Innovation centres to reap benefits of UAE investment
In Dubai, the Tatarstan Investment Development Agency (TIDA) and the Tatarstan-Gulf Investment Corporation (TGIC) signed a memorandum of understanding to create a consortium of government and semi-government investors from the Gulf.
Speaking at the exhibition, Rashed Karmastaji, chairman of Karmastaji Group, who will lead the new consortium, said that the plan for the first, $2.5 billion stage of Kazan Smart City’s development, to be completed by 2016, will be ready by the end of June. Investment in the first stage will reach “hundreds of millions of dollars,” Mr Karmastaji said, adding: “The project’s payback period will be five to 10 years.”
Kazan Smart City
Kazan Smart City is located 15 km from Kazan, the capital of Tatarstan, a republic within the Russian Federation. The project aims to develop four economic clusters: an international business centre, a knowledge and education centre, a park, and a special economic free zone for high-tech manufacturing.
“The ultimate goal of developing Kazan Smart City is to increase the service industry share in our gross regional product,” Linar Yakupov, chief executive of TIDA, told RBTH.
The agreement is being seen as a success for Rustam Minnikhanov, Tatarstan's president since 2010, who has made his republic of 3.8 million people, with its mixed population of Muslims and Christians, one of Russia's most investment-friendly regions.
Tatarstan's Alabuga Special Economic Zone has already attracted $1 billion in foreign direct investment since its establishment in 2006.
The industrial zone, which is currently the largest of its kind in Russia, has attracted 33 international investors, including Ford Motors, Rockwool, Tatneft, and 3M, among others.
Alabuga offers a corporate tax rate of just 2 per cent, while land and property is zero-rated. Similar tax breaks are planned for Kazan Smart City and Innopolis.
Russia has taken steps to attract Emirati investment via the UAE-Russia Agreement on the Securing of Mutual Investments, recently ratified by Russian President Vladimir Putin. The bilateral agreement, which establishes tax-free dividends on investments made by UAE state-owned companies, opens up unprecedented opportunities to attract financing from the Gulf region, experts say.
Investing in Dubai
The Third Annual Investment Meeting, organised under the patronage of His Highness Sheikh Mohammed bin Rashid Al Maktoum, UAE Vice President, Prime Minister and Ruler of Dubai, took place from April 30 to May 2 at the Dubai International Convention and Exhibition Centre.
This year was the second time Tatarstan has taken part in Dubai’s Annual Investment Meeting.
“Our brand recognition has grown from 10 per cent to 50 per cent in a year,” said Mr Yakupov, the chief executive of TIDA.
This year, Tatarstan’s stand was prominent at the exhibition and featured a range of Tatarstan companies and government investment projects, including firms such as Kamaz Export, the Kazan Helicopter Plant and the Zelinodolsky heavy machinery plant.
Pride of place, however, was taken by TIDA's Kazan Smart City project and Innopolis, a tech city and innovation centre envisioned as Russia's future IT hub and a source of economic growth.