GS Paper 3
Syllabus: Science and Technology
Source: TH
Context: India’s R&D expenditure-GDP ratio of 0.7% is very low when compared to major economies and is much below the world average of 1.8%.
Main reasons behind India’s low R&D expenditure-GDP ratio:
- Low investment by the corporate sector: While the corporate sector accounts for about 2/3rd of gross domestic expenditure on R&D (GERD) in leading economies, its share in India is just 37%.
- Low investment by MNCs: For example, US-based MNCs spent $9.5 billion (₹649.7 billion) on R&D in India in 2018, which increased to $9.8 billion (₹690.2 billion) in the following year.
Issues with the current system:
- The National Science and Technology Management Information System (NSTMIS) of the DST is the agency that compiles GERD statistics in India.
- The NSTMIS relies on the Department of Scientific and Industrial Research (DSIR) list of recognised R&D units and the database of the Centre For Monitoring Indian Economy Pvt. Ltd. for this purpose.
- It is easier to gather information on R&D from the government sector, the higher education sector and public sector enterprises, but not for the private corporate sector.
Key factors making the official R&D estimates grossly inadequate:
- The DSIR list may not have many of the actual R&D performers since they may not be inclined to register themselves for two reasons:
○ They consider government incentives are not attractive enough
○ Some firms are sensitive about sharing critical information
- Some R&D firms in services such as software find it difficult to meet the requirement of having separate infrastructure for R&D to distinguish it from their usual business.
- Some of the leading Indian enterprises in new technology areas and foreign R&D centres are not covered.
- For example, SigTuple Technologies, which is a leading start-up in India focusing on AI-based HealthTech, is unlisted in both databases.
Way ahead for transforming India’s R&D statistics:
- The NSTMIS should use the patents granted data, in addition to its current method to identify R&D-performing enterprises.
- Annual R&D estimates can be prepared from mandatory disclosures that the enterprises are required to make to the Ministry of Corporate Affairs.
- Technologies can be used like in the case of revamped IT return forms where various sections are interlinked.
- Proper disclosure of information to regulatory agencies.
Insta Links:
