IT Scan

February 18, 2005
Russia keen to replicate India's STP program

Bangalore Correspondent

BANGALORE -- The Russsian IT brigade was recently on a visit to India, and was reportedly looking at Bangalore to give the nation that necessary push to make its presence felt in the global IT domain. Vladimir Putin, president of the Russian Federation, in his first ever visit to the silicon capital of the country, expressed his happiness being in Bangalore. He said that the city, which is a major center of India's economy, has developed dramatically and was now open to the world. His 20-member delegation of software companies, headed by Leonid Reiman, the ICT minister, had arrived two days before him to get a feel of the pulse of the IT firms in Bangalore.

Trade and business took precedence in the 20-minute address by Putin. He said that the two countries were extending co-operation in many fields and that the Indo-Russian collaboration would make it possible to build a North-South infrastructure platform that would be the largest in Eurasian region integrating aviation, rail and road systems for movement of goods. However, his statement that Russia was keen to replicate India's software technology parks (STPs) and provide tax breaks, created excitement within the IT community. "Frankly, we have had debates, arguments and discussions over such tax breaks to a particular section of the business in our government. However, India offered tax breaks and benefited," Putin said, hinting that the Russian IT industry would soon get a tax break.

According to Reiman, the two-day roundtable conference in Bangalore over IT opportunities among the two countries would become a regular fixture, and specific projects had been chalked out in the areas of medicine, banking and IT systems. Top officials of Russian IT firms like Auriga, Aplana, Verysell and KMSoft, as well as the heads of development centers of MNCs like Boeing, seemed to be enamored of the Bangalore IT phenomena. Little known to the outside world, Boeing has the largest development center, outside of the US in Moscow with over 1,000 engineers working on next-generation aircrafts.

Natenzon Mikhail, director-general, Vitanet, a telemedicine firm in Russia, who had last visited Bangalore 22 years back, said: "Returning to this city is like coming to a completely changed world. I am extremely surprised to see the progress that has been made here. There is a saying in Russian language that seeing it once is better than hearing about it several times. Everyone talks about Bangalore in Russia, but to me, in my recollection of memories, this was a very small city. Now, with the transformations taking place, it has indeed become the number one center in outsourcing."

Sergey Kravchenko, head of the Boeing Russian development center pointed out, "What General Electric did to India in terms of catalyzing an Indian IT revolution, Boeing has done to the Russian software industry." He added that almost one-third of the next-generation aircrafts from the Boeing stable were being designed in Russia.

Collaborations likely in pure maths, applied materials
Industry watchers aver that Russian scientists are of the highest caliber, when it comes to areas like pure mathematics and applied materials. This is one area where Indian companies are looking at in terms of collaborations with them. Janaki Raman, president and CEO, R&D division, MindTree Consulting, said: "These are the areas where India is not too strong. Russian scientists are the best in the world when you look at areas like analog, radio and algorithms needed in multimedia and other related fields."

India, while churning out some of the finest graduates in IT and software, has somewhat lost sight of the basic sciences. Laxman Badiga, chief executive-external relations, Wipro Technologies, added: "We are almost losing out our academic focus when it comes to these areas because we are focusing more on the computer sciences. If we could collaborate with Russia in these fields, there will be a phenomenal amount of gain."

Moreover, before the Russian government opened up its economy, there was a good deal of new technologies that had been developed there and a lot of intellectual property (IP) was still available there. MindTree's Raman added, "If India can leverage these in, say, areas like marine and healthcare, I am sure, there can be so many ways to improve things in developing countries."

According to Krasnov, head of international relationships of APKIT (a Russian all-industry association), it was too late to re-invent the wheel by both countries. He said, "With the intellectual resources we have and the creativity and excellence India has in software, a lot could be achieved now."

Today, Mumbai-based i-flex is setting up its office in Moscow and talks between the Indian and Russian IT firms have begun on a solid footing. With Putin pushing IT hard, things could begin to change, feel industry watchers. And, Indian companies are all set to, at least, think about the Russian foray. No doubt, the Russian language is a major barrier. "However, if an effort is made and you look at it as an opportunity, we can work out miracles. Some company has to take that extra mile," added Raman.