Economic and Investment PotentialEconomic and Investment Potentialof Saratov Regionof Saratov Region

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Saratov Region is a territory for investmentSaratov Region is a territory for investment

Regional centerRegional center – – Saratov city Saratov cityTotal land areaTotal land area – 101 – 101..220000 thousandthousand km2km2Population Population – 2– 2,,584584 thousand people thousand people Manpower resourcesManpower resources – 1 – 1,,647 647 thousand peoplethousand peopleDistance from Moscow cityDistance from Moscow city – 858 km– 858 kmExtent of state border with the Republic of Kazakhstan– 550 kmExtent of state border with the Republic of Kazakhstan– 550 kmSouthern temperate climateSouthern temperate climate

Saratov RegionSaratov Region

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Economic indicesEconomic indices

24,3

40,4 46,956,8

78,262,1

2004г.

2005г.

2006 2007 2008 2009

Dynamics of investments into the fixed capital, billion rubles

151,6170,9 200,7247,6

316,5367,1

2004г.

2005г.

2006 2007 2008 2009

Dynamics of Gross Regional Product, billion rubles

Agricultural production

200436.1 billion rubles

Growth202%

200972.9 billion rubles

Commissioning of residential houses2009

1129,9 thousand sq. meters

Growth233%

2004484.5 thousand sq. meters

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Own regional oil-and-gas production, 100% gasification of inhabited localities and enterprises.Own oil refining at Saratov Oil Refinery Factory, stability of fuel market.Considerable deposits of hydrocarbon raw materials in bowels - gas, oil, petro-condensate, oil shale with shale gas and shale oil.

Superfluous electric energy supply – Balakovo Nuclear Power Plant, Saratov Hydroelectric Power Station, 6 Thermoelectric Power Station – the volume of generated electricity is 41 billion kWh, regional intake is less than 30% of the volume output. Low cost of electric energy.

Investment potential of Saratov regionCompetitive advantages of the region:

Considerable deposits of mineral raw materials - chalk, limestone, carbonate for use as cement raw material, clay rocks for brick manufacture, expanded clay, cement, sand and sandstones, mineral balneological waters, medical, high quality table waters, potassium and magnesium salts, sulfur, phosphates, siliceous rocks, mineral paint sienna, etc.

Availability of free agricultural lands (more than 650,000 hectares), lands of settlements, lands for industrial use with communications and power and heat capacities.Low rental fee (agricultural lands – 0.3% of cadastral value, other lands – 2% of cadastral value), average level of cadastral value of land plot meant for manufacturing and office buildings, constructions, industrial buildings, communal service, material and technical supply, food supply, merchandising, and provision in Saratov is 16,825.5 rub./m2, in municipal areas it makes ≈399.0 rub./m2 depending on location. Tried-and-true procedure of land plots assignment under investment projects in shortest and exact terms, according existing legislation. 6

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Low cost of labor force –2.5 lower than in Moscow region (average salary in the Region is 12 thousand rubles, in Moscow – 25-30 thousand rubles).

Low prime cost of house making, construction of industrial and commercial real estate (and as a consequence short rental rates on the real property).

Advantageous geopolitical location of the region.Proximity to Moscow mega city (858 km) with the mighty consumption market.

Southern moderately continental climate, duration of winter period is a month less than in Moscow that allows reducing charges for heating, illumination of premises and technical services. Region’s location in a favorable fourth light zone that considerably reduces the cost price of production of a hothouse complex.

High level of communications and telecommunications.

Significant cultural, medical and educational potential .

Low cost of holding nature protection and ecological measures.

Presence of skilled manpower resources.

Developed banking, insurance, stock and commercial sectors.

Intelligent transport, engineering and logistic infrastructure.

Competitive advantages of the region::

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Availability of the regional legislation providing the most preferential tax treatment for investors: Law “On the Most Favored Nation Treatment for Investors in Saratov Region” №116-ZSO of June 28th, 2007. Law “On Tax Rate on Organizations’ Profit with Regard to Investors Engaged in Investment Activity in Saratov Region” №131-ZSO of August 1st, 2007. Law “On Levy of Property Tax for Organizations at the Territory of Saratov Region” №73-ZSO of November 24th, 2003. Law “On Transport Tax Levy in Saratov Region” №109-ZSO of November 25th, 2002. Law “On Pledge Fund of Saratov Region” №92-ZSO of October 2nd, 2006. Regulation of the Government of the Saratov region “On Approval of Exemplary Form of Investment Contracts, Form of Investment Certificate, Written Application of Investors, Record of Investment Contracts’ Register and Its Form” №305-P from August 27th, 2007.

Competitive advantages of th region:

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Competitive advantages of Saratov regionCompetitive advantages of Saratov region::low cost of technological connection and basic chargeslow cost of technological connection and basic charges

Gas ratesGas rates

Directions of gas consumption Rubles/thousand cub. m.

Trade prices for gas, extracted by “Gazprom” and its affiliated entitiesand sold to consumers of Saratov Region (except population) 2541.0 Trade prices for gas, extracted by “Gazprom” and its affiliated entitiesand sold to consumers of Moscow Region (except population)

2665.0

Rates for services for gas transmission into gas distribution networks Rates for services for gas transmission into gas distribution networks and customers groups, rubles /thousands m3and customers groups, rubles /thousands m3

Gas supplier

Gas consumption volume, million cubical meters/year

Upwards of

500

from 100 to 500inclusive

from 10 to 100

inclusive

from 1 to 10 inclusive

from 0,1 to 1 inclusive

from 0,01 to 0,1

inclusive

up to 0,01 inclusive

“Saratovgaz” 109.48 116.47 186.35 286.51 302.81 314.46 349.40

“Mosoblgaz” 258.78 269.18 366.25 504.91 522.25 539.58 556.91

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Rates for technological access to electric power linesRates for technological access to electric power linesСтоимость услуги в Саратовской области

№ Zone Voltage level Amount of charge, rubles/ kilowatt

1 Saratov, Engels, BalakovoVoltage level less than 35 kilowatt

Power less than 10,000 kilovolt-ampere13 908

2Other municipal units of Saratov

Region

Voltage level less than 0.4-1 kilowatt Power less than 10,000 kilovolt-ampere 11 629

Voltage level less than 6-10 kilowatt

Power less than 10,000 kilovolt-ampere9 818

Cost in Moscow№ Area Voltage level Amount charge rubles/ kilowatt

1 Inside Sadovoe ring roadAverage voltage 100720.00

Low voltage 113207.00

2Between Sadovoe and 3 transport

ring roadsAverage voltage 90118.00

Low voltage 101291.00

3Between 3 transport ring road and

Moscow Ring RoadAverage voltage 77729.00

Low voltage 87367.00

4 Beyond the Moscow Ring RoadAverage voltage 60648.00

Low voltage 68168.00

Competitive advantages of Saratov regionCompetitive advantages of Saratov region::low cost of technological connection and basic chargeslow cost of technological connection and basic charges

Water supply and disposal ratesWater supply and disposal rates

Supply organization Water supply, rubles/ m3 Water disposal, rubles/ m3

"Saratovvodokanal" 10.73 4.86

"Mosvodokanal" 22.10 15.65 11

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The following tax remissions have been

introduced in Saratov Region in January 1, 2008:

- the rate of profits tax to be transferred to the

regional budget is reduced down to 13.5%;- property tax is reduced from 2.2% down to 0.1%; - full transport tax exemption.

Period of validity of tax holidays is set up for 5

years from the date of starting investment

activity.

Competitive advantages of the Saratov regionCompetitive advantages of the Saratov region::

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By today, we have created exclusively favorable By today, we have created exclusively favorable investment climate, which certainly will have a investment climate, which certainly will have a

prosperous effect upon the outcome of your prosperous effect upon the outcome of your industrial and commercial activity in ourindustrial and commercial activity in our region

REPRESENTATIVE OFFICE OF THE GOVERNMENT OF THE SARATOV REGION TO THE GOVERNMENT OF THE RUSSION FEDERATION7 Podkopaevsky lane, building 3, Moscow 109028 RussiaTel.: +7(495) 917-06-96, 917-27-23, fax: +7(495) 917-23-62 E-mail: predstavitelstvoso@gmail.com, invest@saratov.gov.ru

Deputy Chairman of the Government of the Saratov Region – Mr. Alexander Zhandarov

MINISTRY OF INVESTMENT POLICY OF THE SARATOV REGION72, Moskovskaya str., Saratov 410042 Russia Tel.: +7(845-2) 21-02-10; fax: +7(845-2) 27-73-22E-mail: invest@saratov.gov.ru Minister – Ms. Irina Blohina

Contact information:

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Thank you for your attention!