Jump Start for Russian R&D Businesses

WASHINGTON, D.C.--The Russian government is about to launch two programs aimed at feeding the flames of an already-hot cottage industry: science-based businesses. The initiatives were announced here at a conference on Russian science policy at Georgetown University.

While Russia has had a hard time reforming its network of bloated scientific institutes, researchers have embraced capitalism by forming small businesses attempting to sell everything from new drugs to spark plugs. The government estimates that 70,000 science-based companies, employing about 360,000 people, have sprung up in the past decade. Most occupy space in moribund institutes. "In some cases, these enterprises are doing more R&D than the mother organizations," says former Science Minister Boris Saltykov.

Hoping to bet on a winner, the Russian government plans to pour at least $15 million into two new efforts to shore up existing science firms and spur new ones. The programs, run separately by the science ministry and a new entity called the Federal Fund for Industrial Innovation, will disburse short-term loans and seed grants in such areas as biotechnology and ecological monitoring. It's unclear, however, how the programs plan to coordinate to avoid overlap and how their priorities will differ.

The funds will augment $30 million budgeted this year by Russia's Fund for Assistance to Small Innovative Enterprises (FASIE), which makes loans to start-up companies in a wide range of high-tech businesses. Says FASIE director Ivan Bortnik, "Russian science is evolving into smaller units."

Posted in Policy