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BUSINESS REPORT

IN ASSOCIATION WITH ROSSIYSKAYA GAZETA, RUSSIA

WEDNESDAY, MAY 09, 2012

Can PM Medvedev walk the talk? Russians will be closely watching how Medvedev spurs political reforms and satisfies their hunger for a more democratic system. ALEXANDER BRATERSKY

KOMMERSANT

THE MOSCOW TIMES

Barely five days before leaving office, Russian President Dmitry Medvedev finalised two key political reforms that he had promised after massive anti-government protests swept the country last December. Medvedev recently signed the laws introducing gubernatorial elections and lowering barriers for running in parliamentary and presidential elections. Medvedev said the amendments, which sailed through both houses of parliament in mid-April, should“raise the level of political culture”,but critics say they were watered down by the ruling United Russia. The bill on gubernatorial elections stipulates that candidates need the support of at least 5% of a region's municipal deputies and requires non-party candidates to additionally collect signatures of at least 0.5% of the local population. It also calls on political parties to consult the president before nominating candidates and requires a court ruling to hold a referendum on removing a governor. Gubernatorial terms are limited to two consecutive five-year terms. The second bill says parties no longer have to collect signatures to take part in parliamentary elections. For presidential elections, it lowers the number of signatures

The famous tandem of Vladimir Putin and Dmitry Medvedev gears up for another innings at the top.

required from two million to 100,000 — or 300,000 for independent candidates. A third bill, which reduces the minimum membership from 40,000 to 500 for political parties, was signed by Medvedev last month. The first gubernatorial elections will be held on October 14 in those regions whose governor's term expires between June 1 and Dec. 31 of this year, the Kremlin said. Medvedev has fired nine unpopular governors in recent weeks, leading to allegations that the Kremlin is unfairly maximising the chances of its candidates. Medvedev, who has replaced

more than half of the country's 83 regional bosses during his four years in office, said that most governors' voluntary resignations came after pressure from him because of suspected corrupt activities. Analysts said opposition candidates are unlikely to win gubernatorial posts this year. Pavel Salin, an expert at the Center for Current Politics, said the approval by municipal lawmakers presents a formidable hurdle to outsiders.“The ruling elite could not freeze the process, but managed to slow it down,”he said. One more important move championed

by Medvedev himself - the creation of a nationwide public television channel free of government interference - is yet to take off. During his last days in office. he also offered symbolic gestures like pardoning a wrongly-imprisoned man and taking part in a tough question-and-answer broadcast. Experts say there’s little that can save Medvedev from an inevitable reputation that will follow him out of the Kremlin. Yet each of these ostensible Kremlin concessions has elicited scorn from one section or another of the nascent anti-government

movement. Critics have slammed the return of gubernatorial elections because of the“presidential filter” they incorporate, foreshadowing the continuing meddling of the executive in regional affairs. Many promienent non-systemic opposition figures also seem turned off by the prospect of political competition in what they say is a new party registration system rigged to splinter the anti-Kremlin movement. Lastly, few believe that public access television is realistic in a country where virtually every editorial line is dictated by private interests.

INTERVIEW SERGEY RYABKOV

They are studying the idea. We believe we should work towards universalising the Treaty on the Non-Proliferation of Nuclear Weapons and the ban on medium- and shorter-range missiles. But in terms of demonstrating the high scientific and technical level achieved by India, there is no doubt that the test launch of the Agni-V missile made a big impression on everyone, including India’s neighbours.

A catalyst for reform of global governance 'BRICS HAS ACHIEVED A GREAT DEAL DURING LAST

KATERINA LABETSKAYA VIP PREMIER MAGAZINE

Has BRICS become an instrument of global governance? No, BRICS is not a mechanism of global governance. It is not for me to judge whether it is or will ever be such a mechanism, but at this stage BRICS is a catalyst for global governance reform. Although three billion out of seven billion people in the world are citizens of BRICS countries and although BRICS accounts for 25% of the global GDP, I cannot describe that structure as a mechanism for global governance. BRICS is still to a large extent an association based on interests.This is what makes it strong and viable. Right now, in BRICS 80% of issues pertain to the economic agenda and only 20% to foreign policy. The main global forum for coordinating approaches to econom-

ics is the G20, while BRICS works within that group. Incidentally, unlike in BRICS, the ratio in the G8 today is the reverse: 80% of the issues on its agenda relate to politics and 20% to economics. I don’t think we will ever come to see BRICS in“utilitarian”terms. Has BRICS developed a common philosophy? Definitely. Its philosophy is to not rush the process of transforming BRICS into an international organisation. That means that this option is not ruled out in principle? Russia would welcome the gradual strengthening of the institutional principles in the structure’s activities. We have concrete proposals. Russian President Dmitry Medvedev outlined them in Delhi. But we are not imposing anything on anyone. Because our partners so far prefer to remain at an informal and bureaucracy-free level, we do not think that BRICS has reached the limit of its institutional development. There is no limit, and development continues.

What centrifugal and centripetal forces are at work within BRICS? It would be more correct to speak about varyingspeed of development and the changing geometry. BRICS countries have different views regarding the priorities and the pace of progress on some issues. One such major political issue is the reform of the UN Security Council. Perhaps there are also topics like human rights, their role in the system of international relations and approaches to addressing problems in that area. But it is always the case that the glass is half full or half empty. Within BRICS, Russia always takes the side of those who favour concrete decisions and want to see the language of declarations translated into practical deeds. The year 2011 was unique for BRICS.All itsparticipantswere working in the UN Security Council: Russia and China as permanent members and the others on a rotational basis. Is cooperation in the sphere of international security still on the BRICS agenda?

ITAR-TASS

3 YEARS. I AM VERY OPTIMISTIC ABOUT FUTURE' Russia’s Deputy Foreign Minister Sergey Ryabkov talks about the emergence of BRICS as a platform for global dialogue and practical cooperation.

Such last-ditch efforts are unlikely as ever to turn the tide back in favour of a man nicknamed “pathetic” by Twitter users across Russia. And while Medvedev still can accomplish something as prime minister, political analyst Dmitry Oreshkin said he faces such tough work ahead that popularity is the last thing he’ll gain. “What else can he do to make people like him again? He has only unpopular and unpleasant decisions to make: he’ll need to increase tariffs for gas, water and electricity, and improve general living standards by raising the costs of utilities, among other things,”he said.“Putin ate all the cookies and left him with the dirty dishes.” But maybe there’s an upshot to Medvedev's run at the Russian presidency. Countless observers have pointed to the now-historic moment last September, when Medvedev announced he would step aside for Putin to run for the presidency, as the primary catalyst for the wave of political and social unrest that followed in the months after. According to Stanislav Belkovksy, a former Kremlin political technologist, the Medvedev experience has played a positive role in postSoviet Russia by exposing the current system’s undemocratic tendencies and opening the debate over executive power in society.“He has discredited the presidency as an institution,”he said.“In such a sense, Medvedev, objectively and historically, has been quite helpful and useful for Russia.”

It is not only still on the agenda, but it is growing stronger. BRICS representatives in New York, Geneva andVienna have established an ongoing dialogue and have been holding working meetings. They exchange messages and phone calls. It all takes place as part of the normal diplomatic and political routine. This is one of the major recent achievements. That is how interaction should be built if BRICS is not to remain an event involving heads of state meeting once or twice a year , as happened in 2011 when an informal BRICS summit took place in Cannes on the fringes of the G20, while the main event took place in Sanya, China. Interaction must proceed at all levels. If we have good coordination on pressing international issues concerning regional security, that already marks a step forward. Usually a group of states, especially large, significant ones with global interests, needs decades in order to grow from “the toddler

stage” into a global player, a factor not of global governance, but of global dialogue and practical cooperation. The first meeting of BRICS foreign ministers took place in 2008 and the first summit in 2009. BRICS has achieved a great deal during the past three years. I’m very optimistic about the future. WastherecentIndiantestofits Agni-V intercontinental missile an irritant within BRICS? The declared range of up to 5000 km is not intercontinental but medium-range, according to the Russian classification. Several years ago Russia proposed universalising the agreements on banning medium- and shorter-range missiles it signed with the USA during the Soviet period. We believe it would be desirable to impose a ban on a whole class of ballistic missiles of that range. The existence of these weapons is often fraught with a regional arms race. What do our partners in BRICS think about it?

Sergey Ryabkov, Russia's Deputy Minister of Foreign Affairs: "Within BRICS, Russia always takes the side of those who favour concrete decisions and want to see the language of declarations translated into practical deeds."

Is BRICS developing a common approach for the June 18-19 G20 summit in Mexico? The BRICS finance ministers had a meeting recently. The G20 agenda is evolving. BRICS must stimulate it. Russia would like to promote the “outreach system,” but starting with a dialogue among the BRICS countries and other multilateral structures.Working with individual countries is the next stage. In the G20, a lot depends on the presidency, which forms the agenda and conducts consultations. G20 created the troika a year ago. We are members of the troika because Russia will be chairing the G20 next year. BRICS is creating its own development bank. Will it be involved in the development of Siberia and Russia’s Far East? We are working towards that end and we will seek it. The language in the BRICS' New Delhi Declaration makes it possible to work in that direction. So far a BRICS development bank is only an idea. We have been given a year to develop, jointly with our colleagues from the Finance Ministry, the concept and submit it to the leaders at the South African summit. Full version at www.indrus.in

NEWS IN BRIEF S&T Centre opens India branch in Gurgaon The Indian branch of the Indo-Russian Science & Technology Centre opened on April 25 at Gurgaon, months after the Moscow branch started on Dec 15 last year. The branches will work in tandem to promote modernisation and commercialisation of innovative technologies developed jointly or independently by Indian and Russian scientists. If an Indian or Russian entrepreneur has a proposal for technology partnership and its commercialisation, whether seeking or offering technology, the S&T Centre can network him or her with partners in either country. RIBR

Kudankulam will be operational by May-end The first unit of the Kudankulam nuclear power project is expected to start generating electricity by the end of May, Minister of State in the Prime Minister's Office V. Narayanasamy said. The Atomic Energy Regulatory Board officials visited the Kudankulam project site and inspected the plant. "The first reactor of 1000 MW will be operational within 40 days from today," Narayanasamy said on April 23. He said that after the AERB provides its certification to the plant, uranium - the fuel for power generation - will be loaded in the plant. RIBR

New guided missile frigate joins Indian Navy India has formally commissioned a new frigate into its navy, following a handover ceremony at a shipyard in Russia's Baltic exclave of Kaliningrad. INS Teg is the first of three modified Krivak III class (also known as Talwar class) guided missile frigates being built at the Yantar Shipyard under a $1.6 billion deal sealed in 2006. The other two vessels will follow in a year or so, a Yantar spokesman told RIA Novosti. The 3,970-tonne frigate incorporates stealth technologies and is armed with eight 290-km BrahMos supersonic cruise missiles. It is also equipped with "sensors for three-dimensional warfare," the Times of India reported. RIA Novosti

Indo-Russian Trade House opens in Mumbai A Russian-Indian Trade House, the first one in the history of bilateral relations, opened in Mumbai, India's commerical hub, on April 23.“It will provide full-scale assistance to Russian and Indian businesses in finding partners and building joint ventures,” Russian Ambassador to India Alexander Kadakin said. Over 100 companies are expected to become members of the Trade House this month.They will be given visa support and other advantages when working in the Russian market. A branch of the Trade House is planned to open in Moscow soon. RIA Novosti

GLONASS equipment to be assembled in India

ITAR-TASS

Politics Before stepping out, he finalised two key political reforms. The verdict is out on his legacy and road ahead

The Navigation-Information Systems (NIS GLONASS) plans to start the serial assembly of GPS / GLONASS equipment in India on September 2012.The company selected three Indian companies that will release a pilot batch of 100 terminals early May. After testing, NIS GLONASS will partner with one or two of these plants, said Vladimir Finov, director of the India-GLONASS programme. The company is selecting Indian manufacturers who already have experience in assembling high-quality equipment to order and fulfilling export orders to Europe and the US. Indian factories will only produce terminals for the local market at the moment, he said. In the future, if market conditions allow, the company will export equipment to other countries in the Asia-Pacific region and the world. CNEWS


BUSINESS REPORT

Politics

in association with rossiyskaya gazeta, russia Wednesday, MAY 9, 2012

opinion

Region The proposed state corporation is planned to report directly to President

Shaping a Far East dream A new state-run company with vast powers may be created to transform Siberia and the Far East into a dynamic economic region. Anna Arutunyan

It’s one of the pet projects of President Vladimir Putin that seeks to transform the economic landscape of what is called the new 'Far East Republic' through creating a new state corporation. According to the draft of the federal law, the proposed corporation to develop eastern Siberia and the Far East will have direct access to land and natural resources in 16 Russian regions (comprising 60% of the country), bypassing laws on natural resources, forestry, land distribution, according to a leaked copy of the bill. The corporation is supposed to hand out mining licences in the mineral-rich region, bypassing state agencies. The corporation is supposed to be granted the right to allot licences to mine for natural resources such as gold, which is currently only authorised by the federal and regional governments. The entity will be reporting directly to the president, while other state agencies will not be able to interfere in its decisions. This overarching body would get 500 billion rubles ($17 billion) worth of stakes in energy, resource and infra-

reuters/vostock-photo

the moscow news

A huge flame burns off gas at an oil drilling station on an oil field in Verkhnechonsk, in Eastern Siberia.

structure companies like RusHydro, Russian Railways, diamond company Alrosa, the Inter RAO energy holding, and the Leninsky Riverboat company. The corporation would also receive unprecedented oversight in the decisions of major state monopolies like Gazprom and Transneft, Kommersant newspaper reported.With its headquarters inVladivostok, the corporation would get significant tax breaks – such as a zero percent profit tax – as well as rights to develop projects on lands owned by

other entities. Federal funds would subsidise travel and living expenses for Russians and foreigners employed in the corporation’s projects. Funding could come from the $90 billion National Well-Being Fund. In view of the corporation’s sweeping powers, government sources are already dubbing it “a state within a state.”“In essence, a parallel government is being formed that will be [controlled] by [President Vladimir] Putin personally,” says Rostislav Turovsky, an expert from the

A vast region, abundant in natural resources

Center for Political Technologies. “This will limit the powers of Medvedev as prime minister. The country will be split into two parts, just like under Ivan the Terrible, with the zemschina and the oprichnina. One part will be run by Medvedev, and the other by this state corporation.” Medvedev will assume the prime minister’s past under a pact Putin and he made public last fall, but speculation is increasing that Medvedev may not hold on to the position for long. Meanwhile, First Deputy

Prime Minister Igor Shuvalov said that the Far East development goals may be achieved through an affiliated company of state-run development bank Vnesheconombank. Both options are being evaluated by the government. “We have decided that the region should be developed, but we are still discussing in what way this should happen,” he said on the sidelines of a Russia-China economic forum in April. Putin pledged to revive the Far East and set up a state development corporation as

experts speak out

Implementation is key issue Roland Nash

Partner at Verno Capital

The idea of a state corporation in the Far East was among many ideas being floated around as Putin looks

to form his new administration. If it happens, it’s a very big deal. Since 2008, the government has been looking for ways to stimulate growth. The key question is implementation, on which the government has a patchy record.

It'll work against fair busines Alexei Kudrin Ex-finance minister

These plans go directly against Putin’s target for Russia to jump to the 20th place in the international ‘ease of

doing business’ rating, from the 120th position. Such a market player capable of implementing any private project means that any other investor must be aware that at any moment, the stronger player may seek to compete.

Pushing India-Russia ties into a global orbit Jagannath P. Panda

part of his re-election campaign platform. He also named the Far East as one of five key priority areas for the Russian economy in a speech to the Duma in April. While the state company was being created in order to manage state resources more efficiently, one of the main challenges is how it will work with regional governments. “This is the most difficult issue that we have yet to resolve,” Mikhail Tersky, a professor at the Far East Federal University, said. “Projects in the Far East (new bridges, roads) are costly rather than profitable,”he said.“But the state company will be launching projects to generate income, and it will make significant demands on the regional government. There are certain organisational and financial problems for the administration.” Tersky, who was involved in drafting the original idea of the state corporation in January, said the company would seek both state and private funding for its own projects and for those of the regional government. Other experts were positive, saying the initiative would speed up development of mineral deposits within the next 10 years. “A key question is about the balance of power between the center and the regions,” said Dinnur Galikhanov, senior metals and mining analyst at Aton.“It is possible that regional authorities won’t be able to influence the project. I think no one wants this, so there will still be a lot of consultations on this issue.” Analysts argue that as the bill has yet to be submitted to the Duma, it is too soon to tell whether some of its controversial points will even make it into the final draft. The bill will unleash a slew of investment opportunities to develop resources worth billions of dollars such as gold deposits in the Sukhoi Log site in the Irkutsk region, iron deposits and undeveloped oil fields in the Krasnoyarsk region, and coal in the Tuva republic. Turovsky added that the move was likely geared to promote the investment opportunities ahead of the Asia-Pacific Economic Cooperation summit, to be held inVladivostok in September.

Specially for RIBR

It’s Vladimir Putin again in Russia. Despite massive political protests, Putin has again scored an impressive victory and settled down to rule Russia for the next six years. Russia’s domestic recovery, both in politics where restoring democracy will be the main challenge, and economically generating employment and tackling poverty, will depend a lot upon Putin’s initiatives and charisma. At the regional and global level, Putin’s return is an opportunity for friendly nations like India. While continuity is expected in foreign policy, there is still scope for new creative initiatives to intensify the relationships. Russia’s current foreign policy is at its best. From 2000 to 2008, Putin promoted multilateralism and projected multipolar world politics.The immediate impact of his return will be in Russia’s continued pursuit of multilateral politics. Regionally, Russia is strongly connected with two rising Asian powers, India and China. Both are also, along with Russia, part of the BRICS, and connected in Russia-India-China (RIC) triangular politics. Putin’s return indicates that Russia would like to firm up BRICS and RIC and keep up the momentum of its association with developing economies. Underpinned by strong foundations firmed up during the Soviet era, the time has come to shape and push the India-Russia relationship to the global level. India is a“dear partner”for Russia in Asian and global affairs. But at the practical level, China has greater importance in Russia’s foreign policy discourse. On the other hand, India’s relations with the US have seen a surge in the last few years. Some say India is being considered as a vital partner in America’s Asia vis-à-vis Asia-Pacific strategy. New Delhi has managed to do the tightrope walk of giving adequate preference to the US, while keeping the vitality of its relations with Russia and other major countries of the world unaffected. Putin’s return gives an op-

portunity for the two countries work out a “win-win” resolution about promoting the vitality of their bilateral relationship against the background of a rapid shift in American and Chinese foreign policies. Putin’s return will also further empower the Shanghai Cooperation Organisation (SCO). Russia should exert additional efforts to get a seat for India in the SCO as China has been ambivalent about New Delhi’s bid. It is in Russia’s favour if the SCO gets expanded and India becomes its member. Putin’s return will have a vital bearing for India’s global profile as well. To date, Russia still remains the most trusted ally on many fronts in India’s strategic calculus. India still purchases the largest quantum of military hardware and equipment from Russia. However, more than bilateral issues, it is the array of regional and global issues that merit attention in the current India-Russia

India needs robust support from Russia in its quest for permanent seat in UN Security Council bonding. India needs robust and open support from Russia for its quest for the UNSC permanent membership. Russia has traditionally been a strong supporter for India’s UNSC bid: but much more needs to be done in terms of international campaigning and network building. It is for India to urge Russia to take the lead in this campaign. In return, India must advocate clearly that Russia still remains the“first preference”in its foreign policy stratagem. New Delhi must direct its thrust and focus not only in BRICS, SCO and the RIC, but also match and converge with the Russian arrangement in global platforms like the WTO and G-20 where Russia is set to play a bigger role. The time has come to imbue this vital relationship with a global thrust under Putin’s new presidential tenure. Dr. Jagannath Panda is Research Fellow at IDSA in New Delhi, and Carole Weinstein Fellow at University of Richmond,Virginia.

Nation Putin can face similar challenges as faced by India's Prime Minister Manmohan Singh over the issue of National Counter-Terrorism Centre

Putin could learn from federal politics in India in his quest to create a viable federation of multi-religious and multi-ethnic societies. Vinay Shukla

Specially for RIBR

In March 1992, in the presidential tenure of Boris Yeltsin, the Federation Treaty was signed by most of the constituent regions of the country. In spite of changes in the political and economic scenario in the Kremlin, the regions mostly retained the old Soviet system of administration headed by the former Communist fiefs backed by the opposing Supreme Soviet (parliament). Outwardly, the new par-

liamentary system introduced byYeltsin in 1993 bore some resemblance to the Indian system, with the State Duma playing the role of Lok Sabha and the Federation Council playing the role of Rajya Sabha. By the time Putin became president in May 2000, the situation in the Russian Federation was somewhat similar to postindependence India, when Home Minister Sardar Patel managed the creation of the Union of India by integrating princely states into a new national identity. The ethnic republics and regions of Russia had de facto turned into fiefdoms, with little or no respect for the federal constitution and civil rights and

liberties. To assert Moscow’s power, 83 regions of Russia were divided into seven Federal Districts headed by plenipotentiary representatives of the federal to oversee the uniformity of local laws and their compliance with the Federal Constitution. A major blow to the power of elected governors was the change of rules for the membership of Federation Council.The governors were to vacate their seats in the Upper House to their appointed representatives, depriving them of their parliamentary immunity. In order to streamline the Centre-State relations, Putin by his decree of September 1, 2000 also set up the State

WEBSITE of the embassy of the Russian Federation in India www.rusembassy.in

Council of the Russian Federation, an advisory body comprising heads of the regions. The State Council in Russia plays a role similar to the Chief Minister’s Conferences to discuss issues of national (federal) interests. In the wake of Beslan school hostage crisis of September 2004, Putin abolished the direct elections of the governors of the regions and presidents of ethnic republics and reserved the right to sack regional heads and dissolve regional legislatures. The country-wide protests over the alleged vote fraud in the wake of the State Duma elections of December 2011 has forced the Kremlin to give up the so-called ‘man-

aged’ democracy and introduce electoral reforms. The younger generation, which thrived on the stability and petrodollar prosperity of Putin’s earlier innings, is now demanding sweeping political reforms as the place of political parties was taken up by corrupt and inefficient bureaucrats. Electoral reforms proposed by Dmitry Medvedev, the outgoing president, are now expected to give a spurt to political life. Today, the Federal Centre always has its own way, but eventually Putin could face similar challenges to his authority as faced by Indian Prime Minister Manmohan Singh on the issue of the National Counter Terrorism

itar-tass

Creating a federal Russia: The Indian experience

Russia: Celebrating a mosaic of cultures.

Centre (NCTC). After stiff resistance by several chief ministers over the controversial powers of NCTC to carry out search and arrests in the states, the Centre has indicated its readiness to climb down.A similar situation exists in the militancy-infested North Caucasus, where

many are unhappy over counter-terror efforts of the federal security agencies. The vote in the UN Human Rights Council by India against Sri Lanka was reportedly under the pressure of Tamil Nadu Chief Minister J. Jayalalithaa. After initial opposition, she has now

in The Economic Times Every second Wednesday

www.indrus.in

allowed commissioning of Russian-built Kudankulam Nuclear Power Plant in her state in spite of protests by locals.These examples show that in a federal state the central government would have to be flexible. The Indian federal system was created on what was left after the colonial authorities and the merger of princely states in the Union of India. The Russian Federation was created on the ruins of the USSR, but on a strong industrial and scientific structure. In spite of their peculiarities India and Russia are home to diverse multi-ethnic, multi-lingual and multireligious societies. They can and must learn from each other in fortifying their federal system for the benefit of each and every citizen living in any part of the country. This is a very sensitive issue, especially for ethnic minorities, who have no other home except their country, be it India or Russia.


BUSINESS REPORT

Education

in association with rossiyskaya gazeta, russia Wednesday, MAY 9, 2012

High school To attract more Indian students, Russian universities need to plug the information gap and offer courses in English

Rediscovering joys of Russian education Indian alumni recall the joys of studying in Soviet universities and advise Indian students that Russia has still a lot to offer to them.

During their first year at universities, all foreign students study Russian, even if their course is taught in English.

igor kryuchkov, elena krovvidi

The so-called American dream has lured thousands of Indian students, and Russia may not be such a hot education destination as it used to be in the Soviet times due to a host of reasons. In those good old days, Indian students made up a large chunk of foreign students studying at renowned universities like Moscow State University, Moscow Power Engineering Institute and People’s Friendship University. The numbers of young Indian footfalls in Russian universities may have dwindled, but all is not lost. There is a renewed interest in Russia, with more Indians rediscovering the strengths of Russian universities in engineering, medicine and natural sciences. Russia's worldclass business schools are an added attraction for wellheeled Indian students. If those wishing to study abroad are not convinced, they should listen to old-timers who studied in Soviet universities and are now well established in their chosen professions. Yogender Nagpal, president of Hindustani Samaj (the oldest organisation of Indian diaspora), who studied philology at the Moscow State University (MSU) in late 1960s, is all praise for the Soviet education system and admires it for in-depth studies and for preparing him for a career in the increasingly lucrative area of translation. Nagpal says he came to study to Russia because of his in-

itar-tass

ribr

The numbers

Yogender Nagpal, MSU

Rameshwar Singh, PFU

Chakravarti Pilla, PFU

terest in Russian language. "My education at MSU was a good foundation for my future career," he recalls proudly. Getting a job was not difficult. A graduation degree

from the MSU certainly helped. After obtaining his diploma, he immediately got a job at “Progress”, a large publishing house, as a translator where he worked for

the next 18 years. Recalling his student years, Nagpal says that Indian students felt at home in the USSR. "In those days, we received a monthly stipend

5,000

$7,000

$500

Indians study in 50 Russian universities presently. The most popular specialisations for them are medicine, engineering, natural sciences and MBA.

is an average annual tuition fee at Russian People's Friendship University compared to $20,000 per annum at Cambridge, Great Britain.

is an average living cost per month for a foreign student in Moscow including food, mobile phone bills, transportation and daily expenses.

of 90 rubles, almost as much as an engineer's salary (120 rubles), and we enjoyed a comfortable life," he says with a smile. A born optimist, Nagpal

Trend Russia juggles Bologna system to attract more foreign students; corporates pitch in

A tough call: How to create specialists and nurture careers oleg alekseev special to RIBR

The Russian higher education system is at the crossroads, navigating its way through changes and new trends. According to the Russian Ministry of Education, Russia is the eighth largest exporter of students in the world, after the US, the UK, Germany, France, Austria, Spain and Canada. Russia’s 2003 accession to the Bologna Process, intended to standardise requirements for education worldwide, still doesn't find unanimous support. Compared to the Soviet-based system, in which students are granted the degree of “specialist” after the fiveyear-long university education, the Bologna System gives students more choice allowing them to choose between finishing their education with a bachelor's degree after four-year-long studies or pursuing master's degree for two years.“I think that the Bologna System is better than Russia’s traditional one because it offers more options: you can study less, and then find a job. If you want to be more educated, you are free to get the master's degree. Personally, I can’t imagine studying five years in a university like it

was before,” said Bogdina Buvaeva, a student studying International law at the Moscow Institute of International Relations (MGIMO). Airat Bagautdinov, a student at the Higher School of Economics, has a slightly different take:“I think that joining the Bologna System is an attempt to catch up with the West. But in reality, it doesn’t root out the problem of the quality of Russia’s education.”“Yet, I believe that the Bologna system has some advantages in comparison with Russia’s traditional one. For example,

Currently, there are 90,000 foreign students in Russia, an increase of 20,000 from 2008. after getting a bachelor’s degree, you can change your major and study new subjects,”he explains. But there are reasons why Russians find the requirements of the new system problematic. “The fact that a B.A. is one year shorter than a specialist means the average university loses 20 percent of its income. And only 20-30% choose to pursue a master's degree,”says Irina Abakina, director of the Institute for Educational Studies at the Higher School of Economics, Russia. One of the reasons for introducing the Bologna Sys-

tem in Russia was to attract more foreign students by making Russian diplomas equivalent to university certificates in other countries. And indeed, the ministry reports that the number of international students in Russia has increased in recent years. Around 70,000 foreigners came to study in Russia in 2008, and there are currently about 90,000 international students in the country. But according to Irina Abakina, Russia hasn’t seen a rise in foreign students seeking bachelor degrees – this bunch stands to benefit most from the Bologna Process changes.“Primarily, only those students aiming to earn the Master’s degree go to study in Russia because they are mature and know what they want,”says Abakina. She added that some regions like Russia’s Far East are seeing a steady growth in foreign students studying for the bachelor’s; these are students from China and Southeast Asia who are seeking degrees in science and technical majors such as economy and engineering. Another issue with higher education in Russia today is facilitating employment for young graduates. Many corporations, dissatisfied with the content and quality of higher education, have begun intervening in universities to ensure that the human resources they need are properly trained. For example, Kirill Voronov, a

Unravelling the flight of talent Specially for RIBR

I

Corporations are not only teaching students, but are also helping to design career-oreinted courses.

fourth-year undergraduate student at the Higher School of Economics (HSE), has no reason whatsoever to worry about finding a job when he finishes school: he is almost certain to be hired by PricewaterhouseCoopers, one of the big four accounting firms, where he is currently interning. The consulting giant has employees who teach at the HSE. Russian companies are not lagging behind in nurturing talent. Gazprombank project analyst Tatyana Sorokina also caught the eye of her future employer when she was a student: before graduating from the MGIMO, she first entered their corporate stipend programme, then was recruited for an internship, and finally, in 2009, she was hired fulltime. Another factor driving employers to the universities is the shift of many education programmes to the double-degree, bachelor's-master's system under the Bologna System.“Someone with a BA should essentially

be considered a specialist with a higher education, but that graduate has not actually acquired the specialisation he needs, and has patently inadequate knowledge and skills,”says Vadim Saralidze. On the other hand, dividing the programme into two degrees gives employers room for maneuver. Companies incur costs when they invest money in creating their own departments or corporate universities, or even just by assigning a highly paid specialist to assume teaching duties. Invested funds will be recouped through the students themselves by their signing pledges to work a fixed number of years at the company sponsoring them. “Institutions of higher education that lack serious joint projects with the business community should gradually merge into the larger universities on which the system is based,” says Artyom Babenko, head of the Yandex School for Data Analysis group.

courses are introduced, there are visible results, he says. For example, in the Russian city of Tver, which is not far from Moscow, implementing English-speaking medical course at universities led to a perceptible rise in the number of Indian students. Chakravarti Pilla aged thirty one who has majored in medicine in PFU thinks that critical voices slamming Russian higher education todate are overreacting. He doesn't believe that the Russian education has lost its appeal for Indian students but points out that Indians of his age prefer to take up medicine and engineering neglecting other specialisations such as law or human arts. Also, he says it's not as easy to find a job in Russia after the studies as it used to be although it depends mostly on a specialisation. As to the cost of education, Pilla assesses Russian education as affordable. True, it's no longer free for foreigners, but it is still far less expensive than, for example, in the UK or the US. A year of studies at a good Russian university costs around $7,000 per year whereas foreigners studying at the same level in a British university have to pay three times more, about $20,000. Clearly, there is enormous potential, but if Russian universities are serious about attracting more Indian students, they have to step up their outreach in these marketing-driven times and plug the information gap. Efforts are on to revive interest in Russian education. Last year, the Russian higher education exposition-fair was held in major Indian cities like New Delhi, Chennai and Ahmedabad. More such initiatives are needed, that's the point Nagpal, Singh and Pilla agree on.

Opinion

Stepan Pachikov

itar-tass

Russia's higher education system is navigating tough choices to create specialists who thrive in the globally competitive business world.

believes that Russia could again be an attractive student destination. In some courses such as engineering, physics and biology, Russian universities have a lot to

offer. In fact, young Indians who currently study in Russia usually stand a better chance of finding a job in India due to their knowledge of Russian. He gives the example of his nephew who graduated from Moscow Power Engineering Institute and found a good job in India. Rameshwar Singh, head of Indo-Russian friendship society DISHA, who obtained his degree in philology at People’s Friendship University (PFU) in the 1970s, is, however, a little less optimistic. He says: "In my student years, the Soviet education was reputed, and the staff working at universities, especially PFU, supported foreigners and helped us to adapt. Now, it's different." According to Singh, foreign students had generous monthly stipends, that made staying away from work possible during their studies and they could concentrate on education. Nowadays, only students from well-to-do Indian families can send their children to study in Russia whereas in the Soviet times, more people could afford it. "The contrast could not be more striking," Singh rues. "Compared to 50 or 60 Indian students who were at PFU in my time, there are just a handful now." But still Singh thinks that Russia has a potential to attract more Indian students if there is more information available for Indians wishing to study in Russia. Besides paucity of information, language is another critical barrier. In most Russian universities, there are only Russian-speaking courses, and this can put off young Indians who don’t wish to have the additional burden of having to study in a foreign language, he points out. In cases where English

’m often asked by my Western colleagues, “Is Russia the motherland of talent?” This comes as no surprise given the number of talented Russian developers working for Western IT companies. Even if you discount Google co-founder Sergei Brin and PayPal founder Max Levchin, who left the Soviet Union as children when their parents decided to emigrate and did not make this move on their own volition,there are thousands of Russian computer specialists who have chosen to go and live in the US.These include Arkady Borkovsky, who heads theYandex R&D Center in California, and Eugene Veselov, a leading programmer for Microsoft. Parascript, a leading developer of handwriting recognition solutions for mail and checks, still employs mostly Russian engineers at its headquarters in Boulder, Colorado. I have never come across comparative talent statistics by country, and I don’t believe that Russia supplies more immigrant talent than other countries; however, many have felt this way. In answer to my colleagues’ questions, I normally provide the following explanation. First of all, Russia was under the sway of an ideology-driven dictatorship throughout most of the 20th century. All intelligent people realised that, in order to minimise the ideological imprint on their lives, they should avoid studying his-

tory, philosophy, law, literary studies and politics and, instead, engage in pure science — mathematics, astronomy, physics or chemistry. Yet, ideology played havoc even with exact sciences, including biology, genetics and cybernetics. NikolaiVavilov, one of the most prominent botanists and geneticists of the 20th century, was executed during Stalin’s Great Purge.Soviet genetics was ruined and most Soviet geneticists died in the gulag.The notion of bourgeois pseudoscience,which was applied at the time to cybernet-

It's more prestigious to be a banker, or TV anchor in Russia these days than to be a scientist. ics and genetics, became a common term. In the 1930s, there was an attempt to brand probability theory as a pseudoscience, but it was saved by the ingenuity of eminent mathematician Andrei Kolmogorov,founder of complexity theory. Most intelligent people understood, therefore, the danger inherent in the humanities and focused on the small range of exact sciences,creating the illusion of“extraordinarily talented Russian scientists and engineers” After Scientific Communism was abolished in 1990 and the indoctrination of society collapsed, talented young Russians forayed into fields such as business, banking, law and finance. And, on the flip side, Russian science lost much of its lifeblood.The

policies of post-Soviet Russian authorities have marginalised education and science in state financing and, more important, in the public eye. Contemporary Russia has made it prestigious to be a banker, stock­broker, restauranteur or TV presenter, but not a scientist. There are no indications that Russian science will recover any time soon. And when it finally does so, will there be any demand for it in the world? Talented young Russians interested in science are asking themselves the same question. They understand that their chances of success in their own country are limited in virtually all areas, since the Russian economy today is driven by oil and gas, not innovation. Young Russians are also impeded by the mediocrity of the political system and the Russian authorities in general — the existing vertical of power is essentially feudal: the closer you find yourself to the authorities, the more opportunities,power and money you have. As the great actress and philanthropist Chulpan Khamatova put it, “In this country,you can’t live the way you ought to.” The future of the IT industry in Russia is vague because the authorities today only need people capable of pumping oil and servicing those who pump oil. They plan to buy the rest, including new talent. Stepan Pachikov founded the first Moscow computer club with Garry Kasparov. He is also the founder of the ParaGraph and Evernote companies.


BUSINESS REPORT

Sport

in association with rossiyskaya gazeta, russia Wednesday, MAY 9, 2012

The Big Fight Tretyakov Gallery will host a chess contest for the first time; billionaire Andrei Filatov is the man behind the show

Ilya Trisvyatsky ribr

Chess and culture are set to create a perfect symphony or mosaic in Moscow on May 10. On that fateful day, the world chess championship will kick-off in Moscow between incumbent world champion Viswanathan Anand and Boris Gelfand (Israel), winner of the Candidates Tournament.The tournament will be held at the Tretyakov Gallery, the celebrated museum of Russian art, which will be hosting a chess championship for the first time. Anand has been the world champion since 2007, and this will be his third defence of the title. But his recent performance has dipped his ranking to the number 4 in theWorld Chess Federation’s rankings. Gelfand, who won the right to challenge Anand in the Candidates’ Matches last year, is out of the top 20 entirely. (He is No. 22.) It is “the first time in the modern world chess championships’ history that the match between the legitimate champion and a legitimate candidate won’t be a fight for the title of the strongest chess player in the world,”Garry Kasparov, the

former champion, told 64 Chess Review. Twelve games will be played, plus a tie-breaker, if needed. The player who will score 6.5 first will be the winner. The opening ceremony will be held on May 10 and the next day, the contenders will play with one day-off after every two games. An additional day-off is envisaged before the 12th game. The players will have 120 minutes for the first 40 moves, 60 minutes for the next 20 moves, and then 15 minutes to finish the game, plus an additional 30 seconds for each move starting from the 61st. Initially, the International Chess Federation (FIDE) proposed that London host the tournament, but the British capital withdrew its bid after encountering a slew of organisational problems. Later, a tender was announced. The initiative behind Russia’s bid and the idea of holding the tournament at the Gallery came from 41-yearold businessman Andrei Filatov, who is co-owner, board director and executive director of the N-Trans infrastructure group, a leading private operator in the transportation services markets in Russia and the CIS. Chess is more than a hobby for Filatov, who also loves classical painting. He finished a sports school in Dnepropetrovsk as Candi-

aire has a reputation as a chess sponsor; recently, he paid for restoration of the tombstone of the celebrated Russian chess champion Alexander Alekhine, who is buried in Paris. Even so, a few people in Russia know about the renovated tomb. Moscow beat Anand’s native Chennai in the tender. FIDE announced the tender results in August last year. The plan was to hold the tournament at the Skolkovo innovation centre (Russia’s SiliconValley) outside Moscow, but later, the Tretyakov Gallery idea popped up. On February 20 this year, the Russian Chess Federation and the museum’s adminis-

date Master of Sport of the USSR in chess and, in the late 1980s–early 1990s, was a student at the Sport Academy in Minsk where he met and became friends with Boris Gelfand. The tycoon is not a public figure; his name rarely appears in the Russian media; nor is he linked with chess circles. Filatov himself admitted that he had seen FIDE President Kirsan Ilyumzhinov on just a few occasions. Filatov’s decision to sponsor the tournament (with a prize fund of $2.55 million) was largely prompted by his desire to support his friend Boris Gelfand and promote the Russian art. The billion-

Viswanathan Anand (left) and Boris Gelfand shake hands during a press conference in Moscow last year. Kirsan Ilyumzhinov, president of the World Chess Federation (second from left) and Arkady Dvorkovich, head of the Supervisory Council of the Russian Chess Federation and an aide to former president Dmitry Medvedev, are also seen in the picture.

tration signed a contract on holding the tournament. “The union of chess and culture is a good example to follow; we are launching a good tradition,”says Arkady

Gallery will be a good opportunity to popularise Russian art and stimulate public interest in chess as an educational method for our younger generation,”says Filatov’s business partner Gennady Timchenko, who is co-sponsoring the event. Ex-world championVladimir Kramnik is upbeat.“In 2008, I played against Anand at a big exhibition centre in Bonn. There are always a lot of exhibitions there, many interested and cultured people. It is a perfect venue! Andrei Filatov’s idea is very logical: most of our fans are from the world of culture.All these areas are interrelated: painting, music, chess and science. Take any chess fan, and he’ll be either a doctor of sciences or a musician. It is obvious that holding a tournament in a big, world-standard museum is an important advantage for chess.” During the Anand-Gel-

Dvorkovich, head of the Supervisory Council of the Russian Chess Federation and an aide to the president of Russia.“A chess world championship at the Tretyakov

A tryst with old masters: A treasure house of celebrated Russian art The Tretyakov Gallery is one of the world’s biggest art museums, a treasure house of Russian art. It was founded in 1856 by Pavel Tretyakov, a wealthy merchant who presented it to the city of Moscow in 1892. The gallery is also an important research centre, where exhibits are restored, examined and popularised. Currently, the museum has over 170,000 items created between the 11th and the 21st century, including masterpieces, which are revered internationally. The chess tournament will

be held in the Tretyakov Gallery’s Engineering Building. The building has three floors. The first and second floors are used for exhibiting classical and contemporary art. Under the Golden Map of Russia project, the country’s best regional museum collections are exhibited in this building. The adjacent main building holds regular exhibitions as a part of the programme “The Tretyakov Gallery opens its reserves”, featuring works by Viktor Vasnetsov, Valentin Serov and other Russian artists.

lori/legion media

In a rare event, the world chess tournament will kickoff amid iconic artwork at the famous Tretyakov Gallery (Moscow) on May 10.

itar-tass

Anand versus Boris: A symphony of chess and culture

Olympics Hires back old coach who turned her into a winner

Tennis Breaks finals jinx in Stuttgart

RIBR

Don’t write offYelena Isinbayeva yet. Russian pole vault legend has confounded her critics by recovering her best form and, at the age of 29, she is not only determined to carry on with her career, but also has set her sights on a new world record and winning another gold medal at this summer’s Olympic Games in London. One of the most harrowing memories of Isinbayeva’s career was when she buried her face in her hands at the 2009 BerlinWorld Championships after her third failed vault. Her coach,Vitaly Petrov, who also trained the legendary pole vault world champion

several tournaments. The new jumping technique was turning out to be a success and Petrov was making steady progress in improving her performance. But she was no longer threatening to break records. After going home toVolgograd in spring 2011, Isinbayeva decided she did not want to return to Monaco. She did not even want to train and was considering retirement. However, on Shrove Sunday (the Orthodox day of forgiveness), she telephoned Trofimov and asked him to meet her. The trainer had by that time forgiven Isinbayeva and had been watching his former charge’s career with interest. They met in a small, deserted restaurant. Isinbayeva did most of the talking. She was crying: she had left her home in Monaco, and she wanted Trofimov to be her coach again. If he refused, she

would retire from the sport she loved, for good. On March 8, International Women’s Day, a holiday in Russia, when women traditionally receive gifts, Isinbayeva was sitting at Trofimov’s dining table with her parents. The two had been separated for five years, but the man who had transformed her

into a champion believed he knew what could be done to help her rediscover her winning ways. It seems Isinbayeva could not stand being away from her friends and loved ones for long. Since her return to Russia, Isinbayeva has worked very hard and is starting to find her form.Although she failed

to win a medal at the World Championships in Daegu, South Korea last year, this year, she set a new world indoor record of 5.01m in Stockholm and won gold at the World Championships in Istanbul. It was at Crystal Palace, London, in 2005, that Isinbayeva became the first female pole vaulter to clear 5m. But who knows if she will have as much success in London this year. Some commentators in the Russian press have said she will take gold. However, many strong rivals have appeared in the past two years. Britain’s bright hope Holly Bleasdale, at the age of just 20, can jump higher than the Russian could at the same age. Bleasdale recently smashed the British indoor record in Lyon by clearing 4.87m to become the second highest female pole vaulter in the world – after Isinbayeva. I’ll predict just one thing. I think Isinbayeva will make three attempts in London. The first jump with a pink pole will be a warm up, challenging the stronger of her rivals. She will come out with her blue pole when only a few of the strongest rivals still remain. And God willing, she will come out with her golden pole when it’s time to beat the world record. Nikolai Dolgopolov is deputy editor-in-chief of Rossiyskaya Gazeta.

To buy Iran’s oil, or not to buy, that’s the question… M.K. Bhadrakumar

Don't miss our "Photo of the day" on Facebook!

Maria Sharapova dazzles again After a string of injuries and layoffs, Maria Sharapova is looking gorgeous with her new hairstyle and has bounced back in style. elena krovvidi ribr

After starting with a bang in 2004 winning theWimbledon finals, Sharapova's slide began with a shoulder trouble. Injuries and layoffs have marred her career in recent years. So after several early exits in the tournaments across the globe, losses to lowly-rated opponents, Sharapova's bouncing back to her former self is a welcome news for women’s tennis. Sharapova ended 2011 as number 4 in the world, her

Back in form: Strong will and optimism are key to success.

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first top-ten finish since 2008. She began 2012, exhibiting dazzling tennis to reach the Australian open finals, the third time in her career and her 6th grand slam singles final. Despite losing to Victoria Azarenka, her self-belief wasn't shattered. Thanks to her, Russia beat Spain 3-2 in the Federation cup quarter final. She reached the finals in four important tournaments this year, but lady luck seems to have deserted her on 3 occasions. Вut finally Sharapova broke her finals jinx against her Australian open bête noire Victoria Azarenka in the Stuttgart WTA tournament, moving up to the world number 2.

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NIkolai DOlgopolov

Sergei Bubka, was crestfallen, and her fans were dismayed. At the Doha Indoor World Championship in 2010, she failed again to win the gold medal.“I have decided to take an indefinite break,” she said after the Doha setback. Everyone needs a rest from time to time, but it seems that Isinbayeva needed more than rest to return to form. When she dismissed former coachYevgenyTrofimov, with whom she had worked successfully since late 1997, after the Athens Olympics in 2004, it came as a shock. Later, Isinbayeva perfected a new jumping technique under Petrov. She had set her first world record of 4.82m back in 2003; she took gold in Beijing in 2008 with a new world record mark of 5.05m. After the Doha failure, she was spending more time on the treatment table and missed

corbisoutline/foto sa

Yelena vaults back, sets sights on London gold Double Olympic gold winner Yelena Isinbayeva nearly quit the sport due to injuries and bad form, but is set to dazzle at London 2012.

fand competition, many other tournaments will also be held in Moscow involving chess legends. The Russian Chess Federation, in collaboration with the Tretyakov Gallery, has prepared a programme for young players, who will come to Moscow from all over Russia. It includes chess workshops and multi-board games with famous grand masters, along with museum tours and lectures on the history of art. The tournament games will be broadcast live online.The English language broadcast will inform viewers about the Gallery’s history and Russian painters.The games will start at 3 p.m. Moscow time. Admission for spectators will be free but limited.The museum buildings on Lavrushinsky Pereulok are open from 10.00 a.m. to 7.30 p.m., with admission until one hour before closure.Tickets cost 360 roubles ($12).

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May 2012, Russia & India Business Report  
May 2012, Russia & India Business Report  

Russia&India Business Report is a monthly publication brought out by Rossiyskaya Gazeta, that is published in association with The Economic...

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