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EDITIONS
Wednesday, 26 June, 2002, 09:10 GMT 10:10 UK
Russia approves land sales bill
Russian farmer
Most of Russia's farmland is still owned by the state
The lower house of the Russian parliament has approved the sale of farmland across Russia, for the first time since the 1917 Bolshevik revolution.


Without private ownership of farmland, no country in the world can make market reforms successful.

Vladimir Pekhtin, Unity Party
However, foreigners will still be banned from buying land.

The vote marks a significant break with the past for Russia, though many remain unhappy with the idea of putting the country's farmland back into private ownership.

Under communism, all agricultural land was owned by the state and all farms were collectives, a system that proved inefficient and unproductive.

Since the collapse of communism, each region in Russia brought in its own laws - some allowing partial private sales, others not.

Market reforms

The State Duma approved the bill allowing land sales in its third and final reading, by 258 in favour to 149 against with five abstentions.

Debate in the Duma in June 2001
Deputies literally fought over land reform in 2001
The legislation now goes before the Federation Council - the upper house of the Russian parliament - which is expected to approve it rapidly.

The bill is then due to be signed into law by President Vladimir Putin, and will come into force in six months' time.

Setting a legal framework for the sale of farm land is crucial to Russia's economy, and a key part of Mr Putin's reforms.

"Private ownership of farmland is the most important condition for increasing the participation of several layers of society in the economy," said Vladimir Pekhtin, parliamentary leader of the Unity party, which supports President Putin.

"Without this," he added, "no country in the world can make market reforms successful."

Contentious

While Russia's 1993 constitution allows land sales, the Communists and other hard-liners who controlled the previous parliament opposed attempts to introduce the legislation needed to put the provision into force.

Russian farmer
Russia's farms need investment
There are a billion acres (400 million hectares) of farmland across Russia.

The BBC's Caroline Wyatt in Moscow says the new federal law is crucial to end the current corruption surrounding land leases and to make Russian farming more effective.

Yet it remains a deeply divisive issue - as Russian MPs found the first time it was debated in parliament last year, when the discussions ended in a punch-up between opposing deputies.

The Communists and their allies are still firmly against the sale of land, calling it a betrayal of the Russian people, but they no longer have the power to stop the bill.

The Russian Government says private sales must be allowed and that these reforms are aimed at encouraging transparency and enshrining property rights in the law.

However, in a concession to opponents of the bill, Mr Putin has stressed that there will be no rush to sell land until a proper registry has been set up, and no immediate sell-off.

The new law will also ban foreigners from owning farmland in Russia, though they will still be allowed to lease it.

See also:

26 Jun 02 | Europe
21 Jun 02 | Business
23 Apr 02 | Business
14 Jul 01 | Europe
08 Mar 02 | Country profiles
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