Say no to ‘jugaad’ says the economic survey, suggests to spend more on research and development.
“Mere reliance on ‘Jugaad Innovation’ risks missing the crucial opportunity to innovate our way into the future,” the survey notes.
Out of the ten major economies, India’s businesses have the lowest contribution to R&D while it is the government that has to do the hard work.
The survey highlights read, “India’s gross expenditure on R&D at 0.65% of GDP is much lower than that of the top 10 economies (1.5-3% of GDP) primarily because of the disproportionately lower contribution from the business sector.”
The survey calls resident firms to increase their share of patents that matches India’s status as the fifth largest economy. It calls for more R&D spending if India wants to meet its economic aspirations.
The survey says that despite liberal tax incentives in India for promoting R&D activities, Indian businesses have performed poorly.
As the pandemic reshapes how global supply chains work, India can take advantage of this reordering and come up with schemes like PLI to encourage businesses to manufacture and innovate in India.
The survey shows that despite India’s improvements on the innovation index, it still lags behind Vietnam in the lower middle income group of countries.
That scenario will need to change as India rolls out the red carpet for global giants to come and manufacture in India.