The Ministry for the Development of the Russian Far East and Arctic has drafted a new state program for the Russian Arctic’s socioeconomic development in 2021-2024. The program is to receive over 22.6 billion rubles’ worth of federal funding.

The afore-said Ministry shall implement the new draft program. The document aims to create a competitive environment for implementing investment projects, creating jobs and attracting labor resources to Arctic territories, ensuring legal regulation of the Russian Arctic’s socioeconomic development and creating favorable conditions for the sustainable socioeconomic development of the Russian Arctic’s small indigenous ethnic groups.

“With this in mind, we have formulated two subprograms. The goal of one of them is to promote the creation of new enterprises and jobs in the Arctic zone because the demographic situation is improving in those territories where new jobs are facilitating a stable economic situation. Norilsk, the Yamal-Nenets and Chukotka Autonomous areas are a case in point.

The relevant legislation has already been passed for creating similar conditions in the entire Arctic zone. Mechanisms stipulated by the first subprogram aim to implement these laws. This implies such mechanisms as infrastructure support, interest rate subsidies and insurance premium compensation,” the Ministry’s press service said.

The infrastructure support mechanism stipulates federal funding for creating the external transport, energy or any other infrastructure needed to implement various investment projects.

“Insurance premium compensation will allow business managers to reduce wage deductions from 30 to 7.5 percent at state expense, and the same deductions for small and medium-sized businesses will go down from 15 to 3.75 percent. The mechanism of interest rate subsidies for Arctic project implementation loans will allow entrepreneurs to obtain 6.75 percent subsidies annually,” the press release notes.

The second subprogram includes measures to create favorable conditions for the Arctic’s sustainable socioeconomic development, including the status of small indigenous ethnic groups. The Ministry for the Development of the Russian Far East and Arctic and the Agency for the Development of Human Capital in the Far East and the Arctic are drafting a program, due to provide state support for the traditional economic activity of small indigenous ethnic groups. Measures to preserve the languages of these small indigenous ethnic groups are also stipulated. 

Once implemented, the state program will provide the Arctic economy with 490 billion rubles’ worth of investment, and 28,500 jobs will be created. Consequently, the new investment projects will facilitate the social development of local territories.

A draft nationwide economic reconstruction plan includes a mechanism for streamlining the social infrastructure called the Arctic Social Development Fund. This will make it possible to return up to 50 percent tax, derived from new investment projects, to the budgets of Arctic territories and to use these sums for building or renovating schools, hospitals and kindergartens.