The 45 year-old, who also played for Everton, Fiorentina and Rangers, already had a role with the struggling club but was elevated to the top post until the end of this season.
Jurmala have managed only eight points from 28 rounds and are rooted to the bottom of the league table.
"The team has potential and we are not in the position we deserve to be in," said a confident Kanchelskis.
Kanchelskis finished his playing career in 2006 and had coaching stints at Torpedo-ZIL Moscow, Ufa and Volga Nizhny Novgorod.
(Editing by Amlan Chakraborty)
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