innovative small and medium-sized enterprises has been expanded.
Expenditures have been detailed for measures to strengthen our country’s transport connectivity, and support nationwide public organisations of disabled people, investment projects to improve tourism infrastructure and the “I’m in business” youth entrepreneurship education programme.
This fine-tuning makes it easier to bring the budget financing over the finish line and to carry out all envisaged measures in order to achieve the goals that the President set for us.
One more important piece of legislation.
The Government continues its work aimed at ensuring the resiliency of the economy under sanctions pressure.
The President noted that one of the ways we can respond to the restrictions imposed by some countries on Russia is to cut a lot of red tape and provide greater freedoms to all participants in economic activity.
To this end, we are implementing a set of measures to simplify permitting procedures for businesses and to reduce costs, including administrative costs.
Today we will consider extending until the end of next year a number of the most popular and effective special regulatory measures in public procurement, financial markets, corporate, lease and labour relations, licensing and certification. And determining the peculiarities of the pharmaceuticals and medical products market. It is extremely important that people can always buy the necessary medicine.
The adjustments also concern the construction sector, specifically reducing the number of administrative barriers, shortening the investment and construction cycle, simplifying approval procedures in urban planning and land relations. This makes it possible to significantly accelerate the repair, construction and opening of residential buildings, roads, schools, hospitals and other important facilities without compromising quality.
Legislative changes in the current conditions will provide additional freedom of action for organisations. All services provided, products manufactured or imported into Russia for citizens and businesses must meet all the necessary requirements.
The next question concerns support for the railways sector. The President noted that it is of strategic importance for our vast country, the development of regions, the national economy and the quality of life of our citizens.
Railways are one of the main means of transport in Russia. Most cargo is transported along them.
Now the supply-side economy is actively developing, which the President spoke about. The role of exports is increasing, transport and logistics chains oriented to new markets are being built, and foreign economic cooperation with friendly countries is expanding. These factors should be taken into account when planning Russian Railways’ work.
Today we will study the main parameters of the company’s financial plan and investment programme for the next year. The investments will exceed 1.27 trillion roubles. The funds will be used to cope with ambitious goals.
About half of them will be spent on backbone railway infrastructure. The implementation of the Eastern Operating Domain project, which includes the Baikal-Amur Mainline and the Trans-Siberian Railway, will continue, which will help further increase transportation capacity within international corridors. Also, there are plans to develop railway approaches to the seaports of the Azov-Black Sea and North-Western basins.
A third of the funding will be spent on renovating and repairing railways and bridges, tunnels, stations and terminals, introducing digital technology and improving traffic safety.
To support the transportation of goods and create comfortable conditions for commuter rail passengers, the rolling stock fleet will be replenished. It is planned to purchase over 500 modern locomotives and 280 electric rail cars.
Minister of Transport Vitaly Savelyev will report in more detail on the main parameters of the investment programme and financial plan of Russian Railways for the next year.
Vitaly Savelyev: Mr Mishustin, colleagues,
Russian Railways continues to implement major plans to increase passenger traffic, build new transport and logistics routes, and ensure Russia’s technological independence.
The development of the Baikal-Amur Mainline and the Trans-Siberian Railway is coming to the fore amid the heightened demand for cargo transportation eastward.
The throughput capacity of this infrastructure is planned to reach 173 million tonnes this year, which is record growth of 75 million tonnes from the 2013 level, that is, over a ten-year period.
The opening of the third and fourth Moscow Diameters (MCD 3 and 4) in the Central Transport Hub MCD was an important milestone we reached this summer. In many ways, the MCD project is a benchmark for the development of urban rail transport in other regions.
Several major transport hubs opened to train traffic as part of the MCD project, including Ploshchad Tryokh Vokzalov and Zelenograd – Kryukovo, where passengers can change from rail to surface transport.
The total length of the new lines is over 170 kilometers, with 74 new stations, which have clearly improved transport accessibility in various parts of Moscow.
The development of railway infrastructure towards southern and northwestern Russia is ongoing.
With restrictions on air travel, Russian Railways has fully ensured transport accessibility in the south of Russia, including long-distance and suburban routes.
As a result, 1.147 billion passengers will be transported in 2023, up 3.6 percent year on year.
In addition, Russian Railways will have transported more than 1.2 billion tonnes of freight by the end of this year.
Russian Railways has reported record progress on its 1.2-trillion-rouble investment programme. It should be noted that more than 90 billion roubles have been invested ahead of schedule for the upcoming years. Such excellent results have been primarily achieved thanks to the high-quality performance of all employees of Russian Railways and its management.
The plan is to increase the corporation’s share capital by 162 billion roubles by the end of this year to ensure additional investment sources. The Government has approved spending 45.5 billion roubles earmarked for 2024 to invest this year.
These funds will be used for the further implementation of the project for the development of Central Transport Hub, quantum communications and the purchase of new high-tech rolling stock.
All these factors create favourable conditions for the company to make investment progress.
My report covers the 2024 financial plan and investment programme’s key aspects. When forming them, we relied on the projected socioeconomic development parameters of the Russian Federation.
I want to thank the Government, Mr Belousov, Mr Khusnullin, and all stakeholder ministries for their meticulous attention to the company’s activities and the coordination of its key performance parameters in 2024.
All Russian Railways 2024 performance indicators are projected to significantly increase on the current year.
I will spend a moment discussing the key parameters in more detail. Cargo loading is estimated at 1.265 billion tonnes, with a 1.7 percent increase on this year. Freight turnover will amount to 3.4 trillion tonne-kilometres, which is 3.4 percent higher than the current year. Passenger turnover is projected to further increase to 128 billion passenger-kilometres, or 1 percent higher than this year. The EBITDA is planned at 830 billion roubles.
These key parameters of the financial plan make it possible to establish sources of financing for the investment programme in the amount of 1 trillion 275 billion 400 million roubles.
Thanks to this, Russian Railways will continue to implement vital projects to develop and upgrade infrastructure, as well as to purchase new rolling stock.
I would like to emphasise that 2024 is key to achieving the goals of several major investment projects outlined in the Comprehensive Plan for Upgrading and Expanding the Mainline Infrastructure (CPMI).
Next year, through our joint efforts, we will ensure the implementation of the presidential executive order and achieve a carrying capacity of 180 million tonnes in the Eastern Operating Domain. This will not only increase our country’s export potential but also shape conditions for the growth of domestic transport, including in the regions of the Far Eastern Federal District.
In turn, this development will foster the creation of additional jobs and boost fiscal revenue for the country’s budget.
A sum of 366 billion roubles has been set aside to expand the infrastructure of the Eastern Operating Domain.
Russian Railways will continue to implement projects for expanding the Central Transport Hub with a passenger flow of over 810 million passengers, and building access railways to the seaports of the Sea of Azov-Black Sea basin in order to further increase the carrying capacity to 131 million tonnes by late 2025.
In total, 535 billion roubles, or more than 40 percent of the total investment programme amount, are allocated to the CPMI projects.
Almost 230 billion roubles will be spent on updating the rolling stock, which will boost domestic machine-building and make it possible to buy over 500 locomotives, more than 280 Lastochka electric rail carriages and other multiple units.
Implementation of the programme to renew the infrastructure complex will involve the repair of over 5,500 kilometres of railway tracks.
Russian Railways’ stable financial position and proposed investment programme lay the groundwork for expanding all related sectors of the economy and industry, and ensure full transport accessibility for passengers, which will promote the country’s dynamic socioeconomic development.
Mr Mishustin, I would appreciate your approving the key parameters of the Russian Railways’ financial plan and investment programme for 2024.
Mikhail Mishustin: Thank you, Mr Savelyev.
Russian Railways is a leading customer in a number of industries, providing jobs in machine-building, the mining and processing industries, the construction business, and many other areas. It is important to complete the work under all plans for expanding the railway network on time, which will help expand the geographic reach of railway service, build new supply routes, and increase freight volumes.
It is important to constantly improve the quality of service so that travellers choose trains more often for the quality and speed of service, as well as comfort and convenience.
