Contrary to the myths about import substitution, Rostelecom and Rostec will invest billions in a new joint project

The largest Russian telecommunications operator Rostelecom and the United Instrument-Making Corporation ( OPK is part of Rostec ) plan to engage in import substitution of telecommunications equipment. They create a joint venture for this.

The representative of the defense industry, Leonid Khozin, said that both partners would buy out 37.5% of Bulat. On the part of the defense sector, Bulat’s research institute includes the Scientific Research Institute “Scale” (information protection and telecommunications), Khozin explained, and on the Rostelecom side, Vestelek. 25% will be from the Russian manufacturer of equipment "Kutek" .

“Bulat” will be engaged in the localization of technologies, as well as the development and production of its own solutions in the field of telecommunications and computing equipment, Khozin lists. The company localizes solutions based on open protocols and SDN technologies - the so-called software-defined network. What kind of decisions will be taken as a basis for localization is not yet known.
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According to Khozin, by 2020, half of the Bulat technologies should be localized, half - in-house development. Rostec and Rostelecom plan to invest several billion rubles in the project, he told Vedomosti.

Equipment "Bulat" will be made at the enterprises of the defense industry, as well as abroad. But for departmental communication networks with a high level of information security, only Russian equipment will be purchased.

"Rostelecom" will help expertise, determine the requirements for equipment, said the source "Vedomosti", familiar with the terms of the transaction.

Rostelecom itself needs routers and switches, as well as DWDM equipment, which allows you to organize the transfer of a large number of optical channels along a single line.

And since we are talking about the “daughter” of the operator, its products can be purchased as from a single supplier. Such a scheme in Russia is infrequent, but solely because of the underdevelopment of production - the desire of large enterprises (including state-owned) to control key suppliers is understandable, says Ivan Begtin, head of the government spending committee of the Civil Initiatives Committee.

Another source of Vedomosti assumes that Bulat may have its own development of routers and switches inherited from Kyutek, but it is unlikely to be able to offer domestic developments in DWDM equipment.

An interdepartmental council operates under the Ministry of Industry and Trade, which assigns Russian origin to telecommunications equipment. “Bulat” did not receive such status and did not apply for it, says member of the expert council Svetlana Apollonova. She is not sure that his equipment can be considered Russian, so the choice of this particular Apollo company by Rostelecom is incomprehensible.

This is not the first joint attempt of import substitution of "Rostec" and "Rostelecom". In August 2015, the Federal Antimonopoly Service approved the intention of Rostelecom to buy out 50% of the National Informatization Center ( NCI ), a Rostec subsidiary.

In September, Rostec and Rostelecom signed an agreement on long-term cooperation within the framework of the strategy of “technological breakthrough in the field of information and communication technologies”. The partnership will allow to combine the expertise of developers and production facilities of Rostec corporation with the experience of Rostelecom specialists in the implementation and operation of IT systems and infrastructure.

The partners have jointly planned to finance the joint project. They were going to allocate up to 200 million rubles for two years of work. NCI was to develop electronic services and services for the public sector. However, Rostec is still the sole owner of NCI.

On March 9, the Ministry of Industry and Trade explained the scope and plans for import substitution. An interview with the First Deputy Minister Gleb Nikitin entitled “10 myths about import substitution” has been published on the Ministry’s website. The official debunked 10 popular opinions about the policy of transition to domestic products:

• Russia is not going to completely ban all imports;

• The government does not seek to expel foreign business from the country;

• import substitution does not mean protectionism;

• the state is not going to reduce competition;

• import substitution is not a squandering of the budget;

• the authorities do not impose poor-quality products on their citizens;

• investment in the Russian industry is not the support of backward technologies;

• import substitution is not intended to support businessmen who have been denied banks;

• export growth is possible with the help of import substitution;

• Ruble strengthening will not lead to the collapse of import substitution.