Preferences for domestic producers: Changes in subsidizing agricultural machinery in Kazakhstan

 

There are eight plants in Kazakhstan producing over 15 brands of tractors and combines of various capacities and modifications. As of the end of 2023, local manufacturers have produced 5,418 tractors worth 113.5 billion tenge and 1,032 combines worth 99.1 billion tenge. These figures demonstrate the scale of the domestic agricultural machinery industry.

 

The Government of Kazakhstan actively supports the development of this industry. Recently, the support mechanisms for agricultural producers have been revised: a document limiting subsidies for foreign agricultural machinery if its analogs are produced in the country was adopted. This decision is designed to accelerate the renewal of the machinery and tractor fleet and stimulate the development of local enterprises.

 

Previously, the mechanism provided for greater support for imported machinery, which reduced sales of Kazakhstan plants. Under the new scheme, the share of subsidies for foreign manufacturers has been reduced almost seven times - to 6.5%, while support for domestic producers has been increased to 63.7%.

 

Prime Minister Olzhas Bektenov, emphasizing the need for these changes, pointed to the priority of localization of production of foreign companies in Kazakhstan. An example of successful localization is the company "ST ESEMBLY", which began assembling Claas combine harvesters in 2021.

 

Exclusion of subsidies for foreign machinery does not apply to highly specialized machines, for example, for harvesting sugar beets or potatoes, where subsidies remain at 25%, regardless of the country of production.

 

With this policy, Kazakhstani agricultural machinery enterprises currently cover 85-90% of the market, providing small and medium-sized agrarians with affordable equipment to upgrade their machinery fleet.