(Decanter) - The Russian government is considering investing up to RUB30bn (US$1bn) to develop winemaking in the recently annexed Crimean Peninsula over the next several years.

The funding is set to be approved at a forthcoming meeting of the Russian government under the leadership of Russia’s Prime Minister, Dmitry Medvedev, who has praised the quality of Crimean wine.

Investment will be dedicated to the development of the wine industry in Crimean and Caucasian regions of Russia.

According to Medvedev, Crimea’s total vineyard area reaches 31,000 hectares and the region has perfect conditions for the development of winemakng.

He has also added that the Ministry of Agriculture is working to integrate Crimea’s agriculture and winemaking into state support schemes, including Russia's existing agricultural development programme, which runs until 2020. The programme involves the provision of subsidies to local farmers, including winemakers.

There are also plans to set up to 19,100ha of new vineyards. According to state plans, Crimea's wine grape harvest should increase by 53% on current levels by 2017.

At present, due to closure of the Ukranian market to Crimean wine, the Russian government has ordered leading national retail chains to provide spaces for it on their shelves.