After enduring overwhelming regulatory and economic changes during the last decade, Russia now appears ready to make strides toward establishing a place in the growth of global technology markets. Although the country will undoubtedly battle business policy challenges for some time, it has nurtured technology talent to the point where many experts suggest the country could begin to resemble such hotbeds of IT development as India and Israel.

Executives from the likes of Sun Microsystems and Intel, along with Russia's leading IT insiders, gathered in San Francisco last week at a forum devoted to examining Russian IT capabilities and declared that recent changes in the country's business climate are reinvigorating domestic technology companies and attracting foreign investment.

"It is a tough part of the world we are working in," said Trevor Gunn, deputy director of BISNIS [Business Information Service for the Newly Independent States], a group at the U.S. Department of Commerce that examines the economy of former the Soviet states. "Some people call it the toughest part of the world to work in, but Russia is back, and back with a vengeance," said Gunn, one of the organizers of the conference, called "Russian IT: Stretching the Limits of Possibility."

In the post-1989 era, since the early stages of the fall of the USSR's Communist regime, Russia has met with a bad rap in terms of the international view of its business practices. Rampant software piracy, ineffective intellectual property protection, and the tendency of companies to hide revenue to avoid what was seen as an overburdensome tax regime have led to a climate in which it has been difficult for foreigners to conduct legitimate, fruitful business operations, according to conference speakers.

Although skeptics still abound, many experts claim that the government, in union with business leaders, has made headway toward modernizing the intellectual property laws and streamlining both the tax code and business regulations concerning foreign investments.

"There is an excellent supply of math and computer science talent in Russia," said Jason Horowitz, program manager for the Russian Engineering Software Systems Group at Sun Microsystems. "But even with all of the talent, it remains a difficult place to work. We have learned that choosing partners carefully is almost a commandment for working in Russia, if you want to use the talent best."

Sun turned to Russia for work on several software development projects almost 10 years ago. The company hoped to take advantage of a population filled with technically strong and creative individuals. Sun's efforts, however, took almost four years to bring to fruition due to numerous complications in the country's business environment.

In the past, the cash-strapped government tended to go after any company making a profit and take what many business people thought to be too great a share of the gains, according to conference speakers. Taxes on business are still considered overburdensome by some, but particularly with technology-driven commerce, the government seems more willing to streamline regulations and create incentives to foster growth.

New laws are currently up for consideration in the State Duma parliamentary body

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