Meeting with Deputy Prime Minister Marat Khusnullin

President of Russia Vladimir Putin: Mr Khusnullin, your portfolio is impressive and includes roads, housing construction, and infrastructure. Where shall we begin?

Deputy Prime Minister Marat Khusnullin Khusnullin MaratDeputy Prime Minister of the Government of the Russian Federation : Mr President, first of all, I would like to note that this year marks the 70^th anniversary of the Russian construction sector. Construction Worker's Day was officially established in 1956. The first celebration took place at the Luzhniki Sports Palace to showcase the country's achievements in construction.

However, the construction sector has made tremendous strides over the past 25 to 26 years. Today, our country boasts hundreds, if not thousands, of landmark projects. These include the facilities built for the Olympic Games and the FIFA World Cup, the Crimean Bridge, expressways, major industrial enterprises, and large-scale residential housing developments. Our cities have changed out of recognition. You travel extensively and you had the opportunity to see just how profound these changes have been in terms of quality.

Vladimir Putin: Yes, that is certainly true.

Marat Khusnullin: Thanks to these comprehensive measures and your support, the construction industry has effectively become the driver of economic growth. Despite all the attempts by our detractors and other unfriendly forces to stand in our way, the sector has grown by 34 percent.

Today, together with related industries, construction accounts for over 20 percent of GDP. Over the past five years, its contribution has increased by 1.9 percent. In terms of tax revenue, the sector now accounts for 16.7 percent of total tax receipts. This is shown in the presentation with its share having increased by 2.9 percent. Employment in the sector and related industries now stands at 17.7 percent.

Vladimir Putin: Seventeen-point-seven percent of everyone employed in the economy?

Marat Khusnullin: Yes, 17.7 percent of total employment. That is an enormous number.

Previously, we looked only at the construction per se. But the construction business has a strong multiplier effect: every ruble invested generates 1.68 rubles in economic activity. Therefore, together with the Federal Taxation Service and the Finance Ministry, we calculated the sector's full contribution, including all related industries. That is how we arrived at this high figure. Naturally, it has a significant impact on all key economic indicators.

We also examined the regional picture. As you can see on the next slide, the map shows the sector's contribution across individual regions.

Vladimir Putin: Seventeen-point-seven percent amounts to roughly how many people? About 13 million?

Marat Khusnullin: Yes, 13 million people. If you look at this slide, you can clearly see the extent to which each region depends on the construction sector. At present, 16 out of 85 regions derive more than 20 percent of their regional budget revenue from construction-related activity, while 65 out of 85 regions derive more than 10 percent. Only a handful of regions have a share of 10 percent or less. If you look closely, you will also see that the reunited territories are rapidly gaining momentum, with extensive construction activity taking place there as well.

To be continued.