其他服務業Business News

Home/Business News /Business News list
Russian Ministry of Industry and Trade may ban the purchase of foreign lighting products
Source:Vedomosti From:Taiwan Trade Center, Moscow Update Time:2024/07/29

The Ministry of Industry and Trade has developed a roadmap for improving the mechanism for verifying the “Russianness” of lighting technology. The document will be signed in July, a ministry representative told Vedomosti. He did not specify what new initiatives it would include. But the Ministry of Industry and Trade “if a real need arises” is ready to introduce a ban on government purchases of foreign lighting equipment, the source said.

Nowadays, when government procurement of such products is carried out, the “second odd one out” rule applies. This means that the customer rejects all applications with foreign goods if at least one application with goods from the EAEU (including Armenia, Belarus, Kazakhstan, Kyrgyzstan and Russia) has already been submitted.

According to Rosstat, the market volume of domestic lamps (for the public sector) in 2023 amounted to 110 billion rubles. Most of it falls on administrative and office lighting (35%) and housing and communal services (20%). The rest is for street and road lighting, industry, etc. According to RuSID, the volume of the lighting products market has shown stable growth in recent years at the level of 5–7% annually.

In February 2023, the government introduced a minimum share of purchases under government contracts for domestic lighting products of 90%. And in October, manufacturers of electronic products approached the government with a proposal to introduce reporting on compliance with this requirement and fines for non-compliance, Vedomosti wrote on October 31, 2023. Then the Association of Enterprises in the Field of Radio Electronics, IT, Digital Innovation and

Engineering sent a letter to the Cabinet of Ministers stating that often, under the guise of lighting equipment from Russia, equipment that is not included in the unified register of Russian radio-electronic products is submitted for auction, or when fulfilling a contract, foreign devices are included in the batch.

In 2023, GS Group estimated the share of products from China in the Russian LED market at more than 95%. Products from China are 1.5–8 times cheaper, said Fedor Boyarkov, vice president for production development at GS Group. Therefore, Russian enterprises used Chinese LEDs in the production of lamps. General Director of RuSID Dmitry Anikin confirms that even now “there are often cases when manufacturers replace Russian components when supplying the main batch, for example, with Chinese ones.” 

In November 2023, the government launched an experiment on labeling certain types of radio-electronic products, including lighting equipment. The Ministry of Industry and Trade also planned to require documents from electronics manufacturers on the purchase of Russian components used in the production of goods claiming to be domestic. For this purpose, amendments were prepared to the draft government decree (it was about changing Resolution No. 719 of 2015, which defines the principles for determining the Russianness of goods). But as Vedomosti wrote on June 24, 2024, this rule disappeared from the new edition of the document. Later, a representative of the Ministry of Industry and Trade assured that the requirement for the purchase of Russian components will appear in government decree No. 1604.

The publication's interlocutors at lighting engineering manufacturing companies believe that the roadmap for the traceability of Russian lighting technology will not have the force of law. “Most likely, this is a document that will be signed by the Ministry of Industry and Trade and the Russian Union of Industrialists and Entrepreneurs as some kind of PR stunt,” believes one of the sources. The GS Group and the Association of Manufacturers of LEDs and LED-based Systems did not hear about the roadmap and did not take part in its development, their representatives say.

But the industry reacts positively to the possibility of introducing a complete ban on the purchase of foreign lighting equipment. According to Anikin, a complete ban on the purchase of foreign lighting equipment will be an incentive for the development of domestic production. “A complete ban will have a positive impact on the industry, since this requirement will minimize the risks and access of foreign lamps in government orders,” said Andrey Martynov, director of the lighting sub-holding GS Group.

“At the moment, in the tender documentation, individual state and municipal customers do not indicate requirements providing for mandatory (priority) supply of domestic LED products, which is a violation,” says the top manager. As a result, companies whose products are not included in the register of the Ministry of Industry and Trade participate in deliveries, he explains. Anikin agrees that a number of government customers do not specify in their procurement requirements the mandatory supply of domestic lighting equipment.

Domestic producers will be able to satisfy the demand for products, Martynov believes.

According to Martynov, in order to solve the problem of purchasing Chinese components instead of domestic ones, it is necessary to annually provide information on the volume of purchases of components for final products that are in the register. “Such an initiative will help identify illegal trafficking of products not only in the lighting industry, but throughout the entire electronics industry,” he noted. An effective measure could be the creation of a commission with the participation of manufacturers of domestic components, which would have the right to conduct inspections agreed with the Chamber of Commerce and Industry for illegal trafficking in products in the lighting industry if there are signs of unreliable information, Martynov believes.

On the other hand, Anikin notes that a complete ban could lead to a shortage of certain types of components if domestic manufacturers are unable to quickly increase production capacity. “This, in turn, will lead to an increase in prices for lighting products,” he argues. “Therefore, when deciding on a complete ban, it is important to consider additional measures to encourage Russian manufacturers to expand their production capabilities.”

But a complete ban on the purchase of foreign lighting equipment will not be a panacea, argues Alexey Vinogradov, a member of the board of the Association of Manufacturers of LEDs and Systems Based on them. “The problem of purchasing counterfeit and counterfeit goods will not change with this approach,” he notes. “The customer, as he purchased goods of foreign origin, will continue to purchase, but under the goods numbers from the register.”

Source: https://www.vedomosti.ru/technology/articles/2024/07/03/1047587-minpromtorg-mozhet-zapretit-zakupat-inostrannuyu-svetotehnicheskuyu-produktsiyu