Foreign Electronics Still Preferred

State-owned technology conglomerate Rostekh reports that the Russian government purchases imported electronics four and a half times more often than comparable domestic products.

The complaint came from Sergey Sakhnenko — industrial director of Rostekh’s radioelectronics cluster (REK) — at a joint meeting of the Bureau of the Union of Machinebuilders of Russia and the Bureau of the Association “League for Assistance to Defense Industries” on May 31.

Sergey Sakhnenko

Sakhnenko

According to Interfaks-AVN, Sakhnenko said:

“The volume of sales of products from REK enterprises to federal government executive organs in the medical equipment, computing technology, telecommunications equipment segments and other electronics in 2018 amounted to 18 billion rubles [$275 million]. Meanwhile, the volume of state purchases just in the sphere of IT and telecommunications came to not less than 100 billion rubles [$1.5 billion] for the year.

In Sakhnenko’s words, foreign products dominate Russian government purchasing despite the existence of Russian-made analogues comparable in quality and characteristics to imported equipment.

Replying for the government, Deputy PM and arms tsar Yuriy Borisov could only state the obvious. The Russian radioelectronics industry faces the task of dominating its internal market. Domestic technology should be introduced dynamically and commercialized. Besides dominating its home market, Russian technology has to be better positioned in foreign markets. “Only under such a state policy can we raise this sector,” he said.

Pretty thin stuff for Russian electronics manufacturers.

Suffice it to say, Russia’s import substitution policies since 2014 haven’t dented Moscow’s dependence on foreign high technology products. It’s a lingering pressure point the U.S. and NATO could exploit but for the greed of their politicians and companies still more than willing to do business with Russia.

6 responses to “Foreign Electronics Still Preferred

  1. Pingback: Foreign Electronics Still Preferred - DFNS.net Policy

  2. One would guess most of those foreign electronics come from Europe, China, Japan, and South Korea…. The Russian MOD has been ordered to replace imported components in its weapons and other systems, but not much has been written about its progress in this direction to date.

  3. Instead of sanctioning countries buying Russian weapons systems, perhaps Washington should tackle the tougher diplomatic task of staunching sales of foreign electronics going into the Kremlin’s arms. But that will have to wait for a post-Trump administration with the capacity for that job.

  4. Well pretty obviously if they did use that last pressure point then the Russians would be forced to use Russian electronics instead of western equipment which would be rather better for Russia than the current situation where you claim they prefer to buy foreign alternatives which even you admit are no better than the Russian options.
    The reason they buy foreign products is probably because they can get it cheaper or the foreign companies offer better bribes.
    Ironically it is really a case of hoping the west is stupid enough to push away Russia this extra step, because if they start buying their own electronics then the funding that will create in the industry in Russia will likely enable them to look to expand into exporting into other markets and with the value of the ruble they are going to be very competitive against western and asian alternatives…

  5. Any economist would tell you sanctions and embargoes are good for the target economy in the long run. They force changes and development of alternative goods and services in that economy.

    The “Russian options” are almost certainly not the same as Western equipment in quality and capability even if Mr. Sakhnenko says they are.

    With the ruble tanked, they certainly can’t get Western equipment more cheaply.

    Moscow is a considerable way from becoming an exporter of electronics. Again, with the ruble tanked, Russian electronics would be flying out of the country, if there were good ones to be had.

    • Well a good US dose of sanctions will get them selling and in use, which is probably what they need most to get them up to standard.

      Some Russian companies seem to be able to raise their game, just look at KRET in terms of aircraft avionics and systems.

      Before EU sanctions and the Russian counter sanctions on food from the EU the situation for Russian food producers was dire… how could they compete with the EU in terms of production volume and quality.

      Didn’t take many years of sanctions before Russian production stepped up to fill the gap and then expand to export to other countries… is it unreasonable to expect something similar with electronic components and systems?

      The western systems might be superior, but superior in ways that are important?

      I told a friend who was buying an external hard drive to get the biggest one that is not too expensive. He found two he liked, a 1 TB drive for $120 and a 2 TB drive for $110, but he bought the 1TB drive because it had LED lights down its side to show how much capacity was used up. Now that it is full he regrets getting the smaller capacity flashy model.

      Customers can easily be distracted by features they may never even use.

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