1. Innovation, Finance and Funding in the Russian NSI Thiruvananthapuram, India, August 19-21 2009 Natalia Gorodnikova

2. 2 Contents Financing: dynamics & scale Innovation activity & output Existing financial instruments Financial system and NSI Further policies

3. 3 Gross Expenditure on R&D GERD, % to GDP200520062007 Planned1.361.511.62 Actual1.07 1.12

4. 4 Federal budget appropriations for civil R&D Current pricesConstant 1991 prices (million rubles, before 1998 – billion rubles)

5. 5 Innovation activity & output

6. 6 Structure of expenditure on technological innovation

7. 7 Innovative SMEs’ activity & output

8. 8 Innovation efficiency

9. 9 Innovative G&S markets Share of innovative G&S in total sales, %

10. 10 Existing financial instruments Direct funding: Budgetary funding Programme funding Grant funding Private / foreign foundations PPP projects Venture funding

11. 11 Existing financial instruments (cont.) Indirect funding: Federal taxes -VAT -Income tax Regional / local taxes Advanced mechanisms: simplified taxation

12. 12 Role of the financial system Share of internal funds in expenditure -on R&D: 30% -on technological innovation: 86% Reason – lack of alternative sources -Difficult access to credits -Underdeveloped grant system for innovation -Poor venture support

13. 13 Further policies Technological modernisation: -New approach to public purchases -Advanced priority setting -Tax reforms -Industrial sector sanitization -Selective assistance

14. 14 Further policies (cont.) Institutional adjustment: -Single concept for the tax reform -Targeted budgetary reform -Single concept for direct funding R&D sector development: -Reorganisation (sanitization) of R&D institutions structure -Assistance to commercialisation -Mobility boosting

15. 15 Thank you!