India's R&D sector is steadily increasing its growth pace according to a recent "State of Industry R&D in India" report by FAST India in collaboration with IIFL Securities.
Despite challenges like the COVID-19 pandemic and changes in the R&D tax regime, Indian firms have shown "slightly better" performance in R&D growth in sectors such as Aerospace and Defence, Automobile and Components, Chemical, and Energy compared to global counterparts from FY16 to FY23.
However, global firms continue to outpace India in several aspects. As per the report, international companies showed nearly three times (2.9x) more R&D intensity and have a workforce with 3.7 times more PhD employees. They also hold a whopping 13.1x patents and 1.3x publications per billion USD revenue as compared to their Indian counterparts.
But Indian companies are shining in one key area, which is transparency. The report highlighted that domestic firms are disclosing twice as much R&D information.
"Despite facing challenges such as the COVID-19 pandemic and changes in the R&D tax regime, Indian firms have shown slightly higher R&D growth, albeit from a much lower baseline, compared with global firms and scored well in R&D disclosures to the public. However, the findings also underscore the need for Indian firms to increase their performance in both R&D inputs and outputs to perform competitively in the global market," Prof K Vijay Raghavan, Former Principal Scientific Advisor to GoI, said.
The State of Industry R&D in India report gives insights about the country's R&D space, majorly focusing on sectors like Pharmaceuticals and Biotechnology, Automobile and Parts, Software and Technology, Energy, Aerospace and Defence, and Chemical Sectors. The analysis is based on key aspects of nearly 119 companies.
"While the Indian industry has made great strides, it needs to invest more in R&D to go up the global value chain," said Varun Aggarwal, Co-Founder FAST India.
