Research in India Part 3: Ecosystems are the key to nurturing an innovation economy

Innovation is the basic source of wealth creation within an economy and is beneficial, both for companies and for nations, in order to survive and develop in a commercial environment

SD Shibulal January 13, 2017 13:47:06 IST
Research in India Part 3: Ecosystems are the key to nurturing an innovation economy

The topic of research and development in India is an oft-debated one. There are plenty of views suggesting that the country is simply not doing enough to justify its place in the global economy vis-à-vis research or to achieve its own ambitions, particularly in light of the 'Make in India' initiative. The following is the second in a three-part series on research in India. You can read the first and second parts here and here respectively.

Innovation is the basic source of wealth creation within an economy and is beneficial, both for companies and for nations, in order to survive and develop in a commercial environment. An innovation economy effectively transforms knowledge into products, processes and services that jump starts economic growth, creates employment and improves the quality of life of the people. An innovation ecosystem includes a diverse array of participants and resources that contribute to, and are necessary for fostering innovation in an economy. These ecosystems are largely based on some kind of geographical concentration of entrepreneurs, investors, talent and universities — like in the Bay Area in the US.

Generally, the innovation ecosystem has two aspects: The knowledge economy driven by fundamental research, and the commercial economy driven by the marketplace. However, the two economies are linked because the finance needed for a knowledge economy is sourced from the profits of the commercial sector. This also includes the funds for government research and development (R and D) which are derived from tax revenues.

Presently, the quality of infrastructure and ecosystem for innovation in India leaves much to be desired. So when we speak of innovation, we often focus on individuals and attribute it to people rather than the kinds of structures that promote a culture of innovation. Since our problems are multitude, one sector cannot address all of them. To make innovation happen, a suitable innovation ecosystem must meet different conditions. The government has to play a strong role and ensure three things: Funding, facility and flexibility.

Research in India Part 3 Ecosystems are the key to nurturing an innovation economy

Representational image. Wikimedia Commons

The bulk of the spending, especially for basic research, comes from the government, through channels like direct funding of government research facilities, grants to universities and private-sector researchers, contracts for specific projects, and tax incentives. The rationale for a government role in funding this kind of R and D is that without such intervention the private sector may not be interested in investing in basic and translational science and research. They may concentrate only on applied research projects that fetch near term returns. Investment in research usually fetches later, but very impactful returns. For instance, in 1953, researchers like Watson and Crick; Wilkins, Stokes and Wilson; and Franklin and Gosling firmly established that DNA is a double helix with antiparallel nucleotide chains and specific base pairings. These insights gave birth to the new discipline of molecular biology and have led to great advances like genome sequencing. Today biotechnology applications are a booming business, some of which are based on key research findings developed in the 1950s.  

While media and popular folklore may romanticise stories of scientist in shoebox facilities churning out great inventions, basic facilities have to be created for research to flourish. This includes not just physical infrastructure but talented people and better policies. Government support for R and D should be such that there is sufficient capacity to engage in effective research at the desired scale. This depends on the number of qualified scientists, engineers, and other technical workers. A strong interface between research and innovation communities across the country is needed.

The cycle of investment in research and its returns is well documented in history and even read in daily papers, but the problem with basic research is that the returns from a scientific advance seldom accrue to the inventor, more so if the new knowledge can be copied or diffused at low cost. To counter this, the government needs to set up an effective Intellectual Property framework. For example, granting the developers of new ideas strong and long-lasting claims to the economic benefits of their discoveries. Extending and expanding patent rights will also help to strengthen the intellectual property rights regime.

There is a need to create a flexible environment that allows and incentivises collaboration between industry and academia. Research and its application sometimes goes hand in hand and sometimes the impact is felt decades or centuries later- there is no one model. A free flowing exchange of ideas and collaboration will only help improve outcomes for all sides. Here too the government has a role to play. It can find a way for industry and academia to come together to solve a specific problem such that the returns can be licensed back to the industry. The academia should continue to make efforts to get resources and infrastructure necessary for spin off and incubation of technological achievements of research. For example, Pfizer and University of California San Diego have created teams of university and industry scientists that combine the best academic thinking with the drug development expertise of industry to accelerate the development of new drugs for patients.

Closer home, we do have incubators cells in academia like the Center for Innovation, Incubation, and Entrepreneurship (CIIE) – IIM (Indian Institute of Management) Ahmedabad; Society for Innovation and Entrepreneurship (SINE) – IIT (Indian Institute of Technology) Bombay; Cell for Tech Innovation, and Entrepreneurial Training Society (TIETS) – IIT Kharagpur.  – The government and industry could partner with academic institutes to open more such entrepreneurship cells that spark creativity, risk taking, and enthusiasm to find solutions to problems. These cells also facilitate an efficient transition of innovations from research labs to the market. This is a good way to improve job creation and economic activity.

At the community level too, such a flow of ideas needs to be facilitated and incentivised. The White Revolution in India is an example of how innovation when combined with governmental support boosted the economy of the country. Verghese Kurien’s expert research and entrepreneurial skills helped make India’s dairy farming industry self-sufficient.

To avert economic downturn and arrest unemployment, it is imperative that the government be proactive in nurturing and encouraging the development of innovation ecosystems that foster basic research within academia and industry.

The author is Trustee, Infosys Science Foundation

Part 1: Local solutions needed to deal with unique problems
Part 2: Does R&D hold the key to fuelling economic development?

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