The fourth lecture in the ‘Make in India – Success Stories: Lessons Learnt’ lecture series was delivered by Dr. Naushad Forbes, Co-Chairman of Forbes Marshall and the programme was chaired by Mr. Ravi Pandit, Chairman and Group CEO , KPIT Technologies.
Under the overarching theme of ‘India’s National Innovation System’, Dr. Forbes began set the context for where India stands 25 years after the reforms began. He mentioned that while India’s product and service markets have undergone a huge transformation, our share of manufacturing in GDP, as of 2016, is almost exactly what it was in 1991- at 15%. He projected that to raise the share of manufacturing in GDP, the sector must grow by at least 15% for the next 10 years. Growth at 15% a year for the next 10 years would enable us to match the manufacturing record of countries like South Korea in the 70s and China in the last 20 years.
“Growth in manufacturing has not been accompanied by growth in jobs in manufacturing”, he said. Using China as an example he drew attention to the fact that India employs a drastically lower number of people in manufacturing. “If large scale manufacturing is not our construct, then what is our construct?” he inquired. Suggesting that the German manufacturing system, built around technology, knowledge and skills, could resonate better with us, he shifted his focus to the importance of R&D and innovation systems.
Dr. Forbes observed that the R&D business is a hugely concentrated business, occurring largely in giant firms. Sharing vital information of R&D as a percentage of GDP over time for newly industrialised countries over the last 35 years, he spoke about the position of the USA, China, Germany and Korea with respect to investments made in R&D.
Building on all the (this) vital information, Dr. Forbes explained that India faces a 3-fold challenge in R&D: 1. We need to augment our share of R&D as a percentage of GDP. 2. We have to augment our corporate share in R&D, and 3. We need to boost the share of Universities in R&D.
At 4% of the total national R&D, India is the lowest among all major economies in terms of the proportion of R&D carried out within the education system. The major reason for this stated by Dr. Forbes is the fact that in the 1950s, we made the decision of investing public research in autonomous R&D labs, under Prime Minister Nehru’s government.
In conclusion, he made a plea for public research to be taken over by the public universities, as it encourages young graduates to work alongside seasoned scientists which helps them gain crucial experience and it also engages high quality skilled labour at a low cost.