Importance Currently, food security issues get even more important in Russia. Whereas the food supply market depends on imported food products as seen especially during the last year, it becomes relevant to ensure further development of the domestic agricultural sector. Objectives The research aims at identifying specific reasons for the agricultural crisis, considering the existing mechanism for encouraging investment in agriculture under threats to the national food security. Methods The article reveals specific reasons for the current state of domestic agriculture. To examine the physical volume of investment in agriculture, I use a comparative method, statistical data analysis, graphical method for presenting data. Results In my opinion, I see no efficiency in the mechanism for encouraging investment in agriculture, which has been applied until recently in the Russian Federation. Notwithstanding a growth in budgetary subsidies, the agricultural sector still remains depressed. The government provides some measures of State aid to the Russian agriculture in line with the WTO requirements, but they generate few results or prove to be inappropriate. Conclusions and Relevance The crisis in agriculture stems from borrowed foreign technologies, low profitability of agricultural businesses, technological gap, and insufficiency of investment attracted, etc. I review separate directions for encouraging investment in agriculture. The analysis of actual amounts of investment over time and statistical data enables me to state a lack of investment attracted, and the need to carry out a set of activities to improve the investment potential of the sector. I conclude that, considering the import substitution strategy in relation to agricultural products, it would be reasonable to replace direct State subsidies and grants with finance of regional programs of economic significance. In addition to the allocation of State funds, it is necessary to develop indirect measures to support the Russian agricultural businesses, including preferential tax policies.
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