RSTV: IN DEPTH- THE INNOVATING STATES
Introduction:
Innovation is today recognised as an important vehicle to the realise the goal of a New India. Accordingly, NITI Aayog released the first ever Innovation Index of the country. The report ranks Karnataka as the most innovative major state in India. Sikkim and Delhi are the most innovative among north-eastern & hill states. The Niti Aayog report examines the innovation ecosystem of Indian states and union territories. The idea is to devise a holistic tool that policymakers can use to identify challenges and strengths while designing strategies to promote economic growth. The “India Innovation Index” was launched in 2017 by NITI Aayog, Department of Industrial Policy & Promotion and the Confederation of Indian Industry.
Highlights:
- Recognizing the role of innovation as a key driver of growth and prosperity for India, NITI Aayog with Institute for Competitiveness as the knowledge partner has released the India Innovation Index 2019.
- Karnataka is the most innovative major state in India.
- Tamil Nadu, Maharashtra, Telangana, Haryana, Kerala, Uttar Pradesh, West Bengal, Gujarat, and Andhra Pradesh form the remaining top ten major states respectively.
- The top ten major states are majorly concentrated in southern and western India.
- Sikkim and Delhi take the top spots among the north- eastern & hill states, and union territories/city states/small states respectively.
- Delhi, Karnataka, Maharashtra, Tamil Nadu, Telangana, and Uttar Pradesh are the most efficient states in translating inputs into output.
- The study is an outcome of extensive research and analysis, which looks holistically at the innovation landscape of India by examining the innovation capabilities and performance of Indian states and union territories. The aim is to create a holistic tool which can be used by policymakers across the country to identify the challenges to be addressed and strengths to build on when designing the economic growth policies for their regions.
- The index attempts to create an extensive framework for the continual evaluation of the innovation environment of all states and union territories in India and intends to perform the following three functions- 1) ranking of states and UTs based on their index scores, 2) recognizing opportunities and challenges, and 3) assisting in tailoring governmental policies to foster innovation.
- The India Innovation Index 2019 is calculated as the average of the scores of its two dimensions – Enablers and Performance. The Enablers are the factors that underpin innovative capacities, grouped in five pillars: (1) Human Capital, (2) Investment, (3) Knowledge Workers, (4) Business Environment, and (5) Safety and Legal Environment. The Performance dimension captures benefits that a nation derives from the inputs, divided in two pillars: (6) Knowledge Output and (7) Knowledge Diffusion.
- The index presents the latest findings and highlights the regional catalysts and caveats for promoting innovation readiness. The Report offers a comprehensive snapshot of the innovation ecosystem of 29 states and seven union territories. It also includes a section on state profiles covering 33 indicators looking at the different facets of innovation in India.
- The index shows that the innovation ecosystem of the country is strong in south and western parts of India. In fact, three of the top five major states are from southern India. Delhi and Haryana seem to be an exception to this rule and seem to be doing well on the Index. Thus, there seems to be a west-south and north-east divide across the country.
- The states have been bifurcated into three categories: major states, north-east and hill states, and union territories / city states / small states. Karnataka is the leader in the overall rankings in the category of major states. Karnataka’s number one position in the overall ranking is partly attributed to its top rank in the Performance dimension. It is also among the top performers in Infrastructure, Knowledge Workers, Knowledge Output and Business Environment.
- Among the category of major states, Maharashtra performs the best in the dimension of Enablers. This implies that it has the best enabling environment for innovation, even though the state comes in at the third position in the overall innovation index.
Policy Imperatives:
The broad level learnings and some policy imperatives at the national level include
- Increasing the spending on research and development
- Improving the capability of top rung educational institutions in the country to produce greater innovation outputs.
- There is also a need for greater coordination and collaboration between the industry and educational institutions for enhancing innovation capability.
- A collaborative platform consisting of all the stakeholders of innovation – innovators, researchers, and investors from the industry should be developed. This will help in strengthening the industry-academia linkages and will ease the process of technology transfer by providing a platform for innovators to showcase their inventions.
State Level Learning:
At the state level, broad level key learning includes
- Forming policies at the state level that seek to improve the innovation and entrepreneurial ecosystem.
- Cluster development programs are also an area in need of greater coordination and can benefit from a more open collaborative approach.
- Industrial policies at the state level should focus more on innovation. At present only a few policies exist for innovation even in the most innovative states and union territories.
India in Global Innovation Index:
- India maintains its top place in the Central and Southern Asia region as the 52nd ranked economy this year.
- From 81 in 2015, India’s 29-place move up the GII represents the biggest jump by any major economy.
- Thanks to its high-quality scientific publications and universities, India remains 2nd among middle-income economies in the quality of innovation.
- It maintains top ranks in a number of important indicators such as productivity growth and exports of services related to information and communication technologies.
- This year India reaches the 15th spot in global companies’ R&D expenditures.
- It also features in the GII ranking on the world’s top science and technology clusters, with Bengaluru, Mumbai and New Delhi included in the global top 100 clusters.
- India also outperformed on innovation relative to its GDP per capita for nine consecutive years, only matched by three other countries. (Vietnam, Republic of Moldova, and Kenya)
- In comparison, India’s rank in World Bank’s Doing Business survey has improved 65 spots to 77th position in 2018.
- Commerce and industry minister Piyush Goyal releasing the report said the government will work hard to take the country to 25th ranking in next four years to meet the target set by Prime Minister Narendra Modi.
- India improved its ranking in four out of seven pillars of GII, such as knowledge and technology outputs (up 11 spots to 32nd), market sophistication (up 3 spots to 33rd), human capital and research (up 3 spots to 53rd), institutions (up 3 spots to 77th). By contrast, in business sophistication (65th), infrastructure (79th), creative outputs (78th), it lost one, two and three spots respectively.
- WIPO said India’s improvement this year is largely due to its relative performance and less so to new GII data or methods.
- In the “knowledge and technology outputs” pillar, which saw the highest 11 spot jump, India’s ranking improved for IP-related variables, notably patents by origin (52nd) and PCT patents by origin under Patent Cooperation Treaty (51st), and IP receipts (50th). In this pillar, India maintained its top position in ICT (information and communications technology) services exports, where it ranks 1st in the world, and in labor productivity growth with 4th position.
- India is consistently among the top in the world in innovation drivers such as ICT services exports, Graduates in science & engineering, the quality of universities, Gross capital formation—a measure of economy-wide investments—and Creative goods exports.
- Given its size—and if progress is upheld—India will make a true impact on global innovation in the years to come,” the report said.
- Among the sub-pillars, where India lost relative strength to other countries, the largest drops are found in logistics performance (down 9 spots to 43rd), Females employed with advanced degrees (down 10 spots to 103rd) and Printing and other media (down 12 spots to 88th).
- While India improved in the GII ranking, some relative weaknesses still persist. These include Environmental performance (125th), New businesses (100th), and Entertainment and media market 60th),” the report said.
- When it comes to quality of innovation which includes quality of local universities, internationalisation of patented inventions and quality of scientific publications, China, India, and the Russian Federation hold the top 3 positions among middle income countries with India ranking 26th globally.
- India ranks 2nd among the middle-income economies, with top positions in quality of universities and in quality of scientific publications,” the report said.
- Indian Institute of Technology situated in Bombay, Bengaluru and Delhi occupied the 8th, 9th and 10th rank respectively among the top 10 universities in the middle income countries.
- In “Human capital and research” pillar, two important variables have improved for India: Gross expenditure on R&D (50th) and expenditure by global R&D companies (15th) which is a relative strength for the country.
- “Its (India’s) share in world R&D expenditures has increased since the mid-1990s, but less sharply than other middle-income countries, such as China, or other Asian powerhouses, such as the Republic of Korea.
- In Global R&D companies, India reaches the 15th spot as the second middle-income economy.
- In this pillar, the indicator Graduates in science and engineering (7th) remains a relative strength for the country,” the report said.
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