Electronics is running for Russian – Newspaper Kommersant No. 170 (7371) of 09/15/2022

As Kommersant found out, Prime Minister Mikhail Mishustin approved a draft resolution prepared by the Ministry of Industry and Trade on the introduction of a point system for the computer technology market. Now, Russian servers and data storage systems (SDS) do not need to have domestic processors in order to gain access to the state order market and a number of other preferences. The state sector in the current conditions is in dire need of equipment, and Russian processors may simply not be enough for everyone, market participants explain.

According to two Kommersant sources in major Russian electronics manufacturers, on September 13, Prime Minister Mikhail Mishustin approved amendments to government decree No. 719. They were developed by the Ministry of Industry and Trade and introduce the concept of a “scoring system” for computer technology – primarily servers and data storage systems. In the office of Mr. Mishustin, Kommersant confirmed this information without specifying the details. The Ministry of Industry and Trade declined to comment, the Ministry of Digital Transformation reported that they had not yet received the document.

In the current version, Decree No. 719 defines the criteria for recognizing the “domestic” equipment, including the presence of a Russian processor in storage systems and servers, as well as a number of technological operations carried out in the country, for example, mounting components on a board.

Compliance with these criteria allows equipment manufacturers to include it in the register of Russian equipment of the Ministry of Industry and Trade and receive preferences, including on the state order market under the “second extra” rule (the state customer is obliged to reject all applications for participation in the purchase, which offer imported products, if submitted at least there would be one application with a proposal to supply domestic electronics, see Kommersant dated September 22, 2021).

The Ministry of Industry and Trade has been discussing with the industry for two years the introduction of a point system for determining the “domestic” technology (it assumes that for each technological operation in the production the company receives points, with a sufficient number of which the equipment is included in the register), as well as the abolition of the requirement for the mandatory presence of a Russian processor in technology to recognize it as Russian (see Kommersant dated August 31 and October 1, 2021). The ministry proposes to make this item variable: for the presence of a processor, the manufacturer will receive a large number of points, but if there is a foreign chip in the server or storage system, then points can be scored using other technological operations.

The amendments also assumed the division of all radio electronics into two levels, depending on the availability of a Russian processor. Equipment of both levels will go to the state order market, but equipment with Russian chips, says a source in the ministry, will receive preferences.

According to a number of Kommersant’s interlocutors in the government and in the market, design centers, including MCST (which designs Elbrus chips), as well as manufacturers of storage systems and servers based on these processors, for example, Norsi-Trans. Their position, Kommersant’s interlocutors say, was supported at that time by Deputy Prime Minister Yuri Borisov (in July he left his post and headed Roscosmos, the head of the Ministry of Industry and Trade Denis Manturov received the status of Deputy Prime Minister).

The rejection of the mandatory use of Russian processors was supported by representatives of the Computer Science Association (it includes Yadro, Aquarius, etc.). Aquarius President Vladimir Stepanov believes that the point system will help vendors plan strategic investments in R&D and production more efficiently, as well as understand the payback period for investments, and ultimately increase the level of production localization.

The interlocutor of Kommersant, who is familiar with the discussion of the initiative, emphasizes: “In the current conditions, there is a risk that the Baikal and Elbrus will not be physically enough for all customers. Simply put, if the contractor has enough servers with Russian chips in stock, he will go to the auction and get priority. If there are no physical reserves, the customer will be able to easily purchase Russian equipment at a conditional Intel.”

Nikita Korolev