Topic:GS2-govt policies and interventions
- Even though India is the 5th largest economy in the world and on its way to becoming the 3rd largest, it’s contribution towards science and technology and innovation still remains dismal.
- This article will discuss the possible reasons and solutions to address this shortcoming.
Main reasons for this deficit:
- Indian academia and industry failing to ramp up its contribution to the national Research and Development efforts (R&D).
- Manufacturing in key sectors has been hobbled by constraints in fundamental factor markets of land, labour and capital.
- Faulty trade policies.
What steps have been taken to correct it?
- Make in India campaign has garnered some momentum in terms of India’s share of global merchandise exports registering fresh highs.
- Recognising the importance of generating patents and hence there is a strong effort underway to make it easier and faster to file for and obtain patents for inventions.
- Recent bilateral agreements in science and technology, especially with the United States, shows that the government is correctly identifying strategic priorities in this vital sector.
- Acknowledging the fact that Invent in India has to complement Make in India.
What needs to be done to scale up Invent in India?
- The newly established National Research Foundation (NRF) will hopefully address this important issue.
- The institutions that mediate the flow of capital and resources to convert scientific knowledge into technology-based wealth will require drastic changes to become effective and efficient, so that these institutions power India’s economic output to $10 trillion and beyond in the coming decade by delivering on productivity-multiplying R&D across industries.
What should be the parameters to revamp key scientific institutions?
Merit and Quality of human Capital:
- Merit and quality of human capital should be weighted the highest when it comes to staffing and administration of institutions.
- India has to gear up to both retain its premier talent at home, as well as position itself as a home for talent from abroad.
- The remittance-seeking mindset of the License Raj era needs to give way to a value creation approach.
- Many government labs could enter into structured collaborations with universities where appropriate coordination with on-campus science parks could expand their activities into the industry itself.
- The idea should be to bring teaching and research together in a merit-driven admissions system.
- India should have a barbell strategy for funding research, with high convexity, high payoff projects getting their share of funding from a consortium of government agencies and industry.
What is Barbell Strategy?
- The barbell strategy is an investment concept that suggests that the best way to strike a balance between reward and risk is to invest in the two extremes of high-risk and no-risk assets while avoiding middle-of-the-road choices.
- There are two precedents for creating this barbell approach: The New Millennium India Technology Leadership Initiative (NMITLI) programme launched in 2003, and the more recent Design-Linked Incentive (DLI) programme.
- NMITLI made collaboration across industry, academia and national labs as a standard practice.
- DLI envisages underwriting innovation with big payoffs in collaboration with high technology businesses, with the India Semiconductor Mission receiving appropriate funding for semiconductor design.
- NMITLI and DLI can prove to be reliable models for setting the baseline on R&D, which should be oriented towards industry.
- Innovative and entrepreneurial scientists should be encouraged to obtain supplemental funding from industry.
- Global business history has shown how joint efforts by government and industry to fund research have yielded breakout results in areas such as pharmaceuticals, transportation, chemicals and telecommunications.
- Ultimately, bringing industry to the table for such outcomes should be done through the carrot of profit and the stick of competitive pressure.
Rebooting culture and software of Indian Science:
- Alongside the institutional and hardware changes, the culture and software of Indian science too needs a reboot.
- Ultimately the science bureaucrats needs to go out of the box to ensure productive innovations in order to break the status quo.
- Long term outperformance will be dependent on the quality and motivations of the people involved in Indian science.
- A change in its approach is warranted today, as the stakes are high not just for India’s economic progress, but for national security too.