The Dynamics of the Efficiency of State Support to the Agro- Industrial Complex on the Example of The Volga Federal District

Author Name(s): Diaz R. Kadyrov
Author Email: diaz.Kadyrov@tatar.ru

Abstract

The   issues   of   improving   the   system   of   state regulation   of   agriculture   have   highly   actualized subject to Russia’s accession to the WTO. Based on the    materials    provided    by    the    Ministry    of Agriculture of the Russian Federation, the Ministry of Finance of the Russian Federation and the Center for    Strategic    Planning    in    the    Agro-Industrial Complex, this paper deals with the behavior of the main  indicators  characterizing  the  effectiveness  of measures  of  state  support  to  the  agro-industrial complex  in  the  entities  of  the  Federation  of  the Volga     Federal     District.     The     methods     of comparative  economic  analysis  were used,  serving as   the   basis   for   groups   of   the   VFD   entities identified  according  to  the  criteria  of  profitability, impact   of   profitability   and   subsidies   on   the financial result. Such factor as profitability proved to  be  significant;  in  the  Republic  of  Tatarstan  it exceeds the facto of expenditures by 3.5 times. The analysis   also   revealed   regions   with   abnormal indicators,  such  as  Orenburg  region  –  abnormally high  indicators,  and  the  Republic  of  Mari  El –  the most  problematic  area,  requiring  separate  detailed consideration.    As    a    result    of    the    revealed imbalances,  subject  to  the  fact  that  the  Russian Federation is gradually entering the WTO, it seems important  to  change  the  systems  and  methods  of state   support,   regrouping   if   possible   the   state support  funds  of  the  village  from  the  “yellow”  to the 1″green”2 basket,  and  also  use  indicators  per hectare, per liter and other more accurate indicators to  determine  the  effectiveness  of  subsidies,  which will  reduce  differentiation  and  disproportion  and improve  overall  efficiency.  As  an  example  of  the effectiveness    of    the    proposed    approach,    the structure of these baskets for Saratov region as one of  the  developed  and  representative  agricultural regions of the Russian Federation is presented.

Introduction

In modern conditions, the problem of assessing the effectiveness  of  budget  costs  for  the  support  for agricultural   activities   in   the   Russian   Federation acquires special significance.On the one hand, an unfavorable conjuncture in the hydrocarbon market caused difficulties arising with the formation of the revenue side of the budget and the stability of the ruble exchange rate, on the other hand, food supply security, living standards, social stability and import substitution became more acute as a result of devaluation. The     state     support     allows     mitigating     the consequences  of  non-equivalence  in  the  exchange of  agricultural   goods   with   other   sectors  of  the economy, create conditions for effective solution of the tasks of improving the quality of life, thus being an integral and important part of agrarian policy in virtually all developed countries. Another  one  of  the   most  important  and  urgent problems    of    Russian    agriculture    development remains  unresolved  in  the  context  of  the  country’s accession  to  the  WTO,  such  as  the  transformation of  the  methods  and  ideology  of  support  for  the agro-industrial  complex  in  the  country.  The  need for  the  development  and  implementation  of  other complex   and   topical   methods   that   will   allow optimizing  the  costs  for  supporting  agriculture  in the  conditions  of  competition  and  new  budgetary constraints is exacerbated [5].Thus,    all    initiatives    on    and    studies    of    the rationalization   of   resource   allocation   procedures aimed  at increasing the effectiveness of the use of budget  funds  appear  to  be  extremely  relevant  and important.

Conclusion

According to the calculations in Table 2, we present a  diagram  of  the  general  effect  of  the  factors  on profit (Fig. 2). Group  1:  this  group  of  entities  is  characterized  by the significant influence of the factor – profitability and high profit before taxation in the range of 4-8.5 billion   rubles;   it   includes:   Saratov   region,   the Republic    of    Tatarstan,    Orenburg    region,    the Republic of Bashkortostan, and Penza region. Group  2:  shows  the  average  level  of  influence  of factors   and   profit   –   [1-2.5   billion   rubles];   it includes:  the  Republic  of  Mordovia,  the  Udmurt Republic,  the  Chuvash  Republic,  and  Ulyanovsk Region. Group  3:  shows  low  level  of  influence  of  factors and   profit;   it   includes:   Samara   Region,   Perm Territory,   Kirov  Region,   and   Nizhny  Novgorod Region.We  should  particularly  note  the  Republic  of  Mari El, which has a problematic dynamics and requires detailed research.Further  research  activity  is  aimed  at  using  best practices  and  focusing  on  those  regions  that  have achieved   better   results   (groups   1   and   2)   and recommending  their  approaches  for  reformatting state   support   measures   for   regions   with   low indicators,  as  they  are  located  in  one  natural  and climatic zone.The   main   task   is   to   focus   on   improving   the efficiency  of  the  transition  to  the  “green”  basket during the first stage, and to the blue basket in the long run, as well as to show the actual change in the efficiency of this transition

References

1. Sablina E.A. Finance statistics: a study guide // Е.А. Sablina. – M.: Pub. house “Ekzamen”, 2006. – p. 253.

2. Grishin A.F. Statistical models in economics // A.F. Grishin – Rostov-on-Don: “Fenix”, 2005. – p. 344.

3. Dougherty K. Introduction to Econometrics: trans. Eng. – M.: INFRA-M, 1999. – XIV, p. 402.

4. Implementation of agricultural potential of the region: Monograph. Authors: Р.S. Shepitko, I.S. Korabelnikov, A.V. Nemchenko, N.N. Balashova, E.N. Kashinskaia, Т.А. Dugina, A.V. Boldyrev. – 2016 – p. 190.

5. Trends in the development of the world market of agricultural products: effects. Authors: A. Ivolga, V. Erokhin, I. Ivolga. – 2013 – p. 150.

6. The Agreement on Agriculture URL:http://www.wto.ru/content/documents/docs/se lhozru.doc.

7. The Agreement on Subsidies and Countervailing Measures URL: http://www.wto.ru/content/documents/docs/subsko mp.doc.

8. Lang M. et al (eds.) WTO and Direct Taxation //Linde Verlag, Vienna, 2005

9. A report of the working group on Russia’s accession to the WTO. The document is authentic in English only. 11/16/2011.

10. Agricultural Policy Monitoring and Evaluation 2013. OECD Countries and Emerging. Economies. OECD, 2013, Paris.

11. Martini, R. (2011) «Long term Trends in agricultural Policy Impacts». OECD, PapОrs№45

12. The agri-food sector in Russia: Current Situation and market outlook until 2025. European Union, 2013.

 

264 total views, 2 views today

Download PDF File

About the author: admin