Valery Pshenichny: Tortured, Then Murdered

ByEkK6EZL1H45U3VA1r3Businessman Valery Pshenichny did not kill himself in his cell in a Petersburg remand prison, as the Russian Federal Penitentiary Service has claimed. 

Tortured, Then Murdered
Irina Tumakova
Novaya Gazeta Sankt-Petersburg
April 16, 2018

Valery Pshenichny, a defendant in the case of embezzlement at the Defense Ministry in connection with the building of a submarine at the Admiralty Shipyards in Petersburg, did not die from a lack of medical care. He did not take his own life. He was not tormented by abominable living conditions, something the wardens arrange for other inmates. He was simply tortured and then murdered, and his murderers did not even try to hide their tracks. This was the unambiguous verdict reached by the Petersburg Bureau of Forensic Medical Examiners, thus ruling out the possibility of suicide.

Novaya Gazeta wrote in February about the businessman’s strange death at Petersburg Remand Prison No. 4. Valery Pshenichny stood accused of embezzling money from a Defense Ministry contract for construction of the submarine Varshavyanka. His company, NovIT Pro, was developing a 3D computer model of the submarine for servicing the craft after it was sold. In 2016, Pshenichny, who owns the company, suspected his partner and company director Andrei Petrov had stolen millions in funds from the firm’s accounts and persuaded police to open a criminal investigation. Petrov was arrested. After several months in police custody, Petrov testified the embezzlers were Pshenichny himself and Gleb Yemelchenkov, a deputy head engineer at Admiralty Shipyards. Allegedly, they had colluded and deliberately overstated the cost of the contract. Investigators determined how much the contract should actually be worth, based on their own calculations.

Petrov was released while the new suspects were arrested. Three weeks later, Pshenichny was found hanged in his cell. Before the incident, his cellmates had been removed simultaneously from the cell under various pretexts. The Russian Federal Penitentiary Service insisted Pshenichny had committed suicide, while his loved ones accused prison wardens of not giving him medical care after he had suffered a stroke.

The forensic examination was completed last week. Now we can establish what happened.

Don’t Pay Anyone Anything
Pshenichny shared a cell with three other inmates. At around two in the afternoon on February 5, 2018, two of the inmates were taken to talk to police investigators, while the third was taken to a meeting with his lawyer. CCTV footage shows Pshenichny was removed from the cell fifteen minutes later. He did not leave the remand prison. We do not know how long he was gone from his cell, where he was during this time, what condition he was in when he returned to his cell, and who was with him.  But after four o’clock in the afternoon a guard escorted his cellmate back to the cell and found Pshenichny hanged. An electrical cord torn from a water boiler and the destroyed sneakers of a cellmate lay near his body. Prison wardens explained Pshenichny had tried to slash his wrists with the arch support from the sneakers, but had failed. He then tore the cord from the water boiler, hoping to electrocute himself. Finally, he pulled the lace from his hooded sweatshirt and hanged himself.

A graduate of the Leningrad Electrotechnical Institute, Valery Pshenichny was an engineer. He would hardly have attempted to use a 220-volt current to kill himself. The lace from his hooded sweatshirt was forty centimeters long. It would have been impossible to hang himself with this length of lace. And everyone who knew Pshenichny is unanimous. The last thing this strong, cheerful man used to winning would have done was given up and taken his own life.

“My husband and I were together for forty years, since our first year at the Leningrad Electrotechnical Institute,” says Natalya Pshenichnya. “I’d never met such an intelligent, striking, strong positive person before. I’m not exaggerating. He was confident in himself and the stance he took. He knew he was innocent, and he was not afraid of anything.”

An incitement to suicide investigation was opened. But then rumors flew around the remand prison that all staff members had been made to submit sperm samples for analysis.

Cuts and stab wounds were found on Pshenichny’s body. His spine was broken. Simply put, he was tortured. Forensic experts have identified blunt trauma to the neck and asphyxiation as the causes of death. Translated into Russian, this means Pshenichny was strangled with the forty-centimeter-long lace from his own hood. Tests showed it was not remand prison staff who raped him. Most likely, someone from the outside was sicced on Pshenichny to have his way with him.

None of the businessman’s intimates can imagine what the cause of this stupid brutality could be. However, before his death, Pshenichny managed to pass a note to his wife in which he asked three times not to give money to anyone.

“Don’t pay anyone anything,” he wrote.

A Russian Elon Musk
The work for which, according to investigators, Pshenichny artificially inflated the price, was completely unique. Nobody in the world had done anything like it before. In the future, it could have generated new opportunities not only in shipbuilding, but also for oil and gas companies. NovIT Pro had been negotiating with Gazprom and Rosneft to produce similar designs.

Friends dubbed Pshenichny a Russian Elon Musk. The talk was that he was not only a brilliant engineer but also a maverick genius whose risks paid off sooner or later.

“He arrived in Leningrad to enroll at the institute carrying a tiny suitcase,” Natalya Pshenichnaya continues. “He had nothing. No one helped him, he was a self-made man. At the institute, he was the most talented student in our year. Things came easily for him, but he was a hard worker. Intelligent, cultured, well-read, he could talk with you about any subject. He would immediately pick it up. Sometimes, I would ask him how he knew something. He would laugh and say, ‘It’s obvious.'”

The student with the tiny suitcase eventually became the owner of a major IT company. NovIT Pro occupies two floors in a building on a corner of the Moika River Embankment and Palace Square in downtown Petersburg, and it has worked on defense procurement orders for many years. Staff say that when investigators arrived to search NovIT Pro’s offices in January, they laughed at first. It was clear this was a fly-by-night firm, they said, joking the place had three desks and one and a half diggers. Then they went down to the floor below and were shocked when they saw a large engineering center.


Admiralty Shipyards

One of Pshenichny’s breathtaking ideas was the selfsame 3D digital model of the submarine. He came up with idea back in 2011 after attending the Naval Salon. NovIT Pro had previously worked on orders from the Defense Ministry for seperate units and parts of ships. But nobody had ever produced a virtual model of an entire ship. Technical specs are attached to each part of the computer model, and mechanics can have access to repair documentation and blueprints wherever the ship is deployed. But it was not this design Pshenichny had planned to patent.

As Novaya Gazeta reported, the contract was signed in 2015. But then Pshenichny went even further in his thinking. What if he could make it possible to carry out repairs of the boat remotely as well? After all, no one knows how far from the shipyards where it was built the submarine will be when it needs servicing, and the specialists capable of doing the repairs all work in Petersburg at the Admiralty Shipyards. The idea of mobile repair centers thus arose.

The mobile data center for the Varshavyanka is a room the size of two railway container cars put together. It can be quickly delivered to anywhere the ship is deployed. The technician from the nearest shipyard enters the room and finds himself inside the submarine as it were. He сan produce a cross section of the ship at any point and peer into any compartment of the ship. He communicates in real time with specialists at the Admiralty Shipyards, who see the same picture as he does in the stationary center in Petersburg. This idea had no impact on the cost of the contract. Pshenichny decided to implement it using the funds approved for the contract. He was curious.

Pshenichny was planning to patent the idea for the mobile center, but he did not have the time. On January 16, investigators came to search his company and his home, and he was arrested. All documentation, including the documentation needed to apply for the patent, was confiscated and entered into evidence. It is currently in the hands of investigators.

All You Need Now Is a Grave Two Meters Deep
“When they came to search our home, those men looked at my husband’s suits in the closet and immediately said, ‘Well, you won’t be needing any of that anymore,'” Natalya Pshenichnaya says. “The investigator said that now all he needed was a grave two meters deep.”

Pshenichnaya had suffered a stroke a few years ago. The doctor had told him a second stroke would be his last. Since then, Natalya had been afraid to worry her husband unnecessarily. During the search of their home, his blood pressure jumped to 250 over 140. She begged the investigator to call an ambulance, but he refused. The police asked her only to confirm whether her husband was really in danger of a stroke. Natalya found her husband’s medical records and handed them over to the investigator. Both she and Pshenichny’s lawyer Larisa Fon-Arev say these medical records were not listed in the search inventory. Moreover, during Pschenichny’s custody hearing, the defense asked the court to order house arrest for Pshenichny or release him on his own recognizance, citing the accused man’s  health, but it transpired that the medical records, confiscated during the search, had not been entered into evidence.


The submarine Varshavyanka

It is unclear what happened to Pshenichny at the remand prison. It is clear he was tortured, that is. A wealthy man who was visited by his lawyer nearly every day was tortured. But then he was killed, and his killers did not even bother to hide their tracks, attempting to get off by making up a lie about his suicide.

What did they want from Pshenichny? Perhaps they were trying to extort money from him, because, as we have already mentioned, he wrote to this wife that she should not pay anyone. Maybe they wanted to force Pshenichny to testify, but in that case it is unclear against whom. As Novaya Gazeta has reported, Pshenichny could not have turned on anyone because he was confident the contract was clean, and to this day no new defendants have been named in the embezzlement case.

Gleb Yemelchenkov, the deputy chief engineer at the Admiralty Shipyards, was Pshenichny’s co-defendant in the case. Yemelchenkov had no financial authority and could not have unduly influenced the contract. He was arrested and charged in the case only due to Petrov’s testimony: he and Petrov had fallen out over Yemelchenkov’s wife. Yemelchenkov is still jailed in the remand prison. The term of his detention was extended to May.

Thanks to Julia Galkina et al. for the heads-up. Translated by the Russian Reader

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Uneven and Combined Development

On this bright Saturday evening, when the sun has finally come out in the former capital of All the Russias after a week of nonstop rain, I want to offer you two tales of two completely different modern Russias, situated unhappily side by side, but God only knows for how long and at what cost.

Both stories have their fictional and literary precedents, as is often the case in this overly verbalized country.

The hero of the first tale, Valery Slesarev, will remind you of the characters and real-life heroes and victims in nineteenth-century writer and human rights activist Vladimir Korolenko’s fictional sketches and muckracking newspaper articles, while the nearly unbelievable promises and high-powered wheeler dealers in the second tale will conjure up Ilf and Petrov’s world of con men and grifters during the NEP period. TRR

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Smack Them Upside the Head
Tired of waiting for a promised natural gas tie-in pipeline from local authorities, the Yegorevsk Urban District in the Moscow Region asked Obama for gas
Ekaterina Fomina
Novaya Gazeta
June 5, 2016


Valery Slesarev. Photo by Ekaterina Fomina

After collecting 531 signatures in support of his effort, pensioner Valery Slesarev called the US Embassy and asked a specific question.

“How can I get a hold of Barack Obama?”

The embassy promised him to call him back and make an appointment.

Lots of people in Yegorevsk know Valery Slesarev. First, he has tuned and fixed TV sets his whole life, and that is deemed a vital service. Second, he has an artificial skull.

As a child, Slesarev was involved in Pavel Popovich’s Young Cosmonauts Club. One of the activities at the club was parachute jumping from towers. During one such jump, the carabiner from a pull rope slammed Slesarev hard in the head. A year later, a tumor was discovered in his brain, and it was decided to operate. Popovich himself got involved by asking for help from America, where an artificial bone was grown personally for the sixteen-year-old boy. The doctors told his mother he would not survive, but the bone up and took hold.

As the years passed, it transpired that, along with the bone, the doctors had implanted something Soviet people were not supposed to have: a faith in justice and the strength to fight for it.

Initially, the life of the young cosmonaut with the artificial skull rolled down different tracks than it might have, like in a small town in West Virginia: steady, nothing out of the ordinary.

“Maybe the Lord in fact saved me then. Eighty percent of my group at the Young Cosmonauts Club died in Afghanistan. We were all combat ready, you see, and those boys were sent straight to the front,” he says today.

Slesarev studied to be a radio technician, but went to work as a TV repairman. The celestial expanses no longer appealed to him, and he had enough to do down on earth as it was. He drove from village to village fixing TV sets and occasionally chopping firewood for old women.

In the nineties, the business where Slesarev worked fell apart, and he started a small business of his own, a tire repair shop. He called it Autocupola, and indeed the blue, two-storey building housing his shop is crowned by conical metal cupolas. The cupolas, he explains, are in honor of his artificial skull. He is proud of the black swans, carved from tires, out in front of the shop and a gingerbread boy with a painted mug.

Slesarev lives in amazing house, also topped with cupolas, only they are in the shape of little bulbs. The local council has even hung a sign on the house designating it a cultural landmark.

For a time, then, Slesarev was an amusing local landmark. In 2005, however, the Moscow Region began installing natural gas mains in the villages of Yegorevsk. The mains were quickly installed in all public buildings, but ordinary people, those selfsame old women for whose sake the whole program was undertaken, were left without gas. Slesarev says he simply could not look at old women swinging wood mauls anymore. Thus began his fight.

Vladychino
Only twenty-eight people are officially registered in Vladychino, a village in the Yegorevsk Urban District, but around a hundred people live there permanently, most of them people the natives have contemptuously dubbed “summerfolk.” Slesarev is one of the summerfolk too. He has land there, inherited from forebear, and his grandmother’s house, which he has managed to restore and preserve. The entire village stopped by to admire it.

As in the neighboring villages, people in Vladychino buy natural gas in cylinders. A fifty-liter cylinder, which costs a thousand rubles to refill, lasts a month. Arranging privately to have a gas line connected to your house costs at least 500,000 rubles [approx. 7,000 euros].

A spontaneous assembly of local residents has been taking place on the bench in front of Slesarev’s house. You might say he mobilized them.

Grandma Valentina, Grandpa Nikolai, Kolya, who has no front teeth and wears a leather jacket, Nikolai Alexandrovich, and Tatyana have formed a semi-circle. They occasionally get sidetracked and swat a mosquito. It is the height of the season.

“Please forgive my appearance. I came from the garden,” says Tatyana, apologizing as it were for her apron.

“TV Rain came to film, and we all dressed like peasants,” says Valentina, dangling her rubber-slippered feet by way of proof.

“Why are we appealing to Obama? We hope that, if not Obama, some other president will respond,” says Valentina.

“I’ll tell you why,” says Nikolai Alexandrovich, who steps forward, dressed in builder’s overalls. “He is a winner of the Nobel Peace Price, and he is on his way out of office in any case. Let him do one good deed at the end of his term by getting gas installed for us.”

The locals gossip. The village of Rakhmanovo got gas when an MP from the Moscow Regional Duma and a member of the Yegorevsk Board of Deputies moved there. Actually, according to the paperwork, gas lines have been laid to Vladychino and all the other villages too: 300 million rubles [approx. 4 million euros at current exchange rates] from the regional budget was spent on the program. A presidential commission even came looking for the gas, but they did not find it.  To be hooked up to gas lines under the regional program, a village must have no less than one hundred residents, so Vladychino was lumped together with neighboring Parykino. Now, according to the schedule for gasification, Vladychino and Parykino should get gas lines no later than 2018. But no one believes it will happen, because dates for gasification of the villages have been postponed annually since 2005. Last year, the residents of Vladychino wrote a letter to Putin, but half has many people signed it as did the letter to the US president.

“He’s not going to help. His term is never going to end. He’s president for life,” says Nikolai Alexandrovich.

“God willing he will be president for life!” responds Valentina. “He lifted the country up! As for gas, well, we need it. Maybe he just has not been told about us. Our board of deputies should be the ones helping us, but they don’t do anything for us. This year, they didn’t even spray the bushes for ticks.”

“This writing to Obama thing is all a joke, a way of getting us riled up and forcing us to think,” explained Nikolai Alexandrovich. “But what do you think? Is America Russia’s enemy? I knew you’d say that! I’m not going to try and educate you or persuade you. Who is threatened by Russia? The Americans, however, are already in Estonia. Those are facts, Katya, facts!”

By local standards, Nikolai Alexandrovich is also one of the summerfolk, although he has lived in Vladychino for four years, since retiring. He worked for twenty-six years in security at the Kremlin. Nowadays, he is an elder at Nativity of Christ Church.

“They’ll never unleash a war on us, but they are trying to squeeze us economically on the sly,” concluded Kolya, who worked as a plumber at Slavyanka, Ltd., during the heyday of Yevgenia Vasilyeva, but has now retired.

“That is war,” continues Nikolai Alexandrovich. “Was it necessary to drop the bombs on Japan? This is a continuation, just as today’s Russia is a continuation of Soviet life in many ways. Your colleagues from TV Rain were spooked. They were worried lest we go to jail for what we said. We won’t go to jail: we speak the truth!”

“The mosquitoes have already devoured us,” a bored Valentina chips in.

“It’s time for me to milk the cows,” says Kolya.

“Why was she caterwauling yesterday from lunchtime on? She was probably thirsty?”

“She has been yelling because of the bull. I haven’t been putting the pull in with her. He’s been laid low. I called the vet, and he told me over the phone to give the bull vodka. I gave him vodka. Then he told me to give it sunflower oil. I did it: same damn nonsense! Now he tells me to go and buy lactic acid.”


Slesarev outside his Autocupola tire repair shop. Photo by Ekaterina Fomina

“Sufferings, Trials, and Humiliations”
Since 2005, when Valery Slesarev began his fight to have the villages gasified, he has kept a list entitled “My Sufferings, Trials, and Humiliations.” It includes such entries as “Arrest, searches of homes and shops. Bombing of Autocupola. Arson at Autocupola.”

In 2010, unknown men in masks armed with crowbars broke into his tire shop. They methodically and cold-bloodedly beat up Slesarev and his daughter. A criminal case was opened, of course, but to no avail. The police wrote off the incident as a “workplace fight.”

Slesarev wrote to Vladimir Zhirinovsky that he was being prevented from doing business. Zhirinovsky promised to look into the case. Apparently, he is still looking.

Moscow Region Governor Boris Gromov once visited Yegorevsk. Slesarev was going to the meeting when he was pulled over by traffic cops, allegedly, for driving with dirty license plates. He spent the whole day in the detention center and was released without having to pay any fines.

Governors have come and gone, but the story has not changed. Slesarev had to fight his way into a meeting with current Moscow Region Governor Andrei Vorobyov at the House of Culture. In the auditorium, he was surrounded by police officers in plain clothes.

“When I stood up to ask a question, they made me sit down. They actually grabbed me by the pants and pulled me down, and everyone was laughing,” Slesarev recalls.

Governor Vorobyov noticed the strange man and asked to speak with him personally after the meeting. As Slesarev tells it now, the governor was so outraged that he promised to dismiss the head of the district the very next day. And he did, in fact, dismiss him. Only, at the next elections, Mikhail Lavrov, ex-head of the district, was elected chair of the Yegorevsk Board of Deputies, a position he occupies to this day.

“Vorobyov left, and the bathhouse we guys in the village had built for the gals burnt down. There was a criminal investigation, of course. But they didn’t catch anyone.”

“The Gas Has Come”
This time, it was the head of the Yegorevsk District and his deputies who were meeting with constituents. Slesarev did not know about the meeting, and so we arrive in the village of Yurtsovo a bit late: the event has ended. But we do find Nina Morsh, head of Yurtsovo Area, surrounded by female assistants, next to the Soviet war memorial. Slesarev knows everyone by sight, all the more so because Morsh was previously head of the Yurtsovo Rural Settlement. But late last year, all the municipalities were abolished when when the Yegorevsky District was redesignated as an urban district. The now-abolished Yurtsovo Rural Settlement included thirty-eight villages. Last year, only four of them had gas mains.

Morsh’s assistants immediately cut us off.

“You’re a little late. The head of the district was at the meeting, and he answered everyone’s questions. Residents who wanted to ask questions got definitive answers. You can ask them yourselves.”

Dressed in a suit with a rose on the chest, Morsh drags me along with her.

“Since 2005, a lot of work has been done on gasification,” she tells me, as if she were reading a report. “First, the central village of Yurtsovo and the main municipal institutions, then, in 2010, the entire residential sector.”

She speaks of natural gas affectionately.

“The gas has come,” she says.

The gas has come to Pochinki, Barsuki, Leonovo, and Polbino. And so it will arrive in Vladychino and Parykino, too, Morsh reassures me. The design plans and specifications are already being drafted.

“You cannot jump higher than the budget lets you,” says Morsh by way of explaining why gasification has taken so long. “This has been explained repeatedly to that man, who doesn’t even live in our area. Whatever emotions he may or may not be experiencing, the program has been well implemented. Just look at our governor.”

It is clear as day the village needs gas, but people have been living without it, getting by with cylinders. Some people even stoke wood stoves. Ninety-year-old Grandma Panya, another resident of Vladychino, signed the petition to Obama, but she is afraid of gas.

“That one woman of ours in Moscow, the one who left to be with her lover, was home alone once, but forget to turn off the gas. She died from carbon monoxide poisoning!”

If it had not been for Slesarev, no one would have the heard the voice of the people of Yegorevsk. But that is how his brain operates under his American skull. If the law says people are supposed to have gas piped into their homes, then that is the way it should be, even it means his having to fight hopelessly for it on his lonesome. Slesarev has lived his whole life this way.

Translated by the Russian Reader

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Will Russia Be First to Build Elon Musk’s Hyperloop?
Peter Hobson
The Moscow Times
July 6, 2016

In mid June, Shervin Pishevar, co-founder of Hyperloop One, sat under the high, decorated ceiling of a palace in St. Petersburg.

Men in suits lined the large, rectangular table.

“Eighteen heads of sovereign [wealth] funds and President [Vladimir] Putin. $10 trillion in the room,” Pishevar wrote alongside a photo posted on Facebook. “Then Putin called on me.”

So Pishevar, a burly, bearded Silicon Valley entrepreneur, began to speak. He talked about the Hyperloop trains his company plans to build: Transportation pods levitated by magnets inside an airless tube that could travel at speeds 300 kilometers per hour faster than a passenger aircraft, thanks to the low air resistance. Pods that could whisk goods through Russia from China to Europe in the space of hours, or turn St. Petersburg into a suburb of Moscow.

Putin listened attentively. Then, according to Pishevar, he said, “Hyperloop will fundamentally change the global economy.”

By the time Pishevar left Russia, Hyperloop One had signed its first deal with a foreign government, a partnership with Moscow’s City Hall. It had also been asked by Russia’s transport minister to design a 70-kilometer Hyperloop track in the Russian Far East.

With that kind of support, perhaps the first Hyperloop won’t be built in California, but in Russia.

Dreaming of Innovation

At first sight, all that seems strange. Russia, after all, is suffering its deepest economic crisis for nearly two decades. Much of its infrastructure is hopelessly backward. It is a country in which passengers in slippers shuffle between bunk beds in overnight trains that travel at average speeds of just over 50 kilometers an hour. Freight trains, meanwhile, move at a little over 10 kilometers per hour.

But there are a few things working in Hyperloop’s favor.

First, innovation has once again become a buzzword in government. Officials are, at least in theory, keen to diversify away from the oil and gas industry on which the country currently relies. And they are paranoid that Russia could fall so far behind the technological innovation happening elsewhere that it will never catch up.

That fear has sprouted strategic plans for major infrastructure investment and research into the technology of the future. These plans think big: On the agenda are things like quantum computing, neural interfaces and teleportation. Hyperloop, with its science-fiction-movie tube trains, fits perfectly into that vision.

From Moscow to St. Petersburg in 1.5 Hours

Source: Hyperloop One. View in higher resolution here.

Second, Hyperloop has a powerful Russian investor lobbying its interests, a Dagestani tycoon called Ziyavudin Magomedov.

Tall, handsome and worth $900 million, Magomedov is a true techie. According to Forbes, for his 47th birthday party last year, he hosted a robot-themed ball and gifted each guest a book about Elon Musk, the billionaire inventor who in 2013 launched the Hyperloop concept.

Like Putin, he is emphatically excited about the idea.

“It will kill truck and air transportation at a minimum,” he told Forbes.

Magomedov is also supremely well connected. His investment company, Summa Group, spans businesses from real estate to logistics and has handled orders from state companies worth billions of dollars. He has advised the president and allegedly paid for Putin’s press secretary to honeymoon last year on a super yacht in the Mediterranean. One of Russia’s deputy prime minsters, Arkady Dvorkovich, is an old university friend and, conveniently, oversees the country’s policy on transport, innovation and industry policy, though the two deny any favoritism.

Magomedov invested in Hyperloop One through his $300 million venture capital fund, Caspian VC Partners, and set about bringing it to Russia. Bill Shor, the Russian-speaking American who runs Caspian for him, describes him as “very hands on.”

Magomedov has played the role of Hyperloop One’s deal broker. His Summa Group was a co-signatory on the agreement between Hyperloop One and the Moscow Government, which will create a working group aimed at fitting Hyperloop technology into Moscow’s transport system.

He likely also played a major role in pushing for a Hyperloop to span the 70 kilometers between the Chinese industrial center of Jilin and Zarubino, south of Russia’s Vladivostok, where Summa is investing in port facilities.

Both projects have been billed as revolutionary. In heavily congested Moscow, which is currently ploughing huge sums into expanding its transport infrastructure, Hyperloop One says its technology could potentially “give capital region commuters weeks of their lives back.”

The link with Jilin, meanwhile, would carry 10 million tons of cargo a year, zipping containers to port in minutes, says Russian Transport Minister Maxim Sokolov. He wants Hyperloop One to present a design for the track at an investment forum in Vladivostok in September.

Tapping Into China

The third thing playing in Hyperloop’s favor in Russia is that it could unlock vast amounts of Chinese investment.

The Jilin-Zarubino spur is just the beginning. In the longer term, Hyperloop could create “the heart of the transport infrastructure for the Eurasian landmass,” says Shor. The technology will likely be used for freight before it begins to transport passengers. And the route between China and Europe is one of the world’s busiest trade arteries.

The distance between China’s eastern edge and Central Europe is some 7,000 kilometers. Freight currently navigates that distance by train in around three weeks and by sea in roughly two months. In theory, a Hyperloop could span it in six hours.

Beijing has committed tens of billions of dollars to its “One Belt-One Road” plan to create new infrastructure between it and Europe. Russian authorities have their eyes on some of that money.

“It’s like a tube with an air-hockey table. It’s just a low-pressure tube, with a pod in it that runs on air bearings […] I swear it’s not that hard,” said Elon Musk in 2015. Photo: Patricj T. Fallon / Reuters

Sokolov says he will discuss the Jilin Hyperloop with China’s transport minister at a meeting in August and hopes “we’ll take the next step [in this project] together with our Chinese partners.”

Also, the Russian Direct Investment Fund (RDIF), a $10 billion state-backed investment vehicle, invested in Hyperloop One earlier this year. The amount was “very modest,” according to its chief, Kirill Dmitriev. But the RDIF also happens to run a joint investment fund with China worth $2 billion.

China is already helping to pay for a planned trans-Siberian high-speed rail line that could cost more than $200 billion. Hyperloop’s advocates say their technology be cheaper. According to Sokolov, the Jilin-Zarubino line will cost around 30 billion rubles ($450 million)—almost one-third less than a high-speed rail equivalent.

“We must be serious about this idea,” he insists.

Where’s the Money?

But for all the enthusiasm, few in Russia are prepared to put down real investment just yet.

Hyperloop One is working “very closely” with the Transport Ministry, as well as local governments and “some of the largest Russian corporates,” says Shor. These reportedly include Russian Railways and Gazprom, two giant state corporations. But these partners are contributing expertise and access, not money. All the cash is coming from Hyperloop One and Magomedov’s Summa, which Shor says has “invested quite a bit of resources, financial and otherwise.”

Even Putin, who in St. Petersburg promised support to Hyperloop One, wasn’t talking about financial support, his spokesman later clarified.

The problem is that while the Hyperloop concept is compelling, no one has yet worked out how to build one. Russia seems content to wait for the technology to prove itself with other people’s money.

The Local Contender

It might come as a surprise to discover that one of those working on the technology is Russian. Indeed, it turns out that Russian scientists were on to Hyperloop long before Elon Musk.

A century ago, before it was derailed by World War I, scientists in Siberia began working on a similar scheme, says Sokolov. Now, at St. Petersburg’s University of Transport and Communications, the project has been reborn.

Anatoly Zaitsev is an engineer who was briefly transport minister in the 1990s. At his lab on the Baltic coast, his team of around 20 people have equipment that can levitate transport containers. He says he could “absolutely” build a levitation track to Moscow, 650 kilometers away, if you give him $12-13 billion—significantly less than the cost of high-speed rail.

The only part of Musk’s plan Zaitsev says he hasn’t figured out is how to put his levitating pods in a tube. But that’s the simple part, he insists, “like dressing [the train] in a dinner jacket.”

Zaitsev thinks his technology is more developed than that of his rivals, whose plans remain mostly on paper. Both Shor and Sokolov praise his work. But despite that, Zaitsev is largely ignored by the ministers and local governments now courting Hyperloop One.

The reason why ultimately comes down to money. Hyperloop One has raised more than $100 million to fund research, pilot projects and investor outreach.

Another California company, Hyperloop Transportation Technologies, is also rubbing shoulders with big investors. One of its executives has said it is talking with a Russian private investor and is looking at Hyperloop projects in Russia. Its chief, Dirk Ahlborn, also met Putin in St. Petersburg in June.

Elon Musk proposed the Hyperloop concept in 2013 as a mode of transportation between Los Angeles and San Francisco, California.

These companies can fund relentless global expansion, and they benefit from Silicon Valley’s sheen of success. Russian officials can engage with them at no cost to themselves. No wonder, Zaitsev laughs, that “when a foreigner shows up in Russia at the invitation of a resident billionaire, the music and dances start.”

“The Americans are better at getting money,” he says. “I tip my hat to Musk and his followers who so boldly and aggressively offer the world unfinished technology.” By contrast, Zaitsev has enough money to keep his lab operational, and not much more. If Hyperloop is eventually built, it is unlikely to be Russian-made.

Revolution?

But if Hyperloop really is the future of transport, and Putin jumps on board early, it could be a visionary move.

“Russia has a very good chance [of being the first place to develop Hyperloop],” says Shor. If the government acts quickly on regulation, he says it could happen in the next few years. That could put the country at the forefront of a transport revolution.

On the other hand, the whole thing could be a pipe dream. No one knows if the technology can be made cheaply enough to implement.

Russia, meanwhile, still lacks both money and many basics of a modern transport system, says Mikhail Blinkin, head of the transport institute at Moscow’s Higher School of Economics and an advisor to the Transport Ministry.

Fifteen years discussing high-speed rail has led to a single line between Moscow and St. Petersburg that travels less than 200 kilometers per hour. The country has only 5,000 kilometers of modern expressways, says Blinkin—less than tiny South Korea and not even enough to span Russia from east to west.

The government should focus more on practical improvements to the transport infrastructure and less on visions of Hyperloop tubes criss-crossing the country, says Blinkin. Otherwise, he adds, the officials cheerleading Hyperloop are just the latest versions of Marie Antoinette, the aristocrat who saw French peasants without bread, and supposedly said, “Let them eat cake.”