Technology plays a crucial role in a country's development and also in the process of economic restructuring. Rapid economic changes in the past one decade have led to restructuring in various economies of the world. This has compelled policymakers to look afresh into their technology policies. In a highly competitive world market, there is need for continuous innovation. Therefore, the policies followed in the area of technology development and transfer have a lot in determining the fate of a country's firms and its products in the world market.
This book looks into issues of technology transfer, human resource development and economic restructuring in four countries viz Malaysia, Singapore, Thailand and India, both at the macro and micro levels. Since these issues are linked to broad economic policies and infrastructure availability, the authors also discuss past and present economic policies and the investment climate in these countries in great detail.
They argue that technology transfer is done in stages like negotiating, setting up, starting up and sustained operations. And any proper transfer should include assimilation, adaptation and transmission of complete knowledge related to all these stages.
Multinational corporations do play a major role in transfer of technology, even if their main objective is seeking markets, suppliers and profits. The crucial question is the capability and extent of human beings to receive, assimilate and absorb new technology. In addition, a clear articulation of a long-term vision like that in Singapore and Malaysia is needed to formulate short-term and long-term targets.
A country must identify areas in which it would like new technology to come. This would depend on the development stage of the given sector, availability of skills, economies of scale in terms of export and R&D capabilities. Interestingly, the book shows that availability of market or cheap labour is not always a key attraction for foreign investors. Other factors that can attract foreign investment and technology transfer are proper infrastructure, encouraging government policies and the capacity of the recipient country to absorb technology.
Malaysia has followed a liberal technology policy with limited controls. In Singapore, special incentives and encouragement have been given to firms to upgrade technology on a regular basis. The economy of Thailand is growing, but it has no planned policy for development, assimilation and upgradation of technology. This has resulted in shortages of skilled and technical personnel in Thailand.
Spending on R&D as a percentage of GDP in 1990 in India was almost the same as in Singapore. Compared to Indonesia, Malaysia and Thailand, it was much more. But the difference was that in India, government agencies and public sector companies accounted for 87 per cent of the total money spent. Of 87 per cent, 56 per cent was on defence and space research and atomic energy. The 1993 policy statement envisages that by the year 2000, expenditure on R&D would reach 2 per cent of GDP against 0.9 per cent in 1993.
On the basis of four macro country studies as well as four micro studies of Indian public and private firms, the authors have come out with certain policy recommendations. These include: opening up of the economy, export-orientation, privatisation, financial sector reforms including convertibility, public service reforms, improvement of infrastructure etc. There is nothing new in these recommendations. All those who favour liberal economic policies have been talking about them. But the merit of this book is that it has reiterated the need for these policies from a different angle. It shows that how inward-looking economic policies of import substitution have harmed technological development in India.
It says that before 1991, the government had not really played a facilitative role in foreign collaborations and technology transfer. In fact, the thrust was on exercising control. In many instances, foreign collaboration was actually discouraged.
On the whole, a good book. But there is a minor problem -- it has dealt more with economic policies and less with technology policies and related human resource issues. The reason perhaps could be to show the influence of economic philosophy in all areas of policy-making including technology.
Economic Restructuring, Technology Transfer and HRD
B R Virmani& Kala Rao Response Books/ Sage Publications Rs 395/288 pages
