Research and Development in India: Status, Challenges and Recommendations – Explained, pointwise

Introduction

According to UNESCO’s data, the global expenditure on Research and Development (R&D) has crossed US $1.7 trillion. This signifies the importance of R&D in modern economies. Countries are now placing extensive focus on their R&D programs in order to gain a competitive edge in the fast changing technology driven world.

India too wants to leverage this domain but experts have expressed caution over the meagre allocations towards the sector. It is significantly behind its global peers and hence may lose a substantial share of the innovation pie in the long run. This warrants an increase in R&D expenditure and other supportive steps that would be discussed in the article.

What is the current status of spending on Research and Development?

The Gross domestic expenditure on R&D (GERD) as the percentage of gross domestic product (GDP) is around 0.7%. The percentage expenditure for the last couple of years has shown a downward trend.

According to a report (2020) prepared by the Department of Science and Technology (DST); of the funding allocated to R&D in 2017-18, 61.4% of the amount went to DRDO (31.6%), Departments of Space (19%) and Atomic Energy (10.8%) together.  Approximately 37% was allocated to the general R&D agencies like the ICAR, CSIR, DST, DBT, ICMR etc. while only 0.9% was allocated to R&D in electronics, IT and renewable energy.

The Government has focused on two things in the Budget 2022-23:

First, defense R&D will be opened for industry, start-ups, and academia with 25% of the defense budget earmarked for such activities.

Second, identification of sunrise opportunities in areas like artificial intelligence, geospatial systems and drones, semiconductors, space, genomics and pharmaceuticals, green energy, and clean mobility systems. 

How does India perform in comparison to other countries?

India is a low spender (only 0.66% of the GDP) in comparison to the developed countries and emerging economic powers of East Asia. In fact, India’s expenditure on R&D is lower than Low and Middle Income Countries.

In most of the developed capitalist countries, defense-related R&D is undertaken by the private sector. In India, this expenditure is mostly borne by public funding.

The magnitude and quantum of Joint Public-Private research projects is much higher in developed countries in comparison to India.

Source: Indian Express

What is the need to focus on R&D?

Productivity and Economic Growth: Technology is the main driver of growth in today’s digital economies. R&D helps in development of new technologies, or improving the efficiency of existing processes (like enhancing resource use efficiency). Enhancing spending in R&D would improve research outcomes and contribute to economic growth.

Low Cost Indigenous solutions: R&D is desired in order to create tailor made solutions for the Indian population; such solutions that are cost effective and easily accessible to the poor sections like the Jaipur Foot.

Improve Learning Outcomes: The best teaching and learning process at the higher education level occurs in environments where there is a strong culture of research and knowledge creation. This is testified from the experience of the world’s best universities like the Harvard, Stanford, Oxford etc.

Reducing Imports: India spends considerable money for importing high end technologies from countries like the U.S, South Korea etc. which raises the import bill and increases fiscal deficit. 

Tackling Emergencies: The Covid 19 pandemic was duly tackled by India as it already had a strong base of low cost vaccine manufacturing. This enabled it to partner with countries and companies for arranging vaccinations for the Indian population. A case in point is creation of Covishield vaccine by the Serum Institute in partnership with Oxford University and Astrazeneca company. In addition, Covaxin was developed indigenously in India through the partnership of ICMR and National Institute of Virology with Bharat Biotech, a private sector corporation.

National Security: Relying on foreign countries for domestic R&D needs increases vulnerability of modern digital economies to cyber attacks and espionage. Experts have raised caution against the use of semiconductor chips imported from China. Further India is still one of the largest defense importers of the world as per data of Stockholm International Peace Research Institute.

Climate Change: The Sixth Report of IPCC has cautioned the world towards the approaching climate change. This warrants creating eco friendly technologies to reduce GHG emissions like building low cost solar panels, EVs, lithium batteries etc.

What steps have been taken by the Government to boost R&D?

National Research Foundation: The National Education Policy (NEP) 2020 suggested the establishment of a National Research Foundation (NRF). The aim is to fund competitive, peer-reviewed grant proposals from the universities, colleges, and institutions of higher learning.

IMPRINT initiative: IMPacting Research, INnovation and Technology(IMPRINT) scheme is a pan-IIT and IISc joint collaboration. The scheme was launched in 2015. It aims to provide solutions to the most relevant engineering challenges by translating knowledge into viable technology in 10 selected technology domains.

Atal Tinkering Labs: It is an initiative of the Niti Aayog under Atal Innovation Mission. It aims to foster curiosity, creativity and imagination in young minds; and inculcate skills such as design mindset, computational thinking, adaptive learning etc. 

IPR Laws: The WTO Agreement on Trade-Related Aspects of Intellectual Property Rights (TRIPS) is the most comprehensive multilateral agreement on intellectual property (IP). India is a signatory to TRIPS and has enacted its domestic IPR laws to foster IPR creation and curtail its violation.

What are the impediments faced by the R&D sector?

Low Funding: The funding is less than 1% of the GDP. Further there are no extra provisions for R&D in the sunrise sectors.

Delay in Disbursal: The finance minister in her budget speech of 2021 proposed an allocation of Rs 50,000 crore to NRF over the next five years. However in the actual budget, no such provision was made. 

High Dependence on Grants: Many universities depend on the DST, DBT, ICMR and CSIR under their extramural support system. This dependency creates a situation where quality of research at doctoral level gets hampered when less funding is provided to the public institutions.  

Lack of Skilled Personnel: At present, there is a lack of adequate expertise in many emerging areas. Further the best talent of our country migrate to foreign countries as they don’t get the requisite ecosystem for doing good quality research resulting in brain drain. 

IPR violation: This acts as a very big impediment to create something unique and innovative. Further poor IPR compliance discourages foreign investment flow into the field of R&D.

Outdated Curriculum and Pedagogy: The curriculum in many universities is still focused on rote learning and oriented to getting jobs only. There is less emphasis on R&D due to which many universities are unable to duly utilize the research grant provided to them. 

Fiscal Deficit: The country witnessed a deficit of 9.3% in 2020-21 primarily due to the Covid 19 impact. Such a high deficit impedes higher allocation towards the R&D sector as main focus is placed on reducing the fiscal deficit.

Poor Private Sector Participation: Private sector contributes 37% of the total R&D expenditure in the nation. It is way less than the average 68% expenditure by private players in developed countries.

What steps can be be taken to boost R&D?

First, the budgetary allocation towards R&D should be enhanced. Economic Survey 2020-21 suggested that the country needs to increase its GERD from around 0.7% to over 2% of its GDP.

With increased allocations, joint R&D projects between public institutions and start-ups/industries can also be supported.

Second, the country should focus on proper implementation of schemes like Make in India and Atma Nirbhar Bharat. Higher spending in R&D by the private sector will happen as the manufacturing sector expands in the country.

Third, the amount of Rs 50,000 crore committed to establish NRF could be immediately used to plug the deficits in the grants provided to the autonomous universities and Institutions by CSIR, DST and other agencies.

Fourth, a virtual platform that will hold all the information on the projects granted with public funding could be developed for better information sharing.

Fifth, in the next five years, around 5,000 students/scientists need to be trained at the doctoral and postdoctoral level in the best laboratories of the world using India’s soft power. Simultaneously, post-doctoral work in India should be encouraged by providing better remuneration to the young scientists.

Sixth, the National IPR policy of 2016 should be duly adhered in order to gain investor confidence and attract more investment in R&D.

Seventh, the Government should promote Government-Industry-Academia partnership to support the R&D Ecosystem in India. The development of Covaxin is an excellent example and the learning experience can be transferred to other sectors like green technologies, defense and electronics manufacturing etc.

Conclusion

To move from stagnation in R&D to a more dynamic ecosystem would require action on many fronts including greater allocation of funds. Science and technology departments will have to work out how to fast-track decision-making, information sharing, and allow investigators more flexibility in utilizing the funds. This would be the desired path to breed a culture of curiosity and inquisitiveness in the country.