Bashkortostan special report: Industrial parks and clusters - strength in numbers

The formation of industrial parks and clusters to promote cooperation between Bashkortostan’s leading companies and its growing SME sector constitutes a key plank of the regional government’s plans for economic development.

Euromoney special report: Bashkortostan

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Policy-makers will be eagerly watching the progress of the Republic’s first industrial park when it opens this summer. Located in the city of Blagoveshchensk, 25km north of Ufa, the Khimterra park will be part of a complex owned by polyester producer Polief.

The company, a subsidiary of petrochemicals giant Sibur, produces material for the manufacture of plastic bottles for food products. Its facility in Blagoveshchensk is one of Russia’s largest polyester complexes and is undergoing a €40 million expansion that will triple its production capacity by the end of June 2014.

The Khimterra park will occupy a 27,000 sqm facility within Polief’s existing factory and is due to open by the end of July. The site benefits from good transport connectivity, with easy access to the Kuibyshev rail line, a 48km link-up to the M7 federal highway, and Ufa International Airport 73km away. It also boasts a full complement of basic infrastructure provisions, from water and sewage systems to high-speed broadband access.

Chinese interest

The list of participants in Khimterra has yet to be finalized, but policy-makers indicate that the project has attracted considerable interest from Chinese companies looking to establish a presence in Bashkortostan.

The industrial parks programme comes under the aegis of the Corporation for Development, a government body created in December 2010 by President Rustem Khamitov with a mandate to promote the economic development of the Republic and increase the flow of inward investment.

Officials at the corporation are also working on a second project, which is being developed around the newly created production facility of Kronospan Holdings East. The firm, a subsidiary of Austrian wood processing giant Kronospan, signed an agreement with President Khamitov in August 2012 to invest up to R6 billion ($169 million) in a plant for woodworking and the manufacture of construction materials at a site just to the east of Ufa.

Production of oriented strand board (OSB) is due to start this summer and plans are under way for the inauguration of a 298.5 hectare industrial park on a neighbouring greenfield site within the following 12 months. In addition to being amply supplied with water, electricity and gas, the new industrial park will have direct access to the Trans-Siberian railway via the Shaksha rail station and to the M5 federal highway, and is located just 43km from Ufa International Airport.

Tax incentives

As with the other planned industrial parks, substantial tax benefits are being offered to participants in the Ufa facility. The 2.2% property tax will be waived for residents, while income tax will be fixed at a discounted rate of 15.5% for up to 10 years.

Bashkiri policy-makers are also looking to provide financial and logistical support for the creation of industry clusters at locations across the region. The government has put together $30 million for the establishment of a renewable energy research and development technopark just outside Ufa, on the site of a joint venture between France’s Alstom and local company RusHydro for the manufacture of hydropower equipment.

Similarly, President Khamitov announced in November that the Bashkortostan government had reached an agreement with Sistema, owner of local oil giant Bashneft, on the establishment of a large cluster in Ufa for the manufacture of high value-added petrochemical products.

Potential investment in the cluster is estimated at as much as $3 billion-5 billion, President Khamitov said at the time. "We have seen very good feedback from the largest companies in our region to our plans to promote the development of the chemical and petrochemical industries," he added. "I hope that within the next couple of years we will see significant progress in the formation of this cluster."

A petrochemical complex is also planned to the south of Ufa around the neighbouring towns of Salavat and Sterlitamak. The cluster, which will focus on gas chemistry, will be based around the Monomer plant of Gazprom Neftekhim Salavat, a subsidiary of Gazprom Group.

When completed, the cluster is expected to be the largest in its field in the Russian Federation. Preparations are already well underway. The baseline design, documentation and master plan of the construction site were completed last year by Mitsubishi Heavy Industries Company.