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Economic Analysis: Theory and Practice

Determination of manufacturing complex' development areas to implement the import substitution policy: The electrical equipment case

Vol. 16, Iss. 1, JANUARY 2017

PDF  Article PDF Version

Received: 31 May 2016

Received in revised form: 22 September 2016

Accepted: 1 November 2016

Available online: 27 January 2017


JEL Classification: D24, F52, L51, L64

Pages: 4-18


Grachev I.D. Central Economics and Mathematics Institute, RAS, Moscow, Russian Federation

Kolesnik G.V. Federal Grid Company of Unified Energy System, Moscow, Russian Federation

Bendikov M.A. Central Economics and Mathematics Institute, RAS, Moscow, Russian Federation

Importance The challenges and threats to the national and economic security of Russia in the aggravated geopolitical and geo-economic situation necessitate a strategy to maintain the independence of the national economy from technological import. The article considers localization of production as a tool to implement this strategy and promptly manufacture the most critical import-dependent products.
Objectives The article describes an approach to determination of priority directions of the domestic industry development, based on the localization of production level. The advantage of this approach is consideration of available capacity of domestic enterprises for mastering the manufacture.
Methods The determination of priority areas of manufacturing complex development rests on the analysis of production cost items using the methods for localization level assessment.
Results The analysis of the localization level of electrical equipment production showed a bias in the domestic electrical industry development towards assembly operations. The most import-dependent positions are electrical components, tool engineering products and insulation materials. The most promising area of import substitution development in this industry is the production of materials and components, for which domestic enterprises already have expertise and engineering capability.
Conclusions and Relevance It is crucial to use mechanisms of foreign technologies transfer in this industry. At the same time, it is important to develop the national technological base as part of program implementation for innovation and import substitution development.

Keywords: import substitution, import dependence, localization, life cycle, electrical equipment


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