Gorbachev Touts Russian IT Industry

The Russian economy is rebounding, following India's lead in outsourcing and taking a global perspective, according to the former Soviet Union leader.

BOSTON—Delivering a sales pitch for Russian software development, former Soviet Union President Mikhail Gorbachev addressed a gathering of Massachusetts software industry executives here Tuesday.

"Russian society is ready to make a breakthrough. The high level of education and the potential of our science enable us to take our place in the post-industrial economy," said the man who oversaw the dismantling of Russian Communism under his regime of Perestroika.

The charismatic leaders remarks came on the forty-fourth anniversary of Russian Yuri Gagarins first-ever manned orbital space flight on April 12, 1961. Gorbachev and software executives from Russia, Ukraine and Belarus sought in their remarks to draw a parallel between Gagarins feat and the ongoing strength of Russian science, political and economic woes notwithstanding.

Gorbachev and the executives noted that Russian college students are winning top prizes in international software development competitions.

"After Gagarins space flight, the secretary of education of the United States visited the Soviet Union. Sputnik and Gagarin were first, so Americans learned from us. But we should never boast; we should work together," Gorbachev said.

Alexis Sukharev, president of software maker Auriga Inc. and founder of Russoft, an association of software companies in Russia, Belarus and Ukraine, credited Gorbachev with the creation of a software industry in Russia. "Its largely because of one man, President Gorbachev," Sukharev said.

In turn, Gorbachev saluted Russoft, which was a sponsor of the event.

"The IT industry in Russia today is developing very dynamically," he said. "In 1996, I didnt know the word outsourcing. But I sensed it. I said America should not attract our mathematicians and software people to leave, but should have agreements with our companies. Now this is being welcomed by the Russian citizens that are part of this industry."

He noted that in 2004, Russia, Belarus and Ukraine had nearly $1 billion worth of IT exports and the IT industry was growing at a rate of 50 percent per year.

"We are following India closely. India today is the leader. So we will support outsourcing. New technology parks are being created in St. Petersburg and Moscow. This will give an impetus to progress in this industry," Gorbachev said.

/zimages/3/28571.gifClick here to read Stan Gibsons column on the effect of the Sarbanes-Oxley Act on outsourcing.


Gorbachev said that a union of Russia, Ukraine, Belarus and Kazakhstan could provide a competitor—or a partner—for the European Union and the United States, because those countries comprise some 80 percent of the economic power of the former Soviet Union.

As Russia rebounds from what Gorbachev called the "chaos" of the Boris Yeltsin era, it faces stiff challenges. "Russia is making a transformation to a market-economy democracy. Russia is in a weakened condition. But this is a temporary phenomenon."

/zimages/3/28571.gifCan outsourcing save jobs? Read John Moores opinion here.

As Russia climbs out of its predicament, it will do so in an interconnected world, a condition he said he noted as far back as 1986. However, global inequalities could become an overwhelming problem if not addressed.

"Today, the world has a lot of tension and stress," Gorbachev said. "Three billion people are not living, but surviving. We cannot allow the world to continue like this. This is a bomb—a delayed action bomb—the roots of terrorism are in these inequalities. If we ignore this it will be suicidal for the human community.

"If information technologies just work for the benefit of developed countries while the rest of the world continues to live in a predeveloped era—this is not the way to go."

Next Page: Gorbachev defends Perestroika.