The Russian government will spend about $200 million to build the circuit that will host the country's first Formula 1 grand prix in 2014.
"The federal government has allocated 5.846 billion rubles ($195.4 million) for this project," Alexander Ivanov, deputy governor of the Krasnodar region, told the Reuters news agency.
Russia secured a seven-year deal to host a grand prix on a new track in Sochi, which is also hosting that year's Winter Olympics.
The Olympics project has raised fears that the first grand prix may be delayed for a year in order not to slow down preparations for the Olympics. However, officials insist that the building of the circuit remains on schedule.