Investment in infrastructure development to 2020 will amount to over US$1 trillion. 

“For Russia to continue on the path of innovation, it needs to carry out significant projects in infrastructure, such as investments into construction of railways, roads, airports and ports,” said Deputy Chairman of the RF government Alexander Zhukov.

For reference: Russia is a global leader in terms of length of electrified railways – more than 44,000 km (total length of rail roads is 85,000 km). China and Germany follow Russia ranking second and third with 24,000 km and 21,000 km of electrified railroads, respectively.

Types of government support of infrastructure investment projects by private investors:
•    Funds allocated from the Investment Fund of the Russian Federation
•    Implementation of public-private partnership projects under concession agreements;
•    Tax and other benefits provided in special economic zones.

1. Investment Fund of Russia – state financial fund for co-financing investment projects.

State support from the Investment Fund of the Russian Federation is provided by the Ministry of Regional Development of the Russian Federation.

There are three stages to consideration of projects: consideration by the investment committee, by the government committee and approval of the government of the Russian Federation.

The state finances business projects over RUB 5 billion for a period of five years. A private investor has to finance a minimum of 25%. Profitability of the project has to be at least 4% and not exceed 11%.

State support through the Investment Fund of the Russian Federation is provided in the following forms:
•    Co-financing under investment agreements with provision of ownership rights in Russia
•    Allocation of funds to the share capital of legal entities
•    State guarantees of investment projects.

Quality selection criteria for investment projects include but are not limited to national priorities of development of a certain industry.

Quantitative criteria include:
•    General economic efficiency resulting in growth of regional and national GDP
•    Budgetary efficiency (growth of tax revenue)
•    Financial efficiency (internal rate of return), return period, investment return index). 

For reference: The government committee on investment projects of state significance has approved 21 projects using the funds of the Investment Fund of the Russian Federation. The aggregate amount of investments under these projects will be over RUB 1 trillion with about 30% of funds allocated from the Investment Fund.


2. Concession agreements

The rights and liabilities of the grantor and the operator, as well as procedures of conclusion of concession agreements, are regulated by the federal law On Concession Agreements.

For reference: in accordance with federal law of 21.07.2005 N 115-FZ “On Concessionary Agreements” under а concession agreement a party (the operator) must create and/or reconstruct real estate property determined by such agreement from its own funds (hereinafter, “concession property”), while the ownership rights to such property belongs or will belong to the other party (the grantor), operate the concession property, while the grantor must grant the operator the rights of ownership and use of concession property to perform the activities under the agreement for the duration of the agreement.

State support of concession agreements in Russia provides for:
•    Financing of part of the expenditure for creation (reconstruction) of the concession property
•    Financing of part of the expenditure for operation of such property
•    Provision of state or municipal guarantees to the operator.

Tax regime for concession agreements

•    Deductibility of VAT presented by suppliers from fixed assets, intangible assets and ownership rights belonging to the grantor and conceded to the operator under the concluded concession agreement.
•    Exclusion of profit tax for tax purposes from property and property rights (capital grants) conceded to the operator from all levels of construction and reconstruction of concession property.
•    Property received by the operator from the grantor, which belongs to the grantor, must be amortized by the operator during the whole term of the concession agreement.


1. Concession competitions:

2. The Ministry of Рegional Дevelopment of the Russian Federation (

3. Vnesheconombank (


3. Special economic zones

For reference: A special economic zone is part of the territory of the Russian Federation defined by the government as a zone of special business regime (Federal law of the Russian Federation of 22 July 2005 N 116-FZ) “On special economic zones in the Russian Federation,” Article 2 definition of special economic zones).

Key objectives of SEZs:
•    Development of manufacturing and technology sectors
•    Production of new types of goods, development of domestic production
•    Development of transport infrastructure
•    Development of tourism and recreational sphere.

Types of special economic zones:

  • Industrial production SEZ (in the Lipetsk region and the Republic Tatarstan)
  • Technology implementation SEZ (in St. Petersburg, Zelenograd (Moscow Region), Dubna (Moscow Region), Tomsk (the Tomsk region).
  • Tourist and recreational SEZs (in the Kaliningrad region, Krasnodar region, Stavropol, in Altai region, the Republic of Altai, the Republic of Buryatia, and the Irkutsk region).
  • Port special economic zones.
  • Special economic zones in the Kaliningrad region.
  • Special economic zones in the Magadan area.

Documents regulating activity of special economic zones.

The Federal Agency for Management of Special Economic Zones is the main body regulating their work.

4. Bank for development and foreign economic affairs (Vnesheconombank).

Vnesheconombank is one of the institutions for support of infrastructure projects.
Vnesheconombank exercises the following basic functions:
•    Carrying out investment projects aimed at elimination of structural restrictions for economic growth in infrastructure, including development of energy, transport, and transport infrastructure, housing and utilities infrastructure and tourism
•    Implementation of investment projects aimed at innovations
•    Participation in projects aimed at effective use of natural resources, environmental protection and improvement of ecological conditions
•    Participation in implementation of projects aimed at support of small and medium business through provision of loans to credit institutions and legal entities supporting small and medium business
•    Support of export of industrial goods and services, including to the purpose of national export diversification.

More details at