**3. Status and known tools of high-tech clusters in Russia**

Since 2012, two main trends in the development of clusters have been observed in the Russian Federation. The first is centralized project support from the Ministry of Economic Development of Russia, aimed at forming territorial innovation clusters in each region. Moreover, second, the Ministry of Industry and Trade of Russia provides industrial clusters with software and industrial support [9].

Nevertheless, innovative activity in innovative industries has steadily decreased: from 17.8% in 2017 to 15.1% in 2019. Other negative trends in 2017–2019 were decreased R&D activity from 46.6 to 35.6% in the pharmaceutical industry and from 29.4% to 21.5% in the production of medical devices. However, in recent years, the pandemic has substantially boosted innovation in these areas [11].

Nevertheless, at the same time, in industrial clusters, the mass form of production prevails in the current times, which is contrasted by the continuous production in innovative clusters of a limited range of products at highly specialized jobs. Therefore, mass production in Russia stayed as the long-term strategy for economic development.

As a result, automobiles, tractors, and other specialized vehicles were produced in colossal numbers; agricultural machinery reached hundreds of thousandths of sales per year. The fabrication of these products is usually carried out in unique factories or special workshops oriented toward mass production in industrial clusters. However, innovative products had different results since the population had the lowest possible demand for innovative local products and used well-established analogs from abroad.

Russia lags behind the world leaders in the development of clusters. However, this can be justified because over 75% of innovation clusters were launched after 2012. Therefore, they are still in the initial stage of formation or development, which implies the absence of progressive achievements in the context of innovative leadership or global competitiveness [11].

According to domestic experts, since 2012, when the Government of the Russian Federation announced the implementation of the clustering policy as part of its strategy for innovative development, the policy has yielded significant results only by 2020 in some regions of Russia. It is possible to note that the Republic of Tatarstan has high costs for technological innovations and product innovation activities, as well as the Kaluga region with expressive macroeconomic indicators, where clusters were formed and developed based on the existing powerful production complex. Alternatively, the Smolensk Linen Cluster was created with the participation of Vyazemsky Machine-Building Plant LLC, which reduced material and energy costs because of its innovations. The auxiliary work of this complex made it possible to create a complete production chain with the potential for further development and expansion of membership in a full-fledged cluster [9].

Moscow retains its leading position regarding the degree of innovation and development of the constituent entities of the Russian Federation in 2018/2019 when it has the 32nd position in the technological leadership table from WIPO [10]. This region continues to demonstrate the highest economic, educational, and digital development levels. IT leadership is also seen as the key to its success. There is a colossal potential for digitalization and expressive educational potential of the population in the capital. The manufacturability of the personnel ensures the high innovative activity of organizations, which brings confident costs for technological innovation and prospective confidence in the export of knowledge. The regulatory framework for innovation policy with stable organizational support assists the small innovative business of Moscow with the city's participation in the federal scientific, technical, and innovation

## *Policies for Improving the Efficiency of Innovative Clustering in an Emerging Market DOI: http://dx.doi.org/10.5772/intechopen.112150*

policy [6]. The economic, technological, and innovative achievements of this policy are presented in **Table 3**.

Currently, only St. Petersburg can be perceived as the closest competitor of Moscow. However, the region lags by at least 30 percent in terms of overall digital capacity. These two clusters demonstrate the adequate development of all the advantages of innovation-territorial clusters: Holistic production chains are being created, targeted scientific developments are being conducted, and working talents are being cultivated in the masses. The final stage of the cyclical development of these regions involves the expected minimization of production costs and an increase in production profits. St. Petersburg, just like its competitor, has a confident educational potential of the population, a stable reserve of educational personnel, and a colossal innovative activity of organizations based on the active participation of the cluster in the federal scientific and technical policy [6]. However, as in Moscow, the minimum


### **Table 3.**

*Aggregated innovation indices of Moscow.*

effectiveness of innovation activity and limited costs for science and innovation from the state budget are present, as shown in **Table 4**.

Still, St. Petersburg and Moscow retain leadership in export activities. However, the northern capital has many foreign students who have achieved more impressive results in technology exports and foreign patents for inventions.

St. Petersburg, the Republic of Tatarstan, the Tomsk and Nizhny Novgorod regions, the Chuvash Republic, Moscow, and the Republic of Mordovia confidently retain leading positions in innovation. Furthermore, the ratings of the Russian Cluster Observatory demonstrate that the Republic of Tatarstan has a rich educational potential for the population and substantive costs for technological innovation. In addition, this region surprises by the absolute security of the regulatory framework and the excellent organizational support for innovation policy [6]. However, the effectiveness of innovation and scientific research is at most the levels of other leading clusters in Russia, as shown in **Table 5**.


### **Table 4**

*Aggregated innovation indices of St. Petersburg.*


### **Table 5.**

*Aggregated innovation indices of the Republic of Tatarstan.*

Russian use of the cluster approach in regional development is problematic because of its necessity to constantly balance the complexity and rigidity of regional control and maximize the synergy of all the included institutions.

Before the progressive development of clusters tried to optimize domestic enterprises' position inside the production value chain, but it only contributed to an increase in the processing of extracted raw materials, import substitution, and an increase in the localization of assembly plants. It also increased the nonprice competitiveness of domestic goods and services and strengthened partnerships between government agencies and private entrepreneurs in various regions of the Russian Federation. Only now, after achieving limited results, the government focused more on the original and locally produced innovative outputs.

Under growth conditions, it is possible to form miniature clusters of progress or areas of lesser decline even within the limitations of a spontaneous economic decline. This is another positive aspect of cluster policy—structural resistance to the decline in the quality of the world economy caused by disruptive political events. Because of that, for many years, raw material enterprises have been steadily forming the dominant clusters' role, accounting for a significant part of the Russian GDP [6].

Therefore, this localized economy is a reliable and safe source of accumulated horizontal budgets for implementing other innovative cluster policies. With the successful operation of the cluster, quantitative and qualitative aspects contribute to the effective development of organizations in other areas of scientific and industrial activity. After achieving impressive results in industrial clustering, Russia can afford to use stable capital to develop commodity-oriented and innovation-based clusters, which could serve as a driving force behind the further successful technological development of the country [6].

The possibility of obtaining the lowest unit cost of production compared to other industries in the same region confirms the objective advantage of forming development clusters, which creates a favorable situation for Russia in the domestic and foreign markets. Support for cluster development is currently a legitimate priority of the state policy for the country's socioeconomic development. The foreign practice has also proven that forming and developing innovative clusters is an effective mechanism for attracting local and foreign direct investments. This trend has contributed to the foreign economic integration of Russia with China and the accumulation of infrastructure and human resources in the state. Such and other activities allow the construction of a network of competitive suppliers and service organizations to ensure that business needs are adequately considered within the framework of regional and global planning mechanisms. Thus, the increase in labor productivity, the formation of new companies, and the creation of new jobs should now be heavily encouraged.

Presently, most of the constituent entities of the Russian Federation are strengthening their positions in the world market and participating in the international exchange of information. As a result, more than 80% of regions increased their export activity, including the export of noncommodity goods, and more than 60% noted an improvement in the export of services and innovative products at the time of 2021. At the same time, more than 90% of the subjects of the Russian Federation increased the export of technologies, three-quarters of the subjects began to export educational services actively, and two-thirds of the subjects began to apply for patents abroad [6]. However, their absolute numbers could be higher for a country of its scale.

As world practice shows, one of the platforms for innovation clusters is the system that encourages operational interaction with jurisdictions and state-owned enterprises. Since Russia already has created some of the required government and regional bodies, it could be developed even further, albeit with specific significant changes. With synergies from all institutions, the development of clusters could gradually open opportunities to achieve continuous optimization of domestic enterprises in the production value chain and increase the localization of assembly lines. In addition to these benefits, improvements in domestic goods and nonprice competitive service levels and strengthening public-private partnerships can be obtained.

Based on the Russian innovation policy by 2022, the fundamental problems are the overall low demand for innovation and the structural inefficiency of the Russian economy—a tendency to purchase finished equipment abroad, which does not contribute to introducing new developments. On average, for pilot innovation clusters, increasing the level of the leading macroeconomic indicators is critical. Neither the private nor the public sector paid due attention to innovation spending because the level of corporate innovation activity is significantly lower than the indicators of the leading countries in the same field. And the costs of technological innovation do not shine with high performance [10].

### *Policies for Improving the Efficiency of Innovative Clustering in an Emerging Market DOI: http://dx.doi.org/10.5772/intechopen.112150*

However, the potential of digitalization, the staff of science, and the effectiveness of scientific research are at a moderate level. When reviewing averages, the previously described problem with insufficient funding for R&D and a general deficit in budget spending on science and innovation, which provokes lower results in innovative activity, is once again apparent. The export of goods and services and knowledge export have good indicators, but the share of innovative products in these batches needs to meet expectations.

The described trends dictate the need to streamline the current innovation policy, shifting the focus from increasing the total amount of support to using flexible and experimental approaches to solving critical issues of innovation development. The current regulatory framework for innovation policy must provide the means by the organizational state strategy [6].

The taken averages of the leading indicators for the most pivotal and successful clusters included in **Table 6** suggest that the state government's goals, missions, and strategies could be more realistic.


### **Table 6.**

*Average values of innovative and other work of pilot clusters.*

According to the Global Innovation Index 2020, Russia ranks 47th out of 131 countries in innovative development, only two percentage points higher than in 2015. Russia's cluster development indicators are low compared to the leading countries: 95th in the world, the concentration of clusters barely matters—0.3, and the overall GII score is 3.4 out of 7.

However, in the last GII-2021 reports, Russia has risen by two more positions over the years, taking 45th place out of 132 countries. Over the 5 years, the scoring practices were changed in the country composition analysis; ranking methodologies were adjusted, multiple indicator scores were changed, missing values in the data were calculated, and so on. In contrast to these alterations, Russia's position was stable [12].

A positive observation here is that increasing the efficiency in all areas of scientific, innovative, and creative activity has narrowed the gap between the leading countries in innovation [12]. In a table of 132 countries, Russia ranked 45th in the report (between Vietnam and India). At the same time, Russia occupies high positions in various GII indicators, specifically, higher education development (14th), trade, competition, and market size (17th), knowledge production (26th), research and development (33rd), information and communication technology (36th), and Internet ideas (47th) [12].

At the same time, the indicators of the Russian Federation are significantly lower in some respects. These include environmental sustainability (101st), regulatory environment (92nd), innovative communications (88th), and creative goods and services (81st) [12]. All of the rankings that are mentioned can be found in **Table 7**.

Thus, it is necessary to note the negative factors in the practice of the current innovation strategy, which are actively associated with the immaturity of the framework conditions for innovation. Weak institutional infrastructure, underdevelopment, the backwardness of the legislative framework in this area, and a low institutional investment activity illustrate the limited state for innovations [12].

In the current situation, only direct financing and tax incentives are considered state support, which, according to critics, reduces the incentive for firms to innovate and improve. The proof of this position is the inefficiency of the Skolkovo project. Due to the lack of a commercial impulse for independent survival, the experimental potential of the company is reduced, which minimizes the innovative activity of the entire region [7].


### **Table 7.**

*Main ratings and indicators of economic and innovation in Russia, 2021.*

### *Policies for Improving the Efficiency of Innovative Clustering in an Emerging Market DOI: http://dx.doi.org/10.5772/intechopen.112150*

These shortcomings are manifested in the formation of uneven clusters, which exacerbates the fragmentation of the socioeconomic development of the territory of the Russian Federation. Also, administrative efficiency still needs to be improved and is a fundamental shortcoming of Russia's competitiveness.

Just as there is no country in the world with a very high level of corruption and very competitive power, there is no country with a low level of corruption and low competitiveness. The main factors hindering national competitiveness are the inefficiency of the financial and banking sector and the inequality of institutions [12].

Also, one of the critical constraints to doing business successfully can be high levels of corruption, which is highly correlated with black market activity and overregulation. Of course, 2 years after the devastating COVID-19 pandemic, the Corruption Perceptions Index (CPI) still shows a flat rate worldwide. Despite promises on paper, 180 countries have yet to progress in fighting corruption over the past decade. Moreover, one of these countries is Russia, which scores 29 out of 100, where 100 is equivalent to a state administration that is clean of corruption [14].

In addition, significant shortcomings of the innovation policy of the Russian Federation are administrative barriers to doing business, insufficient protection of property rights, high tax rates, demanding access to financial resources, inflation, and shortcomings of the current tax system.
