In the recent past, we saw two important dates being observed in India; first, World Intellectual Property Day on April 26 and National Technology Day on May 11. The first date had a global significance given that the World Intellectual Property Organisation had instituted this date in 2000 while the second on a modest note is Indian in spirit. Acknowledging the close link between IPR regimes and technological assertiveness of a nation, one needs to find out where India stands in technology at present, particularly after the changes in the Patents Act that was expected to give a fillip to innovation.
We know that technological learning and catch-up has played a very significant role in India. Traditionally, shop floor technological learning and process revolutions have helped our industrial growth. More recently, India’s engineering skills have got reflected in routine (though skill intensive) tasks in knowledge driven sectors like IT. In the bargain, did we lose out on creativity and cutting-edge research? One explanation put forward is the resource constraint of a developing economy like ours. Over the years, R&D expenditure has gone up in India, but it is still below one per cent of our GDP. However, given the fact that technology has sizeable externalities, is not static and comes with a price tag in most cases, efforts towards innovation are imperative despite disparate resource endowments across nations.
There is little doubt that India has acquired technological sophistication in some sectors. We are, however, far from achieving frontier research capabilities. One needs to think if we can achieve this transition only with a quantum jump in the levels of our R&D expenditures, or whether it can be achieved by maintaining a year-on-year steady growth in our resource allocation towards research. Apparently, there is no clear answer to this.
Technology generation as captured by patent statistics suggest that there has been a steady increase in the number of patents originating in India. According to the latest Annual Report (2008-09) of the IPO, the Council for Scientific and Industrial Research topped the list of Indian patentees. The private sector has contributed significantly towards patenting in pharmaceutical and information technology sectors. However, we do not have a significantly diversified portfolio of patents in India.
Patenting abroad signals demand for technologies and technology intensive products abroad. In terms of share of foreign patents with the USPTO over 2002-06, China with a share of 1.8 per cent stood ahead of India which had only at 0.5 per cent. Both, however lagged far behind South Korea, which had a substantially larger (7.8 per cent) share. This share can improve for India only if it strives for higher technology content in its exports. In turn we need to look at our industrial strategies to encompass innovation incentives and create enough demand for indigenous technologies. It is also crucial that development of high technology sectors centres on growth and diffusion of intellectual human capital. To this end, therefore, India should orient production strategies to ensure not only that skills are exploited, but also that talents are used in a larger measure.