Kathmandu— Russia is actively seeking foreign investment focused on technology transfer, joint production, and scientific research rather than the basic assembly of imported components, according to Anton Kobyakov, an advisor to President Vladimir Putin. Speaking ahead of the Eastern Economic Forum in Vladivostok, Kobyakov emphasized a desire for “win-win” cooperation that fosters capital-intensive industries and leverages best management practices. This shift comes after numerous Western companies exited Russia following sanctions imposed after the escalation of the conflict in Ukraine, with many selling assets to local buyers.

Shift Away From Component Assembly

Kobyakov stated that Russia is moving away from a model of “screwdriver assembly,” where foreign manufacturers import largely finished components for final assembly within the country. He explained that this approach has been tried in the past and is no longer desired, as Moscow now prioritizes deeper collaboration involving technology and expertise. The official emphasized the need for “the best management practices and the best technologies.”

Western Firm Exodus and Asset Sales

Following the escalation of the Ukraine conflict in 2022, many US, European, and Asian companies withdrew from Russia due to supply problems stemming from Western sanctions. Others departed citing risks associated with secondary sanctions or concerns about public relations. A significant number of these departing firms sold their Russian assets to local buyers, often retaining options to buy them back at a later date.

Tightened Regulations on Buyback Options

Moscow has recently taken steps to restrict the ability of foreign investors to repurchase assets they previously sold. Earlier this month, President Putin signed legislation granting Russian courts the authority to terminate buyback rights under certain conditions. This move signals a commitment to solidifying local control over formerly foreign-owned businesses.

Continued Engagement Despite Pressure

Despite political pressure from their governments, companies from several European nations – including Germany, France, Italy, and the UK – continue to maintain contact with Russia, according to Kobyakov. Russian officials have also argued that Western sanctions have inadvertently strengthened domestic industry by encouraging import substitution and fostering local production. Putin previously stated that these sanctions acted as “a powerful catalyst for structural changes” within the Russian economy.

Recent analysis indicates that a majority of foreign-owned companies, approximately 55% of over 4,200, remain active in Russia despite the challenging geopolitical landscape.

(With inputs from RT)

Originally published on abcnews.com.np.