India is currently facing a rare window of opportunity to emerge as a major manufacturing hub for domestic and global markets. Prime Minister Narendra Modi’s flagship ‘Make in India’ initiative is aimed supporting the National Manufacturing Policy, which plans to create 100 million jobs by 2022 and raise manufacturing’s contribution to the GDP from 16 to 25 per cent.
The government is also trying to drive other initiatives like ‘Skill India,’ ‘Digital India’ and ‘Smart Cities Mission.’ Another big ticket item called ‘Start-up India’ is being fine-tuned to foster a culture of entrepreneurship and innovation. Investor outreach programs are underway with several countries so that enterprises can access the best practices, tools and strategies.
These are essential for Indian businesses to gain competitiveness in design and development of quality products at affordable prices, and eventually become a part of global supply chains.
To help build the talent pipeline, the new Ministry of Skill Development and Entrepreneurship is overseeing over 70 skill development schemes run by more than 20 ministries / departments as well as giving a fillip to the network of Indian Institutes of Technology and Indian Institutes of Management. These are being aligned to the 25 sectors of ‘Make in India’ with sector-specific skill councils.
Private sector participation
While government's initiatives to skill the youth are a welcome development, increasing private sector's participation is imperative. Corporates should thus partner with universities and other educational institutions relevant for their industries to create commercialisation paths for deserving projects.
Young innovators must be encouraged to go on exchange programmes and get special internships or grants which help them fuel their research and learning. Our universities too need to encourage entrepreneurial mindsets so that students can challenge the status quo, think differently and come up with innovative solutions to solve present and future challenges.
Incubation centres in universities across the world support and encourage business activities. This leads to fostering entrepreneurial mindsets which in turn leads to new job creation and overall economic development. Creative energies of the youth need to be nurtured to outgrow the mindset of a controlled economy.
India's space program 'Mangalayaan' is a shining example of its innovative capabilities. The country ranks among top middle-income economies in terms of innovation quality along with China and Brazil. A recent report says India has made significant progress in institutions, knowledge and technology outputs. But its ranking dips in human capital and research, market sophistication, business sophistication and creative outputs.
Aiming to strengthen the eco-system of innovation and further improve India’s ranking in Global Innovation Index (GII), the Department of Industrial Policy and Promotion has decided to set up a task force. Innovation is widely recognised as a central driver of economic growth and development, and GII aims to capture its multi-dimensional facets.
Making a mark globally
India’s ranking in GII 2016 jumped 15 places to 66th position. The country retained the top rank in information and communication technology service export for more than last three years. India is a top-ranked economy in central and south Asia, and shows particular strengths in tertiary education and R&D, including global R&D intensive firms, the quality of its universities and scientific publications.
The annual rankings are jointly published by Cornell University, INSEAD, and the World Intellectual Property Organisation. It surveyed 128 economies around the world 92.8 per cent of the world’s population and 97.9 per cent of global GDP, using 79 indicators to determine both innovative capabilities and measurable results.
India also over-performs in innovation relative to its GDP. It ranks second on innovation quality among middle-income economies. As per the report, “India is a good example of how policy is improving the innovation environment.” The country moved up across all indicators within the knowledge absorption sub-pillar. It has also exhibited a solid performance in the GII model’s newly incorporated research talent in business enterprise where it ranks 31st.
Demographic dividend
There are other bright spots too. India has one of the world's largest educational systems with 1.4 million schools, 35,000 colleges and 600 universities. Over half of the population is under 30 years of age and 10 million people join the workforce each year. However, there is a need to update the education curriculum, to revamp the examination system which is currently a test of memory than test of analytical skills, and to improve the quality of teaching and teachers.
Blending skill development with education system is required on a priority basis. Hence linkages between universities and businesses need to play an important role in innovation and entrepreneurial dynamics. Research-linked scholarships, paid for by both the government and the private sector, are a crucial requirement.
The private sector must step up its involvement in furthering STEM (science, technology, engineering and mathematics) proficiency much more. STEM education programmes and activities will promote these subjects particularly to young people and help create talent to secure the future success of businesses in aerospace and all other sectors – particularly manufacturing. The country needs strong business models whose cornerstones are trans formative change and sustainability.
Seize the momentum
India is among the countries with the most acute talent crisis globally. By 2020, the shortfall of engineers is expected to range from 1.5 to 2.2 million, posing a risk to national economy. Policy makers must realize that possession of significant human resources in science and technology is both a national economic priority and technological necessity.
By 2025, India will have nearly 25 per cent of the world's total workforce and organisations like the National Skill Development Corporation will be useful in creating opportunities for youngsters. Such indicators point towards economic upswing in the coming years. With focus on skill development and local manufacturing, India can achieve double-digit GDP growth while ensuring that it becomes self-sufficient in developing critical technologies.
We are on the cusp of the fourth industrial revolution where all sectors of the economy and people’s lives will be transformed in significant ways in the years ahead. India has a unique opportunity in this time of immense change. A smart pro-active strategy for innovation and entrepreneurship supported by dynamic leadership from the government, private sector and the academia can help elevate the mission to ‘Innovate in India.’