The regime of industrial assembly of auto components in Russia will be unlimited

Russia decided to break the preliminary agreement within the bounds of World Trade Organization (WTO). The regime of industrial assembly of auto components, new agreements of which were abolished in October 2007, will be in force in Russia without time limits.
Russia"s industry and trade ministry told the newspaper �Kommersant� that the ministry order about continuation of call for bids from auto component manufacturers about the regime of industrial assembly may come into force in the nearest future. This regime of industrial assembly was abolished in October 2007 as a controversial one to WTO norms and alongside with it - the call for bids from manufacturers who decided to use opportunity of privileges offered in the regime of industrial assembly. Till nowadays right to sign such agreements have only those companies which has already signed memorandums of intent (terms of signing of the most of memorandums have been expired).
According to government regulation of September 2006 auto component manufacturers had right to import components for parts and car units assembly with minimum duty (from 0% to 3% instead of 5-20%) but under conditions that in three and a half years upon signature the share of imported details will decrease to 30%. Such right will have all manufacturers after the regulation has been signed.
Experts remark that despite the fact that plants of all large foreign companies appeared in Russia the major component projects were not announced. Russia"s industry and trade ministry hopes that most plants which use SKD production will come to the stage of auto component localization in the nearest future and this fact will give significant surge of component productions.
According to the data of Pricewaterhouse Coopers in 2007 the production volume of components of foreign cars of the Russian assembly was about $250 million (about 440,000 cars). By 2012 the car production should increase to 2 million units and turnover of component production should be $10 billion.
However it is obvious that perspectives of auto components assembly growth in the regime of industrial assembly will directly depend on recovery of effective demand on the Russian automobile market but at the moment no one can estimate the terms of the possible recovery of the market even to a year.