According to the instruction of the Head of State Kassym-Jomart Tokayev on strengthening the potential of the agro-industrial complex, a mechanism has been developed to accelerate the renewal of the machine and tractor fleet and the development of local agricultural machinery enterprises. The Ministry of Industry and Construction together with the Ministry of Agriculture adopted a document excluding subsidies for foreign agricultural machinery, analogues of which are produced in Kazakhstan. 

Currently, there are 8 plants in the country producing more than 15 brands of tractors, combine harvesters and forage harvesters of different capacities and modifications. At the end of 2023, domestic manufacturers produced 5,418 tractors worth 113.5 billion tenge and 1,032 combines worth 99.1 billion tenge. 

Under the previous mechanism, the difference in the amount of subsidies for imported and domestic machinery was in favour of foreign manufacturers. Thus, 28.3bn (40.4%) of the total reimbursement of 70.2bn was allocated to support local enterprises, while 41.9bn (59.6%) was allocated to imports. This approach reduced the sales of products of Kazakhstani factories. Under the new mechanism, the share of subsidies to foreign producers will be reduced 6 times to 6.5bn (9.3%), while the share of domestic producers is planned to reach 63.7bn (90.7%). 

For example, a special investment contract with Claas was signed at the enterprise "ST ESEMBLY" in 2021, when the assembly of combines TUCANO 450 and TUCANO 580 began. Two years later, components from local manufacturers were supplied by JSC "AgromashHolding KZ", LLP "Kazakhstan Agro Innovation Corporation", JSC "Vostokmashzavod", LLP "Reimann". At the facilities of the enterprise in 2023, 246 units of self-propelled machinery and 158 units of trailed equipment were assembled. In the current year, the tractor model range was updated and expanded. The number of jobs provided by the production has increased 2 times since the launch of the plant - currently 73 employees work at the enterprise. 

Exclusion of subsidies for foreign agricultural machinery does not affect those positions, the production of which is not established in Kazakhstan, namely specialised machinery for production and harvesting of sugar beet, cotton, potatoes and horticultural crops, etc. The subsidy rate for foreign agricultural machinery does not affect those positions. In this case, there is a subsidy rate of 25% regardless of the country of production.

In general, Kazakhstan's agricultural machinery enterprises currently cover about 80% of the self-propelled machinery market. At the same time, about 90% of the country's agrarians are small and medium-sized farmers, for whom favourable leasing instruments and affordable equipment will open up the possibility of renewing the machine and tractor fleet.

#Olzhas Bektenov #The Prime Minister of the Republic of Kazakhstan #Agroindustrial complex #Engineering #President's instruction