* Entrepreneurs seek PM Putin's help in entering EU markets
* President Medvedev wants businesses to innovate
* Weak demand for innovation at home
(Refiles to fix typo in 'businessman', first paragraph)
By Gleb Bryanski
LAPPEENRANTA, Finland, May 27 (Reuters) - When Russian businessman Dmitry Svetlov opened a joint venture producing antiseptics in 1994, it was a St Petersburg official called Vladimir Putin who signed the permit.
Sixteen years on, he wants Putin, now prime minister, to help him crack the European market. At the first EU-Russia Innovation Forum, held this week in a sleepy Finnish town near the Russian border, Svetlov lamented the difficulty for Russian entrepreneurs of penetrating foreign markets with innovative products -- something President Dmitry Medvedev has sought to encourage.
"We would like to sell our products here. We are tired of middlemen who simply want to get hold of our research," said Svetlov, deserted by Finnish partners after the 1998 rouble devaluation and now sole owner of the Soft Protector venture.
"We (Russians) are viewed in the West as raw material suppliers. It is very difficult to enter the market with a ready-made product," he said.
Medvedev wants Russian businesses to innovate as part of his drive to make the economy less dependent on natural resources like oil and gas, but his critics say innovation should be driven by demand and not by orders or budget handouts.
Medvedev's chief of staff Sergei Naryshkin said in an article published this week the country was becoming dangerously dependent on foreign innovation ideas, posing the biggest threat to national economic security.
Domestic demand for innovative products is wrecked by cheap imports, while entry barriers in foreign markets are too high for a small company like Svetlov's, operating in a country which is not even a member of the World Trade Organisation.
ENTER THE MARKET
Russia is already spending a fortune to address the supply side of innovation through a giant state venture fund, Rusnano, tasked with financing innovative businesses and headed by 1990s privatisation architect Anatoly Chubais.
The country has also announced a plan to build Russia's answer to California's Silicon Valley outside Moscow, where officials promise to create a special zone for innovative businesses without red tape and corruption.
However, Putin himself complained recently that the bulk of state-sponsored research projects were not even formally required to result in product patents. "What kind of R&D projects are these?" he fumed at a government meeting.
The Russian economy is dominated by a small number of giant holdings, controlled by either the state or tycoons, which are able to deal with bureaucracy and corruption but generate neither innovative ideas nor demand for innovative products.
Putin, keen to bring Russia back on the path to growth, is negotiating global deals to sell Russian energy resources, nuclear reactors or weapons, but helping small businesses to carve their niche in competitive markets will be more difficult. "We are looking for a partner who can help us enter the market and we are ready to share the profit because we know we are going to get it," said Valery Saxon, CEO of Polyinform, a company which cleans up oil spills using biotechnology.
TOO BUSY TO RESPOND
Saxon says his enterprise survived the turmoil of the 1990s, when similar high-tech firms with rights to Soviet-era technology had collapsed, because it offered services rather then products that can be copied.
The company is now working on remote diagnostics of oil pipelines to prevent spills, and plans to install its device on remotely controlled submersibles to detect faults in deep-sea installations.
"We wrote to BP to tell them about our research but they are probably too busy to respond right now," Saxon said in reference to the oil leak in the Gulf of Mexico. "It (the leak) was the result of poor diagnostics."
Vsevolod Opanasenko, CEO of Russian supercomputers maker T-Platforms, has recently struck a deal to supply coolers for a data centre to be built in Finland. He said 80 percent of the market for supercomputers is controlled by U.S. companies.
"This is a very competitive market and no one is welcoming us here," Opanasenko said. His vision is to conquer 3-5 percent of the supercomputers market in three to five years, up from a current stake of less than one percent. (Editing by Mark Trevelyan)