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Russia’s state-owned companies to fund €420m Skolkovo endowment

Russian state-owned companies have been ordered to transfer 1 per cent of their R&D budgets to create an endowment fund for the newly formed Skolkovo Institute of Science and Technology, SkTech.

The private graduate university, a collaboration between the Russian Skolkovo Foundation and the US Massachusetts Institute of Technology launched in October last year, will be based within the $2.8 billion (€2.1bn) Skolkovo science city just outside Moscow.

According to MIT, the three-year collaboration will establish a strong emphasis on innovation and entrepreneurship at the institute and aim to connect international researchers with their peers in Russia. By 2014 the university expects to have 1,200 masters and doctoral students, 300 postdoctoral researchers and 200 academic staff.

The endowment fund, estimated to attract $560 million in 2012 alone, will be invested and the profits, which the project claims could be up to 15 per cent of the total value, used to pay for SkTech’s research programme. Donating companies, including Gazprom, RusHydro and Aeroflot, are expected to have access to researchers and facilities in exchange.

Stanislav Naumov, Skolkovo’s vice-president, said in a statement that the fund would be the largest in Russia with a total expected value of $1.8bn by 2015.

SkTech is just one arm of the Skolkovo project. Dubbed Russia’s Silicon Valley, it is the brainchild of outgoing president Dmitry Medvedev. Its 6 square kilometres, being built from scratch and scheduled to be complete by 2014, will accommodate R&D centres and businesses as well as the university.

The project will focus on five areas: energy, information technologies, communication, biomedical research and nuclear technologies.

The Russian government is ploughing ahead with the plans, despite concerns that using incentives to artificially create a Silicon Valley is rarely successful. There are also doubts about the project’s overall impact, if Skolkovo remains an island in an otherwise corrupt and non-innovative economy.

So far more than 200 companies have set up at the site, including some of the world’s largest and most hi-tech companies. EU firms already agreeing to host R&D centres include BP, EADS, Nokia, Ericsson and Siemens, alongside US firms such as IBM and Intel.

Other companies, such as Microsoft, are involved in co-investment in start-ups or research and education infrastructure.