RESTRICTED  WORLD TRADE  
ORGANIZATION  WT/ACC/SPEC/RUS/19 
24 April 2001 
 (01-2039) 
Working Party on the 
Accession of the Russian Federation Original:   English 
 
 
 
ACCESSION OF THE RUSSIAN FEDERATION 
 
Major Guidelines of the Agrifood Policy of the  
Russian Federation Government for the Years 2001-2010  
 
 The Permanent Mission of the Russian Federa tion has submitted the following information, 
with the request that it be circulated to members of the Working Party.  
__________ 
 
 
Approved at the Session of the Government of the 
 
Russian Federation on 27 July 2000 (Minutes No. 25)  
 
MAJOR GUIDELINES OF THE AGRIFOOD POLICY OF THE RUSSIAN FEDERATION 
GOVERNMENT FOR THE YEARS 2001-2010  
 
 
1. Current State of Agro-In dustrial Complex (AIC) .......................................................................1 
2. Goals and Objectives of Agrifood Policy ...................................................................................3 
3. Regulation of Food Market................................................................................................... ......6 
4. Agricultural Input Market Regulation........................................................................................ .7 
5. Regulation of Agricultural Land Market ....................................................................................8 6. Institutional Policy........................................................................................................ ..............8 
7. Financial, Credit and Taxation Policy ....................................................................................... .9 
8. Development of Rural Countryside ..........................................................................................10  
9. Environmental Policy........................................................................................................ ........11 
10. Research, Consulting and Human Resources ...........................................................................11 11. Improvement of the System of Government in Agro-industrial Sector....................................11 12. Regulatory and Legal Fram ework of Agrifood Policy .............................................................12  WT/ACC/SPEC/RUS/19 
 Page 1 
 
 
 1. Current State of Agro-Industrial Complex (AIC)  
Reformation of AIC  
 A land reform and a reorganisation of agricu ltural enterprises have been implemented in 
agriculture. Share distribution of land and property made it possible to eliminate the state monopoly of land and transform agricultural enterprises into  economic entities legally independent from the 
state. 
 Due to the transformations, about 62 per cen t of agricultural land have become privately 
owned. Large scale enterprises which are the main producers of agricultural commodities have greatly 
changed their economic behavioural pattern: their response to market signals have become more 
adequate, they take into account demand and search for the more beneficial channels for selling their 
production. Agribusiness management is improvi ng and the financial responsibility for how 
successful it is has increased. The process of form ation of a private farming sector is currently 
underway, and although its production volume is still quite small (about 2.2 per cent), it gives an opportunity to run their own business by most active part of the rural population. 
 The development of private household plots h as enhanced the opportunities for self-provision 
with food products for the population, which helps maintain social stability during the restructuring 
period. 
 Food and processing industries, wholesale and retail trades have been almost entirely 
privatised. Instead of the old distribution sy stem of food products it has emerged market 
infrastructure, which is developing. Apart from big trading companies there are thousands of small and medium-sized private intermediary organisations  helping bring the products to the consumers. 
 Visible changes have occurred in the state re gulation of agriculture at federal and regional 
levels. From direct intervention to production pr ocesses and management of economic activity of the 
producers, governmental bodies have switched to economic methods of regulation. The range of 
measures of agrarian policy is continuously improvi ng and enriching along with the development of a 
market relations. 
Basic problems in agrifood sector
 
 The agrifood complex in Russia is going throu gh a crisis stage due to problems accumulated 
in this sector. The general social and economic crisis  in the country, faults in the agrarian policy and 
certain specific sectoral problems have aggravated the situation. 
1.  Low profitability had resulted in a reducti on of resource potential more materially in 
agriculture than in any other industry. Lack of  liquidity and earnings caused a drastic decline 
in procurements of new machinery and equipmen t and has led to the majority of fixed assets 
of agricultural enterprises being physically depr eciated. Therefore, even given an increasing 
demand for domestic foods, the production is being held back by resource constraints. 
 The problem of land degradation is of great urgency. About 30 million hectares of agricultural 
land have been abandoned. Up-taking exceeds a pplication of nutrients by 4 times. Irrigation 
systems are decaying and the areas of acid soil are expanding. 
2.  The most urgent problem is the dire lack of finance in agriculture , which is manifest in the 
following: WT/ACC/SPEC/RUS/19 
Page 2  
 
 - negligible money earnings from sales of products because of low prices and sales 
limitations; 
- shortage of floating assets for seasonal fi nancing, and bank credit inaccessibility; 
- high accounts payable, mainly under soft stat e credits, payments due to budgets of all 
levels and non-budgetary funds. The major part of those debts is represented by fines and 
penalties for overdue payments since the exis ting taxation system is not flexible enough 
to take into account the seasonal nature of  production and generation of financial 
resources in agriculture. 
 Due to this fact, an overwhelming number of agricultural enterprises have their accounts 
blocked, which brings about various non-monetary lending forms, an increasing number of 
barter deals, and shadow dealing, and the corresponding adverse impact. 
3.  The problem of inter-branch disparity of prices and incomes still remains unsolved
. In a 
situation of economic liberalisation it occurred that agriculture was unprotected against monopolised industries. The pricing pressure from numerous intermediaries and dealers has 
resulted in multiple reductions of the share of agricultural producers in the retail price of the 
end-product.  
As a result of the rouble devaluation in 1998 a favourable pricing situa tion became forming in 
the food market. If effectively sustained in th e future, it would have made production in AIC 
profitable. Yet, the prices for fuel and other i nputs have restored the previous level of inter-
branch disparity of prices and incomes.   
4.  The limited demand for agricultural food production
 is another topical issue. The 
liberalisation of prices in 1992 brought about th e elimination of state food subsidies, which 
for certain basic products had represented 80 per cent of their retail price. That drastically 
decreased the purchasing ability of the population. 
The marketing problem was aggravated for domestic producers by foreign food trade 
expansion. The 1998 financial crisis made f ood imports less profitable. Import substitution 
has afforded new opportunities for expanding th e sales market for domestic food products. At 
the same time, decre asing real incomes restrain the overall demand for foods, first and 
foremost those protein-containing (animal products). 
5.  Backwardness of agricultural markets, a lack of efficient regulatory systems, the existence of 
interregional trade barriers, artificial restraint of prices by regional administrations impedes 
the functioning of the Agro-Industrial Complex . Imperfection of market infrastructure does 
not allow a normal producer-consumer relati onship and makes it difficult for agricultural 
producers to sell their output at reasonable prices. 
An essential restrictive factor for the growth of agro-industrial production is the lack of 
efficient governmental and non-governmental f ood market regulation systems. While the old 
administrative distribution bodies have been a bolished, no new mechanisms corresponding to 
modern economic conditions have as yet been est ablished. This makes it difficult to organise 
a single national marketplace and has led to s ubstantial losses for both agriculture and the 
consumers. 
Interregional trade barriers, hampering the access to  the food market for the producers, have a 
negative impact on its development. Trade rest rictions reduce the competition level, knock 
down the prices for net-exporters of foods in the regional markets and accordingly blow up 
the prices for regional net-importers, which works in the long run to suppress demand.  WT/ACC/SPEC/RUS/19 
 Page 3 
 
 
 6.  Enterprises supplying production facilities are extremely poorly adapted to satisfy the demand 
of agriculture . There are two distinct groups: en terprises providing only for the domestic 
market (e.g. machinery manufacturers) and ente rprises having export potential (e.g. producers 
of mineral fertilizers).  
The first group of enterprises, facing a drastic  narrowing of the demand for their production, 
is labouring with a thorough crisis. Due to th e processes of restructuring and modernisation 
taking too long, there is a critical inability to meet the demands of AIC. The slow development is holding back the formation of modern type dealers’ networks and leasing 
companies.  
Export-oriented industries have not been as badly hit by the decrease of demand in the 
domestic market because they have found th emselves a niche externally. The long-term 
problem with these industries might be that the possible growth of domestic demand for their products would be restrained by their unwilli ngness to use prices lower than the world ones 
on the domestic market, or to try and adjust to the demands of domestic customers.   
7.  The problems of rural development today are not only of social nature but have a negative 
effect on the economics of agricultural production .   
Social rural infrastructure still remains largely on the sheets of agricu ltural enterprises, which 
increases their non-production expenses and thus  aggravates their financial situation. 
The problem is that there are almost no othe r sources of income in a rural area apart from 
agricultural activity. This for ces the management of agricultu ral entities to retain surplus 
labour in order to maintain social stability in their territories. This reduces labour productivity 
and profitability of the industry as a whole. 
8.  Acute demographic and labour availability problems , a lack of qualified specialists and 
managers, insufficient level of management a nd of organisational and consultative work in 
respect of developing and functioning of new market structures prevent successful elimination 
of negative processes in many regions.   
2. Goals and Objectives of Agrifood Policy  
 Agrarian policy should support the forming of developed agrifood markets, a guaranteed 
supply of food products for the country, an eff ective and sustainable agro-industrial production, the 
increase of the level of individual incomes for ru ral population and preservati on of natural resources 
used in agricultural production.  
 Development of the AIC has been recognised as one of the key priorities of the social and 
economic policy of the state. 
 The strategic goals of agrifood policy of the state are as follows: 
- economic sphere – development of effective, competitive agro-industrial production 
helping to ensure food security of the country  and integration into the global agricultural 
production and food markets; 
- social sphere  – improvement of the living standards and quality of life for rural 
population, development of social rural infrastructure;  
- environmental sphere – production of ecologically safe food products and preservation of 
natural resources used in agricultural production through improvement of its WT/ACC/SPEC/RUS/19 
Page 4  
 
 technological sophistication and introduction of resource-saving and ecologically-friendly 
technologies. 
 The federal executive bodies must provide for ge neral conditions for the functioning of all 
participants of agricultural and food markets, a nd the uniformity of such conditions throughout the 
territory of the country. The efforts should be focused on the following: 
Sustain a stable supply of food products for the country:
 
- take measures to accelerate the revival of  grain production as the basis for a stable 
agrifood market; 
- form buffer stocks of basic food products; 
- supply food aid to territories in food emergency zones; 
- support food provision to the Far North re gions and territories of equal status. 
Ensure the integrity of agrifood markets in the country:  
- liberalise the movement of goods, services and inputs across the territory of the country; 
- pursue a single antimonopoly policy in the sector; 
- support development and regulation of agrifood markets. 
Implement a structural policy:  
- provide improving the competitiveness of domestic commodity producers;  
- correct the persisting structural deformations by restructuring inefficient and unprofitable 
enterprises in the AIC. 
Pursue an effective foreign economic policy:  
- implement reasonable protectionism for food imports; 
- support integration of domestic agricultural production and food to the world markets; 
- make agricultural sector attractive for foreign investments. 
Pursue a single land policy:  
- form land legislation; 
- elaborate general principles of land policy in agriculture; 
- introduce an all-state land cadastre; 
- introduce a single real property registration system. 
Pursue a single technological policy:  
- support elite seed growing, br eeding and land reclamation; 
- establish uniform state standards in AIC; 
- implement special programs ensuring technological and technical progress in AIC; 
- develop and finance fundamental studies and priority-trend applied research in 
agricultural sphere; 
- support the more effective and resource-saving technologies. 
Pursue a personnel and labour policy   
- systematic personnel training and refresher training, migration control in rural areas.  WT/ACC/SPEC/RUS/19 
 Page 5 
 
 
 Information service:  
- develop and support a single national agrifood market information system; 
- monitor impact of agrarian policy; 
- promote domestic products and technologies abroad. 
Pursue a single financial policy:  
- organise a multi-channel financial investment system; 
- concentrate state resources on priority dir ections of development of agro-industrial 
production. 
Methodology and organisation of structural and institutional transformation in AIC.  
Development of a single bookkeeping system and statistics for agricultural industries.  
Implementation of state control   
- veterinary, technical, seed growing and breeding, etc.  
To stop decrease of production in agriculture in th e nearest future it is of primary importance : 
- rehabilitate agricultural producers financially by restructuring their debts to budgets of all 
levels and non-budge tary funds, and by institutional reform; 
- make the mechanism of bankruptcy more effective; 
- promote development of horizontally and vertically integrated structures; 
- continue transferring social sphere facilities of agricultural enterprises to the jurisdiction 
of administrations of the Russian Federa tion regions and local self-administrations; 
- expedite the finalisation and adoption of th e Land Code of the Russian Federation and a 
federal law on state control and peculiarities of constraints on agricultural lands turnover; 
- ensure elaboration of a regulatory framew ork and introduction of a crop insurance 
mechanism, and develop an agricultural insu rance system taking into account the market 
conditions; 
- stimulate the development of credit cooperatives; 
- eliminate administrative constraints on imports  and exports of agricultural production and 
food in regions, provide for a non-discriminator y treatment for participants of the market 
and transparency of movement of goods; 
- stimulate economic growth of agricultural industries through support for import 
substitution and develo pment of export; 
- provide for better technical equipment of agricultural enterprises; 
- create favourable conditions for attracting private investments into agricultural 
production, manufacturing agricultural machin ery and equipment, expansion of leasing 
operations; 
- support implementation of measures for constr uction and reconstruction of irrigation and 
drainage systems, mechanisation, anti-erosion, amelioration; 
- take measures to make governmental f ood procurements, primarily from domestic 
producers; 
- organise a federal operating grain reserve and complete elaboration of measures for state 
control improvement on the grain market; 
- continue to develop training a nd consultative centres to assist regions in reform of the 
agro-industrial production and re fresher training of personnel; 
- make appropriations for support of AIC in the federal budget for 2001 at least at the same 
level as was maintained in 2000; WT/ACC/SPEC/RUS/19 
Page 6  
 
 - form Rosselkhozbank, and on its basis form  a state credit and finance system for 
agricultural commodity producers; 
- support advancing of finance for agricultura l producers providing commodities for state 
needs; 
- expedite the development and implementati on of new mechanisms of economic activity 
helping enterprises adapt to the market conditions.  
3.  Regulation of Food Market
 
 In working on a regulatory policy for the food market, the Government proceeds from the 
potential of increase in domestic production. Th e growth depends upon formation of conditions for 
innovative activity in the AIC aime d at modernisation of the technological basis of major industries. 
Leading development should be given to those bran ches and products of the AIC which are in demand 
on the world market. 
 In the coming decade, own production may be able  to provide for the requirement of food and 
fodder grain, poultry meat, eggs, milk and dairy prod ucts, vegetables and potatoes. It is necessary to 
organise specialised production zones for those prod ucts and exercise reasonable trade protectionism, 
not allowing dumping of foreign imports a nd unfair competition on the internal market. 
 For other essential types of food and raw materials such as meat, sugar, etc., Russia will not 
be able to satisfy the requirement of the market  with own production in the coming decade. In the 
years of 2001-2010 there will be pre-conditions encouraging the rise of competitiveness for the 
domestic production of beef and ot her meat products. A reasonable balance of imported and internal 
supply will be maintained in sugar production. 
 Non-governmental organisations (sectoral “commodity” unions and associations) established 
on a voluntarily basis, should play an active role in the regulation of product markets. Those entities 
together with governmental bodies should contribut e to the development of fair competition, 
minimisation of transaction costs, and informational transparency of the operations of enterprises in 
the relevant industries. 
 Unions and associations being an intermedia te link between governmental authorities and the 
industry represent the interests of enterprises to the authorities. 
 Legal guarantees for the functioning of agrifood markets will be granted by : 
- state guarantees for property rights, including st rengthening of property rights to land, 
extension of lease periods and more flexib le terms of granting ownership of trading 
premises in wholesale and retail trade in food, reduction of the government share interest 
in enterprises of processing industry, etc.; 
- a system of guarantees for enforcement of contracts for product supply, credit 
agreements, etc. 
Foreign trade regulation will be orientated at : 
- efficient integration into the world mark et, accession to the WTO on the conditions of 
non-discrimination towards domestic producers; 
- adoption of restricted temporary measures to pr otect the interests of internal agricultural 
and food producers whose output has potential to fully provide for the needs of the country;  
- use of flexible customs tariffs for imports; 
- support of exports of Russian agricultural food products given a stable internal market;  WT/ACC/SPEC/RUS/19 
 Page 7 
 
 
 - improvement of the system of customs control; 
- development of a system of certification and attestation of agricultural products 
approximated to the international standards, under which quality certificates recognised abroad will be issued;  
- maximise harmonisation of its agrarian policy with that of CIS countries in consideration 
of creation of Common Agricultural Market; 
- instruct the state diplomatic and trade missi ons abroad to seek advanced technologies and 
to search for sales markets for Russian-made products. 
To promote improvement of market infrastru cture the following measures will be undertaken
: 
- promote the establishment of commodity exch ange and other mechanisms ensuring the 
formation of organised agricultural output and food markets; 
- develop national market inform ation and consulting services; 
- optimise the system of sanitary  and phytosanitary control, including, inter alia , necessity  
to comply with the WTO requirements; 
- develop a single quality control system for agricultural products at all stages, from the 
field to the final consumer; 
- improve the system of standards for agrifood products; 
- provide legal and organisati onal support for developing a risk-insurance system in 
agricultural production;   
- lift market barriers, ensure transparency of commodity movement. 
4.  Agricultural Input Market Regulation  
 In order to meet the agricultural sector’s re quirement of machinery it is necessary to create 
conditions for improvement (on a new technological b asis) of the capacities of the bigger part of 
enterprises manufacturing tractor and agricultural e quipment, subject to the specific nature of 
particular agricultural zones and the demand. A significant role in that could be given to 
corresponding sectoral unions. 
 The development of leasing and its de-monopoli sation is becoming more and more important 
for input supply of agriculture. 
 To ensure effective distribution of government  financial resources allocated for development 
of production facilities if AIC, it is necessary to con centrate those in a special fund. The assets in the 
state leasing fund will be used alongside with add itional private financing and selection of operators 
through the tenders. 
 It is rational to allocate part of the assets in the leasing fund to equipping machinery stations 
which are being created primarily in a co-operativ e effort on the part of agricultural producers.  
 It is necessary to enter into strategic alliances with international corporations exploring the 
Russian market, for the purpose of manufacturing sp are parts and transferring as big a part of their 
production process as practicable to this country. 
 The mineral fertiliser and pesticide market should pursue a flexible customs tariff policy 
sensitive to the changes in the worl d prices, to make the internal market at least equally as attractive 
as the foreign markets, taking into account the gr eater risks for businesses ev ident in the internal 
market.  WT/ACC/SPEC/RUS/19 
Page 8  
 
 5.  Regulation of Agricultural Land Market
  
 A civilised, regulated and controllable agricultu ral land market will be developed. However, 
certain limitations will be imposed: 
- agricultural land can be utilised only for ag ricultural purposes, and to changeover to a 
different purpose one has to complete the procedures laid down by the federal and 
regional laws and other regulatory acts; 
- agricultural land can serve as collateral only for long-term investments; 
- agricultural land must be owned (leased or ot herwise belong to) juridical and physical 
persons engaged in agricultural producti on or granting the land to other producers 
engaged in agricultural activity. 
 Principles of legislation on land in agrarian sphere: 
- private ownership and other forms of owners hip of land are integral elements of an 
efficient agrarian sector; 
- effective redistribution of land resources be tween producers requires a turnover of land 
plots and land shares; 
- regulation of land market should guarant ee preservation of land for agricultural 
production, compliance with environmenta l requirements, avoidance of excessive 
fragmentation of land use; 
- diversity of climatic, natural and demographic conditions makes it necessary to take into 
account local peculiarities when defining re gulation procedures in respect of land 
turnover subject to constitutional requirements; 
- the state must arrange for a land cadastre to be maintained, which must be accessible for 
all business actors. 
 On the basis of the above mentioned  prin ciples related to the implementation of the 
programme of land reform it is necessary to implement the following measures: 
- comprehensive guarantees for ownership rights in land plots and shares; 
- improvement of land leasing mechanisms; 
- finalisation of the formation of federal legi slation governing registration of land plots or 
other proprietary rights in agricultu ral land and regulate d legal relations; 
- subordination of federal and regi onal laws in the regulation of  land turnover, elimination 
of any provisions of regional regulatory acts conflicting with federal legal standards. 
 Development of a civilised agricultural land market must be aimed at ensuring rational 
utilisation, preservation and improvement of their qu ality considering the interests of the population 
and the state. 
6. Institutional Policy  
 The key guidelines of institutional policy in the AIC are: 
- matching of the organisational and legal fo rms of agricultural enterprises with the 
legislation of the Russian Federation; 
- support for formation of competitive agricultu ral enterprises and creation of conditions 
for concentration of necessary inputs in the most efficient owners and organisations; 
- promotion of horizontal and vertical integr ation in strict compliance with antimonopoly 
legislation;  WT/ACC/SPEC/RUS/19 
 Page 9 
 
 
 - state support for all kinds of cooperation, in cluding cooperatives between family farms in 
marketing, supply, processing, etc.; 
- finalisation of the formation of an informational and consulting service in the AIC; 
- elaboration of regulatory and legal documen ts specifying the procedures for financial 
rehabilitation and bankruptcy of agricultural producers; 
- development of a regulatory and legal frame work to support development of private 
household plots; 
 Institutional policy in the processing in dustry and mediation sector includes: 
- improvement of antimonopoly control in the agrifood sector, elimination of unreasonable 
barriers to market access of agrifood products; 
- legal and organisational support for market inst ruments in respect of short-term credits 
(futures contracts, warehouse receipts, etc.); 
- support for formation of dealer and distribution networks, leasing companies, machine 
pools and other organisations of agricultural input markets. 
7.  Financial, Credit and Taxation Policy  
 To financially rehabilitate agricultural produ cers it is necessary, first and foremost, to 
implement a comprehensive restructuring of agricult ural producers’ debts to the budgets of different 
levels and governmental non-budge tary funds, while simultaneously providing for responsibility of 
agricultural producers for improvement of production efficiency.  
 In the coming years it is necessary to cha nge the directions of governmental support in 
agriculture and start supporting enterprises and farms able to ensure the greatest return on resources. 
Budgetary credits and subventio ns will be granted under agreem ents made with agricultural 
enterprises in which the prerequisite conditions fo r being granted such support will be specified. 
Support on the regional level should unify with the requirements maintained on the federal level and 
comply with the Russian legislation. 
 To ensure stability of the AIC in a situati on of increasing natural risks insurance, certain 
reserve funds must be made. Under the state suppor t programmes it is proposed to maintain federal 
funds of seeds, veterinary preparations, reserves of plant protecting substances. 
 To support agricultural producers, provision of  soft credits will be continued while the 
concept of soft lending itself will be revised. The interest rate of commercial banks on seasonal loans 
borrowed by producers in the AIC will be subsidised. 
 Federal budgetary funds will be used to fina nce facilities included in federal special-purpose 
programmes, as well as construction developmen t, reconstruction, retooling of budgetary 
organisations, environmental facilities. 
 One of the most important guideline of the state credit policy will be to attract private 
investments into the AIC. 
 Investment in AIC must take into account the distinctive nature of private farms and other 
forms of small business. 
 It is proposed to stimulate development of credit cooperatives. WT/ACC/SPEC/RUS/19 
Page 10  
 
  The taxation policy in the AIC will proceed as follows: 
- adjustment of the taxation system taking into account of the current profitability of 
agricultural production; 
- improvement of taxation of agricultural lands. 
 The key task in the sphere of insurance is to  form and improve an efficient insurance system 
in agriculture, comprising obligatory reinsuranc e of part of risks; introduction of a separate 
accounting procedure for insurance opera tions underwritten by the government. 
 Other types of insurance for agricultural producers are provided in accordance with the 
current legislation. 
8.  Development of Rural Countryside
 
 The rural development policy is aimed at improving the living standards and living conditions 
of the rural population, which w ill require the following measures to be implemented in the coming 
years: 
- create conditions allowing generation of income  in agriculture in the same range as in 
other industries; 
- develop non-agricultural employment options  in rural areas to increase individual 
incomes, expedite the release of excess labour from agricu ltural enterprises and increase 
labour productivity. To this end it is proposed  to provide refresher training to personnel, 
provide advice to rural residents on organi sation of non-agricultural activities, create 
favourable terms and simplify the procedure fo r setting up small enterprises in rural areas; 
- release agricultural enterprises from the burdens of social and engineering infrastructure; 
reimburse expenses of maintenance of social properties transferring to municipal 
ownership at the expense of regional budgets  and funds appropriated for such purposes in 
the federal budget; 
- ensure social development of rural towns and villages to gradually improve the living 
conditions, make social services easier availa ble in rural areas and improve their quality. 
To implement these objectives it is necessary to  provide state support for solving housing 
problems in rural areas, improving rural public health institutions, comprehensive education, gas supply, electric power suppl y, road development, and provision of 
computers to secondary schools in rural areas. 
 Rural residents rely on their private household land plots for their incomes to a considerable 
extent. It is recommended that local authorities, consumer cooperatives and agricultural enterprises 
provide support to these enterprises in production  and marketing of their output and establish 
cooperatives to provide them with necessary services. 
 To improve social security for rural resident s it would be rational to legalise the status of 
persons employed on the private household plots and legislatively provide for their social security and insurance depending on the type of the employing private household: whether it is a consumer or 
commodity entity, and whether it is an  only (principal) or additional job. 
 An important element of rural development is  the revival and strengt hening of financial 
stability of consumer cooperation. It is planned to expand and better implement the measures of its 
support.  WT/ACC/SPEC/RUS/19 
 Page 11 
 
 
 9.  Environmental Policy  
 Since intensification of agricultural producti on results in environmental pollution and food 
contamination, the Government will regulate agri cultural production by reference to ecological 
standards, namely: 
- control over agricultural production technol ogies to reduce their impact on the 
environment, expanded use of zone ma pping and indication of possible maximum 
tolerance limits of pollution; 
- formation of a system ensuring maximum ecological safety of products at all stages of 
food chain; 
- control over import of genetically modified  food products and components for their 
production; 
- unification of Russian sanitary and phyto sanitary standards with the international 
standards and strengthening ecological control over agrifood imports. 
10.  Research, Consulting and Human Resources  
 Transition of agrifood sector to market mechanisms calls for new approaches towards 
relevant academic research and human resources. Competition will stimulate agricultural business 
development and support applied research, while the growth in the agricultural food sector will 
increase their financial potentialities in that sphere.  
 Fundamental and certain priority applied research should continue to be financed by the state. 
The key goal here is to switch to a competiti ve basis for distributing the funding for the 
implementation of such academic research. Integr ation of Russian researchers with academic 
endeavours world-wide will become a significant el ement of fundamental science development in the 
AIC. 
 The existing educational system in agriculture  needs to be adjusted to the new production 
structure now maintained in the sector and to the structural modifications in the demand for 
professional employees. On a par with production engineers, modern enterprises currently need 
managers, marketing experts, fina ncial managers, and consultants. 
 Educational and consulting centres will be res ponsible for co-ordinating the reform of the 
system of training and refresher training of personnel. 
 Now that agrarian economy is on the mend, the need for creating a national informational and 
consulting services for agricultural producers is becoming more and more pressing. Formation of such a system under the auspices of the Ministry of Agriculture of the Russian Federation should be 
expedited, besides it is necessary to assist in th e creation of cooperative and commercial structures 
which will provide information and consulting services to agricultural producers.   
11.  Improvement of the System of Government in Agro-Industrial Sector
 
 Priority long-term objectives for further deve lopment of agro-industrial production, certain 
tendencies evident in the development of market relations, and integrati on and cooperation processes 
require a reform of the government system of the Agro-Industrial Sector. 
 In order to create the conditions for implementi ng a single agri policy it is necessary to clearly 
distinguish the responsibilities of federal, regiona l and municipal bodies of management of the AIC 
and ensure their close cooperation in solving the existing problems. WT/ACC/SPEC/RUS/19 
Page 12  
 
  To exercise governmental and controlling functions it is necessary to ensure smooth 
functioning of veterinary, hunting, and land recl amation services, plant quarantine inspection and 
other public services, inspectorates and their territorial bodies, from federal to district level on the vertical of government. 
 Regulation of key markets is one of the most  important objectives. It will be implemented by 
federal bodies through specialised state structures in  conjunction with non-governmental structures in 
the agrarian sector (sectoral “commodity” unions and associations).  
 As regards state property management in the AI C, there is a need for a thorough stocktaking 
and continuing privatisation aimed at increasing the e fficiency of the agrarian sector; it is necessary to 
create vertically integrated structures in strategica lly significant markets, through which structures the 
state food policy will be implemented. 
12.  Regulatory and Legal Framework of Agrifood Policy
 
 Successful implementation of state policy in respect of AIC development requires further 
elaboration and adoption of regulator y and legal acts, which will afford forming an integral system of 
agricultural legislation and eliminate the loopholes and inconsistencies of the existing legislation. 
 It is proposed to draft a federal law on ag ricultural development which would constitute the 
legal framework for AIC development, lay down the principal guidelines of the state agrarian policy, 
the forms and methods of state support and regula tion of AIC, and other factors increasing the 
efficiency of agro-industrial production. 
 The fundamental principles of possession, use and disposition of land, land turnover 
mechanisms, delineation of powers between the fede ral authorities and the Russian Federation regions 
are expected to be provided under the Land Code of the Russian Federation and the federal law on 
state regulation and peculiarities of limited turnover of agricultural lands. 
 Institutional reform should be supported with relevant legislation taking into account the 
characteristics of agro-industrial production. In th is connection it would be advisable to adopt a 
Federal Law “On private (peasant) farms”. 
 Further legislation is required to solve certa in problems of the financial and credit systems 
and state support for agriculture. This concerns in the first place certain issues of banking services to 
the AIC, restructuring of debts of agricultura l enterprises to budgets and non-budgetary funds, 
measures of their reform and fina ncial rehabilitation: laws on financ ial rehabilitation of agricultural 
organisations, on Russian agricultural bank, and s upplements and amendments to the Federal Law 
“On Insolvency (Bankruptcy)”.   
 It is essential that legislative acts identifying  the peculiarities of cr eation and f unctioning of 
rural credit and insurance organisations on co-operativ e principles be adopted in the near future – the 
Law “On Credit Cooperation”. 
 Due to the fact that the Taxation Code of the Russian Federation does not fully reflect the 
seasonal fluctuation of agricultural production, it is  desirable to introduce relevant amendments to 
taxation legislation. 
 It is desirable in terms of legal support for development of market infrastructure and 
regulation of food market to make supplemen ts and amendments to the Federal Law “On 
Procurements and Deliveries of Agricultural Produc ts, Inputs and Food for State Needs”, to elaborate  WT/ACC/SPEC/RUS/19 
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 a law on self-regulating organisations in the agrari an sector (sectoral unions and associations of 
agricultural commodity producers).  
 The problems of development of rural country side and social infrastructure also require 
legislative solutions. 
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