Russia, which has accrued large international reserves from windfall oil revenues, is short of long-term capital to stimulate economic growth, experts said at the St. Petersburg International Economic Forum last week. \"Russia really has a shortfall in long-term domestic capital that will support issues along with foreign capital,\" Renaissance Insurance Group head Boris Jordan said at a roundtable discussion at the forum. Russia has long been seeking to diversify its economy away from a dependence on on oil and gas exports, the largest source of budget revenue. \"It is quite easy to raise capital from everything connected to raw materials, oil, gas production and local monopolies,\" President of the United Shipbuilding Corporation Roman Trotsenko said. \"It is very difficult for companies working on the open market, in a completely competitive environment, to raise capital.\" Poor protection of investors\' rights, corruption, weak rule of law, ineffective corporate governance and Russia\'s image hurt by the jailing of oil tycoon Mikhail Khodorkovsky and the death in custody of Hermitage Capital lawyer Sergei Magnitsky are factors hindering foreign investment in Russia. Russia\'s authorities have recently taken a series of measures to lure foreign investment into the country, including the launch of a $34 billion privatization program, which kicked off with the sale of a 10 percent in state-run VTB Bank, measures to create an international financial center in Moscow and establish a Foreign Direct Investment Fund intended to raise from $60 billion to $90 billion and share risks with foreign investors. Russia is currently beset with large capital outflows, and some $50 billion has left the country in the last seven months alone. Helen Teplitskaia, president of the American-Russian Chamber of Commerce and Industry, said, however, that capital outflow should not be regarded as a negative trend. \"This is in sync with current global economic trends,\" Teplitskaia said. \"If you look at funds like Blackstone and TPG that are making direct investments, not just portfolio investments, none of these funds invests only in their domestic economy. They invest enywhere where returns on investments are good and where upside is also greater than in other economies. Therefore I think it\'s a very positive development for the Russian economy that their business community representatives are investing overseas.\" She said Russia was treated unfairly abroad and that foreign investors tend to dramatize the country\'s investment climate. \"There is a huge bias against Russia in investors\' board rooms and as a result Russian companies, the ones that are publicly traded, are being traded with exponentially lower than their Western peers,\" Teplitskaia said. \"Russia is measured with totally different yardsticks to its peers, including China and India where similar problems exist.\" Khemka also said that there was a perception gap between reality and Russia\'s image abroad. \"I think an interesting comment is this perception of Russia on global markets. I find there is a big gap between perception and reality,\" he said. The head of Renaissance Insurance Group agreed with Khemka and cited Russian Internet search engine Yandex as an example. Yandex held a 17-times oversubscribed Initial Public Offering in May. \"Here you have a great company [Yandex] with fantastic management, a great global profile, one of the biggest competitors in its industry and in the world, and it was being put in the same category as everybody else. That\'s, I think, the image problem. You can actually have great businesses coming out of Russia; Russia has a stigma around it which is that this is not an easy place to invest,\" Jordan said. To attract long-term capital sorely needed by Russia to modernize its economy, the country, first of all, needs to rebrand its image, Teplitskaia told RIA Novosti. \"In order to increase investment flows to Russia, the government and the investor community need to urgently undertake efforts to rebrand Russia,\" she said.