Policy

Why we need more than just tax breaks to spur R&D investments

M Ramesh | Updated on December 08, 2020 Published on December 08, 2020

Ashutosh Sharma, Secretary, Department of Science and Technology   -  RAMESH SHARMA

Prof Ashutosh Sharma, Secretary of the Science and Technology Ministry, wants to steer policy towards the newer directions and needs necessitated by a rapidly changing world

Prof Ashutosh Sharma is a busy man. The government has announced it would bring in a Science, Technology, Innovation Policy, 2020 (STIP 2020) and there are only three weeks before the year runs out. As the Secretary of the Ministry of Science and Technology, Prof Sharma is keen that the deadline is met. Alongside STIP 2020, he is spearheading a number of scientific missions, the most imminent being the ₹8,000-crore National Mission on Quantum Computing. Some of the other initiatives include SATHI, NIDHI, and SSR (details follow). Furthermore, the Ministry is working closely with Industry, including some 80 start-ups, to find Covid-19 solutions.

Prof Sharma, who became the Secretary in January 2015, is a nano-scientist, an alumnus of IIT Kanpur, who got his PhD from the State University of New York, Buffalo, USA. He has written more than 350 peer-reviewed papers on a range of subjects, including thin polymer films, nano-composites and devices in energy, health and environment, nano-mechanics of soft matter, nano-patterning and nano-fabrication.

Prof Sharma spoke to Quantum about the initiatives of his Ministry. Excerpts from the interview:

When are you launching STIP 2020 and how will it be different from the earlier policies?

We are calling it STIP 2020, so the first draft should come by December. It appears to be on-track. Work is going on in terms of stakeholder consultations. Science and Technology permeates everywhere, so the stakeholder base is very large.

As for how it will be different than the previous policies, the point is not to compare it with other policies and see which is better or worse. The point is, times have changed, new directions have emerged. Future is coming at us at a much faster pace. Ten years back there was not much appreciation of things like start-ups, sustainable development, climate change etc. We are now talking about intelligent machines, industry 4.0, society 5.0, IoT, 5G and beyond, quantum technologies, smart grids, and energy storage to match the rise of renewals, etc. Many streams of science and technologies are converging. Earlier policies were mostly focused on things like, say, funding science and technology largely by the Government. This has worked well — India is the third largest producer of scientific papers in the world. But now the need is for quality, profoundness, relevance, direction and translation.

Given these, what will the policy contours look like?

The policy will be evidence-driven and there will be actionable items. For example, how do we enhance industry participation in R&D? Merely saying that industry should do more R&D is not going to work.

The focus will be on entrepreneurship, data, capacity building, access to knowledge and infrastructure resources. What happens (today) is, our knowledge and infrastructure resources are locked up — the question is how to democratise knowledge? Our major weakness is not knowledge creation but knowledge consumption. Often times, we focus rather exclusively on the gaps in knowledge generation and push of knowledge, but a neglected factor is enhancing the pull and consumption of knowledge as well, which, among other things, requires relevance and direction of knowledge provided by partnership with the private sector.

There are several other compelling themes in the policy, including international collaborations; diversity and inclusion; strongly connecting R&D and academia; structures and processes for national S&T missions, and many others. For example, our international science and technology connects and partnerships should enhance both science for diplomacy and diplomacy for science, so that our expectations from the international engagements are delivered.

In India, R&D is mostly driven by public investment. We see less of industry participation, and, within industry, the public sector even less. Is this a healthy trend?

Certainly not! Societal transformations bringing prosperity and security happen on the foundations of effective R&D investments. In today’s world, R&D investments of a single global technology company can exceed the entire budget of the science foundation in the US. Why? Obviously, a knowledge industry, in its absence, will lose the competitive edge and disappear in a few years. What is true for tech companies is true for knowledge economies. We need more companies of that kind. We need to value knowledge for its socio-economic transformative power and create structures, interfaces and mechanisms that would make it possible for the goddesses Laxmi and Saraswati to develop mutual understanding, respect and partnership for the greater good.

So there will be special focus (in STIP 2020) on how to encourage more R&D investments from the industry which benefit them. We have to bring in more compelling opportunities for public-partnerships.

What kind of policy push would you give to make this happen?

One aspect is to create knowledge interfaces in the industry, for example, by attracting scientists employed in industry to pursue PhD based on the problems relevant to their industry. Right now, PhDs are often isolated from the larger concerns of science and society, and the research is often driven by the imported fashions and by interests of academic mentors rather than the needs and priorities of industry. So the idea is to create brilliant scientists who can create first-rate knowledge with a relevant direction and have an understanding of how to consume that knowledge.

We need to incentivise R&D investments, and not necessarily only by tax breaks. There are other ways. For example, through government procurement policies that encourage industry to develop relevant products. Ministries could plan ahead about their needs of products and technologies so that there is a shared purpose and time for the academia and industry to work together to develop these at appropriate technical and cost levels. The government and the industry together can fund such research and development with greater investment by the government in the initial phases, when the risk is higher. Private sector should develop increasingly greater investments and efforts for manufacturing, as the product becomes technologically sound. DST has already launched a scheme for co-funding of R&D in the PPP mode.

Yes, the R&D in industry is low, but it has been going up. Five years ago, it (industry’s share of R&D expenditure) was one-third; today it has gone up to 40 per cent. I agree, the rise is a bit slow. Greater efforts are certainly needed both for the robust PPP models and the industry involvement in the knowledge economy.

DST is setting up science and technology infrastructure facilities which have a preferential access for the MSMEs, industry and start-ups, in addition to academia. Each of the SATHI (Sophisticated Analytical & Technical Help Institute) facilities receives an investment of ₹125 crore to create much needed resources for testing, characterisation, prototyping and fabrication. The first three centres have been set up this year in IIT-Delhi, IIT-Kharagpur and Banaras Hindu University. These centres will be professionally managed through a Section 8 company. Twenty-five per cent of the time on these resources will be allocated to the host institutions, the other 75 per cent will be available to the industry. It will not only be for infrastructure sharing but also provide relevant information and knowledge to industry. It won’t be like “you give me a sample, I’ll give you a read-out.” We will build three such centres every year until we have 15 of them. The industry can book any facility from anywhere in the country.

Also, the number of researchers per million is low in India.

This number has also been going up. Inching up, but improving. The data we have today is of 2017 and things have improved since then. In 2017, we had 255 (researchers per million of population). The total number of researchers was 342,000. Most scientists in the knowledge-based economies are employed in the private sector. As the Indian industry grows in that direction, there will be greater needs and opportunities. New opportunities are being created by the government also, for example, in a new DST scheme that supports upto 3,000 national post-doctoral fellows to prepare them strongly for careers in academia and industrial research.

There are also other indicators related to funding that convey other kind of information. For example, if you take per capita R&D expenditure and account for the purchase power parity, our numbers become more comparable to ‘technologically developed countries’. It may come as a surprise. For example, Australia spends $205,000 per researcher per year, Canada $178,000, Israel $154,000, UK $170,000 and Russia $102,000. India spends $178,000. And we have made some significant further progress since 2017.

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Published on December 08, 2020
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