Creating a modern chemical industry is a strategic task for economic and spatial development that can ensure import independence and sovereignty in Russia. The new chemical cluster in Usolye-Sibirskoye in the Irkutsk Region is a successful example of comprehensive territorial development that can become a model for creating modern agglomerations and scientific production centres across the country, one of the elements of the large-scale reassembly programme for domestic chemistry, Maria Vasilkova notes.
Let me start with a well-known phrase to lead us to the main topic: “Chemistry is what separates poverty and hunger from a prosperous life.” How much do you think this reflects the essence of chemistry, especially within the context of our country? How does chemistry make us rich?
First, it should be noted that chemistry underpins everything around us; there is nothing without chemistry. Some ignorant people have demonized it. Food security cannot be achieved without chemistry, including fertilizers, plant protection products, and agricultural chemicals in general. So, chemistry is a fundamental sector. And how rapidly chemistry develops will determine the pace at which other sectors grow.
As for the chemical industry’s contribution to the national economy, we calculated that for every 1% increase in GDP, the chemical sector needs to grow by about 6%. There is definitely room for growth here.
In recent three years, we’ve seen significant state efforts to develop the national chemical industry. To what extent are these linked to the sanctions restrictions that we’ve had to overcome?
The current leap forward in the integrated development of the country’s chemical industry has indeed been significantly driven by sanctions pressure. For instance, the sixth package of EU sanctions banned the sale of 79 chemical products to Russia. More than half of them, or 41 items, had not even been produced in Russia before. These restrictions provided the impetus to launch the reassembly of the domestic chemical industry in 2022.
When we began, apart from fertilizers, chemistry was somewhat neglected. A lot has been accomplished since then. As part of the Future Technologies Forum, President Vladimir Putin launched the national project for technological leadership called New Materials and Chemistry, which will allocate RUB 55.6 billion from the federal budget over the next three years.
This project is well-designed and addresses current challenges while answering key questions, such as which product chains, projects, consumers, and timeframes need to be implemented. Thanks to the combined effort of the Russian Ministry of Industry and Trade and with the support of experts from the State Duma’s Expert Council on Chemical Industry Development, the Russian Union of Chemists, and major state corporations like Rosatom, this national project became a systematic response to the challenges facing the chemical sector.
Who will implement these plans? Where will the workforce come from?
This is a crucial question. Public platforms across the country highlight the problem of a shortage of skilled professionals, which is an acute issue for the entire economy and particularly for the chemical sector. To address this, a separate federal project that focuses on accelerating the supply of skilled labour for the chemical industry has been developed as part of the national project, in cooperation with the Russian Ministry of Education and Science. This includes measures such as continuing professional education, regional subsidies, industrial graduate programmes, and more.
I would like to emphasize that we have a strategic plan for developing the chemical industry in the country, and it’s a good one. Now, all that’s left is to execute it. However, I’m confident that we’ll succeed because there’s a growing understanding among professionals that chemistry is foundational for the nation’s economy. We used to live in a paradigm where we could rely on imports, but now, given the current circumstances, we must depend on ourselves. If we don’t develop our own industries, especially those strategically important to the state, we may find ourselves in dire straits.
Our relatively small internal market for chemical products is a weakness. What are our strengths?
First, we have excellent raw material resources in the country. Second, it’s our people – the scientists working in the chemical industry. They are truly unique individuals who achieve things that weren’t possible before.
Another challenge is learning how to multiply this effect, i.e., translate successful prototypes into mass production. This requires building modern infrastructure. We’re currently discussing specialized industry parks and techno-parks specifically designed for chemical production, drawing on both local experience and international best practices.
The Federal Chemistry Centre in Usolye-Sibirskoye in the Irkutsk Region is an example of such an emerging cluster that showcases a comprehensive approach to territorial development. Why did they decide to build a new chemical production centre in Siberia in this particular city?
During the Soviet era, the Usolyekhimprom enterprise was the largest chemical industry site in the country beyond the Urals, encompassing major acetylene and chlorine complexes. Unfortunately, the private owners who took over the plant and drove it into bankruptcy in 2017 not only let it fall into disrepair but also left behind an environmental disaster. Essentially, it was a Siberian Chernobyl.
However, the region was fortunate to have a capable governor, and the city was lucky to have a proactive mayor. Thanks to the efforts of Maxim Toropkin, the mayor of Usolye-Sibirskoye, the issue was brought to the attention of the federal authorities. In 2020, due to the risk of hazardous substance leaks at the plant and its surrounding area – a vast territory spanning 1,200 hectares – a state of emergency was declared. Then, starting in 2021, the state corporation Rosatom was brought in to dismantle the old facility and carry out full-scale land remediation.
This is a massive, complex project that is now being successfully implemented by our colleagues from the Federal Environmental Operator. It is important to note that Russian technologies are being used for the remediation efforts.
But cleaning up the hazardous waste dump, which contains large amounts of heavy metals and mercury, is only part of the challenge. The second part is figuring out how to use this site after remediation, given the significant budget resources being spent on it, and how to revitalize Usolye-Sibirskoye, a city of chemists.
And how would you respond to this question?
At the first stage, the Vostok production and technical complex is being constructed on the new site, which will process waste from classes I–II, and eventually, classes III–IV. For Russia, this is a unique development that will make it possible to close the full cycle of chemical waste processing and disposal at one location. Further down the line, in the second stage, we will develop modern chemical production here.
There really couldn’t be a better place for this. Usolye is primarily a city of chemists. Generations of families have actually worked in the chemical industry for decades. They understand it, aren’t afraid of it, and know how to work with it. There are numerous industry-specific competencies concentrated there. For example, the main sports complex in the city is called Khimik (meaning chemical industry worker), so chemistry is literally in their DNA. Overall, there aren’t many cities like Usolye that can boast that chemistry is, in the truest sense, the foundation of their existence. The local chemical industry will serve as the cornerstone of the comprehensive development programme for the entire territory – a programme that we have also developed.
What does it entail?
When designing the comprehensive programme, we considered the following key factors: ecology and safety first, of course. The new production facility must meet these obvious requirements. We have learned from past mistakes and do not wish to repeat them. Moreover, we must treat the resources allocated by the government with care.
Second, science and technology, which are tightly intertwined in chemistry, perhaps more so than in any other industry. So, local industries must necessarily have scientific and technological partners. In this regard, we actively cooperate with the Favorsky Institute of Chemistry in Irkutsk, which has received the status of a federal research centre. We also maintain active collaboration with Mendeleev University of Chemical Technology, one of the key specialized universities in the country.
The third is directly related to industry and cooperation. Developing cooperative links is fundamental to the development of the chemical industry. Without strengthening basic industries, advancing low-tonnage chemistry (which is most critically affected by sanctions) becomes impossible.
Fourth, of course, human resources. Without them, planning and investing makes no sense. Unfortunately, we have seen examples where factories were built, but failed to attract the required personnel. Usolye must avoid this risk.
Finally, fifth, the direct development of the territory. With the support of Dom.RF, we are working on creating a master plan for the city of Usolye-Sibirskoye. By the end of the second quarter, we expect to finalize a systemic quality document that will serve as the basis for rebuilding the city of chemists. Our goal is to rebuild the city with its houses, kindergartens, schools, and other social and engineering infrastructure. This is important because today, retaining personnel is less pressing than attracting young and talented individuals who can answer the question of why they want to come and work in Usolye.
And what do you tell them in response?
We say that it will be a new, comfortable environment that allows them to balance their work and personal life, grow professionally, and take advantage of modern social and sports infrastructure. On the one hand, it offers the charm of living in a small town where people connect with each other and form friendships. Plans include establishing scientific and engineering infrastructure that will enable young scientists to realize their ambitions and turn their ideas into reality.
Of course, interesting and well-paying work is very important.
We are already seeing a shift in attitudes among our youth. For example, whereas in 2023 only about 9% of schoolchildren in the Irkutsk Region took the chemistry exam, last year that number increased to over 12%. This is a very encouraging sign, as students taking challenging subjects like chemistry are typically those who are passionate, see potential in their studies, and are willing to dedicate themselves fully to their pursuits.
Where will these young people work? In other words, how do you intend to attract business to your site that will create modern jobs? Especially private businesses?
Several anchor residents are already present at the site, including Rosatom and Ruschem. Several projects are underway, such as the Ekovolokno cluster. However, not all projects are progressing as dynamically as we’d like. All major investors are waiting for the Central Bank to adjust its key interest rate to an acceptable level.
The primary obstacle to implementing large-scale investment projects, as evidenced by business surveys, is the cost of money. It effectively acts as a barrier, particularly for complex industrial projects. Together with the Skolkovo Foundation, we estimate that to launch complex technological leadership projects with low profitability and attract industrial investors in relevant fields, the key rate needs to be reduced to 1%.
Without accessible long-term financing, implementing large-scale technological leadership projects will be extremely difficult, not just in the chemical sector, but throughout the industrial sector as a whole.
Apart from lowering interest rates, what else needs to be done to give momentum to the project’s development?
Certainly, we need to provide the necessary legislative support to our colleagues. This includes updating requirements, construction standards, and other regulatory documents to meet modern conditions. We need a sound balance to ensure, on the one hand, the safety of our citizens and to prevent additional problems, while, on the other hand, keeping the projects sustainable and necessary in terms of its content.
