Home Legislation in IT Government halved the budget for software import substitution: Ministry of Communications will have to look for money elsewhere

Government halved the budget for software import substitution: Ministry of Communications will have to look for money elsewhere

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On March 1, 2016, Prime Minister Dmitry Medvedev signed the Anti-Crisis plan Government.The Ministry of Communications (along with the Ministry of Finance) was appointed responsible for the software import substitution program.
For the program (in the document it is called "Development and promotion of domestic software") the industry in 2016 will receive up to 5 billion rubles. The source of these funds will be deductions for the use of radio frequencies and the sale of radio frequencies at auctions. No money has been allocated for these activities from the federal budget.
The anti-crisis document states that the result of the program should be the selection and implementation of at least eight projects to develop Russian software, its localization and promotion in foreign markets with the attraction of co-financing not less than 6 billion rubles in 2016-2017.
Government did not go along with Ministry of Communications, which insisted on more state funding to support IT-industry
Initially, as proposed by the Ministry, the draft anti-crisis plan proposed to allocate 10 billion rubles to support programmers (now only 5 billion are allocated), proceeds from auctions for frequencies. If the development of the Russian software products will be reliably supported by the budget, they will be cheaper for the government customers than their foreign counterparts, the representative of the Ministry of Communications explained.
If, according to the February data, the amount of funding for all measures of the anti-crisis plan was to amount to 828 billion rubles, in the final document they amounted to only 470 billion, explains CNews’ interlocutor.
According to the plan, in 2017 the revenue from the export of Russian software should grow by $30 million, and in 2018 – by $40 million. In addition, the budget should save 2 billion rubles in 2017 and 3 billion rubles in 2018 on the purchase of software by government agencies.
The most competitive Russian IT companies in the foreign market work in the sectors of information security, biometrics (voice and image processing), big data and digital modeling. Therefore it is more logical to look for projects for export among them, told "Igor Bogachev, vice president of the Skolkovo IT cluster and former CEO of SAP CIS, told Vedomosti.
He estimates that it takes about $1 million a year to bring a mature product to a foreign market. Part of this money will be spent on the localization of the product (e.g. interface translation) and fine-tuning it to meet the certification requirements of other countries, and some will be invested in the local office, employees’ salaries and marketing, explains Bogachev.
In July 2015, MegaBrain wrote that the Audit Chamber of the Russian Federation recognized the work of the Ministry of Communications on the creation of the software import substitution program as unsatisfactory.
Then for the implementation of the import substitution program the department requested 18 billion rubles. The Ministry of Communications planned to receive this sum for 3-5 years. Implementation was planned for 10 years. At the same time, the Ministry of Finance proposed not to rely on the grant, but to use the funds of the existing state program "Information Society." From 2016 to 2018, 364.49 billion rubles were allocated for it.

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