MOSCOW AROUND THE TIME that Apple Computer was making it big in California, Andrey Shtorkh was getting a firsthand look at the Soviet approach to high tech: he guarded the fence keeping scientists inside Sverdlovsk-45, one of the country’s secret scientific cities, deep in the Ural Mountains.

Ostensibly, the cities were closed to guard against spies. Its walls also kept scientists inside, and everybody else in the Soviet Union out. While many people in the country went hungry, the scientific centers were islands of well-being, where store shelves groaned with imported food and other goodies.

Security in these scientific islands was so tight, though, that even children wore badges. Relatives had to apply months in advance for permission to visit. “It was a prison, a closed city in every sense,” recalls Mr. Shtorkh, then a young soldier.

Today, he is the publicist for an improbable new venture. The Russian government, hoping to diversify its economy away from oil, is building the first new scientific city since the collapse of the Soviet Union. Even more improbably, it is modeled, officials say, on Silicon Valley.


EDUARD KORNIYENKO/REUTERS; TOP RIGHT, EUROPEAN PRESSPHOTO AGENCY


President Dmitri A. Medvedev said Russia’s scientific city will promote biomedicine and space.


Russia is hardly the first country to seize on the idea of copying Silicon Valley. In Malaysia, for example, a jungle has been cleared for a computer city called Cyberjaya that is a self-declared effort to imitate the south Bay Area. China has a cluster of hightech in Tianjin, outside Beijing, and France in Sophia Antipolis, near Nice, all created with an infusion of government aid - and all eventually successful in attracting and fostering private business.

Russia’s site, still nameless and near a village outside Moscow, is an attempt to duplicate the vibrancy and entrepreneurial spirit of America’s technology hotbed. Russia’s rich scientific traditions and poor record of converting ideas into marketable products are both undisputed, cited as causes for the Soviet collapse and crippling dependence on mining and petroleum. Not surprisingly, then, its leaders look longingly at Silicon Valley. “The whole country needs some sort of breakthrough,” Viktor F. Vekselberg, the Russian business oligarch appointed co-director of the project, said. “The founding of the innovation city, in form and substance,” he says, “could be a launching pad for the country as a whole.” He calls the city “a test run of business models” to rebuild Russian science for the capitalist era. Once developed, the site is intended to incubate scientific ideas using generous tax holidays and government grants until the start-ups can become profitable companies. Its backers in government and the private sector describe it as an effort to blend the Soviet tradition of forming scientific towns with Western models of encouraging technology ventures around universities. Skeptics see a deeper strain of Russian tradition: trying to catch up with the West by wielding the power of the state. “We should not expect the same mechanisms that work in Silicon Valley to work in Russia,” says Evgeny V. Zaytsev, a co-founder of Helix Ventures, a life sciences venture capital company based in Palo Alto, California, and a member of the advisory board of Am- Bar, the Russian business association in the real Silicon Valley. “The government will be involved, because that is the way it works in Russia.” The new city was conceived by what is called the Commission on Modernization, deep within the Kremlin bureaucracy. The Russian government, though, has a conflicted relationship with entrepreneurs and scientists. There is still a thriving tradition of government crackdowns on private business with capricious enforcement of the tax laws . Russia’s hoped-for Silicon Valley site was chosen for its proximity to another ambitious project, the Skolkovo business school, housed in a futuristic building financed by millions in donations from the oligarchs, including Mr. Vekselberg. While similar ideas have been bandied about for years, this one was approved ? and blessed with $200 million in government money ? within a month of a visit in January to the Massachusetts Institute of Technology by senior Kremlin leaders, including Vladislav Surkov, the powerful deputy director of the presidential administration. Mr. Surkov says the new city will isolate new businesses from the bureaucracy that stifles the Russian economy today. The new town is intended to advance five scientific priorities laid out by President Dmitri A. Medvedev ? communications, biomedicine, space, nuclear power and energy conservation ? and to encourage cross-fertilization among disciplines. Property will not be owned, but rented, and the government will offer grants for scientists who struggle to find private financing. Russia, officials say, will again be defined by the depth of its scientific talent, rather than by its mines and wells. The government has appointed as scientific director a Nobel laureate in physics, Zhores Alferov ? whose discoveries in the 1950s were cited by the Nobel committee as paving the way for cellphones (which the Soviet Union, incidentally, never made). High-tech entrepreneurs who stayed in Russia are more skeptical. Yevgeny Kaspersky, founder of the Kaspersky Lab, an antivirus company, says that he is pulling for the site to succeed but that the government should confine its role to offering tax breaks and infrastructure. “Russia has a lot of talented software engineers but not a lot of successful businesses,” he said. “People still have an iron curtain in their minds.”


By ANDREW E. KRAMER


JAMES HILL FOR THE NEW YORK TIMES
The state is taking a lead role in a scientific city planned near the Skolkovo business school, which has received millions from Russia’s oligarchs.