Russia to Double IT Exports to $11 Billion to Cut Oil Dependence

Russia aims to more than double its information technology exports to $11 billion by 2020 to decrease the economy’s dependence on commodities, according to a strategy drafted by the Telecommunications Ministry.

Russian IT exports are approaching $5 billion this year, Deputy Minister Mark Shmulevich said in an interview in Moscow.

“It’s a meaningful figure, compared with the country’s arms export of about $15 billion,” he said. “It shows that Russia has competitive IT products to offer.”

Russia plans to help its domestic IT companies compete with global technology companies such as Google Inc., Facebook Inc. and Microsoft Corp. (MSFT), which are expanding in the country, the strategy shows. Search engine Yandex NV (YNDX) and social-networks operator Mail.ru Group Ltd. (MAIL) already dominate the Russian market, beating foreign rivals.

“Russia has several Internet giants which are mid-sized companies on the global scale, while other market participants are much smaller,” Shmulevich said. “That’s why for a breakthrough technology startup it’s often easier to find investors abroad. We plan to change this.”

The Telecommunications Ministry will support joint projects by Russian scientific institutes and local IT companies to develop technologies such as speech and video-image recognition, robotics, cyber-security and cloud services, the strategy shows.

“We realize that IT is a global industry, and we don’t plan to ban anything foreign,” Shmulevich said. “Instead, we plan to support domestic companies with state orders for R&D, loans and other market mechanisms to let them develop and gain international success.”

Besides publicly traded Yandex and Mail.ru, the Ministry names Kaspersky Lab, ABBYY, Dr.Web, 1C and Positive Technologies as examples of Russian IT companies which have gained recognition abroad.

To contact the reporter on this story: Ilya Khrennikov in Moscow at ikhrennikov@bloomberg.net

To contact the editor responsible for this story: Kenneth Wong at kwong11@bloomberg.net

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