Boosting private sectors R&D

Written by Saikat Neogi | Updated: Jul 16 2013, 06:36am hrs
If India has to emerge as one of the top five knowledge powers globally, private sector will have to step up its investment in R&D and equal contribution has to come from the government during the ongoing 12th Five-Year Plan.

At present, India spends around 1% of GDP on R&D, of which 70% of the money comes from the government. A joint committee of CII and the Department of Science and Technology has suggested that private sector investments in R&D alone should reach 1% of GDP by 2017. Globally, Japan spends more than 3% of GDP on R&D and France, Germany and the US spend more than 2% of their GDP on R&D. In these countries, industry spends more than the government on R&D.

The joint committee has recommended that expenditure incurred on translation and pre-commercialisation trials could be included as a part of R&D costs and such costs could be notified by the government after examination. Currently, private sector investments into R&D are generally limited to those incurred for direct research in a laboratory in the form of plant and machinery, manpower, consumables and utilities.

Also, the government should mandate disclosure of private R&D investment in public domain as an obligation, which would help in proper quantification of investments. The joint committee has also suggested formation of an expert committee for rationalisation of heads of R&D investment for direct and indirect facilitation.