UPDATE 2: Putin says effective mechanism needed to promote digital economy

(Adds more comments from president in paragraphs 7–9)

NOVO-OGARYOVO, Moscow Region, Jul 5 (PRIME) -- Russia must create an effective mechanism to promote the digital economy, abolish legal barriers, and launch tools to back up local companies-centers of competences in the digital technologies industry, President Vladimir Putin said on Wednesday.

“On the basis of the accumulated technological potential, we’ll have to implement a difficult comprehensive project. It has no precedents by scale, importance, impact on life of the country and every person,” he told a council on strategic development and priority projects.

“It’s truly compared to the ground-breaking changes that have enabled Russia at various historical stages to make a serious step forward and strengthen its position in the world.”

He likened creation of the digital economy to construction of railroads in the late 19th century and electrification of the country in the first half of the 20th century.

“Our primary task is to shape an effective mechanism to promote this significant and important project,” Putin said.

Among the main directions of the digital economy are liquidation of legal barriers, which obstruct the use of advanced technologies, and creation of mainstay infrastructure, connection lines, and data storage and processing centers, among others.

Putin called for making a breakthrough in the sphere of digital economy development to avoid dependence on leaders.

“In general, the technological evolution is well in progress, but we need a breakthrough. That’s what we need. And it should be done,” the president said, reminding of words of a former Saudi Arabian oil minister saying that “the Stone Age did not end for lack of stone,” but because new technologies popped up.

“They appear in the world, and the one who is late in this competition will instantly, I’d like to underline that, or very fast find themselves completely dependent on leaders of this process. Russia cannot let it happen. The most important thing is that we have all chances, all opportunities to use the factors I’ve earlier voiced, to use them at maximum, to ensure a breakthrough into the future.”

Communications and Mass Media Minister Nikolai Nikiforov said that the digital economy roadmap could entail additional spending of budget money.

“The digital economy program itself is not an operative instrument, but adjustment of our targets for 2024, to which we should immediately start heading for. We’ll move in the framework of the operative instrument, a so-called three-year plan. We think it should be approved by the government, be amended annually, and be the document that will link aims and objectives, including sources of funding,” the minister said.

“The current assessment of annual expenses under the operative plan, which we’ll have to prepare and endorse, amounts to some 100 billion rubles. I want to underline that the bulk of the money is already stipulated in expenses of the federal budget. We’ll have to consolidate them, determine a single technical policy, single rules of the game. The government is preparing such suggestions. Additional budget expenses will be needed.”

The Industry and Trade Ministry offered to specify the list of subsidized software. “Today, this support covers engineering software,” Minister Denis Manturov said.

“We find it reasonable, first, to apply it to the software programs that are needed for the industrial Internet, which are systems to manage production processes,” he said, adding that big high-technological companies should also enjoy discounts.

By 2035, Russia will have about 40 factories of the future, 25 testing grounds, and 15 experimental digital certification centers, the industry minister said.

The first factory of the future, comprising advanced production technologies and business models, will be built until the end of 2017 at NPO Saturn, in central Russia, where a testing ground for technologies to manufacture aviation details will be built.

(59.2295 rubles – U.S. $1)

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