National Academies Press: OpenBook
Suggested Citation:"Front Matter." National Research Council. 2007. India's Changing Innovation System: Achievements, Challenges, and Opportunities for Cooperation: Report of a Symposium. Washington, DC: The National Academies Press. doi: 10.17226/11924.
×

INDIA’S CHANGING INNOVATION SYSTEM

Achievements, Challenges, and Opportunities for Cooperation

Report of a Symposium

Committee on Comparative Innovation Policy: Best Practice for the 21st Century

Board on Science, Technology, and Economic Policy

Policy and Global Affairs

Charles W. Wessner and Sujai J. Shivakumar, Editors

NATIONAL RESEARCH COUNCIL OF THE NATIONAL ACADEMIES

THE NATIONAL ACADEMIES PRESS

Washington, D.C.
www.nap.edu

Suggested Citation:"Front Matter." National Research Council. 2007. India's Changing Innovation System: Achievements, Challenges, and Opportunities for Cooperation: Report of a Symposium. Washington, DC: The National Academies Press. doi: 10.17226/11924.
×

THE NATIONAL ACADEMIES PRESS

500 Fifth Street, N.W. Washington, DC 20001

NOTICE: The project that is the subject of this report was approved by the Governing Board of the National Research Council, whose members are drawn from the councils of the National Academy of Sciences, the National Academy of Engineering, and the Institute of Medicine. The members of the committee responsible for the report were chosen for their special competences and with regard for appropriate balance.

This study was supported by: Contract/Grant No. SB1341-03-C-0032 between the National Academy of Sciences and the U.S. Department of Commerce; Contract/Grant No. OFED-381989 between the National Academy of Sciences and Sandia National Laboratories; and Contract/Grant No. NAVY-N00014-05-G-0288, DO #2, between the National Academy of Sciences and the Office of Naval Research. This material is based upon work also supported by the Defense Advanced Research Projects Agency Defense Sciences Office, DARPA Order No. K885/00, Program Title: Materials Research and Development Studies, Issued by DARPA/CMD under Contract #MDA972-01-D-0001. Additional funding was provided by Intel Corporation, International Business Machines, and Google. Any opinions, findings, conclusions, or recommendations expressed in this publication are those of the author(s) and do not necessarily reflect the views of the organizations or agencies that provided support for the project.

International Standard Book Number-13: 978-0-309-10483-8

International Standard Book Number-10: 0-309-10483-1

Limited copies are available from Board on Science, Technology, and Economic Policy, National Research Council, 500 Fifth Street, N.W., W547, Washington, DC 20001; 202-334-2200.

Additional copies of this report are available from the

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Copyright 2007 by the National Academy of Sciences. All rights reserved.

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Suggested Citation:"Front Matter." National Research Council. 2007. India's Changing Innovation System: Achievements, Challenges, and Opportunities for Cooperation: Report of a Symposium. Washington, DC: The National Academies Press. doi: 10.17226/11924.
×

THE NATIONAL ACADEMIES

Advisers to the Nation on Science, Engineering, and Medicine


The National Academy of Sciences is a private, nonprofit, self-perpetuating society of distinguished scholars engaged in scientific and engineering research, dedicated to the furtherance of science and technology and to their use for the general welfare. Upon the authority of the charter granted to it by the Congress in 1863, the Academy has a mandate that requires it to advise the federal government on scientific and technical matters. Dr. Ralph J. Cicerone is president of the National Academy of Sciences.


The National Academy of Engineering was established in 1964, under the charter of the National Academy of Sciences, as a parallel organization of outstanding engineers. It is autonomous in its administration and in the selection of its members, sharing with the National Academy of Sciences the responsibility for advising the federal government. The National Academy of Engineering also sponsors engineering programs aimed at meeting national needs, encourages education and research, and recognizes the superior achievements of engineers. Dr. Charles M. Vest is president of the National Academy of Engineering.


The Institute of Medicine was established in 1970 by the National Academy of Sciences to secure the services of eminent members of appropriate professions in the examination of policy matters pertaining to the health of the public. The Institute acts under the responsibility given to the National Academy of Sciences by its congressional charter to be an adviser to the federal government and, upon its own initiative, to identify issues of medical care, research, and education. Dr. Harvey V. Fineberg is president of the Institute of Medicine.


The National Research Council was organized by the National Academy of Sciences in 1916 to associate the broad community of science and technology with the Academy’s purposes of furthering knowledge and advising the federal government. Functioning in accordance with general policies determined by the Academy, the Council has become the principal operating agency of both the National Academy of Sciences and the National Academy of Engineering in providing services to the government, the public, and the scientific and engineering communities. The Council is administered jointly by both Academies and the Institute of Medicine. Dr. Ralph J. Cicerone and Dr. Charles M. Vest are chair and vice chair, respectively, of the National Research Council.


www.national-academies.org

Suggested Citation:"Front Matter." National Research Council. 2007. India's Changing Innovation System: Achievements, Challenges, and Opportunities for Cooperation: Report of a Symposium. Washington, DC: The National Academies Press. doi: 10.17226/11924.
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Suggested Citation:"Front Matter." National Research Council. 2007. India's Changing Innovation System: Achievements, Challenges, and Opportunities for Cooperation: Report of a Symposium. Washington, DC: The National Academies Press. doi: 10.17226/11924.
×

Committee on Comparative Innovation Policy: Best Practice for the 21st Century*

William J. Spencer, Chair Chairman Emeritus, retired

SEMATECH

Kenneth Flamm, Vice Chair

Dean Rusk Chair in International Affairs

Lyndon B. Johnson School of Public Affairs

University of Texas at Austin and STEP Board

Alice H. Amsden Professor of Political Economy

Massachusetts Institute of Technology

Gail H. Cassell Vice President,

Scientific Affairs Distinguished Lilly Research Scholar for Infectious Diseases Eli Lilly and Company

Lewis S. Edelheit Senior Research and Technology Advisor, retired

General Electric

Mary L. Good, Vice Chair Donaghey University Professor Dean,

Donaghey College of Information Science and Systems Engineering University of Arkansas at Little Rock and STEP Board

Bronwyn Hall Professor of Economics

University of California at Berkeley

Mark B. Myers Visiting Professor of Management

The Wharton School of Business University of Pennsylvania

Alan Wm. Wolff Managing Partner

Dewey Ballantine

*

As of December 2006.

Suggested Citation:"Front Matter." National Research Council. 2007. India's Changing Innovation System: Achievements, Challenges, and Opportunities for Cooperation: Report of a Symposium. Washington, DC: The National Academies Press. doi: 10.17226/11924.
×

Project Staff*

Charles W. Wessner Study Director

Sujai J. Shivakumar Senior Program Officer

McAlister T. Clabaugh Program Associate

David E. Dierksheide Program Officer

Paul Fowler Senior Research Associate

Ken Jacobson Consultant

Jeffrey C. McCullough Program Associate

*

As of December 2006.

Suggested Citation:"Front Matter." National Research Council. 2007. India's Changing Innovation System: Achievements, Challenges, and Opportunities for Cooperation: Report of a Symposium. Washington, DC: The National Academies Press. doi: 10.17226/11924.
×

For the National Research Council (NRC), this project was overseen by the Board on Science, Technology and Economic Policy (STEP), a standing board of the NRC established by the National Academies of Sciences and Engineering and the Institute of Medicine in 1991. The mandate of the STEP Board is to integrate understanding of scientific, technological, and economic elements in the formulation of national policies to promote the economic well-being of the United States. A distinctive characteristic of STEP’s approach is its frequent interactions with public and private-sector decision makers. STEP bridges the disciplines of business management, engineering, economics, and the social sciences to bring diverse expertise to bear on pressing public policy questions. The members of the STEP Board* and the NRC staff are listed below:


Dale Jorgenson, Chair

Samuel W. Morris University Professor

Harvard University


Timothy Bresnahan

Landau Professor in Technology and the Economy

Stanford University


Lew Coleman

President

Dreamworks Animation


Kenneth Flamm

Dean Rusk Chair in International Affairs

Lyndon B. Johnson School of Public Affairs

University of Texas at Austin


Mary L. Good

Donaghey University Professor

Dean, Donaghey College of Information Science and Systems Engineering

University of Arkansas at Little Rock


Amo Houghton

Member of Congress, retired


David T. Morgenthaler

Founding Partner

Morgenthaler Ventures


Joseph Newhouse

John D. MacArthur Professor of Health Policy and Management

Harvard University


Edward E. Penhoet

President

Gordon and Betty Moore Foundation


Arati Prabhakar

General Partner

U.S. Venture Partners


William J. Raduchel

Independent Director and Investor


Jack Schuler

Chairman

Ventana Medical Systems


Suzanne Scotchmer

Professor of Economics and Public Policy

University of California at Berkeley

*

As of December 2006.

Page viii Cite
Suggested Citation:"Front Matter." National Research Council. 2007. India's Changing Innovation System: Achievements, Challenges, and Opportunities for Cooperation: Report of a Symposium. Washington, DC: The National Academies Press. doi: 10.17226/11924.
×

STEP Staff*

Stephen A. Merrill

Executive Director


McAlister T. Clabaugh

Program Associate


David E. Dierksheide

Program Officer


Paul Fowler

Senior Research Associate


Charles W. Wessner

Program Director


Sujai J. Shivakumar

Senior Program Officer


Jeffrey C. McCullough

Program Associate


Mahendra Shunmoogam

Program Associate

*

As of December 2006.

Suggested Citation:"Front Matter." National Research Council. 2007. India's Changing Innovation System: Achievements, Challenges, and Opportunities for Cooperation: Report of a Symposium. Washington, DC: The National Academies Press. doi: 10.17226/11924.
×

Contents

PREFACE

 

xiii

I
INTRODUCTION

 

1

II.
PROCEEDINGS

 

25

 

 

Welcome Remarks
Ralph Cicerone, National Academy of Sciences Ronen Sen, Ambassador of India to the United States

 

27

 

 

Opening Remarks India and the United States: A New Strategic Responsibility
Paula Dobriansky, Department of State

 

30

Panel I:

 

India and the United States: An Emerging Global Partnership
Moderator: David McCormick, Department of Commerce

 

35

   

 India’s Reforms: Current Challenges and Opportunities
Montek Singh Ahluwalia, Planning Commission of India

 

35

   

 Opportunities and Challenges in U.S.–Indian Science and Technology Cooperation
Samuel Bodman, Department of Energy

 

39

Suggested Citation:"Front Matter." National Research Council. 2007. India's Changing Innovation System: Achievements, Challenges, and Opportunities for Cooperation: Report of a Symposium. Washington, DC: The National Academies Press. doi: 10.17226/11924.
×
   

 New Synergies in U.S.–Indian Cooperation
Ram Shriram, Google

 

43

Panel II:

 

Synergies and Gaps in National and Regional Development Strategies
Moderator: Praful Patel, The World Bank

 

53

   

 Building Regional Growth: Elements of Successful State Strategies
T. S. R. Subramanian, Government of India (retired)

 

54

   

 India’s Knowledge Economy in a Global Context
Carl J. Dahlman, Georgetown University

 

58

   

 Manufacturing Innovation as an Engine for India’s Growth
Surinder Kapur, Sona Group

 

67

 

 

Keynote Address: India’s Changing Innovation System
Introduction: John Marburger, White House Office of Science & Technology Policy Kapil Sibal, Ministry of Science and Technology

 

77

Panel III:

 

Growing the Science and Technology, Research, and Innovation Infrastructure
Moderator: George Atkinson, Department of State

 

88

   

 Renewing the National Laboratories
R. A. Mashelkar, Council on Scientific and Industrial Research

 

89

   

 National and State Investments in Science and Engineering Education
P. V. Indiresan, Indian Institute of Technology (retired)

 

94

   

 Opportunities for U.S.–Indian Materials Cooperation
Thomas A. Weber, National Science Foundation

 

100

Suggested Citation:"Front Matter." National Research Council. 2007. India's Changing Innovation System: Achievements, Challenges, and Opportunities for Cooperation: Report of a Symposium. Washington, DC: The National Academies Press. doi: 10.17226/11924.
×

 

 

Panel IV: Building U.S.–Indian Research and Development Cooperation
Moderator: Mary Good, University of Arkansas at Little Rock Swati Piramal, Nicholas Piramal India Ltd. Robert Armstrong, Eli Lilly and Company Kenneth G. Herd, General Electric Ponani S. Gopalakrishnan, International Business Machines M. P. Chugh, Tata AutoComp Systems

 

109

 

 

Closing Remarks
Charles W. Wessner, National Research Council

 

135

III.
RESEARCH PAPER

 

 

 

 

India’s Knowledge Economy in the Global Context
Carl J. Dahlman, Georgetown University

 

139

IV.
APPENDIXES

 

 

A.

 

Biographies of Speakers

 

167

B.

 

Participants List

 

186

C.

 

Bibliography

 

201

Suggested Citation:"Front Matter." National Research Council. 2007. India's Changing Innovation System: Achievements, Challenges, and Opportunities for Cooperation: Report of a Symposium. Washington, DC: The National Academies Press. doi: 10.17226/11924.
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Suggested Citation:"Front Matter." National Research Council. 2007. India's Changing Innovation System: Achievements, Challenges, and Opportunities for Cooperation: Report of a Symposium. Washington, DC: The National Academies Press. doi: 10.17226/11924.
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Preface

The United States faces a changing global environment where the capacity to innovate and commercialize new high-technology products is increasingly distributed worldwide. Governments around the world are taking active steps to renew and strengthen their national innovation systems, recognizing the strategic and economic importance of economic competitiveness.1 In this new global environment, the United States must take up the challenge of maintaining its position of leadership by investing in its own capacity to innovate. The National Academies, in a recent report entitled Rising Above the Gathering Storm, called on the United States to adjust its policies concerning its workforce and research and development (R&D) capabilities to compete successfully in the future world economy.2

This report of a conference considers the opportunities, and some of the challenges of a strategic innovation partnership with India—a rising economic power

1

National Research Council, Innovation Policies for the 21st Century, Charles W. Wessner, ed., Washington, D.C.: The National Academies Press, 2007.

2

National Academy of Sciences/National Academy of Engineering/Institute of Medicine (NAS/ NAE/IOM), Rising Above the Gathering Storm: Energizing and Employing America for a Brighter Economic Future, Washington, D.C.: The National Academies Press, 2007. The growing chorus of concern about U.S. innovation policy also included a report by the Council on Competitiveness, “Innovate America: Thriving in a World of Challenge and Change,” Washington, D.C.: Council on Competitiveness, December 2004. Growing concerns about U.S. competitiveness led to the introduction in the Senate of the American Innovation and Competitiveness Act of 2006 and the Protect America’s Competitive Edge Act of 2006. Also, in his 2006 State of the Union Address, President George W. Bush called for doubling commitment to basic research programs in physics and engineering over 10 years at the National Science Foundation (NSF), the Department of Energy (DOE), and the National Institute of Science and Technology (NIST) as a part of his Competitiveness Initiative. These initiatives have yet to become law, as this report goes to press.

Suggested Citation:"Front Matter." National Research Council. 2007. India's Changing Innovation System: Achievements, Challenges, and Opportunities for Cooperation: Report of a Symposium. Washington, DC: The National Academies Press. doi: 10.17226/11924.
×

BOX A

Innovation Ecosystem and Competitiveness

Innovation involves the transformation of an idea into a marketable product or service, a new or improved manufacturing or distribution process, or even a new method of providing a social service. This transformation involves an adaptive network of institutions that encompass a variety of informal and formal rules and procedures—a national innovation ecosystem—that shapes how individuals and corporate entities create knowledge and collaborate successfully to bring new products and services to market.

Competitiveness, in turn, refers to the ability of a nation’s firms to produce the goods and services that can successfully compete in the globalized economic environment, while enabling a standard of living for its citizens that is both rising and sustainable. The ability of these factors to collaborate successfully depends on the flexibility and responsiveness of a nation’s innovation ecosystem to recognize emerging opportunities and adapt to new challenges.

and an increasingly important locus of advanced research and development—in part through the growth of R&D facilities put in place by U.S. firms eager to draw on the intellectual assets and market opportunities of a rapidly growing India. The conference, held on June 17, 2006, at the National Academies in Washington, D.C., advances the joint communiqué following President Bush’s state visit to India in March 2006, which called for strategic cooperation between the two nations in innovation and the development of advanced technologies.3

Cabinet ministers, senior officials, and academic experts from India and the United States came together at the conference on India’s Changing Innovation System to explain the sources of India’s exceptional recent economic performance, India’s strengths in innovation, and the challenges India faces as it seeks to modernize its innovation system to become more competitive internationally as well as address the challenges of human development for its growing population. The conference, moreover, emphasized the opportunities that a strategic partnership in innovation holds for both the United States and India.

The conference, whose proceedings are reported in this volume, sought to highlight a set of complex and interrelated issues concerning India’s changing innovation policies and the role the United States can play in aiding and benefiting from this transition. By necessity, even an ambitious one-day conference cannot (and did not) cover all facets of this rich topic. For example, the conference focused more on India’s emerging strengths in the auto component manufacturing and pharmaceutical sectors than on the already familiar software and service sectors.

3

The White House, “Fact Sheet: United States and India: Strategic Partnership,” March 2, 2006 Press Release. For a broad overview of the evolution of the U.S.–India strategic partnership, see Teresita C. Schaffer, “Building a New Partnership with India,” Washington Quarterly, 25(2):31–44, Spring 2002.

Suggested Citation:"Front Matter." National Research Council. 2007. India's Changing Innovation System: Achievements, Challenges, and Opportunities for Cooperation: Report of a Symposium. Washington, DC: The National Academies Press. doi: 10.17226/11924.
×

THE CONTEXT OF THIS REPORT

Since 1991 the STEP Board has undertaken a program of activities to improve policy makers’ understanding of the interconnections among science, technology, and economic policy and their importance to the American economy and its international competitive position. The board’s interest in comparative innovation policies derives directly from its mandate.

This mandate is reflected in STEP’s earlier work on U.S. competitiveness, U.S. Industry in 2000, which assesses the determinants of competitive performance in a wide range of manufacturing and service industries, including those relating to information technology.4 The Board also undertook a major study, chaired by Gordon Moore of Intel, on how government–industry partnerships can support the growth and commercialization of productivity-enhancing technologies.5 Reflecting a growing recognition of the importance of the surge in productivity since 1995, the Board also launched a multifaceted assessment, exploring the sources of growth, measurement challenges, and the policy framework required to sustain the information and communications technology-based productivity gains and growth that have characterized the United States since the mid 1990s.6

Building on this experience, STEP’s current study on Comparative Innovation Policy is developing a case-based international comparative analysis focused on U.S. and foreign innovation programs. The analysis includes a review of the goals, concept, structure, operation, funding levels, and evaluation of foreign programs similar to major U.S. programs, such as those found in Japan, Taiwan, Flanders in Belgium and now India. Among other activities, this study is convening a series of meetings with senior officials and academic analysts of these and other countries who are engaged in the operation and evaluation of these programs overseas, to gain a first-hand understanding of the goals, challenges, and accomplishments of these programs. As reflected in the conference reported in this volume, the National Academies Committee on Comparative Innovation Policy is also considering the role of innovation systems abroad and opportunities for collaboration that can complement the strengths of the U.S. innovation system in a globalizing innovation ecosystem.

4

National Research Council, U.S. Industry in 2000: Studies in Competitive Performance, David C. Mowery, ed., Washington, D.C.: National Academy Press, 1999.

5

This summary of a multivolume study provides the Moore Committee’s analysis of best practices among key U.S. public–private partnerships. See National Research, Government–Industry Partnerships for the Development of New Technologies: Summary Report, Charles W. Wessner, ed., Washington, D.C.: The National Academies Press, 2003. For a list of U.S. partnership programs, see Christopher Coburn and Dan Berglund, Partnerships: A Compendium of State and Federal Cooperative Programs, Columbus, OH: Battelle Press, 1995.

6

National Research Council, Enhancing Productivity Growth in the Information Age: Measuring and Sustaining the New Economy, Dale W. Jorgenson and Charles W. Wessner, eds., Washington, D.C.: The National Academies Press, 2006.

Suggested Citation:"Front Matter." National Research Council. 2007. India's Changing Innovation System: Achievements, Challenges, and Opportunities for Cooperation: Report of a Symposium. Washington, DC: The National Academies Press. doi: 10.17226/11924.
×

ACKNOWLEDGMENTS

We are grateful for the participation and the contributions of the Defense Advanced Research Projects Agency, the National Institute of Standards and Technology, the Office of Naval Research, and Sandia National Laboratories.

We are indebted to Ken Jacobson for his preparation of this meeting summary. Several members of the STEP staff also deserve recognition for their contributions, including McAlister Clabaugh, David Dierksheide, and Jeffrey McCullough for their role in organizing the conference and preparing this report for publication.

NATIONAL RESEARCH COUNCIL REVIEW

This report has been reviewed in draft form by individuals chosen for their diverse perspectives and technical expertise, in accordance with procedures approved by the National Academies’ Report Review Committee. The purpose of this independent review is to provide candid and critical comments that will assist the institution in making its published report as sound as possible and to ensure that the report meets institutional standards for quality and objectivity. The review comments and draft manuscript remain confidential to protect the integrity of the process.

We wish to thank the following individuals for their review of this report: M.P. Chugh, Tata AutoComp Systems Ltd; Vinod Goel, The World Bank; Sarita Nagpal, Confederation of Indian Industry; Kesh Narayanan, National Science Foundation; and T.S.R. Subramanian, Government of India (Retired).

Although the reviewers listed above have provided many constructive comments and suggestions, they were not asked to endorse the content of the report, nor did they see the final draft before its release. Responsibility for the final content of this report rests entirely with the author and the institution.

William J. Spencer

Sujai J. Shivakumar

Charles W. Wessner

Suggested Citation:"Front Matter." National Research Council. 2007. India's Changing Innovation System: Achievements, Challenges, and Opportunities for Cooperation: Report of a Symposium. Washington, DC: The National Academies Press. doi: 10.17226/11924.
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Suggested Citation:"Front Matter." National Research Council. 2007. India's Changing Innovation System: Achievements, Challenges, and Opportunities for Cooperation: Report of a Symposium. Washington, DC: The National Academies Press. doi: 10.17226/11924.
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Suggested Citation:"Front Matter." National Research Council. 2007. India's Changing Innovation System: Achievements, Challenges, and Opportunities for Cooperation: Report of a Symposium. Washington, DC: The National Academies Press. doi: 10.17226/11924.
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Page xiii Cite
Suggested Citation:"Front Matter." National Research Council. 2007. India's Changing Innovation System: Achievements, Challenges, and Opportunities for Cooperation: Report of a Symposium. Washington, DC: The National Academies Press. doi: 10.17226/11924.
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As part of its review of Comparative National Innovation Policies: Best Practice for the 21st Century, the Board on Science, Technology, and Economic Policy convened a major symposium in Washington to examine the policy changes that have contributed to India's enhanced innovative capacity. This major event, organized in cooperation with the Confederation of Indian Industry, was particularly timely given President Bush's March 2006 visit to India and the Joint Statement issued with the Indian government calling for strategic cooperation in innovation and the development of advanced technologies. The conference, which brought together leading figures from the public and private sectors from both India and the United States, identified accomplishments and existing challenges in the Indian innovation system and reviewed synergies and opportunities for enhanced cooperation between the Indian and U.S. innovation systems. This report on the conference contains three elements: a summary of the key symposium presentations, an introductory chapter analyzing the policy issues raised at the symposium, and a research paper providing a detailed examination of India's knowledge economy, placing it in terms of overall global trends and analyzing its challenges and opportunities.

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