The Global Innovation Index is a leading reference for measuring an economy’s innovation performance.
Moving into its 13th edition in 2020, the GII has evolved into a valuable benchmarking tool that facilitates public-private dialogue and that helps policy-makers, business leaders, and other stakeholders to evaluate their innovation progress on an annual basis.
According to the Economic Survey 2020-21, tabled by Union Minister for Finance & Corporate Affairs, Smt. Nirmala Sitharaman, India now ranks first in Central and South Asia, and third amongst lower middle-income group economies.
The Economic Survey 2020-21 also said that India needs greater thrust on innovation to catapult itself to a higher growth trajectory and become the third largest economy in GHDP current US$ in the near future.
This requires boosting gross expenditure on R&D from 0.7 per cent of GDP currently, to at least the average level of Gross Domestic Expenditure on (GERD) in other top ten economies (GDP current US$) of over two per cent. It also involves significantly calling up R&D personnel and researchers in the country, especially in the private sector.
“The GII report could be India’s one-stop reference to plan and accelerate our journey toward the future we imagine for our people. I encourage you to refer to this report, discuss it with others, and consider the ways we can improve as individual nations and as a global community.“
Confederation of Indian Industry (CII)
The Economic Survey has stated that the Government sector contributes a disproportionately the large share in total GERD at three times the average of other large economies. However, the business sector’s contribution to GERD is amongst the lowest in India. The business sector’s contribution to total R&D personnel and researchers also lags behind that in other large economies. This situation has prevailed despite the tax incentives for innovation having been more liberal than other economies.
India’s innovation ranking is lower than expected for its level of access to equity capital. This points towards the need for India’s business sector to significantly ramp up investments in R&D. India’s performance on Innovations has been lowered than expected for its level of its accessing to equity finance, observed the Survey. It highlighted the need for boosting business sector contribution to total GERD from the current 37% to close to 68%. The Survey also suggests that the sectors total R&D contribution needs to be scaled from the present level of 30% and 34% personnel of researches respectively, to 58% and 53% respectively.
The full report can be accessed here.