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. Last Updated: 07/27/2016

U.S., Russia Resolve Computer Dispute

SAROV, Central Russia -- The United States and Russia have quietly resolved a long-simmering dispute over the illegal sale of sophisticated IBM computers to Russia's leading nuclear weapons lab, U.S. officials said.

In the process, both sides have helped open to cyberspace what was once one of the most secret installations of the Soviet Union.

On Friday, the 16 computers, now fully licensed and operational, were to be on display as part of an open computing center that U.S. Energy Secretary Bill Richardson was to inaugurate at the lab that developed Russia's hydrogen bomb.

The center is a joint project of the Energy Department and the Russian Nuclear Power Ministry, to which Washington contributed $2.3 million. It is intended to help find jobs outside the weapons industry for thousands of scientists, engineers and technicians at this remote nuclear city.

In quiet talks, for more than two years Washington had insisted that the computers, which IBM sold to Russia in 1996 without the required export license, either be returned or openly dedicated to nonweapons work. Russia initially refused, but earlier this year, negotiators agreed that the computers would be incorporated into the computer center, which is expected to create 80 technological jobs in its first year and as many as 650 in the next five years.

The center is one of five projects planned in Sarov under the U.S. Nuclear Cities Initiative. It is aimed at converting Russia's 10 closed nuclear cities to peaceful work. But Congress cut the administration's request earlier this week, and only granted the ambitious undertaking $7 million of the $30 million sought.

Richardson defended the initiative in an interview Thursday, saying he hoped to use money from other weapons-conversion programs to help scientists in Sarov and at other nuclear cities to convert to peaceful work. "We are all concerned that scientists might be forced by economic necessity to seek employment in rogue states or among terrorists," he said.

Sarov, some 400 kilometers southeast of Moscow, is the Russian equivalent of Los Alamos National Laboratory, where the United States' nuclear bombs were designed. But in addition to designing bombs, this complex still engineers, fabricates and assembles nuclear weapons warheads and components.

As part of the Soviet Union's effort to mimic the Manhattan Project, Josef Stalin established a nuclear complex here in 1946 and closed the city. It takes its name from a monastery held sacred by the Russian Orthodox Church for its link to one of the most revered Russian saints, Seraphim of Sarov.

The walled monastery became the site of the first Soviet nuclear program. The remote city was renamed Arzamas-16 and appeared on no Soviet maps and was accessible to only a few. Not until 1990 did the Soviets acknowledge its existence. Russia restored the city's historic name in 1995.

Rady Ilkayev, director of the lab, talked Thursday about the institute's 30,000 employees, and their struggle to survive the downsizing of the nuclear weapons industry in this now impoverished city of 80,000. Ilkayev said the institute's staff had shrunk almost in half, to 18,000 employees from 30,000.

Although the institute once controlled virtually all of the city's vital infrastructure, he said that 40 percent of Sarov's transport, 90 percent of its medical infrastructure and 70 percent of its sports arenas had now been transferred to the city government.

Fifteen percent of the lab's employees now work in the civilian sector, but Ilkayev said he hoped to increase that proportion to 29 percent by 2002. He said this could be achieved partly by expanding the institute's diamond-cutting business, its oil and gas enterprises and its production of hydraulic drives.

Noting that the United States provides some 86 percent of the $8 million that the institute receives each year in aid from foreign governments and labs, Ilkayev called the United States his main partner. He said U.S. support had helped "prevent critical leakage" of key scientists with nuclear weapons expertise.

He estimated that his institute would need $40 million over three years to restructure the lab. With Russian bank interest rates exceeding 50 percent, raising that amount of investment capital domestically is impossible, he said.

Russia had evaded U.S. export laws by buying the IBM computers in 1996 through Moscow-based middlemen. IBM installed them here. Though a federal grand jury investigated the transfer, no charges were brought against IBM.