In Russia the policy of forced import substitution of electronics began

Steady interest in domestic electronics arose after imposition of sanctions against our country in 2014. Then the country leaders had to develop the urgent measures directed to substitution of the become unavailable electronic component base (ECB) arriving earlier from Ukraine and some countries NATO. As noted, speaking at a conference in Yalta in September, 2020 Yury Borisov, the vice-chairman Governments of the Russian Federation supervising a MIC, ENERGY INDUSTRY and the industry, critical dependence on the Ukrainian producers was succeeded to overcome, on other suppliers of work go according to plans. By assessment Vasily Shpak, directors of the department of the radio-electronic industry (DREP) Ministry of Industry and Trade Russian Federation, in the space industry today more than 80% of EKB occupy the Russian developments. However parameters import substitution which are reached in the civil markets significantly lag behind indicators of such industries as a MIC and space.

Import substitution on "citizen"

As Dmitry Chernyshenko, the Deputy Prime Minister of Russia noted in the performance, the import equipment still dominates in our markets, the share of the Russian producers makes about 10%. Even in the market of the state order regulated by the state which volume was, according to Minpromtorg, in 2019 900 billion rubles a share of the Russian producers makes at most 20%. The exact digit cannot be received as the mechanism of detailed accounting of the modules and blocks which are introduced into the ready equipment in terms of their origin – Russian or foreign is not created yet.

Case is complicated by the fact that it will be hardly possible to create finished civil goods only on domestic solutions in the near future. By some types of chips, in particular, memories, products are turned out by only several companies in the world, and global job specialization in this part – regulation. The habit to use in the work led foreign EKB, available in the market, to the fact that even the largest suppliers of domestic production, for example, Rostec develop the ready-made solutions, with rare exception, on foreign component base.

Approximately the situation with developments of Rosatom for the nuclear industry also is, Vasily Shpak notes and emphasizes:

We just should create the market of the state order on domestic microelectronics. It just should be included in those solutions which are delivered according to the government contract

In other words, the Register of domestic radio-electronic production which was created in the fall 2019mgoda and also the definition of domestic production given in order of the Government of the Russian Federation No. 719 "About confirmation of production of industrial output in the territory of the Russian Federation", it only the beginning of a way. Further, according to Shpak, the requirement to a share of domestic blocks and modules in finished goods will change in process of expansion of the Russian microelectronic products.

For support of this movement the state undertakes measures of very serious support.

Public finance of raising of domestic electronics

On September 28 - literally on the eve of opening of a conference – there were two events, important for the industry. First, at a meeting of presidium of the State Council under the leadership of the Russian President the list was created from five high-priority national projects among which there is a digital transformation of national economy.

Key industries of economy should reach a digital maturity and that is very important, investments in domestic IT solutions should be increased by 4 times, - Dmitry Chernyshenko noted

Secondly, the Russian Prime Minister signed the national plan of an economic recovery which, in particular, means selection of very serious funds for development of the radio-electronic industry in the next three years.

Speak about implementation of digital economy, about stability of infrastructure of the state it is impossible without solution of those tasks which face electronic industry. It defines consumer characteristics of a wide range of products, both military, and civil today, - Yury Borisov emphasized. - And, of course, today there is an understanding at all levels that it is necessary to improve this industry, both in the technology roadmap, and in the plan presence of domestic production in the market

By Vasily Shpak's estimates, investments of the state in the Russian electronics will make about 1 trillion rubles in the next 10 years.

It is that digit which will help us not to lag behind, and in certain directions to get into the lead, - the director of the department of radio electronics of Minpromtorg explained

He reminded that in the strategy of development of the radio-electronic industry until 2030 as key reference points are designated: growth of revenue by 2.5 times to 5.2 trillion rubles and export growth by 2.7 times to 12 billion dollars. For support of the movement to these purposes for 2021 - 2023 350 billion rubles will be selected in addition.

However the growth rates of purchases of domestic production planned in the strategy of development of the radio-electronic industry, according to Oleg Bocharov, the Deputy Minister of Industry and Trade of the Russian Federation are not reached yet. The state strengthens measures of regulatory regulation.

Regulyatorika: support of domestic extends

The main regulating document around which the regulatory activity of Minpromtorg is under construction, - the register of the Russian radio-electronic products. For the equipment from the register preferences Third wheel within 44-FZ, preferences about discounts at the price for 30% - for tenders on 223-FZ work. Let's impose in parallel expanded requirements to positions from the register, in terms of localization of its elements, Vasily Shpak noted.

On July 27 - in the last day of a spring session of the State Duma – amendments to 44-FZ and 223-FZ, the quotings of purchases providing introduction of the mechanism were adopted in the second and third readings at once. Work on digits of quotas goes on each group of products, and is going to create specific parameters until the end of the year. As Vasily Shpak explained, this is not about as much as possible to increase a quota of domestic production: "We analyze a situation, first of all, in terms of that our industry could execute this quota".

Till November 1, 2020 the order of the Government of the Russian Federation about prohibition of purchase of the import equipment in the presence of a domestic analog in the Russian register is expected. It is supposed that this resolution will strengthen the filter interfering getting into the register of foreign products under the Russian brand - market participants continue to complain of such facts.

We will toughen control over it in every possible way that under the auspices of domestic production there were no products of so-called screwdriver assembly when it has only a domestic label, - Yury Borisov emphasized

In the summer of the enterprise of electronics were ranked as the IT sphere and received the corresponding financial privileges: since January 1, 2021 income tax will be reduced from 20% to 3%, insurance premiums will be reduced almost twice.

As Vladimir Gutenev told, the commission chairman of the Gosuduma on legal support of development of the organizations of defense industry complex of the Russian Federation, at the moment in a portfolio of the State Duma is 18 bills in different degree of a maturity, three of which have a direct bearing on a radio-electronic complex. So, for example, there is a work on amendments to regulations which will exempt the domestic companies from payment of the VAT when purchasing promotion services at promotion of the Russian products abroad.

It is the second packet of amendments which should align at first our conditions in comparison with the international businesses and the markets that it was profitable to business to enter international markets. And we will create further further preferences to our producers, including restrictions for the admission of foreign suppliers to the crucial markets, - Dmitry Chernyshenko explained

New orgmekhanizm of support of domestic

Multiple increase in the amount of financing requires new approaches to the organization of interaction of domestic suppliers and large consumers, Vasily Shpak noted, telling about innovations.

Matrix of end-to-end projects

The matrix of end-to-end projects is made, on the one hand, by priority technology repartitions: from the equipment for production of electronics before production of the final equipment and services, and, on the other hand – priority end-to-end projects: ADP equipment, digital energy, digital marking, etc.

These are projects with rather high capacity of the market. These are projects in those niches in which the role of state regulation is strong. These are those directions on which our domestic equipment will be demanded in the next 10 years, - Vasily Shpak explained the choice of starting end-to-end projects of a matrix

For these projects it is possible to count volumes, potential of increase in production and purchases of domestic production – they are transparent for monitoring and control from the Government of the Russian Federation.

Source: Ministry of Industry and Trade of the Russian Federation, September, 2020.

Complex (offset) projects within niche consortia

As on many basic technologies of electronics we still have considerable lag, it is necessary to move in parallel on different levels of a matrix, are sure of Minpromtorg in this connection focus on complex (offset) projects is selected. Such approach, Oleg Bocharov considers, will help to come quickly and effectively for creation of ready-made solutions with the maximum participation of domestic suppliers at the different levels of localization and to provide at the same time the unification, compatibility and other features necessary for quick start of final products in serial production. For formation of such communities of participants of development it is offered to use the mechanism of consortia.

In fact, in this idea there is nothing revolutionary, Vasily Shpak believes:

After disintegration of the Soviet Union technology chains were destroyed, and time these stones came now to collect. Without reconstruction of all these technology chains from the lower technology repartitions before creation of ready-made products and services hardly we will be able to reach that effect which we expect

As of fall of 2020 production consortia of telecommunication equipment, ADP equipment, car electronics, medical devices and also complexes for management systems of energy industry are created. Activity of consortia is closely integrated with problems of digital transformation of the industries of the Russian economy: problems of transformation are prompted what niches of IT solutions, new services and services will be demanded in this or that segment of the market. In other words, to the place of spontaneous "market" formation of demand and supply in the industries the planned offer of hi-tech products and services comes. Starting orders of domestic production for the industries will create departments, relying on the programs of digital transformation and interaction with the relevant consortia of the Russian suppliers.

As Oleg Bocharov noted, the first results of activity of consortia were already shown:

We took away nearly all 100% of competitions until the end of the year which were held by Rostelecom

And participants of consortium of ADP equipment left with the offer to refuse the Chinese tablets for a population census – today they are produced at two enterprises serially. There are negotiations with a building complex of Moscow. According to Vasily Shpak, the management of the capital construction industry is ready to support projects of Internet of Things in the Moscow new buildings, for example, to change Construction Norms and Regulations so that to all again entered housing at a stage of the project to put necessary sensors, and, Russian sensors.

In addition to production consortia technology consortia - those which define some technology conditions of development of the industry are formed. For example, The Entrusted Platform association is focused on the solutions ensuring safety and the entrusted IT environment.

They will define requirements to devices of different industry application, in terms of their power of attorney and security, - Vasily Shpak explained

Also the consortium of the design centers is created – they will interact with each other, approving road maps of development of the developed products.

Combination of budget and private financing

Selection of budgetary funds will be performed on the principles of a combination of the public and private financing. According to Oleg Bocharov, basic approach to financing of complex projects – 70% x 30%, and, under real obligations of the market customer.

Earnings time for Research and Development ended. Time of earnings for series in the form of offset contracts began, - emphasized with the Deputy Minister of Industry and Trade of the Russian Federation

At the same time it is obvious that the volume of a potential investment resource strongly differs on different technology repartitions. For example, creation of materials for microelectronic factory is a project with a high share of Research and Development, long term of payback and limited scope of sale. For such projects other ratio of budgetary and extrabudgetary funds is supposed: 90% and 10% respectively.

Fig. A ratio of budget and off-budget financing in complex projects. Istochnk: Ministry of Industry and Trade of the Russian Federation, September, 2020.

According to forecasts of Minpromtorg, the volume of private investments by 2025 will exceed the size of those budget investments which will be made on start of complex end-to-end projects, i.e. 350 billion rubles approved the day before within the national plan of a recovery of the economy of Russia.

Industry priorities of complex projects

Yury Borisov noted that two years of purposeful work of the enterprises of a radio-electronic complex with energy industry already bore fruit:

2-3 years ago practically connected nothing them. Ruble of sales of the Russian products, nothing domestic was implemented, despite their huge investment programs into hundreds of billions rubles. And today sales volume was 12 billion rubles

The near-term outlook – 60 billion rubles. Valery Seleznyov, the First Deputy Chairman of the State Duma Committee on power, agrees:

The power consisting of objects of critical infrastructure should be formed only on the Russian developments

It is unlikely any other industry of the Russian economy is capable to be compared to energy industry on the potential capacity of domestic solutions. Pavel Sorokin, the Deputy Minister of Energy of the Russian Federation comments:

The branch of the energy industry making nearly a quarter of GDP of Russia spends 12 trillion rubles only for operating expenses, and investments make 5 trillion rubles. At the same time only oil industry workers buy every year the IT equipment and software approximately for 300 billion rubles.

Pavel Livinsky, the CEO of PJSC Rosseti, adds:

The investment program of Rosseti makes 4 trillion rubles till 2030, and a quarter it volume is the share of a high tech products

The next obvious market - smart meters of the electric power. The volume of consumption of this market - about 5 million metering devices which are replaced every year. This huge market became managed after loading on replacement of counters was shifted from the consumer to the network and sales organizations, Vasily Shpak told.

Now electronic industry has a clear market. We understand what protocols of communication, interfaces should be. Respectively, we can build architecture of solutions, plan development and production of component base. And to occupy this market, - Vasily Shpak explained

The existing technology backlog in the field of microelectronics gives confidence that Russia should take powerful positions in global market of intellectual power, - Valery Seleznyov says about industry ambitions

On a similar way those industries for which import substitution is critically significant owing to the growing sanctions pressure should go, first of all. Recent events with failure of foreign producers to perform deliveries of systems for the Russian MS-21 medium-range aircraft obviously indicate that the aircraft industry is the following industry which should turn, at last, facing domestic developments.

By Oleg Bocharov's estimates, demand for purchases of the serial electronic systems in the Russian aircraft industry is about 750 billion rubles.

There too the state ruble will be directed. Naturally, with direct confirmation then the facts of serial implementation of domestic solutions, - Vasily Shpak noted

Oleg Bocharov noticed that the ministry already conducts work on "coercion to import substitution" of auto makers. But there is no break on this direction yet. Yury Borisov urged the companies working in the electronic industry to join in the general fight for import substitution more actively:

I know that you have solutions for telecom industry, medicine, the fuel and energy sector, etc. Today the domestic market is open for you. It is done everything possible, and everything that it is necessary that you could be present at this market as much as possible will become

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