‘R&D support can deepen India’s share in global supply chains’

Krishan said India should strive to have both high-volume low value-added products that create jobs as well as high value-added products protected by IPR in its export basket as a strategy to attain $1 trillion merchandise export target by 2030 as set by the government.

“We can retain a large part of the value in manufacturing within the country if we focus on innovation…Owning intellectual property of the products sold, as opposed to using one’s facility to add some value, helps in deepening the value addition. And that is where the whole focus on R&D comes," he said.

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Krishan also said a report brought out by PwC India proposed a blueprint for India to achieve $1 trillion merchandise export by 2030 by unlocking the country’s export growth potential.

PwC report

The report titled 'Vikasit: an approach for India to achieve $1 trillion exports’, released on Friday said that in 2023, the top 10 exporting countries, led by China, US and Germany, serviced more than half of the global demand. India is ranked seventeenth, accounting for 1.85% of global trade, compared to China’s 14.6%.

PwC India said in a statement on Friday that steps like value addition and volume growth in exports, identifying priority products and industries, infrastructure investments, sustainable supply chains and focusing on small businesses have the potential to open up new opportunities for India in trade. 

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Official data from the ministry of statistics and programme implementation showed that the total expenditure on intellectual property rights creation by the government, private sector and households in FY23 was at ₹5.6 trillion, 1% more than what was spent in the year before. The expenditure on intellectual property rights creation is a part of the overall investments in fixed assets or Gross Fixed Capital Formation.

“A market is able to contribute more in terms of value addition if the intellectual property rights rests with it," Krishan said, adding that skilling people was equally important.

“Our employees, our people, are an important factor in India's success. If somebody wants to do something which is more precision oriented, it would require a certain amount of incremental skilling," said Krishan.

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What do experts say?

Experts said that IPR is critical for scaling up manufacturing sophistication. “Intellectual property rights are important for driving innovation and need to be designed and executed carefully. In India, the broader contract enforcement and ease of doing business context also reduce investment in value adding innovation and must form part of any strategy to improve the status quo," said Rahul Ahluwalia, founder and director at Foundation for Economic Development, a  not-for-profit organization based in Delhi.

Ajay Sahai, director general of Federation of Indian Export Organisations (FIEO) said IPR-protected innovations can transform ordinary products into high-value offerings enabling India to move up the value chain and compete in global markets.

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“We should focus on sectors with high innovation potential like biotechnology, pharmaceuticals, medical and diagnostic equipment, electronics, hi-tech engineering and renewable energy to reap the benefits," said Sahai.