There continue to be many ill-informed misconceptions about India's innovational capacity.
Some writers and “studies” seek to create the impression that India scores poorly on innovation. The term “innovation” is erroneously used in this country to mean only technological innovation, when there are many forms of innovation — organisational, managerial, financial, and others.
There are cases like the Nano of Tata Motors and the Xylo of Mahindras, both examples of superb multi-dimensional innovation and preceded by a string of earlier innovations—Indica, Indigo, 407 LCV, ACE and HCVs of Tata Motors, including turbo-charged ones for the army, and the Scorpio of Mahindras and the tractors of Punjab Tractors (now bought by Mahindras). Moreover, Mahindras are to launch a hybrid car in 2010-11 and an electric vehicle in 2011-12.
There are numerous other examples in pharmaceuticals, agro-chemicals, and fine and heavy chemicals. In electronics too, there are several examples: the 45 million lines of digital electronic exchanges based on C-Dot technologies worth more than Rs 40,000 crore, the computerised Railway Passenger Reservation System (RPRS) and the monstrous Railway Computerised Freight Operations Information System (RFOIS), done jointly by the railways and CMC. These have resulted in huge productivity improvements in the world’s largest railways. In comparison with RPRS and RFOIS, the real innovation in the IT and ITES industry is trifling. After 20 years of existence, our IT “industry” does not have a single product to show for itself. It has grown in revenues and white-collar labour force almost solely on the basis of wage differentials — not on the basis of productivity increases.
When comparing with other countries, our buying Embraer VIP jets from Brazil should be juxtaposed with Brazil buying from us Cipla’s unique anti-AIDS pharma “cocktail”, a range of Bt-based diagnostic kits, digital electronic telecom switches and solar photo-voltaic energy sources. If we are talking of “technological innovation”, I would put India ahead of both China and Brazil. For an India-China comparison, please see a recent study by the US consulting firm, Zinnov, and Vishnu Saraf’s 2008 book India & China: Comparing the Incomparable.
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There have been, and continue to be, many ill-informed misconceptions in this area. There is the argument that India has been innovative through the reverse engineering route. But we have followed the primary innovation route as well, as C-DAC, Wireless in Local Loop (WLL) of Jhunjhunwala’s IIT-Chennai group, Titan of ONGC and others bear out.
To be sure, we do not have the venture capital firms of the US, and consequently few start-ups. The US also has its MITs and Stanfords for accelerating and diffusing technological innovation. But globally only two countries have been able to do both — the US and Israel. Even here, it is really only the US, because most spawners in Israeli academic institutions are Jews of US origin. Other OECD countries, academia, industry and governments have tried every trick in the book in terms of policies, practices, institutional structures and financial and fiscal incentives to match the US, but all have failed. There is one Cambridge Science Park (CSP) in the UK, one Cadarache in France and a couple of small Fraunhofer (Institute) Science Parks around Munich and Stuttgart. But none of them (except perhaps for CSP) have shown the dynamism and continuous spawning capacity of MIT or Stanford. Why? Numerous studies have led to the conclusion that “there is something cultural in the phenomenon” (see Anotolia Saksenian’s study of Silicon Valley, 2002).
Many of our clusters of small hi-tech companies in Bangalore and Hyderabad have come up with core/supportive higher educational institutions but also been spawned off government R&D labs. IISc in Bangalore, the National Aerospace Lab (two flourishing spawns, NALTEC and NALAR), many major labs of ISRO and DRDO, Osmania University, the Indian Institute of Chemical Technology (four spin-offs), the Centre of Cellular and Molecular Biology, DLRL (six spin-offs feeding our defence and space programmes), Bharat Dynamics Limited (our missile manufacturing company) and the space division of BEL have been the spawning nuclei. We must shake off the copycat syndrome that sees the US alone as the role model. What is our basic objective? To spawn start-ups. Whether the core “spawner” is an academic institution, R&D lab or industrial company will depend on the history and culture of innovation of the country.
Finally, the key ingredient for generating innovation is the government. It should and does fund institutions (of all types) that have a strong R&D agenda and capacity, provide seed capital for start-ups, provide the infrastructure, and be the driver for the formation and sustenance of clusters of hi-tech companies. However, our techno-commercial conditions are very different from those of the US. So we need additional roles for government in achieving innovation, as we demonstrated 40 years ago with the Green Revolution and more recently the White (Milk) Revolution, eg financing lone/small groups of entrepreneurs to innovate, not just up to ‘proof of concept’ but right down the innovation ‘chain’ to the market. We have a host of institutions and schemes in various arms of the ministry of S&T which do just that — Technology Entrepreneurship Programme (TEP), Technology Incubator Programme, Science & Engineering Research Council, Programme Aimed at Technological Self-Reliance, Technology Development Board, New Millennium Science, Technology and Industry Initiative and National Innovation Foundation. At last count, there were around 125 start-up and spin-off companies from the IITs, government labs and companies in healthy operation in Bangalore, Chennai, Hyderabad and Pune. All these diverse government programmes have been designed after detailed study of different countries.
Then, there is the focused funding of pharma, nano-technology, bio-technology (around Rs 200 crore/year each) and NRDC as the nodal commercialiser of some 2,000 technologies from over 200 S&T agencies, labs, IITs and universities, many of which have led to not just product exports but technology exports as well. Moreover, NRDC has been making sustained profits for the last 20 years.
The total annual R&D funding of academic institutions, government labs and industry through the above programmes is around Rs 1,500 crore, and the output has been excellent at around Rs 15,000 crore, with an annual growth rate of around 30 per cent and many international patents. But we have to do much more, principally, grow the scale and scope of these mechanisms and the levels of government funding.
The author is Former Science Adviser to late Prime Minister Indira Gandhi and former Secretary of various scientific departments of the Government of India
