Transcript of the beginning of the meeting:

Dmitry Medvedev: Colleagues, today’s agenda, as usual, is not too short and not too long, which is a good thing. But the issues are important.

Let us begin with the health issues. Today we are considering a draft law which, for obvious reasons, affects practically the entire population of this country. I mean the draft federal law “On Protecting Public Health From the Effects of Tobacco Smoke and the Consequences of Tobacco Consumption.” I think you understand why this affects both smokers and non-smokers. It is obvious that this problem affects the living standards of the vast majority of the people in our country. Why? I spoke about this not so long ago and I will say a few words now. Russia is practically the heaviest-smoking country in the world. But what does this phrase – “the heaviest-smoking country” really mean? Speaking in simple terms it means ours is the most backward country in the world. People usually smoke in the most disadvantaged countries. There is, of course, a set of social habits and a certain way of life, but it’s already common practice for people all over the world to take care of their health. Europe also smoked heavily 20 or 30 years ago, but it has almost kicked the habit today. By contrast, this country has 44 million smokers (a third of the population), including children. We are second in terms of the volume of the tobacco market. Second to whom? A “tiny” country, China!

The most unpleasant thing is that this concerns everyone not just smokers, because 80% of our people are affected by smoking. I’ve already mentioned this number, but it’s a scary number. Tobacco kills nearly 400,000 people annually. It’s a serious problem. I don’t think we can solve it with a campaign to promote a healthy lifestyle, as our friends and colleagues who are smokers often suggest. This is not enough. They say: “If you provide the right opportunities, we are willing to be reeducated…” This looks like mockery. Of course, we should create conditions that encourage people to drop bad habits. We must support health programmes targeted at helping smokers. It’s necessary because smoking is also an addiction. But obviously we are behind the civilised countries in this respect, and we aren’t fully protecting non-smokers. We don’t protect them at all! It’s no news that dividing accommodations into zones and other efforts are useless.

The drafted law we will discuss today bans smoking in all public places, including government agency buildings. Even though smoking was prohibited in the Government Building several years ago, people still smoke there. But formally the ban exists. We must enforce it, including in the rooms. By January 1, 2015 smoking is to be stopped in restaurants, cafes, and other retail facilities. The number of locations for cigarette sales will be reduced significantly, advertising will be limited. A number of other regulations were included in other laws providing tax incentives. The objective is to prevent the negative effects of tobacco on  public health.

I’d like to note that the draft law does not violate the rights of those who chose this path themselves and who enjoy smoking. We must protect those who do not want to breathe in other people’s cigarette smoke and that’s all. Moreover, two thirds of all smokers support the fight against smoking.

And a few more important issues. There are two state programmes. One of them is called “Development of the Pharmaceutical and Medical Industry for 2013-2020,” and the second is targeted at environmental protection for 2012-2020. I’d like to remind you that adoption of state programmes with respect for these key sectors is our priority task. We must establish a modern competitive pharmaceutical and medical industry. We understand perfectly that the effectiveness of the treatment of millions of our citizens directly depends on our hospitals and clinics having the latest equipment and drugs.

Yesterday I visited a high-tech medical centre that treats cardio-vascular pathologies in Kaliningrad. Everything is perfect; everything is good, and it’s all high-tech. But the trouble is that everything is foreign made, absolutely everything down to the last nail. We just built the infrastructure, and I think that it also includes foreign-made elements, for obvious reasons.

It is equally important that such high-tech knowledge-based industries as bio-medical technology and new medicines can push Russia forward on the path of innovative development. We have already made the biggest steps in this direction. We have adopted a target programme for the development of the pharmaceutical and medical industries, which will create the foundation for the state programme. We are promoting cooperation between research and education centres, and industrial facilities. A bio-medical cluster has become operational in Skolkovo. Development institutions are investing in projects launched to create modern medical equipment.

The state programme should integrate all these elements into a united, efficient system, consolidate the research and production infrastructure, create conditions for the inflow of foreign investment and, of course, secure the use of international standards, including through the active use of technology platforms and innovative medical-pharmaceutical territorial clusters. Seven such clusters are being created. The goals are ambitious and allocations will be considerable: over 100 billion roubles until 2020. The target is to increase the market share of Russian-made medicine to 50%, and of medical products to 40% by that time. Let’s talk about this today. By the way, I have invited several governors who are actively advocating this.

A few more words about the issue of pharmaceuticals: I have approved regulations on Government oversight of the medical goods market. They stipulate a better procedure for federal supervision inspections. But the main goal of this document is to ensure the provision of safe, quality medicines for the people, because the situation is currently a long way from positive and is often described as unsafe. At the same time, the new provisions will not create additional administrative obstacles for businesses.

Let’s talk about the Government programme for protecting the environment until 2020. Intensive development of the industries and of transport and industrial infrastructure has had an impact on the environment, but the environmental damage that had accrued prior to this, during the Soviet era, was considerable as well. Obsolete enterprises have a major negative influence on the environment. According to experts, the environmental situation on some 15% of the country’s territory is critical. The air pollution level in 135 cities is assessed as high and very high. There are problems with the soil, which is littered and polluted. A large share of waste is not recycled or utilised, but is taken to landfills where it sits for decades in unsuitable conditions.

The Government programme is aimed at resolving these issues. There are three goals. The first is to reduce the overall negative burden on the environment. The second goal is to preserve and rehabilitate ecosystems within the boundaries of special conservation areas. And the third goal is to enhance the efficiency of hydrometeorology and environmental monitoring systems. I want to emphasise that the implementation of this programme should proceed systematically and on an up-to-date level.

Another vital issue on which our future depends is the action plan for the development of the leading Russian universities. The development of a network of leading universities began within the framework of the Education national priority project, as part of which 57 universities that employ innovative curricula have been selected. We also created the first two federal universities – the Siberian and Southern federal universities. At this point, the system comprises two national universities (in Moscow and St Petersburg), nine federal universities and 29 national research universities. In addition, 55 universities are implementing three-year strategic development programmes financed from the federal budget. Taken together, they constitute 15% of the total number of Government and municipal universities. This is the potential that we have. But it does not mean that it should stop at 15%.

At the same time, we must improve the quality of higher professional education in a consistent and well-considered manner, and help the best Russian universities integrate into the international educational space. Foreign students at our universities account for approximately 3% of the total number of foreign students studying across the world. This is not much, considering our potential, and besides, the export of Russian educational services amounts to less than 1% of the global market. We cannot be satisfied with this.

Heavy work lies ahead, and we must carry out this work systemically and at a quick pace. You know our goals regarding the five universities and everything else; no one has changed them. The plan of action to develop the leading universities is also aimed at achieving these goals. Nine billion roubles have been allocated for this purpose from the federal budget in the first stage. There will be additional sources and allocations, and if the global economy recovers, we will certainly provide more money.

Please, the first speaker, Mr Denis Manturov.

And while he is walking up, let’s wish our new colleague, Mr Igor Slyunyayev (Minister of Regional Development) success in his Government post. I presented him yesterday, when the President signed the executive order. So best of luck to you, Mr Slyunyayev and nerves of steel, as I wished you yesterday. Please proceed, Mr Manturov.

Denis Manturov (Minister of Industry and Trade): Thank you. Mr Medvedev, members of Government, colleagues. The Ministry of Industry and Trade has drafted a development programme for the pharmaceutical and medical industries. We have held public hearings at the presidential Public Chamber and the ministerial Public Council and received positive conclusions from the concerned agencies. The current per capita consumption of medicines in Russia is several times smaller than that of the United States and Western Europe. I will provide the data in roubles, for the sake of convenience: 30,000 roubles in the United States, 20,000 in Western Europe and only 4,700 roubles in Russia.

At the same time, by our estimates, the Russian market of pharmaceutical and medical products will grow by 150% by 2020 thanks to modernisation of the healthcare system. Currently the proportion of public procurement of non-medicinal agents within the consumption pattern accounts for 35%, and of medicinal products, 85%. This will remain considerable in the future as well. Thus the state plays, and will continue to play, a significant role in forming the demand for medical products, so the programme activities are aimed at a continuous growth of provision of the population with domestic drugs and medical equipment.   

The programme that has been presented is one of three key elements of the system seeking to take Russian healthcare to a new level. The first element is the state programme, Science and Technology Development in Russia, which forms a scientific foundation for creating new drugs and medical equipment. The second element is the state programme of healthcare development in Russia. It is aimed at introducing new products and treatment methods. Thus, the programme under consideration is a link between the results of research and practical medicine. Our programme was developed in close coordination with other governmental strategic documents. In addition to the provision of accessible and quality drugs and medical products for the healthcare system, we are setting the task of creating an industry that can successfully compete on global markets. The growth of the Russian market, international integration processes and the potential of Russian science determine the development priorities of the pharmaceutical and medical sector, including the following: improving the investment attractiveness of the sector, integration within the international production chain of pharmaceutical and medical products and transition to a new innovative model of development. The goal of the programme has been determined with due account of these priorities –to create an innovative Russian pharmaceutical and medical industry competitive on of the global level. To achieve this goal it is necessary to build the production and innovative potential of the sector, and then to organise the manufacture of innovative drugs and medical products.

I’d like to say a few words on the structure of the programme. Mr Medvedev, as you have said, the main instrument of the programme is the federal targeted programme for the development of the pharmaceutical and medical industry until 2020, which was adopted in 2011. This is the main source of funding for the activities of the programme. Next, the state programme provides for implementing three subprogrammes: the development of drug production, the development of production of medical products and a subprogramme for improving state regulation of the turnover of drugs and medical products. The total budget of the federal targeted programme for 2013-2020 is just over 166 billion roubles, including 108 billion roubles of federal budgetary funds, and some 58 billion roubles of funds from non-budgetary sources.

The fifth slide highlights the programme funding distribution by year. I want to draw your attention to the fact that the state will provide budget funds for launching the innovative cycle at the start of the implementation of the state programme. Later on, the programme provides for a gradual reduction of direct state funding and a transition to indirect measures incentivising investment. I have spoken about this in detail at the meetings held in Penza and Skolkovo, when we discussed issues of the development of medical equipment and drugs.

Dmitry Medvedev: I just want to ask: does this include everything that we have discussed?

Denis Manturov: It includes absolutely everything, especially in the regulatory framework, which we prepared within a specific subprogramme…

Dmitry Medvedev: I mean the regulatory framework above all. Good.

Denis Manturov: Under the subprogrammes 1 and 2, we will implement projects of strategic importance aimed at supporting the development and production of innovative drugs and medical products. These include projects, for example, on developing hi-tech medical equipment and medical products. The priorities of the healthcare system are taken into account in the implementation of these projects, including the development of domestic drugs to replace imported drugs on the list of vitally important medicines, and the launch of new facilities producing drugs on the list of medicines for the treatment of high-cost diseases on the List of Seven Nosologies. Research is being conducted on creating drugs and medical products for paediatrics. When developing the state programme, a decision was taken to form a specific subprogramme that would include the activities within the legal and regulatory framework. The adoption of the Pharma-2020 strategy in 2008 provided an impulse for significant legislative changes in this sector. The plan of implementation of the subprogramme for 2013 provides for the fulfilment of your instructions in respect of developing the law on the turnover of medical products and developing and adopting the strategy of medical industry advancement. 

In terms of the state programme, we have taken into account the tasks for creating an innovative system of the Russian Federation mentioned in the Presidential Executive Order of May 7, 2012. The development of innovative territorial clusters has already received a considerable amount of support. The federal budget allocations for the creation of centres developing drugs and medical products as part of the development of leading universities and research institutions, will amount to about 15.7 billion roubles. This concerns Moscow, the Moscow Region, St Petersburg, the Leningrad, Yaroslavl and Volgograd regions, the Republic of Tatarstan and some other regions. The programme’s implementation is expected to bring a quantum change to the industry. The share of Russian companies in production will increase markedly – to 50% and 40% in the pharmaceutical and medical technology sectors, respectively. Labour productivity in the sector will increase 4.5 times, 20,000 hi-tech jobs will be created or modernised, and exports will increase seven times.

The programme will stimulate the development and manufacturing of science-intensive products in Russia, boost the domestic pharmaceutical industry up to world standards and enable the sector to compete with foreign producers on both the domestic and foreign markets. Mr Medvedev, colleagues, I ask you to approve our programme. Thank you.

Dmitry Medvedev: Thank you. Any comments on the presentations by the government members? Mr Dvorkovich, please.

Arkady Dvorkovich (Deputy Prime Minister): I would just like to add that alongside the preparation of the government programme we are also working actively with Russian and international companies on various issues, such as localising the production of existing drugs and new drugs that are in the development stage. Some are on the national vaccination calendar. In this respect, our approach is strict, we need to have practically100% monopolisation of production as we must ensure security in this sphere and stick to the calendar. The work has already reached the advanced stage of preparation. We expect to have global-standard production facilities as early as 2014-2015. Thank you.

Dmitry Medvedev: Thank you. We have invited some speakers from the regions. I suggest that we give them the floor. Let us start with the Sverdlovsk Region. Yevgeny Kuyvashev. And try to be brief.

Yevgeny Kuyvashesv (Governor of the Sverdlovsk Region): Yes, of course. Mr Medvedev, esteemed cabinet members. Thank you for the opportunity to address this Government meeting.

Briefly about our region... There are over 40 enterprises that produce medical technology and eight enterprises that produce medicine. They employ more than 7,000 people. In 2011, their output amounted to 5.2 billion roubles. The region’s enterprises account for 11% of the total medical technology output in Russia and 3% of all of the medicine. In 2011, 1.2 billion roubles were invested in medical technology and drug production. Four of the region’s enterprises – Triton-Electronics, the Urals Optical and Mechanical Plant, the Urals Federal University and the Organic Synthesis Institute of the Urals Branch of the Russian Academy of Sciences – are involved in implementing the federal targeted programme to develop the pharmaceutical and medical industry. Among their products are anesthetic and respiration equipment, and next generation equipment for monitoring a patient’s condition. The programme envisages the construction of an innovative pharmaceutical research technology centre using the Urals Federal University’s facilities. The centre will include laboratory-type business incubators and an experimental production area for the development of technologies and obtaining substances for formula drugs. The federal targeted programme has earmarked 370 million roubles for this project.

Another item in the plans to develop the medical and pharmaceutical industry in the Sverdlovsk Region is the construction of a multifunctional centre on the basis of a public-private partnership, which will pool the potential of regional companies, the Urals Branch of the Russian Academy of Sciences, and the Urals Federal University. The partnership includes over 30 organisations and companies that form the pharma cluster. As I said, a cluster of 32 enterprises has been created in the Sverdlovsk Region. The participants plan to implement 20 projects, into which a total of 27 billion roubles will be invested. Over 130 drugs and medical equipment units will be developed.

One of the cluster’s major projects is the production of substances for genetically engineered insulin drugs. Already 83% of diabetics in the Sverdlovsk Region receive locally produced insulin. When the plant starts producing these substances in addition to insulin, there will no longer be a problem of providing patients with domestically produced insulin. Nevertheless, when the factory offered the regions to buy our insulin, 41 territories refused, although there hasn’t been a single complaint about the use of our product. Moreover, we have launched the parallel production of specialised hydrolytic glass to facilitate the administration of insulin.

The Government of the Sverdlovsk Region and the cluster management company have prepared and filed an application with the Ministry of Economic Development to include this project in the list of pilot programmes to develop innovation territorial clusters approved by the Russian Government on the appointed day – 20 April, 2012. We will file the application once again.

Pursuant to the target set by the President to increase the output of strategic and vital domestic drugs to 90% of the total, we have made considerable progress along that path. In the past three years, the share of domestically produced drugs in drugs procurement programmes has increased by 12% in terms of the number of units. In the first nine months of 2012, it has increased by 59%. And there is potential for further growth…

What we consider to be successful and close cooperation has been established with the Urals Branch of the Russian Academy of Sciences, as well as with pharmaceutical enterprises and sites. We expect that the adoption of this government programme will boost the development of the medical and pharmaceutical industries, including in our region.  Thank you.

Dmitry Medvedev: Thank you. Yaroslavl Region, do you have any comments to make? Sergei Yastrebov?

Sergei Yastrebov (Governor of the Yaroslavl Region): Mr Medvedev, esteemed cabinet members. Thank you for the opportunity to speak here. We have no critical remarks on the draft. We support it. The draft programme has been thoroughly discussed and has also been reviewed during public hearings, in which the members of our pharmaceutical cluster also took part. I would like to say a few words about it.

Today, I can safely say that the pharmaceutical industry and innovative medicine cluster in the Yaroslavl Region has been formed and is poised for further development. The nucleus and the leaders of the cluster are major pharma companies like Takeda (Nikomed), R-Pharm and Teva. Two enterprises have been built and four more pharma factories will open by 2014. Direct investments in the pharma cluster will amount to 17.8 billion roubles, of which about 9 billion roubles will go towards R/D. By 2020, the output volume will reach 50 billion roubles per year, or roughly 5% of the pharmaceutical market in the Russian Federation.

The cluster has set an example of implementing the strategy aimed at diversifying the region’s economy. When the enterprises hit full capacity in 2014, they will employ 8,400 people and pay 1.4 billion roubles per year in taxes. The continuing programmes to train personnel are being actively implemented in conjunction with our foreign partners. A federally financed technology transfer centre is being built at Yaroslavl’s Ushinsky State Pedagogical University. The centre will develop technologies with active molecules, which will lead to the development of new drugs. By 2020, 50 original drugs and 60 import-replacing pharmaceutical substances will be created. The creation in Yaroslavl of a branch of the Roszdravnadzor (Federal Healthcare Supervision Service) federal drug quality control laboratory will provide a powerful impetus to the pharmaceutical cluster’s development. The decision to create it was agreed upon during the Yaroslavl delegation’s meeting with President Putin. I believe that it is necessary to note that the elaboration of the programme’s various sections will enable the regions to start working to prepare clinics for the use of the new drugs developed under the programme. We are confident that the implementation of the projects under this programme will give yet another impulse to the Yaroslavl pharmaceutical cluster’s development. The Government of the Yaroslavl Region supports the adoption of the Development of the Pharmaceutical and Medical Industry government programme and is ready to fulfill it. Thank you.

Dmitry Medvedev: Thank you. Would anyone like to comment on the programme? Let’s consider it adopted then. OK.

The next state programme project concerns environmental protection, as has been announced. Sergei Donskoy, please.

Sergei Donskoy (Minister of Natural Resources and the Environment Protection): Mr Medvedev, esteemed colleagues. We would like to present to you the Environmental Protection in 2012-2020 draft state programme. The state of the ecology in Russia is well known, and Mr Medvedev described it in his introductory remarks. It should be mentioned that one-third of the population lives in poor environmental conditions. Issues still persist such as the wasteful use of natural resources, which existed during the Soviet era. In the Soviet Union, half of all companies did not use waste treatment facilities, which resulted in 30 billion tons of waste. The level of waste utilisation remains low. For instance, the level of solid domestic waste recycling hardly reaches 10 percent, while in other countries it is four times higher.

Due to air pollution, the average lifespan is shortened by one year. The annual economic damage brought about by the worsening ecological situation amounts to 4-6 % of the GDP. Following the reform of the system of state administration bodies, environmental functions were combined in a single federal executive body. This allowed for progress in settling a number of the most urgent ecological issues.

This year, the President approved the basic state policy in Russia’s environmental development up to 2030. This is a major strategic document that defines the priorities for economic policy and the transition to an environmentally oriented model of economic development. Other efforts include the ratification of the Stockholm Convention on Persistent Organic Pollutants and the Rotterdam Convention on the Prior Informed Consent Procedure for Certain Hazardous Chemicals and Pesticides in International Trade. Work is being implemented to further harmonise environmental laws with international standards, including those related to Russia’s accession to the Organisation for Economic Co-operation and Development.

The State Duma is considering a package of draft laws aimed at introducing principles of the best available technologies, developing the institution of state environmental appraisal, and creating economic impetuses for the development of the waste recycling and utilisation industry. The draft law on the liquidation of cumulative environmental damage has been introduced to the Government. In 2011, regulations were adopted on increasing state system efficiency, environmental monitoring, and state environmental supervision, as well as expanding the used potential of ecosystem services at natural reserves and national parks.

Practical efforts include work to clean Arctic islands from cumulated damage, to develop the system of detecting and removing unauthorised solid domestic waste dump sites, and to create new specially protected natural territories. Mr Medvedev, with your involvement, the Akademik Tryoshnikov ship was transferred to the Federal Service for Hydrometeorology and Environmental Monitoring a week ago to assist in conducting environmental research of the Antarctic, which plays a pivotal role in forming the global climate.

The state programme, which is being considered today, should be the basis for resolving key ecological issues and making the shift to sustainable development. This document combines into a unified system legal regulation measures aimed at economic incentives and green-growth-oriented, practical steps to improve the environment. The programme provides the chance to bring together the efforts of federal executive bodies, regions, corporations, and public and other organisations. The programme aims to increase citizens’ environmental safety and to preserve natural systems. Its implementation will result in considerably lower volumes of released pollutants by 2020 compared to the 2007 reference year. The overall volume of waste per GDP unit will also drop, and our economy will become more environment-oriented. The number of highly and extremely polluted cities and towns in the country will also decrease by 2.7 times.

The liquidation of cumulative environmental damage will reduce the number of Russians residing in poor environmental conditions fivefold, with specially protected natural areas at all levels occupying 3.5 percent of the territory. The total financing for the programme will be some 336 billion roubles, including 268 billion from the federal budget. We also expect Vnesheconombank, the Rostekhnologii corporation and the Skolkovo Foundation to be actively involved in the programme, including activities to develop environmental biotechnologies.

The state programme consists of four main and one supporting subprogrammes. Among the efforts implemented under the state programmes is the Protection of Lake Baikal and the Socioeconomic Development of the Baikal Nature Area for 2012 up to 2020 state federal targeted programme, which was adopted by the Government in August 2012.

As for the subprogrammes, the first is Environment Quality Control, and it is aimed at introducing a new standardisation system based on the principles of the best available technologies, the reduction of administrative barriers and the creation of economic impetuses in handling waste and liquidating environmental damage. Among the envisaged practical measures are 10 priority projects on the liquidation of cumulative damage, such as the project to remove an industrial waste unauthorised landfill. So, under the subprogramme, we’ll implement at least ten priority projects on eliminating the accumulated damage, for example, on cleaning up the unauthorised damping of industrial waste and sludge in the Nizhny Novgorod Region, on reclaiming the land around the Srednevolzhsky Chemical Plant in the Samara Region, on projects to clean the accumulated damage in the Arctic. These projects include industrial and consumption waste processing and utilisation including in the Leningrad and Tomsk regions. This subprogramme should result in the containment and neutralisation of pollutants in the air by 22%, and the amount of used and neutralised waste will increase by 2.2 times. It sets specific indicators for a reduction in aggregate pollutant emissions and waste.

The objective of the second subprogramme is to preserve Russia’s biodiversity. Under this subprogramme, we’ll carry out the Concept of Development of Specially Protected Natural Areas to 2020 approved by the Government. Over 30 new nature reserves, national parks and federal wildlife reserves will be established. After this subprogramme is complete, 3% of Russia’s total area will be federally protected land. This will include the habitats of over 77 species of mammals and 97% of species of birds listed in the IUCN List of Threatened Species. People will visit national parks with at least 50% greater frequency. 

The third subprogramme is aimed at developing the system of hydrometeorology and environment monitoring. Under this subprogramme, we plan to introduce a unique system of state environmental monitoring. This system will make it possible to coordinate the information from 14 different sources. This will improve the quality of environmental review and the efficiency of the environmental policy being developed. The development of the Early Warning System for Climate including the installation of 140 Doppler locators will provide an improved warning predictability rate of up to 90%-92%. The development of the hail guard system will protect farmland on an area of over 2.4 million hectares. This monitoring system will improve the predictability of daily weather forecasts by up to 93%–95% in the regions. Every city with a population of over 100,000 people will have an air pollution monitoring system.  

Climate change is one of the global environmental challenges. The implementation of the fourth subprogramme on the Antarctic, the climate-forming continent, will provide new knowledge in this area and will create a foundation for forming a state environmental protection policy with consideration for climate change. This subprogramme will provide for Russia’s national interests in the Antarctic aimed at strengthening and developing the existing system (the Antarctic Treaty System, ATS) and at implementing Russia’s international obligations in environment protection in the Antarctic.

The participation of voluntary, scientific and expert organisations in the implementation of the state programme as well as the monitoring of programme events contribute to the state programme objective. We plan to use an extensive range of methods to ensure the openness and transparency of the implementation of these state programmes as well as to incentivise the community participation in its events. Voluntary organisations and individuals will play an important role in implementing the state programme.

When we were developing these programmes we took into consideration the strategic priorities established in the Foundations of the Environmental Policy, in the Strategy of Innovative Development and also the comprehensive programme of biotechnology development. The implementation of the programme will provide positive results on most indicators in the mid-term. 

When we were finalising the drafted version of the state programme, we had some differences with the Ministry of Finance, but we worked them out prior to this meeting. Currently we have no discrepancy with any departments.

I want to note that next year we expect that the federal targeted programme Environmental Security will be adopted. Given the allocations for it, we plan to start a more comprehensive elimination of past environmental damage (from the Soviet years). In addition, we hope that the institutes for development will take an active role in implementing the programme. In our view, Vnesheconombank should participate in investment projects for the development of a processing and recycling process for industrial and consumption waste. We are ready to cooperate with the Skolkovo Foundation, technology platforms, as well as with Rostekhnologii corporation on developing and commercialising new resource conservation and environmentally effective technology including biotechnology. This sector needs considerable resources for the development and introduction of technology for bioremediation, power waste disposal, and other things not included in the draft budget…

Dmitry Medvedev: Bio… what?

Sergei Donskoi: Bioremediation, excuse me.

Dmitry Medvedev: You said meditation! I got worried.

Sergei Donskoi: This draft state programme has been agreed upon within the established procedure; it has been posted on the ministry website and was approved by the Public Council under the ministry. I ask you to approve it.

Dmitry Medvedev: You only surprised me with the idea of improving the predictability of forecasts up to…

Sergei Donskoi: Up to 95%. In some cases…

Dmitry Medvedev: Is this at all possible?

Sergei Donskoi: Considering that today monitoring is provided by Gidromet (the Russian Hydro-Meteorological Centre) with a minimum of meteorological stations, we are planning a fairly extensive programme across the country…

Dmitry Medvedev: So, the probability will increase?

Sergei Donskoy: Yes, the probability will increase, we are talking about calculations made by specialists, so we trust their figures.

Dmitry Medvedev: Yes, we always trust the weather people, that’s true. Okay. Thank you.

Are there any comments on the draft programme on environmental protection? Mr Dvorkovich please.

Arkady Dvorkovich: Thank you. I chaired a reconciliation meeting on this topic. Indeed, there were some disagreements with the Finance Ministry, but we sorted them out, mainly because the new element of the programme has to do with the protection of Lake Baikal and related issues. We adopted it very recently. If the programme had not been agreed upon on the scale that we are discussing today, we would not be able to implement the programme to protect Lake Baikal that we have just adopted. Now the resources are available, though perhaps some internal redistribution of allocations will be needed, depending on what decision will be taken concerning the enterprises around Lake Baikal.

As for other components of the programme, there is one related issue on which a decision needs to be taken this year. I repeat, it is not directly linked to the programme, but it is related to it. I'm referring to the Kyoto Protocol, on which different agencies have different positions. This topic will need to…

Dmitry Medvedev: We should meet and discuss this topic. In general, I have to remind you that previously… I did this personally as a participant in various forums and summits, I said that unless the world community comes to an agreement, we will have to wave goodbye to the Kyoto Protocol. Has anything changed since then?

Arkady Dvorkovich: On the part of the international community, nothing has changed, so I believe we should stick to the decisions. Our colleagues who are responsible for the economy have their own position, which is connected with the need to continue ongoing projects, and of course, with the Protocol and availing ourselves of the benefits it affords. I have given instructions to study the possibility of signing a bilateral agreement with the European Union on this matter, but considering our sensitive relations with the European Union, I am not sure whether this scenario is likely to be possible.

Dmitry Medvedev: Why sensitive? In what way?

Arkady Dvorkovich: Concerning energy. But the two things may turn out to be unconnected.

Dmitry Medvedev: One has to admit that we have not gained any substantial benefits from the Kyoto Protocol. Indeed, commercially, we have been unable to derive proper benefits from it. But that does not mean that we should go on pulling all this weight, contrary to common sense. So, consider this matter carefully and then come to me, we need to discuss it, because it is an important issue: it's an international issue, and it has to do with ecology and energy. So, make a thorough review.

Arkady Dvorkovich: Yes. And we are completing the work on the draft law on environmental security.

Dmitry Medvedev: Good.

Arkady Dvorkovich: We have reported to you on that. We’ll finish that shortly.

Dmitry Medvedev: Very well. Are there any more questions? None? Adopted.

Now about tobacco and tobacco smoke. Ms Skvortsova (Veronika Skvortsova, Healthcare Minister), please, you have the floor. During the past week I have been ratcheting up tensions on this topic, speaking out in the media, on the internet, and I have just been speaking about it. So, give us the hard data without scaring the Government members who have not yet kicked the bad habit. I won’t name them, but you all know them.

Remark: It’s a good law.

Dmitry Medvedev: It is good. I support it.

Veronika Skvortsova: Mr Medvedev, esteemed colleagues. The tobacco smoking situation in our country has been assessed as a threat to public health that calls for urgent measures. New legislation is needed to turn the situation around. I will not bore you with statistics. I would simply like to cite several figures: a 10% drop in tobacco smoking would benefit the economy to the tune of 110 billion roubles in 2013, 140 billion in 2015 and over 250 billion in 2020, not counting excise.

Russia ratified the World Health Organisation’s Framework Convention on Tobacco Control (FCTC) in 2008, joining the 175 countries that ratified it before Russia. In accordance with our international obligations, and pursuant to the instructions of the President and the Government, the Healthcare Ministry developed and submitted to the Government the draft federal law, On Protecting Public Health from the Impact of Tobacco Smoke and the Consequences of Tobacco Smoking. The draft law stipulates a complex of measures to prevent the impact of tobacco smoke and cut tobacco consumption, including the following: a ban on smoking in certain areas, premises and sites; price and tax measures; regulation and disclosure of the composition of tobacco products; requirements for the packaging and marking of tobacco products; education and promoting popular awareness of the harm of tobacco consumption and the harmful impact of tobacco smoke; a ban on tobacco advertising, encouragement of the sale of tobacco products and tobacco consumption as well sponsorship by tobacco companies; medical assistance for people  to help them give up smoking, and treating tobacco addiction; prevention of the illegal sale of tobacco products; limiting wholesale and retail trade in tobacco products and paraphernalia; and a ban on the sale of tobacco products and paraphernalia.

It must be said that these measures will not be introduced at once, but gradually, in order to enable consumers and businesses to adapt to these changes. The law will fully come into effect as of January 1, 2016. The law’s provisions are based on the best foreign practices, which have proved to be effective in many countries. The draft law has been recognised as meeting the high international standards by the Secretariat of the WHO Framework Convention on Tobacco Control, the supreme international body in this field. The language of the draft law has been approved without any remarks by all federal executive bodies concerned. The President’s Legal Directorate has provided its opinion. The document has been backed by the Government’s Law-Making Commission, which has ruled that amendments could be made when the draft is discussed by the State Duma. On the strength of the above, we ask you to support the draft law and submit it to the State Duma. Thank you.

Dmitry Medvedev: Thank you very much. Looking at the cabinet members around the table, I’ve noted two things: first, this side of the table is non-smoking and all the smokers are on this side…

And second, percentage-wise, there are more than 25 of us here. It is a small statistical sample, but anyway, we have fewer smokers than the country at large -- in the country one in three people smoke, and in the Cabinet, one in five.

But speaking seriously, it is indeed a big problem. We have always treated it lightly, especially since none of us are without sin, and some of us have smoked to some extent at various times.

We understand all that, but a decision has to be made, and we should move in the same civilised direction as the whole world. It will definitely have an effect, an effect measured in a large number of human lives saved.

No objections?

Voice: None.

Dmitry Medvedev: Coming from you, it carries added weight.  

<...>