Role Of Innovation In Building A Strong India: Initiatives & Challenges

India has been on a rising trajectory, over the past several years in the Global Innovation Index (GII), from a rank of 81 in 2015 to 46 in 2021. The consistent improvement in the GII ranking is owing to the immense knowledge capital, the vibrant start-up ecosystem, and the work done by the public and the private research organizations.

• As part of the broader policy agenda, innovation helps to drive economic growth and address socio-economic challenges such as poverty and health. Poverty-related effects can substantially influence opportunities for engaging in entrepreneurial activities (e.g. ill health reduces the potential productivity of workers), thereby boosting innovation. In India’s Green Revolution of the 1960s, innovation led to the introduction of high-yield varieties and seeds and increased use of fertilisers and irrigation which resulted in a substantial increase in grain production and productivity.
• Innovation has been at the forefront of our battle against the unprecedented crisis created by the pandemic, and will be pivotal in driving the country’s resilience and self-reliance.

Initiatives for Innovation

1. Atal Innovation Mission (AIM): It was launched by NITI Aayog in 2016 to promote a culture of innovation and entrepreneurship in the country.

Initiatives under Atal Innovation Mission

• Atal Tinkering Labs: Atal Tinkering Lab is a state-of-the-art space established in a school with a goal to foster curiosity and innovation in young minds, between grade 6th to 12th across andstimulate a problem-solving innovative mindset.
• Atal Incubation Centres: AIM has been establishing world class incubators called Atal Incubation Centres (AICs) at universities, institutions and corporates among others to foster and support world class innovation, dynamic entrepreneurs who want to build scalable and sustainable enterprises..
• Atal Community Innovation Centres: These are setup to promote the benefits of technology-led innovation to the unserved/underserved regions of India including Tier 2, Tier 3 cities, aspirational districts, tribal, hilly and coastal areas.
• Atal New India Challenges: These are launched in partnership with five different ministries and departments of central government to create product and service innovations which have national socio-economic impact.
• ARISE ANIC Challenges: Launched improve research capabilities in the start-up and MSME ecosystem. It aims to fast track the growth of the Indian MSME sector.

2. Technology Incubation and Development of Entrepreneurs (TIDE 2.0):

• MeitY had initiated TIDE 2.0 to promote tech entrepreneurship through financial and technical support to incubators engaged in supporting startups primarily engaged in using emerging technologies such as IoT, AI, Block-chain, Robotics, etc. in seven pre-identified areas of societal relevance- Healthcare, Education, Agriculture, Financial inclusion including digital payments, Infrastructure and transportation, Environment and clean tech and Clean Energy Solutions.
• “MeitY Start-up Hub” has been launched under TIDE 2.0 scheme to build a conducive innovation ecosystem by bringing together various technology innovation stakeholders, facilitate commercialization of technology solutions for market outreach and provide technical and business advisory through Experts and Mentors.

3. Startup Accelerator Programmes: It aims to bring-in seed investment, mentorship, industry connect and relevant components.

4. Scheme for Accelerating Startups around Post COVID Technology Opportunities (SASACT): It was launched to support electronics hardware/ ICT based tech entrepreneurial initiatives of startups for developing or re-purposing technologies, tools, systems, solutions to respond to the post COVID-19 scenario.

Challenges to Innovation in India

• Inadequate Funding: India spends less than one percent of its GDP on research and development, lower than most of its global peers. The lack of funding support in the country forces innovators in India to park their IP rights outside the country.
• Absence of Enabling Ecosystem: India has the scientific talent, but lacks the enabling ecosystem. As a result Indians continue to do innovative research for global pharma companies as contract research service providers.
• Lack of Recognition: In India, there is a lot of talk about ‘innovation’ but ‘Made in India’ innovations are rarely discussed. As innovation does not get due recognition at home, researchers do not aim for breakthrough innovation.
• Risk Aversive Invetsors: There is lack of investors for business models that are truly innovative and thus untested as real innovation has an inherent element of high risk. Investors in India prefer predictable business models where they have the visibility of assured returns.
• Absence of National Innovation Ecosystem: A national innovation ecosystem that puts in place a financing cycle — academia generating ideas, especially those based on science and technology, which are incubated to proof of concept through government-sponsored seed and incubation funding and then taken to market through business intervention backed by venture funding is absent in India.
• Gender Inequality: The underrepresentation of women in science prevents utilization of full potential of innovators in India.
• Lack of Interest of Venture Capitalists (VCs) in Innovation in India: Venture capital funds are not comfortable investing in innovation in India because there is no attractive exit route for them. Many VCs will invest in India if they can cash out of their start-up investments via the IPO route. However, exiting via the capital market route is uncommon in India. The last Indian start-up to list on the Nasdaq was MakeMyTrip in 2010.

Possibilities and Prospects

The government should incentivise innovation and intellectual property (IP) creation, increase expenditure on research and development and create mechanisms for ease of accessing primary and secondary markets. There is need to build the credibility of Indian innovation within the country and convince people that the quality of research in India is at par with the best in the world.

• The government must enable and support innovative startups and businesses that think locally but have the potential to make enormous global impact. It should encourage technopreneurs to grow from small and medium enterprises to large industrial scale operations to take innovative ideas to global markets and create ample employment opportunities. ‘Make in India’ and ‘Innovate in India’ can be combined to deliver an Atmanirbhar Bharat and garner a large share of the global value chain.