Technological deficiency - Russia's achilles heel

Russia should eliminate technological deficiencies standing in the way of its economic development, Russian Prime Minister Mikhail Fradkov said Thursday at a cabinet session considering main areas of the cabinet's work.

According to the prime minister, about 1% of the GDP is allocated on research in Russia today, as compared to 2-3% in its leading rivals.

Russia's innovative production accounts for merely 4-5% of the total output as compared to 30-35% in other countries.

According to Fradkov, this sphere also needs reforms requiring partnership between business and the authorities. In particular, at issue are large infrastructure projects and encouragement of new sources of growth in the innovation sphere.

Fradkov also noted that innovation development strategy should be worked out and implemented before 2010. In his words, venture funds should be developed to finance research among other things.

"Their share is expected to increase up to 1.5-2% by 2010," he said.

In his opinion, particular attention should be devoted to federal targeted programmes for developing innovations and scientific towns, and also other industries such as aircraft building and space, defence industry, communications and telecommunications, bio technologies and others.

Fradkov believes that Russia should start producing medium haul aircraft, and also new multi-purpose types of arms. The premier noted that the state needed young and revolutionary managers, including from private business.