India produces the highest number of science, technology, engineering, and mathematics (Stem) graduates in the world, after China. Indeed, it is bursting with tech talent, as is indicated by the fact that three-quarters of the top 500 multinational corporations in the world have established development centres in India.

All that talent means India can do a lot more to develop its own technological base, aiming to be among the top three science and technology (S&T) nations in the world.

However, it comes in currently at 39th on the Global Innovation Index, while China is placed 11th. In 2022, India spent 0.65% of its GDP on research and development (R&D), much lower than that of other Brics (Brazil, Russia, India, China and South Africa) nations (Brazil 1.15%, Russia 0.94%, China 2.43%), let alone advanced S&T powers like the US, Japan, Israel and South Korea.

India is at present a lower-middle income country that has still some way to go before it reaches its productivity frontier.

Is there a case to be made that it should focus, for now, on the diffusion of existing technologies that make its labour-intensive industries grow, and think later about enhancing R&D? The answer is that India is a large country with a diversified economy and needs to do both at once.

While the economy certainly needs to grow its labour-intensive sectors to pursue the Holy Grail of generating jobs at scale, India cannot ignore the fact that skill- and capital-intensive areas such as pharma, chemicals, automotive, etc, currently dominate its industrial sector. Further advancement........

© hindustantimes