“De-nationalizing” the R&D Landscape in India: A Roadmap for the Future

The relationship between science and innovation within R&D has been looked at for decadesby scholars worldwide. Science is seen as very much of a global endeavour as it reflectsknowledge, which flows seamlessly across borders in the form of publications and findings.Innovation, on the other hand, tends to be more geographically limited not only within national boundaries but even within the borders of organizations. In the field of R&D, it is observed that the private sector continues to be a significant contributor in nations that are deemed as global leaders in R&D. In terms of the share of R&D in national R&D expenditure by sector (2018), industry on average globally accounted for about 70% (world average). In India, it was very little at 41%. The Government in India accounted for the bulk of the R&D spending (52%) and Higher Education formed about 7%. Hence, one can say that the public sector spends heavily when compared to the private sector in India. It is observed that a bulk of the Central Government spending on R&D (52%) is funded and carried out by three technology-heavy departments: – the DRDO, the Department of Space and the Department of Atomic Energy. A study was conducted by CTIER along with the Office of the PSA to the Government of India and CII on “Evaluation of Innovation Indicators Excellence Indicators”. According to the study, it was observed that participation in terms of collaborations with industry and international industry was very limited on projects. Among national laboratories, only 37% were engaged in collaborations with industry in India and around 8% were collaborating with industry overseas. With regard to academic collaborations, the median share of projects was about 13.7% for national partnerships with academic institutions whereas the same was less with international academic institutions at 1.2%. Hence marginal industry and academic collaborations led to a situation where research was being performed in silos. In terms of patent output, the study found that filings have slowed over the years for laboratories. The patents granted to the laboratories in the study represented only 8% of the total patents granted within and outside India to residents. Meanwhile, patents filed by laboratories in the study account for around 2% of the total patents filed within and outside India by Indian residents. The study found that non-residents account for a large share of patents filed and granted in the Indian ecosystem. It was noted that out of 5, 54, 818 publications (2015- 2019), the contribution of India’s publication output was approximately 15%. According to a case study conducted in India to understand how the institutional context of an emerging economy shapes innovation, it was observed that private Small & Medium Sized Enterprises (SMEs) face more innovation and knowledge transfer-oriented impediments than large private entities. Moreover, access to financial resources to fund innovation was also a challenge for SMEs. With regard to IPR, the study observed that, as of 2018, out of the 16% of patents that belonged to Indians, a major portion was owned by a select few private entities and Government organizations. SMEs, especially in the pharmaceutical industry, face numerous patent-oriented impediments in the form of – a marginal degree of awareness, lack of substantial revenue from IP and exorbitant legal expenses. The study further noted that approximately 35% of large private entities launch revolutionary technology sourced from in- house research facilities. Out of the large private entity participants in the study, 70% claimed to have an in-house R&D space. However, according to most of them, R&D as an activity was not perceived as essential as most innovations were: sourced from western nations,

developed for market requirements or developed to adhere to international standards such as ISO. The Way Ahead Although there are pro-R&D policies in place backed by the Government of India, the introduction of a policy framework/enabling mechanism that covers the following aspects could play an integral role in inducing proactive participation from the private sector as well as addressing the previously-mentioned challenges, in the nation’s R&D space: –  An “Innovation” Committee could be mandatorily constituted, under the directions of Government regulatory authorities, in private enterprises that focus on industrial products and technology services. The Committee could be responsible for assisting the Board of Directors in evaluating and launching R&D-centric initiatives within the organization, monitoring the organization’s R&D strategy and investment plans, among others.  The appointment of a “Chief R&D Officer (CRDO)” in private entities could be made mandatory. The CRDO would be an experienced executive-level official who would be in charge of leading the R&D initiatives and strategy of an enterprise. The CRDO could be responsible for: – (a) devising and executing far-sighted R&D advancement decisions, (b) analyzing and determining potential market spaces and technologies crucial to the entity’s development, (c) ideating and facilitating capacity/skill-building initiatives for employees in the organization’s R&D vertical, (d) identifying and maintaining constructive alliances with fellow industry stakeholders, research and academic institutions and the Government.  Private entities could be asked to mandatorily disclose information related to their R&D initiatives such as: – R&D expenditure, R&D manpower, and research output in the form of patents, among others. Such disclosure enables the Government in proactively monitoring the entities’ pace of progress in R&D. Moreover, the information so procured could be utilized as a point of reference for future policy- making. Steps could be taken to ensure that the disclosure provision does not negatively impact the organization in terms of market competence. In addition to the above-mentioned provision, well-performing entities that are inadequately investing in R&D for a prolonged time period could be directed to provide reasons for the same.  An online “Unified R&D Endowment (URDE)” medium could be established by the Government, that provides up-to-date and hassle-free access regarding currently available Government funding schemes for the private sector along with their eligibility criteria. The URDE medium could be utilized to accept applications for funding schemes as well. For transparency and accountability purposes, the URDE medium could publish information pertaining to: the amount of financial assistance provided, details of organizations that have received assistance, research outputs etc. in a timely manner.  It is the need of the hour to legally acknowledge the social value of R&D activities (especially in educational institutions and think tanks). A regulatory structure that establishes standards, guiding principles for Industry-Academia Collaborations (IACs) and impact-monitoring and accountability standards/measures could be introduced.  As the Government of India strives to promote the “ AatmaNirbhar Bharat ” initiative, Government financing entities could introduce accessible funding mechanisms that are tailor-made for the requirements of budding domestic SMEs in the nation. This could be achieved through collaborations with multi-sectoral stakeholders (industry

stakeholders/players, private financing entities etc.). Affordable legal services, particularly in the IPR domain, could be provided to startups and budding SMEs by the Government in association with legal experts (think tanks and law firms, for instance). Capacity and awareness-building initiatives on patenting in the form of workshops, training sessions, seminars etc. could be organized as well.

Rohan Girish Raj is a Programme Executive at Ananta Aspen Centre