10.2 KEY ELEMENTS FOR R&D INSTITUTIONS POLICY TOWARDS WORK WITH AND FOR INDUSTRY
i) Recognise that now onwards the future of S&T be it oriented basic research, or applied research or development etc lies with those who run Industry, Agriculture and Services.Government in the long run can only support some basic research, research concerning strategic sectors, defence and national security, and a limited amount of social welfare. Resources even for traditional scientific services like mapping and surveys may in near future have to come from the users. Therefore work closely with Industry, earn resources from them.
ii) If there are problems of archaic rules or other constraints bring it in clear terms to business persons and Government, who are increasingly committed to debureaucratising S&T institutions.
iii) Institute Industry and Market Watch - global and domestic in your laboratories. Devote considerable number of talented persons to these tasks. Make it career wise more attractive than pure research or mere paper generation. Use this watch to work on concrete problems of relevance to Industry/Services. Propose projects researched through such watches.
iv) In areas where you have strengths and if Indian Industry is not ready to use them, do not hesitate to go global. Your demonstrated ability to achieve and show results to a global actor will count and many Indian industries will eventually come to you.
v) Give highest priority to joint projects with Provide mobility of personnel, if necessary by demanding changes in rules.
vi) Invest in future through conscious induction of young persons in new areas of research which have been assessed (along with Industry/business groups) to have large potential economic/commercial significance in the future. Also train your middle management not only in S&T but also for appropriate altitudinal changes.
vii) Soon move to a situation when you can take a few soft loans for R&D projects which you assess can have large commercial potential.
viii) Be open to international linkages and export of technologies.
10.3 KEY ELEMENTS OF GOVERNMENT POLICIES
i) First and foremost Government should greatly minimise its role of sitting over judgement on many matters of innovation and leave it the actual players in the field. As a first step towards this it is necessary to drastically reduce the interference of the Ministries with the conduct of Public Sector Units (PSU) and autonomous bodies funded by Government, which in most cases today are run by lower functionaries of the Ministry/Department secretariat having almost veto powers over Directors, Chairman etc. The existing farce of MOU with PSU should also be dispensed with. Their accountability should be on the balance sheets. The whole set of uniform procedures thrust on PSU's such as guidelines from Bureau of Public Enterprises should be removed. Unleashing of PSU and autonomous bodies from Ministry Secretariat shakles will itself generate lots of technological resources.
ii)Government funding to S&T establishments should not immediately withdrawn without facilitating them, by way of drastic debureaucratisation, to earn funds from Industry and other non-budgetary sources : whatever they get from such sources should be considered additionality. The Directors/ Heads of institution should be empowered to decide on various issues without reference to their headquarters.
ii) There is plenty of scope to reduce the number of departments dealing with S&T matters as this will facilitate speed of action without reference to far too many small departments which have mushroomed in the eighties. Also S&T/R&D institutions under the socio-economic Ministries/ Departments numbering to 100 or more should also be freed from the grip of the traditionally bureaucratic Departments and if they cannot administer in newer styles (as it is a small part of them) they may be transferred to those departments who can deal with S&T matters better.
iv) So much for removing the fetters. In addition departments dealing with Commerce, External Affairs etc should also use their channels for extensive collection and dissemination business intelligence. If necessary mean them with right people from laboratories and industries.
v) Without sitting on judgement, playa catalytic role in speedily narrowing down a few areas of action for Indian business to excel in world markets.
This will require considerable close work between persons, and financiers in
terms forecasting and foresight exercises.
vi) As can be seen in a book on "The Technological Specialization of Advanced Countriesâ€, 1992 technology specialization become imperative for technology policies. To quote :
â€œIn terms of policy options, two major opposing pressures appear to shape national choices. On the one hand the importance of technological accumulation and the persistence in time of some sectoral specializations suggest policies of defending and building up consolidated advantages in the face of foreign competition. Better economic and technological performance is more likely to be achieved by persisting in the established sectors of strength, even if they happen to be in low technology fields, rather than by shifting to fields of scant national competence.
On the one hand, there is the pressure to pursue the opportunities opened by technological advances in new fields, challenging the advantages of the other countries. The changing relative position of individual countries in innovative activities can be understood as a process of growing endeavour and specialisation in technology, with countries facing challenges to their traditional advantages and seeking new advantages in other fields. The importance of innovating in new technological fields is obvious, but such efforts are risky and require a considerable amount of resources and favourable institutional conditions. They also have to meet more intense competition in global markets while their payoffs may take years to materialise. In allocating limited national resources to science and technology, difficult choices have to be made at the sectoral level.
Careful targeting of technology is required at the industry Level, taking into account the different dynamics shown by individual sectors. For instance, opposing patterns have emerged between generic and pervasive technologies on the one hand, where the international distribution of activities is more even and, on the other hand, the fields showing growing international competition and specialization, based on economies of scale and cumulative advantages. Increase in national specialization is also associated with the growth of international cooperation among firms, research institutions and Governments. These collaborative arrangements do not change the competitive nature of relations between firms, but have emerged as key elements in the technology policy of advanced countries. Identifying complementarities between the different specializations developed by various agents is likely to be an increasingly important aspect of national technology policy. The experience of the EEC high technology programmes is an important asset in the search for cooperative innovation activities, and it may deserve to be extended to other fields and to a wide range of agents in the business and research communities.
While greater resources and a more specialized pattern of technological activities appear to be associated with better national performance, several economic and institutional conditions play an equally important role in the successful development of a country's innovations. In this context, countries will find their resourcefulness increasingly challenged by a technology system which has grown more international and cooperative in orientation, specialized in selected sectors, and constrained by intense international competition. In the 1990s, the outlook for technological advance is clouded by signs of a slow-down in the R&D efforts of many countries, by stagnant patterns of domestic patenting and by uncertainty over the priorities of technological efforts. The economic recession which has hit a number of countries casts yet another shadow over the future, and stagnating R&D efforts certainly do not contribute to renewed growth of advanced economies. Given the present context, the processes of technological change and specialization investigated in this book may suggest more sharply focused and appropriate policies for innovation and new directions for national efforts in science and technology. In turn, together with very many other economic and social factors, these may contribute to improving the prospects for advanced countries in the new century.â€ Unquote. Govt.should recognise these facts and help Industries accordingly.
vii) Government's role should be to facilitate all actions
required to speadily arrive at such choices by various stakeholders (without the paralysis by analysis Syndrome) and to help various actors through tax incentives, softer loans, etc for limited periods.
viii) As far the resources for R&D is concerned while there is a definite case for Industry to increase its direct investment in R&D (and to avail of various tax benefits as well), Government should immediately rationalise the use of various cesses collected by it (not just the R&D Cess) and reserve substantial portion of these cesses for funding tarqeted commercialisable R&D projects - in one industry or group of industries. Methods of use of these funds should be substantially debureaucratised.
ix) Government should enhance (about ten time) the total fund pool available in venture capital funds for R&D/technology intensive projects. Presently the amount is miniscule and various constraints make them funds not available for real technology development. Such Venture Capital funds can be given certain special concessions for next 5 to 7 years in order to manage the transition.
x) Special drive may be done for encouraging joint venture R&D corportions in the country with foreign equity not exceeding 50%. Government laboratories may also be encouraged to join such ventures.
xi) Considerable liberalisation may be done by the Government in the field of education for enhancing the skills of workers and administrators for facing the challenge of modern technologies.
xii) Since environmental management and clearances will be vital in future enhance the quality of those who administer these laws and ensure that they do not emerge another hot bed of Government control by backdoor as it happened with DGTD, in the era of industrial licensing.
10.4 JOINT ACTIONS
There have to be joint actions by all the three segments of stakeholders described in the earlier sections. The key words are technology foresight, technology specialisation, targeted technology action, speedy commercialisation and marketing of R&D, global scale actions, and ability to continually review and change strategies as required. Incidentally for all these our time scale available is about 5 years when many of the transitional periods given in GATT agreements are still protecting the old order. We should be well rooted to stand up to another major dose of global (chilly) winds that will blow soon.
Therefore the orchestration of various elements is key to the national survival. Such an orchestration should be done less by Government departments as they have mainly shown their ability for "no-action through continual coordination". The role should now shift to Industry and Business Associations, S&T academies, autonomous institution, business houses and financial institution. Government should play a benign role of facilitating and for making available the vast resources that have been built up under it with peopleâ€™s money collected in taxes. It should learn to use it sovereign powers when there are technology or trade embargoes which no doubt will be imposed or attempted or threatened of when Indian business and R&D teams win in the global markets through targeted actions.
Government should be constantly looking for creating an environment to unleash the creative energies of the Indian experts and enterpreneurs while leaving the details of actions to more professional actors in the scene.
The new role to be played by the Government would keep the apex levels of Government dealing with real issues of policies and long term strategies.However in the process a large sections of lower and middle level personnel will feel left out. They are national assets. They are now unproductive or counter productive because of the earlier policies, fears and resultant methods of functions. They can and should be given new lives.Government should facilitate, in various ways by amending rules, their leaving Government jobs and experimenting with other avenues for a period of 3 to 5 years. Many of them will learn new methods and leave Government. Business houses should be sympathetic towards them, retrain them and utilise their talent when they wish to experiment a tenure with them.
Industry has a crucial role to play in raising the investments in S&T to 2% or more of GNP by the turn of the century. This has to be an orchestrated action along with Government and financial institutions. This size of investment is crucial for a real take off as can be seen from all developed countries, the trends in European countries and South Korea.
For technology forecasting and preparing the nation for the future, various levels from the national, sectoral, industry and firm levels have to participate as a continual biennial exercise. Industry and Business associations have a special lead role to play in the Indian context.
Another important task is to create confidence in the national psyche that our businessmen, scientists, Government, and others can meet the challenge. Media of all forms should be creatively used for which business houses and Industry/business associations can playa great role. Government may give time in electronic media at special rates for such messages.
11. ACTION ON POLICY AND IMPLEMENTATION
This paper has deliberately avoided spelling out the details of areas to be targeted though it is well known that infrastructure areas like Energy, Transport road/waterway/ airways), Agrobased industries, advanced emerging areas in materials, biotechnology etc will have to receive special attention. Instead of going through generalised and impressionistic judgements or cliches, it may be worthwhile for persons, business houses and R&D Institutions to sit together to narrow down specific time-bound tasks for targeted actions. Let this process be a continuing exercise thus creating a culture of joint actions.
Our scientists or business persons or administrators have shown individual excellences in the past. Now it is a matter of showing their collective strengths and ability to take orchaestrated actions to win Indiaâ€™s place in the global economy. It is going to be set of actions based on trust and confidence, It is a task of reaching peaks of excellence even while raising the average levels to substantial heights. It is a vision leading to specifically focussed actions to concentrate our energies and to sustain competition; it means also learning to say â€˜noâ€™ to some actions, that is the road of hard choices and fearless risk taking.
If there is a collective action on all fronts as outlined in this paper, Indian business can emerge as a serious force to content with in world of tomorrow.
(see next pages for references for those desirous of digging deeper).
(Not enclosed for the website)