Strategic Directions of Russia

to promote science and innovations for the period of time up to 2010¹

А. FURSENKO, Minister of education and science of the Russian Federation Moscow

The strategic guidelines of the Russian Federation to promote science and innovations for the period of time up to 2010, elaborated in accordance with resolution of the Government, are developing the Basics of the policy of the Russian Federation on the promotion of science and technology for the period of time up to 2010 and for further perspective (approved by the act of the President of the Russian Federation 30.03.2002 г., № Пр-576).

The goal of the strategic guidelines are to resolve the systemic contradiction, i. e. the pastes of development and the structure of the Russian sector of R&D does not reflect the requirements of national security and increasing demand of the business sector for high technologies.

It is frequently stated, in particular by the scientists, that the problems in developing national R&D sector are mainly related to the lack of demand for innovation from the business community. This is not quite correct.

Firstly, the rise of expenditures for technological innovations has been noted during the recent years. Mainly, it relates to the purchases of machinery and equipment (for instance, in 1995 – 44%, in 2004 – 56%), the share of expenditures for R&D in 2004 was 16% confronting 27% in 1995. Having the machinery assets severely out-worked such a behavior of the entrepreneurs is quite logic and justified.

Secondly, the demand of the economic operators for R&D is really not so high at present. Nevertheless, it should be taken into account, that even such a demand is satisfied by the science entities only by half. In 2001-2003 the share of importation of technologies in total volume of purchasing expenditures was equal approximately to 46%.

Thus, the reserves to expand the demand for national R&D still exist. But the realization of this demand is possible only under the condition of the substantial raising of the quality of national R&D embodied in technologies ready to be used in production.

Thirdly, one could speak about the competitiveness of our R&D sector globally as a supplier of knowledge. At the same time the business sector is interested, in general, in ready-to-use technologies.

With respect to the exportation of technologies the share of scientific research is increasing and with respect to the importation the share of IP items is increasing. Thus, it is common for Russia at global markets to be a supplier of ideas, i. e. to be an “intellectual raw material”, and to be a consumer of ready-to-use technologies.

 The issues of fundamental science should be mentioned. We faced almost double fold raise of budget expenditures for fundamental research (in comparison with 1998). Nevertheless, the number of publications of the Russian authors has a clear tendency for reducing. From time to time, one could meet the opinion, that the figures of “number of publications”, “citations” etc. are not so important. But, in our view, the increase of such figures (along with the others we talk later) in conjunction with the transparency of financing the activity of academic institutions is the necessary prerequisite for the increase of participation of Russian scientific institutions in realization of international scientific programs.

Realizing the systemic problem one should follow two main principles.

 The first one is laid down in concentration of resources of federal budget for financing R&D on key directions, in particular:

• Vast reproduction of fundamental knowledge; raising the level of “human factor”, as the main competitive advantage of Russia;
• Realization of applied researches on a limited number of directions to ensure their competitiveness, including capitalization of the received results;
• Creation of innovation infrastructure, ensuring modification of knowledge into marketed good for realization of national priorities of technological development.

The second principle is laid down in exploitation of the mechanism of private-state partnership. It is presumed that the part of applied researches and creation of innovation infrastructure should be done with the participation of business and the technological modernization is to be done mostly by business itself.

It is clear, that the global competitiveness of Russia, based on the national technology, could be developed when concentrating the efforts aimed at holding and gaining the positions in the areas where we are strong, in particular, military, nuclear and space industries, IT, nano-industry, development of new materials etc. With this goal in mind ambitious federal targeted programs should be established with the participation of business. The purpose of those programs is to employ the potential of R&D sector for effective realization of national priorities of technological development, simultaneously modifying this sector into a producing sector of the “new economy”.

 The strategic guidelines are defining the system of mutually dependant targeted programs, separate projects and non-program events as concerns goals, time frames and resources.

 In doing that one could define the following main goals:

• Creation of the competitive R&D sector, including the terms for its vast reproduction;
• Creation of the effective national innovation system;
• Development of institutions of exploitation and protection of IPR;
• Modernization of the economy on the basis of technological innovations.

 The strategic guidelines also contain complexes of concrete measures and targeted indicators applicable to each goal. We consider each goal and enumerate the measures seem to be the key ones.

 The resolution of the first goal is aimed, first of all, at increasing the effectiveness and the competitiveness of R&D sector.

 The strategic guidelines attach great importance to the Russian Academy of Science (hereinafter referred to as RAS) and all academic community in defining the priority tasks of fundamental researches. However, in our opinion, the responsibility for the development of the fundamental science, ensuring the effectiveness of the budgetary expenditures, should be complex. It is necessary to force the realization of the program of modernization of functions, structure and mechanisms of financing the academic sector of science approved by the Inter-agency commission on scientific and innovative policy. Before hand, starting from 2006, the over-pass should be realized from the management of financing resources to the management of the results in the area of fundamental science.

There are the following major measures:

• Concentration of resources on the priority directions, ensuring the realization of the competitive advantages of the Russian R&D sector at global markets;
• Transforming the scientific institutions and increasing their capitalization, restructuring the State sector of R&D;
• Ensuring the integration of scientific and educational potentials. The main results of the realization of such measures are as follows:
• Increasing the share of the off-budgetary assets in the internal expenditures for R&D;
• Strengthening the prestige of the Russian science, including the incoming flow of young people to the scientific area;
• Increase of the budgetary financing of the staff involved in the academic sector of science, in particular, in 2008 – not less than 750 thousand Roubles annually per person (at that, the average monthly salary in the academic sector should be not low than 30 thousand Roubles). Speaking about the sector of science, we have in mind not only the RAS institutions, but also other entities active in fundamental R&D.

 The second goal is to create the effective innovation infrastructure and the development of small and medium entrepreneurship in the area of innovation.

 It seems to be important to realize the measures to establish a friendly climate for the development of small innovation business and innovation infrastructure. Before hand, it should be ensured the further development of:

• financial institutions, providing non-stop financing of the business projects at all stages of the innovation process and first of all, including venture, technological funds;
• technological infrastructure, including techno-introducing zones, techno-parks, innovation and technological centers, business incubators, engineering centers, centers of transfer of technologies etc.

The third goal is interconnected closely with the second one and laid down in developing the institutions of exploitation and protection of IPR.

 Among the main measures in that area there are development of the legislative framework, in particular, introducing the legislative procedures of obtaining the rights on the R&D results achieved at the budgetary expenses. In doing that it is necessary to note, that with this respect some steps have been made – the Government has approved the Procedures on the legalization and transmittance of the rights on the R&D results achieved at the budgetary expenses to the business entities. However, the intensification of the innovation activity and creation of the civilized market of IP items shall be possible if only the legislative provisions in different areas contain agreed systemic alterations and amendments, aimed at promotion of innovation activity² .

 The main results of the resolution of the second and third goals should be as follows:

• increasing the patent activity and capitalizations of the scientific results;
• increasing the share of small and medium business in the area of science and innovations;
• substantive increase of the scale of the activities of funds investing in companies of the high technology sectors.

 The fourth goal is to modernize the economy on the basis of technological innovations. On one hand, that would be a technological modernization of the sectors of the economy on the basis of the forwarded technologies and integration with the global technological complexes in order to ensure the global competitiveness and formation in the future the market of innovations for the Russian R&D sector. The intensified modernization of the economy sectors is imperative and it is necessary to support all its types, in particular, development corporative R&D, importation of the forwarded technologies, placement of orders in the Russian specialized R&D sector, including, above all, within the framework of private-state partnership. It is essential to provide every potential consumer the information on the R&D projects realized in the State sector of science, promote the participation of business in making choice of the technological priorities, develop the measures of technical regulations and the policy of long-term contracts within the framework of government procurement, including defense ordering, coordination of plans of technological modernization of the State corporations.

One of the most important directions is to promote the demand for innovations within the business sector. One of the incentive measures in this respect is to include the expenses of the corporations on R&D into the self cost of the final product. The corresponding amendments to the fiscal legislation have been made and enforced as from 2006³ . Further development of fiscal instruments stimulating innovation activity, including those already applied in foreign countries, have vital importance.

On the other hand, this process if to form and realize the national priorities of technological development within the segmented targeted programs of technological profile. The most essential are as follows – market orientation, developed system of private-state partnership, support of regional innovation clusters. The search of the perspective directions, including those within the approbated mechanism of “mega-projects”, which was mentioned many times by the Ministry of education and science of Russia, is also important. We are now starting to realize the big scale investment projects ⁴ .

 Within the framework of the projects (timeframe for realization three-five years) there is a complete innovative cycle. At present the Ministry of education and science of Russia is financing nine projects – six since 2003, the rest since the end of 2004. The volume of the budgetary funding is equal to 2 760 millions of Roubles, including 939 millions of Roubles in 2005, off-budgetary funding is equal to 3 310 millions of Roubles, including 1 172,5 millions of Roubles in 2005.

The realization of the proposed measures would allow to raise the level of the innovation activity in the economics, to increase the share of innovation products neither in total volume of sales of the industrial products, nor in its exportation.

 The basics for verifications of measures of existing federal targeted programs of technological profile and for the formation of new targeted technological programs could be two major wide profile technological programs, in particular:

1. the program of development of the scientific and technological basis;

2. the program of the transfer of the dual purpose technologies.

With respect to the program of development of the scientific and technological basis the following should be noted. Starting from 2005 the Ministry has been realizing the new edition of the federal targeted program “R&D the priority directions of the development of science and technique” for 2002-2006. Within the framework of this program the resources are concentrated in six priority directions ⁵ aimed at reaching the multiplicative effect in sectors of the economy.

 The realization of this program has allowed to reach the following results:

• the system of defining the priorities of the state support in the area of science and technology has been established and the assets of the federal budget spent have been concentrated on those priorities;
• the mechanisms of support of the innovation projects at the stages of innovation cycle “generating the knowledge – development and commercialization of the technologies” have been elaborated;
• the organizational system, ensuring the interests of the state, business sector and the science when realizing the priorities of the technological development, including substantive inflow of the off-budgetary assets (up to 50% on the complex innovation projects) has been established.

 It would be worthwhile to use the above mentioned mechanisms and instruments in the process of elaborating of the new basic program in the area of science and innovations “The scientific and technological basis of Russia” for 2007-2012 to ensure the subsequent and logical development of programs.

 At the same time, when realizing new program, the changing of accents on a number of directions has been planned, in particular:

• increasing direct participation of business in fine tuning the national priorities of technological development and in selection of the most effective scientific institutions to realize respective R&D;
• active stimulation of the sustainable ties between the elements of the innovation system, including the integration of high schools, small scientific entities into a system of scientific and technique;
• strengthening the support of the formation of non-governmental scientific institutions, including through the development of techno-introducing specific economic zones and techno-parks.

The proposals contained in the strategic guidelines are based on the scale of financing the civil R&D, defined at the common meeting of the Security Council of the Russian Federation, the Board of the State Council of the Russian Federation and the Council on science and high technologies under the President of the Russian Federation on March 20 2002 for the period up to 2010. The proposals have foreseen the expenses for the support of the innovation infrastructure as well. The above mentioned document contained the proposal on two approaches to funding – in currant prices and as share of the expenditure part of the budget. The interim scenario seems to be more rationale. It conjuncts the conservative approach in increasing budgetary expenses and necessary resources for the balanced solution of the key tasks of the present strategic guidelines at least.

The main principles of financing the strategic guidelines are the increase in budgetary expenses for fundamental researches, as an unconditioned state obligation, and the development of key elements of the innovation infrastructure.

With respect to the applied R&D in general taking into account all sources of funding the proposals contained in the strategic guidelines the significant share of financing is to be provided for the national priorities of technological development.

 The strategic guidelines in the area of development of science and innovations is designed to be realized in two stages – first in 2006-2007, second – in 2008-2010.

The first stage (2006-2007) is devoted to further development of R&D sector, reforming state sector of science, harmonization and development of institutions, influencing on the innovation and investment climate. The institutional changes in the area of the exploitation of the IP activity results need to be completed.

 The key tasks of the second stage (2008-2010) are as follows – creation of the modern unified innovation system, active positioning of the national R&D sector in global economy, realization of big scale projects on national priorities of technological development within the private-state partnership.

 It is necessary to note that the submitted document contains the proposals and respective resources for the period up to 2010, but the effects of the realization of the strategic guidelines have long term character. That is why the strategic guidelines contain the evaluations for the period up to 2015.

 The first – the sustainable increase of the internal expenses for R&D in case of realization of the strategic guidelines with the enlargement of the share of the off-budgetary assets in such expenses and increase of the share of the high school education sector.

 The second – ensuring the inflow of the young people into the area of science, increase of the share of Russian authors of publications in main scientific magazines.

The third – the dynamic increase of the share of entities, realizing technological innovations as well as increase of the share of innovation industrial products in a total volume of sales. In doing that, it is expected to gain statistics usual for the foreign countries with developed innovation systems.

 The approach for the solution of the systemic problem proposed in the strategic guidelines would allow: • to form the basis for the sustainable economic development in short- and long-term perspective;

 • to create the terms and conditions for the development in all sectors of economy, where the IP activity results are being used;

• to demonstrate on the example of the concrete projects and programs the opportunities of the knowledge-based economy;
• to raise the quality of the “human capital”.

 For almost a year the strategic guidelines have been open for discussion, a numerous meetings of experts on principal issues have occurred, the representatives of the federal executive bodies, scientific and business communities have expressed their views.

Simultaneously the practical work on all mentioned directions has been made, including elaboration of legislative acts. As a result the draft strategic guidelines have been substantially redrafted in order to take into account the most significant remarks and proposals

• • information and telecommunication systems;
• industry of nano-systems and materials;
• live systems;
• rationale exploitation of natural resources;
• energy and energy saving;
• security and counteraction against the terrorism