The industrial take-off under Vyshnegradsky and Witte

• Tariffs were raised in the 1880s and under Ivan Vyshnegradsky who took over in 1887 a prohibitive import tariff of 30% of the value of raw materials was introduced.
• This was designed to boost home production and considerably helped the iron industry of southern Russia as well as the development of industrial machinery.
• Vyshnegradsky needed to balance the budget while financing enterprise. As well as negotiating some valuable loans for example from the French in 1888 he also increased indirect taxes and mounted a drive to swell grain exports.
• On the surface the policy appeared very successful. Between 1881 and 1891 grain exports increased by 18% as a percentage of total Russian exports and by 1892 the Russian budget was in surplus.
• However this remarkable export drive was achieved at the expense of the peasants who paid the taxes and saw their grain requisitioned by the State.
• Many were left with no reserve stores for the winter and it was put about that  Vyshnegradsky said 'we ourselves shall not eat but we shall export.
• A result of this policy was the 1891-1892 famine brought by bad harvest in which thousands died. Vyshnegradsky was dismissed in 1892.