Prime Minister Vladimir Putin visits the Novosibirsk Academic Town Technology Park and an exhibition of its resident companies during a working visit to Novosibirsk


Vladimir Putin spoke with company representatives during his tour of the technology park.

The main building of the technology park is located next to the major science centre, known as Academic Town, part of the Siberian Branch of the Russian Academy of Sciences, hence the name “Novosibirsk Academic Town Technology Park.”

The first phase of the building – a modern two-tower structure – opened in January 2012. IT and computer companies who are registered as residents of the new technology park are currently moving in.

The prime minister was introduced to projects that are unique both in Russia and worldwide. One project involves technology meant to ensure safety in mines. The system, abbreviated GORNASS (mountain navigation and communications system) can monitor each miner’s whereabouts as well as the climate in the mine and provide each miner with an audio and video link.

In addition, the prime minister was shown innovative security systems for applications such as communications, TV broadcasting and software, including computer games.

The prime minister also examined a new pharmaceuticals production technology that helps manufacture safe codeine-containing drugs.

Communications Minister Igor Shchegolev, who accompanied Putin on his tour of the technology park, said that this is an ideal location for the residents in terms of the technological support that is available. He said that a biotechnology and nanotechnology centre (supported by RusNano), as well as an IT centre and a precision tool production centre are already up and running.

The minister added that another distinguishing feature of this technology park is the fact that it has received more private investment than federal and regional government funding. The idea of building technology parks in Russia has been largely justified, he said. Residents of the Novosibirsk technology park will earn more in 2012 than the government has invested in all the technology parks put together.

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Vladimir Putin spoke with company representatives during his tour of the technology park

Question: Mr Putin, we have quotas for hiring specialists, but placing them isn’t easy. For example, we have students from Kazakhstan. They are considered immigrants, because to change their status would require a complex set of legal documents…

Vladimir Putin: These issues will be resolved much more easily once the common economic space arrangements take effect. I’m not really sure what the problem is now. In fact, capital and people should be able to move freely now.

Remark: They have the same status as immigrant workers that come from other former Soviet republics, so authorities are asking for the same permits. As employers, we have problems with hiring them, because they need work permits...

Vladimir Putin: Are you talking about highly skilled workers?

Remark: University graduates.

Remark: Our university.

Vladimir Putin: I see. There are certain preferences for highly skilled workers. We have introduced a number of preferences for hiring highly skilled employees, even for those who come from countries other than former Soviet republics.

Remark: The minimum salary…

Vladimir Putin: Are there any salary restrictions?

Ответ: Yes, there are, but the skill level is determined by the salary.

Vladimir Putin: I see. I wasn't aware of these details. Please give me your proposals.

Remark: An apartment rental programme should be in place, so that we can bring in students from other countries. This is very important.

Vladimir Putin: You are absolutely right. This is what we are about to do.

Remark: We have already begun this work: the first apartments will become available in May. We need to speed this up, because the first 130 apartments…

Vladimir Putin: The common economic space will make the movement of capital and people much less complicated. I will look into this once again and see if there are any restrictions left that prevent highly skilled workers from getting a job. I will absolutely look into that, I promise.

Remark: Great. Thank you.

Remark: Of course, Siberia is not a very hospitable place in terms of weather: it’s hot in the summer and very cold during the winter. But as far as comfortable living is concerned, we can build housing ourselves and we should strive to do so. The trouble is that leading employees are leaving Siberia for better places, since they’ve been to many places and know that there are places with better environmental conditions. Our main goal is to create such an environment here, in order to entice people to stay. We absolutely need your support in this area.

Vladimir Putin: We are operating out of the belief that private businesses are interested in keeping specialists here. Let’s think about programmes that would combine the efforts of the regions, the federal government and private businesses.

Remark: Companies are ready to build housing, including low-rise comfortable houses. The state should be responsible only for the engineering and social infrastructure.

Vladimir Putin: You said “only the engineering and social infrastructure.” But this is exactly where most of the money goes. The frame costs almost nothing. However, we will return to this issue and consider it more in detail. What I mean is, regional authorities could take on the social infrastructure, just like they do with other projects, and we could think about covering costs involved in the construction of the engineering infrastructure from the federal budget.

Question: Mr Putin, a year ago in Tomsk the issue was raised of applying benefits available to the participants of special economic zones to residents of software technology parks. IT companies were granted certain privileges, but other companies that are also involved in innovative research have salaries that are a significant expense item of their budgets, especially during the startup period. In addition, we invested 30 million roubles from our net revenue into purchasing new equipment and we also paid property tax on it. We paid income tax and property tax. You instructed ministries to look into that. Has there been any progress?

Vladimir Putin: As you may be aware, this decision was made with respect to special economic zones. They now have income tax and social fund deduction incentives. However, as you might rightfully assume, the Finance Ministry is against expanding the list of privileges, and says this might put you at an advantage against the competition that works outside of the software technology park. However, there are only 11 such parks.

Remark: Mr Putin, in fact, a lot of work has been done in this area, by the way. We have established an association of technology parks at the initiative of the Ministry of Communications. Now we want to receive the status of a self-regulating organisation and develop criteria for accrediting a software technology park. Our association has already developed and approved these criteria. They are very tough both in terms of quantifiable indicators and the innovative nature of the work. If the technology parks accredited by this association could receive these privileges, then it would be quite in the spirit of those…

Vladimir Putin: The issue is not about accreditation or lack thereof. I have just cited the main objection of those who are against applying these incentives to technology parks. They say that in so doing we would create unfair competition for other companies that work outside of technology parks. If we create privileges here, then what about others who are working in the same industry, but are not residents of technology parks? What are they going to do? However, I believe that you framed the question correctly, and we will return to it later.

Remark: Perhaps I will express the pain felt by everyone in this room, because most of us present here graduated from Novosibirsk State University. The level of our university… In addition to being a business owner and a deputy director, I’m also an associate professor at the department of automation of physical and technical studies. I have taught about 500 students since 1988. Of them, 50 are working for Microsoft in Seattle. Do you know of any other university, 10% of whose graduates are working for an industry leader? I don’t think that there is any other such university on the planet. I teach just 12 students. I cannot teach more than that, because our university was designed for 3,000 students, and we currently have 6,000. We can’t even admit students into tuition-based departments, because there are no vacancies. In 2008, the decision was made to construct a new building. The first thing they did was cut the originally designed building area in half. In 2008, construction was suspended because of the crisis. In 2010, they gave us 100 million roubles, which wasn’t even enough to build the foundation. This year, we received 300…

Vladimir Putin: You are planning to train even more students for Bill Gates?

Reply: 90% of them have stayed in Russia! Their skills are in no way inferior to the skills of those who left.

Vladimir Putin: I’m sure they're not.

Remark: If we manage to combine all of that: an excellent university, a software technology park and decent living conditions…

Question: We need this desperately. There are funds budgeted for this purpose, but they will be released only in 2015. Is there any way to rearrange this and allocate funds now so that we can build the university quicker? This is the number one question. There is one other issue that has to do with co-financing. We are grateful to the governor for his support, but our university is small and we admit too few students to tuition-based departments. We just don’t have enough of them. We have a problem with co-financing: we can’t come up with the required amount of money. We will either have to ask the governor for a handout, or get relief. We worked under a different programme before which did not ask for co-financing. Beginning in 2010, we were switched to a new one that does require co-financing.

The second question has to do with financing the university. Our university has always been among the top five Russian universities according to Western ratings. Moscow University is usually number one, but we have never left the top five. Moscow University receives nine grants, we normally have six grants, while everyone else has just one each. The faculty at Moscow University, Bauman Technical University and the University of Physics and Technology have four students per one faculty member while we have a student-to-faculty ratio of ten-to-one.

Vladimir Putin: They should have ten-to-one as well.

Question: Perhaps a better way to go would be to raise us up instead?

Vladimir Putin: These numbers should be about equal, but there must be a standard number, otherwise it’ll be difficult to raise the average teacher salary. We can go ahead and have one teacher for every student, or have five to seven pupils in a school classroom instead of 20. This would surely improve the quality of education. It surely would! However, we need to find an optimal solution, a balance between our financial capabilities and the quality of teaching. The number of students per teacher is also dependent on this. Let’s think about it. It’s not that Moscow University has a standard of its own, no. They have simply violated these standards.

Remark: I don’t want this to look as though I've just exposed Moscow University, I don’t like the way this sounds.

Vladimir Putin: No, you haven’t. I met with Mr Sadovnichy (Viktor Sadovnichy, rector of Moscow State University), and he told me about it himself. This isn’t just true of Moscow University; it’s the case with other universities as well. Universities need to decide how many professors they need...

Remark: As in Oxford: one professor per two students. Then, we’ll teach like they do in Oxford.

Vladimir Putin: You are already teaching better than in Oxford, since more of your students work for Bill Gates than do Oxford graduates. Therefore, there must be a balance. However, you shouldn’t then think about raising salaries in the near future, because there’s no way you can get this kind of money. We should be honest and level with each other. You are a scientist, a professor...

Remark: I do know the law of conservation of energy.

Vladimir Putin: It’s easy to calculate revenue and spending.

Remark: Seven employees of our company teach at the university. They are both staff members at the university and work for a business.

Vladimir Putin: By the way, the number of students who pay for their tuition is unlikely to increase in the near future. I’m referring to our demographic problem, the demographic gap of 1992-2003.

Remark: We could redistribute students and take some from other places and bring them here, where they will receive better instruction.

Vladimir Putin: That’s another way of doing it.

Remark: We don’t have much choice.

Vladimir Putin: If we choose this path, then we will definitely be able to improve the situation at higher educational institutions, because we have a fairly large number of institutions that are training specialists with inferior skills, unlike you. Perhaps they should be combined with the institutions like yours. This is an alternative way to address the problem.

The third way is to streamline the faculty and non-core personnel. What are your numbers? Probably about fifty-fifty?

Reply: It’s hard to tell the exact number. Our university is special, because 80% of our faculty work part-time at the Siberian branch of the Academy of Sciences or IT companies.

Vladimir Putin: I see.

Remark: If you take our university, office and street cleaners and others predominate because all researchers work there as dual-job holders.

Vladimir Putin: But this ratio should not be even fifty-fifty. I’m not saying that people must be left without jobs. We must think together with the regional authorities about their jobs and decent salaries. By the way, maybe these people will get higher salaries in private companies that we have seen here. Do you understand my point? Our dialogue must not be solve this, solve that… We must together…

Remark: We agree.

Vladimir Putin: We must find the best solutions to problems together, and we have many problems. You have just named them yourselves. First, the number of teachers per student must be optimal and balanced. The ratio between technical personnel on the one hand, and professors and teachers, on the other, must meet the requirements of the national economy. We have more universities today than the Soviet Union. Is that a good thing?

I think I’ve made the point in one of my articles that we should not miss out on this education drive. We must use this desire of young people to get an education. The methods that have been mentioned here are not the only ones for streamlining the operation of universities, raising salaries and the level of training for specialists and R&D.

You are certainly right about the conditions. But, let me repeat that it is necessary to pool the efforts of business, the federal authorities and the regions. I have just spoken to your colleague who works on computer games. He said: “We want to build a structure here, and not just a structure but a whole complex, including housing.” We are ready to give the land for this. I will resolve this issue. Maybe, we will even provide some additional funds. The region and private companies must contribute money as well. We must look for these optimal solutions.

Remark: We are ready…But we’d still like to here your decision on the new university building. We can’t do without it.

Vladimir Putin: We’ll try… But what did they plan it for… I can’t recall the details now but I think they planned it for 2014 or 2015. First, its funding has not been cancelled but postponed. But we’ll try. This will depend on the budget capacity.

Remark: This will help not only our university but also the technology park.

Vladimir Putin: Okay, let’s try it. I will look into this by all means. Perhaps we will revise the parametres considering that our economy is doing well. And, if we have an opportunity to do this by using additional revenues, we will try to move it from 2015 to 2014 or even 2013. Is this okay with you?

Remark: Thank you.

Remark: As a developer of IT applications for financial institutions and state corporations, I’d like to note that the Russian market for these applications is very competitive. There are many strong Russian players in it and they can implement federal projects at a high level. In this context, I’d like to draw your attention to the federal law on state purchases. It would be good if state corporations looked at this market and offered some preferences to Russian software suppliers because quite often they offer the best value for the money. There are also other issues of dependence, cost of ownership and so on.

Vladimir Putin: During the crisis we decided to give some preferences to domestic producers in state purchases. As far as I remember, this concerned all categories of commodities. Of course, we can give some preferences to our IT producers in the domestic market, considering that our (or rather your) Western rivals enjoy broad support of their governments (quite often we don’t see the channels of this support but we know they exist). I will give instructions to the Ministry of Economic Development although we must bear in mind that there should be some restrictions here as well as competition.

Remark: Mr Putin, I boasted to you that the share of our domestic suppliers is growing compared to their Western counterparts, but this is true of private companies only. State corporations sometimes prefer the latter. They find it more prestigious to buy Western technology. And if you say: “Guys report on what you have done. The state takes care of domestic technology…”

Vladimir Putin: This is a good proposal.

Remark: “...Why don’t you report what this care is all about?”

Vladimir Putin: Okay, let’s do this.

Remark: The trends are different. Private companies, including those from abroad, eagerly buy domestic technology but state corporations… Sometimes it is more difficult for them to overcome the stereotype that everything made in the West is better.

Vladimir Putin: Agreed.. This is a good proposal, good idea.

Remark: Thank you very much.

Vladimir Putin: At any rate, we must be able to understand how much money our state corporations spend on domestic products in their overall purchases. But I must tell you that I understand that everyone is doing his business and nobody monitors on a daily basis what is being done or what the government is doing. At practically all of my meetings with our large enterprises, all our companies and not only public ones or public-private – I mean all companies in general – metallurgical, energy, gas, chemical, oil and machine-building ones draft development programmes worth trillions of roubles. This is huge money. In practically every industry we are setting the task of purchasing domestic products but these products must be competitive. We cannot compel our companies to buy inferior products because in this case we will put them in worse conditions compared to their Western counterparts. But the idea you voiced is good. We must make transparent the structure of purchases and to see how much funds our public companies and all major companies in general spend on domestic goods. We’ll do this. Thank you.

Question: Mr Putin, here’s another question about support for domestic companies. In many cases they produce better goods than foreign ones… We will give preference to domestic producers by raising the requirements on products… We can develop a market worth about one billion dollars in Russia and give preferences only by raising the requirements.

Vladimir Putin: Of course. I understand perfectly well that it is possible to set requirements for a specific product across the entire chain. I do understand this. But it is also possible to adopt such technical formulas that they will conform only to your products and all others will be shut out.

Remark: The foreign market is ready to use this approach.

Vladimir Putin: Nonsense! They have their own technical formulas for their products. For instance, Europeans have introduced technical regulations for their aircraft and that’s the end of the story! This is a very sensitive instrument and must be used with caution, including in the WTO but we are going to use it.

Remarks: Thank you! Thank you very much!

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