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. Last Updated: 07/27/2016

State Electronics Policy Shifts Toward Design

For electronics, design seems to be the way of the future. Or at least that is the impression given by a policy document signed by President Vladimir Putin earlier this month.

According to the document, called "Principal Policies of the Russian Federation for Developing the Electronic Component Base Over the Period Up to 2010," emphasis is to be on establishing design centers that can create modern electronic systems. Modernizing production facilities will take second priority.

A year ago, the "Developing Electronic Technology" program came to an end. The main task of that program was to keep the sector from falling apart by maintaining the production levels of antiquated goods that still have buyers in Russia. Since then, there has been no state strategy as to what should be done with Russian electronics in the future.

The main problem is that the modern production of microchips in Russia needs to be created from the ground up. Even at enterprises in Zelenograd, the center of the Soviet electronics industry, about $1 billion would be required. Against the backdrop of a slumping international electronics markets, finding this scale of funding would be unrealistic.

The new document, however, changes the emphasis. Having the capacity to design microchips will now take precedence over the availability of the necessary production facilities. A design studio must be created, with capable and fully qualified employees. Production orders can be placed in Southeast Asia, where there is an overabundance of production facilities. Two Russian design institutes already operate in this way, Progress and Modul.

Anatoly Sukhoparov, the chairman of the Federal Fund for the Development of Electronic Technology who helped to write the document said the ability to design the fundamental parts will mean a departure from reliance on Western suppliers.

The speed of development in the industry internationally is rapid and in a few years' time there may be no more of the microchips that the Russian electronics industry uses.

The solution is to learn how to design them. To start with, the international standards system must be adapted for local design bureaus to follow. Sukhoparov said three to four years would be needed to create the legal basis and get a training program up and running. This would cost 200 million to 300 million rubles ($6.4 million to $9.6 million) a year, he said.

Gennady Krasnikov, general director of the Nauchny Tsentr company in Zelenograd, was more reserved. He said the new priority will be to create design centers rather than re-equipping factories -- including Nauchny Tsentr's Mikron plant.

"An entire program should be adopted, starting with tax benefits and a targeted investment program with state participation," he said.