MOSCOW, October 20. /TASS/. Arctic and Far Eastern regions support the bill on Northern Supplies, which President Vladimir Putin had ordered to draft, press service of the Ministry for Development of the Far East and Arctic told TASS.
Earlier the president ordered the government to draft and present to legislators by March 2023 a bill on the Northern Supplies' coordinator. The government will present its ideas about a sea operator, which will provide the ice fleet on the Northern Sea Route. Another aspect, the president had mentioned, was subsidies for loans borrowed for the Northern Supplies.
"The Far Eastern and Arctic regions support the bill on the Northern Supplies," the press service said. "The document will be presented to the government in late October."
The Northern Supplies system serves Russia's 25 regions. The government allocates every year for purchase and shipment of 3-million-ton supplies more than 87 billion rubles ($1.4 billion). The ministry pointed to insufficiency of the current system to ship food products, medicines, fuel and other essential goods for people who live in hard-to-reach areas in the Far North and similar regions. In addition to complicated climate conditions and limited infrastructures, disruptions in the deliveries have been due to a comprehensive approach to purchases and shipments. Consequently, the terms are not observed, and the retail prices, which include costs of inefficient procedures, become unaffordable for the local residents. At times, retail prices may be two or three times higher than in the country's central regions.
"In the present Arctic focus, where the Arctic zone's development is a key state priority, the Northern Supplies bill is a very important and timely solution," the press service quoted Yakutia's Deputy Prime Minister Mikhail Nikiforov as saying. "The president has inked key documents on new policies in the Arctic's preferential development; we have special conditions for doing business. Another important stage would be to build an effective system to organize and offer state support for the Northern Supplies."
According to him, the federal government's involvement in the Northern Supplies organization and in its financing, taking into account the peculiarities of all regions in the Far North, will make it possible to convert the shipments into a system, to establish inter-regional relations, to ensure economic development, and to improve the energy and food security.
Priority order and responsibilities distribution
The draft law has taken into account regional and industrial specifics. An expert group on improving the Northern Supplies system features representatives of the Federal Assembly, federal and regional authorities, the Far East and Arctic Development Corporation, Vostokgosplan, the Rosatom State Corporation, and other organizations. According to Minister for Development of the Far East and Arctic Alexey Chekunkov, the bill provides for a comprehensive system to solve not only transport and logistics tasks, but also to cut prices along the entire chain. The bill introduces the Northern Supplies notion, regulates relations between federal, regional and municipal authorities, procurement activities, shipment procedures, monitoring and control, and introduces a set of incentives for involved parties. The Ministry for Development of the Far East and Arctic will act as the unified federal coordinator.
It is for the first time that the bill sets a priority order for transport and logistics services regarding Northern Supplies. The goods are broken into three categories. The first category includes essential goods for the population and for social organizations (including food, medicines, and medical products), housing and household services and the energy sector. Incentives will include budget loans to the regions for the purchase and delivery of priority goods and for services related to their supplies, as well as subsidies to finance transport costs. The bill provides for a single maritime operator - this company will transport priority cargoes by sea at subsidized tariffs, the ministry said.
"The adoption of this law to a certain degree will be a historic step, <...> we count very much on the Northern Sea Route development. If the shipments by it become regular and if businesses trust them, and if shipments of food and other essentials become regular, then this will be an excellent example of how the state and the market have achieved effective cooperation to response to the problems of people living in Russia's North," the press service quoted the Kamchatka Region's government's deputy head Yulia Morozova as saying.
The ministry's press service told TASS about the work to create a legal base for the development of necessary infrastructures. The bill defines sources to finance maintenance of key infrastructure facilities at the federal, regional and municipal levels. The Northern Supplies participants will have an unhindered access to non-public infrastructures.
"The bill will structure the supplies' organization - whereas currently everyone solves own problems. For example, resource-supplying companies, that give energy to remote areas, have to deliver goods and thus they bear the financial burden, which further on is reflected in tariffs for consumers, and which the regional budget has to compensate. The deliveries' structuring will have a positive effect, including on the delivery costs, and there will be certain predictability," the press service quoted the Arkhangelsk Region's Minister of Economic Development, Industry and Science Viktor Ikonnikov as saying.
Monitoring and state information environment
According to the bill, the ministry's press service continued, the country will have a federal system to monitor the Northern Supplies. It will accumulate all the data: from procurement plans to tender results and cargo tracking. It would be a unified information environment for parties to the Northern Supplies. It will guarantee transparent purchases, will offer conditions for price competition between suppliers of homogeneous goods. In addition, in the future, operational monitoring data will be used to optimize logistics routes.
"Cargo ranking and prioritization along with the option of digital tracking, where a single sea carrier is working, will make the Northern Supplies procedures more efficient and transparent. This approach will be used to see how busy the cargo flows are, and also to regulate their order. <...> The bill will inevitably mean the present logistics will be reviewed," the press service quoted the Federation Council's deputy head of the committee on federal structure, regional policy, local self-government and Northern affairs Anatoly Shirokov as saying.
The bill introduces liability for Northern Supplies participants - like, for example, for violation of goods priority rules, for a failure to submit or for an untimely submission, or for submission of false information to the federal information system.