science & technology - ibef 2017 for updated information, please visit 8 indian science &...

11FEBRUARY 2017

SCIENCE & TECHNOLOGY

FEBRUARY 2017 For updated information, please visit www.ibef.org

22FEBRUARY 2017 For updated information, please visit www.ibef.org

❖ Executive Summary……………..…………..3

❖ Advantage India………………………..…….4

❖ Market Overview and Trends………..……...6

❖ Porter Five Forces Analysis..……………...12

❖ Growth Drivers………………………………14

❖ Opportunities……………………….……….25

❖ Success Stories…………………….………31

❖ Useful Information………………….………34


FEBRUARY 2017

33FEBRUARY 2017

• Third largest technical manpower in the world

• 162 universities awarding 4,000 doctorates and 35,000 postgraduate degrees

• Global share in scientific publications rising at a CAGR of ~12 per cent

• India ranks 8th in the world in terms of number of students graduating in science &

engineering stream

• Policies aimed at projecting India as a Science & Technology powerhouse & promoting

both public & private sector involvement in the Research & Development practice

• Women Scientific programmes to expose women more and more towards research

• With more and more multinational companies setting up their R&D centres in India, the

sector has seen an uptrend in investments in recent years

• As per Union Budget 2017-18, Government of India allocated USD597.46 million to the

Department of Science & Technology, covering 6 main objectives including technology

development programmes, partnerships & alliances, policy formulation, strengthening

human capacities, strengthening institutional capacities & societal interventions of S&T.

• With a USD1.59 trillion (calculated at base price) economy in FY16 & per capita income of

over USD1,182.88 in 2015-2016, India presents a unique opportunity for companies to tap

the huge consumer base demanding technologically advanced products.

• Demand for cheap and durable products that could meet the local requirements drives the

need for innovation

For updated information, please visit www.ibef.org

EXECUTIVE SUMMARY

Source: RBI, India Budget, TechSci Research


Large consumer base

Huge talent pool

Policy framework

Rising investments

ADVANTAGE INDIA



ADVANTAGE INDIA

Source: Department of Science & Technology, IBEF, FICCI, TechSci Research


Advantage

India

Growing demand

• Expanding middle class and increasing

affordability are expected to remain key demand

drivers for technologically advanced products

• Demand for products that meet the local needs

is set to accelerate

Rising investments

• Cheap labour costs and easy access to talent

have been attracting investments from foreign

companies in recent years

• Multinational companies are setting up their

R&D centres in India

Policy support

• Government has continued policy support in the

form of Science, Technology & Innovation Policy

2013 & the 12th Five-Year Plan (2012–17)

• The new government assured more and more of

support to researchers with lesser bureaucratic

hurdles

Huge talent base

• Third largest technical manpower in the world

• With government & private sector funding,

academia is adapting to the changing

requirements of the business sector

MARKET OVERVIEW & TRENDS


77FEBRUARY 2017

2003


EVOLUTION OF SCIENCE & TECHNOLOGY POLICY FRAMEWORK IN INDIA



Source: Department of Science & Technology, Ministry of HRD, Government of India,

Union Budget 2016-17

• New Initiatives such as

SWAYAM (Study Webs of Active-

Learning for Young Aspiring

Minds), etc. have been taken to

support young talent and attract

innovation

• "Innovation of Science Pursuit for

Inspire Research (INSPIRE)“

initiative was launched to

communicate with the youth

population and attract talent to

the scientific field

• The total plan outlay allocated

under the Union Budget 2015-16

for the Department of Science

and Technology is around

USD557.1 million

2013

2014

2015

2016

• Science &

Technology Policy

to bring science and

technology together

and emphasize the

need for investment

into research and

development to

address national

problems.

• Science,

Technology &

Innovation Policy

aims to develop

synergies

between science,

technology and

innovation. Ethnic

diversity and

varying

demographics

attracted

investment from

various players.

• Scientific and

Technological

(S&T) Activities

Survey 2015-16

aims to collect data

on resources

devoted to R&D in

science and

technology. The

information is

collected from

about 5000 R&D

organizations

present across the

country.

• New Initiatives such

as the Science,

Technology,

Innovation &

Creation of

Knowledge (STICK)

framework has been

taken by the Indian

government to

support innovation.

• The total plan outlay

allocated under

union budget 2016-

17 for the

Department of

Science &

Technology is

around USD597.46

million .


INDIAN SCIENCE & TECHNOLOGY SYSTEM

Source: Changing Indian STI Landscape Presentation, Department of Science & Technology

Note: STI refers to Science Technology & Innovation


Indian STI system

R&D bodies

Government funding &

development agencies

Academic sector

Socio Economic Ministries

Industrial R&D Systems

R&D by multinational companies

R&D in NGO groups


INDIA HAS A STRONG NETWORK OF SCIENCE & TECHNOLOGY INSTITUTIONS AND TRAINED MANPOWER

Source: Department of Science & Technology, NSTIMS, TechSci Research

As per the latest available information

India is among the top-ranking countries in the field of basic research

It has the third largest scientific and technical manpower in the world

162 universities award 4,000 doctorates and 35,000 postgraduate degrees annually

The Council of Scientific and Industrial Research runs 38 research laboratories

India ranks 12th in terms of the number of patents filed

India ranks 7th among highly productive countries in science and technology research.


1010FEBRUARY 2017

Source: Department of Science & Technology, NSTIMS, Business Standard, TechSci Research

Note: (1) Estimated Data; (2) - Data is as per latest data available


STRENGTHNING INDIA’S POSITION IN RESEARCH THROUGH INVESTMENT(2)

During the 11th Five-Year Plan, India’s R&D/GDP ratio

increased to 0.88 per cent

R&D investments have grown in India to around USD66.5 billion

by 2015 and are estimated to reach USD71.5 billion in 2016

As of December 2016, Government of Arunachal Pradesh

planned to allocate funds worth USD22.92-30.55 million for the

development of science & technology sector in the state.

A series of new investments were recently announced by Cisco

India to enhance cyber security infrastructure in India. It will

enable to build transparent & secure digital infrastructure

environment for accelarating India’s digital transformation. For

strategic cyber security cooperation,

Cisco India has signed an MoU with Indian Computer

Emergency Response Team (CERT-In) to establish a threat

intelligence sharing program.


USD’ billion

National R&D expenditure and its

percentage with GDP

5.4

6.87.6

9.810.3

11.2

18.0

0.0

2.0

4.0

6.0

8.0

10.0

12.0

14.0

16.0

18.0

20.0

FY05 FY06 FY07 FY08 FY09 FY10 FY14

0.76%

0.78%

0.80%

0.82%

0.84%

0.86%

0.88%

0.90%

0.92%

National R&D Expenditure (LHS)

R&D Expenditure (%of GDP) (RHS)

1111FEBRUARY 2017

NUMBER OF PATENT APPLICATIONS GOING UP

Source: Office of Controller General of Patents, Design, Trade Marks and Geographical Indication, Intellectual Property India, TechSci Research

Note: Figures mentioned are as per latest data available

Patent filings have gone up from 28,940 during 2006–07 to

42,774 during 2014–15, representing an increase of 5.01

per cent.

Out of the total number of 42,763 patent applications, the

number of applications filed by Indian applicants was

12,071 in 2014-2015, indicating around 10.3 per cent Y-o-Y

growth.

Total number of patents granted has dropped marginally in

recent years, primarily due to an increase in the disposal of

applications for which the request of examination was

received


Top 5 Indian applicants for patents from institutes Top 5 Indian applicants for patents from R&D organisations

Patenting trends in India

Name of R&D organisationsApplications

filed (2014-15)

Council of Scientific & Industrial Research 315

Defence Research & Development Organisation 98

Indian Council of Agricultural Research 68

G.H.R Labs and Research Center 31

Department of Biotechnology, Government of

India23

Name of Institute/UniversityApplications

filed (2014-15)

Indian Institute of Technology 337

Janardan Rai Nagar Rajasthan Vidyapeeth

(Deemed) University53

Indian Institute of Science 46

Amity University 43

Sandip Foundation’s Sandip Institute of Technology

and Research Center33


28

94

0

35

21

8

36

81

2

34

28

7

39

40

0

43

19

7

43

67

4

42951

42

76

3

0

5000

10000

15000

20000

2006

-07

2007

-08

2008

-09

2009

-10

2010

-11

2011

-12

2012

-13

2013

-14

2014

-15

0

10000

20000

30000

40000

50000

Patents Filed Patents Granted

PORTER FIVE FORCES ANALYSIS



PORTER FIVE FORCES ANALYSIS


Competitive Rivalry

• Competitive rivalry is low; however, there is indirect competition between

contract scientific research centres due to development needs of their

clients that operate in the same market and are in direct competition with

each other

• Many foreign companies tend to set up their in-house research centres

that may operate in competition with contract R&D centres

Threat of New Entrants Substitute Products

Bargaining Power of Suppliers Bargaining Power of Customers

• The threat of new entrants is

low because of the capital

intensive nature of the business

• Contract or academic research

centres do not have any direct

influence on the market, and

have little bargaining power for

the commercialisation of

technologies developed

• There is no direct influence of

consumers on scientific

research; however,

technologies are developed

keeping consumer needs in

mind

• With easy access to talent base

and low operational costs,

companies may look to set up

in-house scientific research

centres

Competitive

Rivalry

(Low)

Threat of New

Entrants

(Low)

Substitute

Products

(Medium)

Bargaining

Power of

Customers

(Low)

Bargaining

Power of

Suppliers

(Medium)

GROWTH DRIVERS


1515FEBRUARY 2017

STRONG POLICY FRAMEWORK TO PROMOTE INDIA AS A R&D HUB


Resulting in

Investments from

Multinational

Companies (MNCs) to

cater to the needs of

the local market and

their global client base,

R&D expenditure by 25

Indian pharma

companies has

increased by 28.8 per

cent in 2014-15

Strengthening capacity for basic research

Strengthening institutional capacity for research

Strengthening human capacity for research

Policy support


In FY15, most of the leading pharma players spent anywhere between

USD58-325 billion on R&D, which represented an increase both in

absolute term as well as in proportion to net revenues (8-11 per cent of

sales)

Source: ICRA, Deloitte, PWC, TechSci Research

Note: R&D - Research and Development


STRENGTHENING HUMAN CAPACITIES FOR GROWTH


Source: NSTMIS, Department of Science & Technology

Note: Pursuit for Inspired Research (INSPIRE)

In recent years, the Indian Government has implemented

several fellowship schemes to nurture human capacity for

advanced research in the country

The period between 2010-20E has been declared as the

“Decade of Innovation” by the nation & the need for the

establishment of National Innovation Council has been

emphasised. To fuel the growth innovation in science &

technology STI (Science, Technology & Innovation) Policy

2013 was formed.

In 2008, Government launched Innovation in

Science Pursuit for Inspired Research (INSPIRE)

scheme, through which the Government awarded

2,150 research fellowships for doctoral research &

270 faculty awards for post doctoral researchers

As of December 2016, India & Israel announced plans to

support R&D programmes in science & technology sector,

with an investment of USD1 million, by both nations

Number of researchers in India

1,92,819

2,00,000

2009 2015

INSPIRE fellowship growth profile

780871

11901000

679

FY11 FY12 FY13 FY14 FY15


LOCAL DEMAND ATTRACTING INVESTMENTS FROM MNCs … (1/2)


Source: IMF, World Bank, India Budget, Government of India Press

Information Bureau Government of India, Ministry of Statistics and

Programme Implementation

Note: E- Estimates, F - Forecast

India presents a unique opportunity for companies

manufacturing technologically advanced products,

registering USD1.59 trillion economy & per capita income of

USD1719 in FY16.

An expanding middle class & rise in purchasing power of

rural residents have boosted demand for innovation &

development of cheap & durable products that could meet

the local requirements

Rising per capita income in India to bring boom in R&D

investments in the country with more & more of foreign

players shifting R&D bases to India

As of December 23, 2016, Maruti Suzuki announced plans

to invest USD305.53 million, during 2017-2019, in its R&D

center in Rohtak, Haryana.

Qualcomm, plans to invest US$8.5 million on design

initiatives in India, which would include funding its

innovation labs at Hyderabad & Bangalore, for R&D.

Per capita income (in USD)

14

30

.2

15

52

.5

15

14

.8

15

04

.5

16

00

.9

16

17

.3

17

19

1874.9

20

26

.7

22

07

.6

-4.0%

-2.0%

0.0%

2.0%

4.0%

6.0%

8.0%

10.0%

0.0

500.0

1000.0

1500.0

2000.0

2500.0

GDP per capita, current prices Growth Rate


LOCAL DEMAND ATTRACTING INVESTMENTS FROM MNCs … (2/2)


Source: FICCI, Department of Science & Technology, Zinnov, TechSci Research

Note: Figures mentioned are as per latest data available

Lower development cost, rising technology intensity and growing

local demand for top of the line unique technology products have

attracted R&D investments from foreign companies in India,

making it one of the largest outsourcing provider in R&D segment

More than one-third of the top 1,000 global R&D spenders have

centres in India. Around 50 per cent of the global 500 companies

present have more than 10 per cent of the global headcount in

India

About 28 per cent companies with headquarters in Japan, the EU

& APAC have a R&D centres in India

There is a potential to create 200,000 R&D jobs by Global 500

companies in the next 5 years. During 2013-18, R&D headcount is

expected to increase at a CAGR of 15.8 per cent

Total number of MNC R&D centres in India

4683

52 4528 20

4

1748 55

72 80

Top 50 Top 100 100- 200 200-300 300-400 400-500Present Not present

Number of R&D centers for global 500 companies, 2014

176

366

313

229

489

595

2013 2018

R&D headcount Remaining addressable population

R&D headcount by G500 (‘000)

191297

517699 780

8711,031

1,165

Before'00

2001-02 2003-04 2005-06 2007-08 2009-11 2011-13 2014-16

1919FEBRUARY 2017

The key elements of the STI policy are:

• Developing synergies between science, technology and innovation

• Providing a fresh perspective on innovation in an Indian context

• Charting a high-technology path for creating a science, research and innovation system in India

• Promoting proliferation of scientific temper among all sections of the society

• Enhancing skill for applications of science among the young from all social strata

• Making careers in science, research and innovation attractive to the brightest students

• Establishing world class R&D infrastructure for gaining global leadership in some select frontier areas of science

• Positioning India among the top five global scientific powers by 2020

• Encouraging private sector to invest in research and development in Science & Technology.

• Setting up of large scale R&D facilities via PPP mode.

• Setting up of regulatory framework for sharing IPRs between inventors and investors.

• Migrating R&D outputs into commercial applications by replicating hitherto successful models as well as

establishing new structures

• Facilitating S&T-based high-risk innovations through new mechanisms

• Triggering changes in the mindset and value systems to recognise, respect & reward performances that create

wealth from S&T derived knowledge

• Increasing R&D spending to 2.4 per cent of GDP by 2034


FAVOURABLE POLICY MEASURES AIDING GROWTH

Science Technology and

Innovation Policy 2013

Source: News articles, Science & Technology Policy 2013


2020FEBRUARY 2017

The Government of India has taken various steps to generate interest and promote investments in the Science &

Technology sector


KEY GOVERNMENT INITIATIVES…(1/2)

12th Five-Year Plan

(2012–17)

Key focal points include:

• Creation of major national facilities under partnerships

• Programmes for centre-state technology partnership

• Building educators for science teaching

• Investments into mega science for creation of R&D infrastructure within India and abroad

under partnerships

• Creation of proper institutional framework in science & technology institutions to enhance

R&D activities.

Source: Department of Science and Technology, Government of India, & Other Government websites

National knowledge

network

• A state-of-the-art multi-gigabit (multiples of 10 Gbps) pan-India network is planned to link

some 5,000 nodes in India

• It will be the sole vehicle for international connectivity in future


National Innovation

Council

• 2010–2020 has been declared the Decade of Innovation to stimulate innovations &

produce solutions for societal needs such as healthcare, energy, infrastructure, water &

transportation

Improving Academia

• Innovation universities would be set up as public private partnerships to develop new

hubs of education, research and innovation

• The Educational market in India has the potential of reaching USD110 billion by FY15

with the increasing demand for quality education

2121FEBRUARY 2017

The Government of India has taken various steps to generate interest and promote investments in science & technology

sector


KEY GOVERNMENT INITIATIVES…(2/2)

National Council for

Science & Technology

Communication

(NCSTC)

Key focal points include:

• Aims at promoting scientific thinking.

• Communicating science & technology to masses using digital media, folk media and

digital media.

• Focus on training in science and technology communication, incentive programmes,

production & dissemination of S & T software, development and research in S&T.

• Important initiatives under NCSTC include Mathematics Awareness Resources &

Initiatives (MARI), campaigns over Year of Scientific Awareness, the National Science

Day, the National Children’s Science Congress, Science Express, etc.

Source: News articles, Government websites, swissnex India

Big Data Initiative

(2016)

• An innovative R&D perspective to promote big data science, technology and applications

within the country.

• Aims at developing core generic technologies, tools and algorithms for wide applications

in industries, government and academia.

• Extraction of useful knowledge hidden in in-size data repositories.

• Understanding the current status of industry in terms of policy framework, distinct players

providing services across sectors, market size, SWOT of industry, etc.



INDIA AS CENTRE OF EXCELLENCE


Source: swissnex India, NSTMIS

Note: (1)Centre of Excellence are identified using a threshold of minimum of 200

research papers in the top decile of global research (2014);

As per Latest Data available

In 2015, Punjab University has been acknowledged as India’s

leading science institution, based on its research papers published

during 2010-14. It had the highest citation impact of 1.4

As of November 2016, Ministry of Earth Sciences, Government of

India and Japan Agency for Marine-Earth Science and Technology

(JAMSTEC) have signed a Memorandum of Understanding (MoU)

for advancement of academic research in the field of Earth Sciences

As on November 2016, India has become an associate member at

European Organization for Nuclear Research (CERN)

Top Indian Institutions by citation

impact(1)

Citation

Impact

Punjab University 1.4

Tata Institute of Fundamental

Research1.39

Indian Association for the Cultivation of

Science1.28

CSIR Chemistry and Physics 1.18

Indian Institute of Technology Bombay 1.15

Indian Institute of Science Bangalore 1.11

Indian Institute of Technology

Guwahati1.07

CSIR Industry and Standards 1.07

Indian Institute of Technology

Kharagpur1.06

Indian Institute of Technology Madras 1.03

2323FEBRUARY 2017

ATTRACTING INVESTMENTS FROM PRIVATE SECTOR


Source: Press Release, Department of Science & Technology, NSTMIS, TechSci Research

Notes: E denotes Estimated, (1) Data till 2010, (2) Data Till 2014, (3) Data Till 20164: As per latest available information

In 2016, India ranked 6th in terms of R&D spending, across the world and is likely to overtake Germany and South Korea by

2018.

In 2016, R&D investments in India was estimated 0.85 per cent of GDP, which is expected to further increase to 2.4 per cent of

GDP by 2034.

R&D investment to register nearly twofold increase during 2020 and reach USD 38 billion

Engineering R&D market is expected to increase by a CAGR of 14 per cent to reach USD42 billion by 2020 whereas the

outsourced engineering services market in India would reach USD15 billion by 2020, growing at a CAGR of 13 per cent

Company R&D Spend (USD million) R&D Spend (% Revenue)

Tata Motors 365.63 0.84%

Prithvi Information(1) 246.3 60.5%

Polaris Software(3) 0.62 0.22%

BHEL 155.67 3.3%

Mahindra & Mahindra 235.43 3.38%

Lupin 183.20 8.87%

Infosys(3) 63.40 0.8%

Reliance Industries 202.39 0.31%

Core Education &

Technologies Limited(2) 96.2 53.4%

Bharat Electronics 83.86 8.2%

Top 10 companies spending on R&D in India – 2014-154



ATTRACTING INVESTMENTS IN THE R&D SPACE


• In 2016, Tata Group has joined hands long with Indian Institute of Technology, Harvard & Yale

Universities, to start developing breakthrough technologies, with an investment of US$ 25 million.

• In 2016, the company invested USD15 million in building a development, quality & global research Thane,

Maharashtra.

• In 2015, Honda invested USD98.26 million, to accelerate its manufacturing capacity and R&D capabilities,

at its Greater Noida and Tapukara (Rajasthan) plants.

• In 2015, the company made plans to double its business in the country and upscaling the headcount by

hiring 200-250 engineers annually for the next three-four years.

• Plans to start R&D in rolling stocks for its railway systems to support the growing urban transport needs in

the region.

• Opened an R&D centre in India with focus on organic synthesis, advanced process and formulation,

molecular modeling and agro chemicals, innovation campus to start by 2017 in Mumbai.

• USD2074 million has been spent on R&D in 2014.

• BASF estimated to invest 10.5 million in R&D in 2015.

• BASF opened a new R&D center in Germany in 2016, for biological crop protection and seed solutions.

• In 2014, investing ~USD82.9 million across 5 units of R&D and also setting up a new R&D unit.

• Hero MotoCorp spends USD118.4 million in their R&D expenditure in, FY15.

• Hero MotoCorp opened a new R&D center in Jaipur with an investment of USD129.85 billion, in FY16.

Source: Company Websites, News articles

Note: Figures converted to USD using INR-USD exchange rate for 2013-14

OPPORTUNITIES


2626FEBRUARY 2017

R&D OPPORTUNITIES IN VARIOUS SUB SECTORS IN INDIA


ICT and wireless

technology

• Establishment of Software Technology Parks of India (STPI’S)

• National Policy of IT aims at bringing the power of ICT within the reach of all its citizens to enable India

to emerge as a global hub for IT by 2020

• Cloud computing presents endless opportunities in wireless technologies

Pharmaceuticals and

Health Care

• 3rd largest pharmaceuticals market by 2020

• USD55 billion in revenues by 2020 and USD 26.1 billion in genetics by 2016

• A new Health Policy 2015-2025 to focus on healthcare for all holistically

Water technologies

• The water demand of industry will account for 8.5 per cent and 10.1 per cent of the total fresh water

abstraction in 2025 and 2050 respectively

• R&D efforts should concentrate on developing technologies for treatment, recycling, recovery, reuse

and efficient use of water

Manufacturing

technologies

• Automation and environmental sustainability are the key focus areas for manufacturing companies

• The National Manufacturing Policy targets at creating 100 million additional jobs in the sector by 2025

• Planned expenditure in R&D in manufacturing sector is estimated to increase by 63 per cent in 2016-

17 as compared with that in 2015-2016.

Material energy • Multi-disciplinary research to combine emerging concepts in nanotechnology with fundamental

metallurgical chemistry is the way forward

Bio-energy

• Bio-energy is emerging as a promising alternative to meet rural energy needs in India

• Targets set by Bioenergy Programme: By 2020, 20 per cent blending of fossil fuels will be done, cost

effective production system for algal biofuel, next generation biofuels produced from agricultural waste

Source: Make In India, FICCIFor updated information, please visit www.ibef.org


ICT EVOLVING IN INDIA AT AN UNPRECEDENTED RATE


Source: News Releases, FICCI

Notes: ICT denotes Information & Communication Technology,

E denotes Estimated, F denoted Forecasted

According to Nasscom, India’s information technology

design and engineering services market is expected to

touch $35 billion by 2020

As per report of a UN (United Nations) agency,

released on August 15, 2016, India was the top

exporter of information & communication technology,

globally.

As of February 2017, ISRO is planning to initiate

production of Telemetry & Telecommand processor

(TTCP), whose indigenous development is expected to

replace the expensive imported equipment.

USD’ billion

Investment in ICT in India

66.471.5

78.986.2

95.9

2012 2013 2014 2015E 2016F

Information & Communication Technology (ICT) spending in Indiais expected to increase at a CAGR of 9.63 per cent to USD95.9billion during 2012-16F

Telecommunication sector, which accounts for 67 per cent of theIndian ICT market, is expected to drive growth

Key drivers that would accelerate growth of the sector includeincreased access to services due to launch of newer telecomtechnologies, better devices, changing consumer behaviour &emergence of cloud technologies

With usage of wireless technologies expected to grow in future,low power devices with higher duty cycles need to be explored

Network infrastructure also needs to be improved as elimination ofcongestion in existing network infrastructure is the need of thehour

According to NASSCOM, the total ICT spending allocated forSmart Cities in India during the Union Budget 2014-15 wasaround USD30-40 billion. However, as per Union Budget 2015-16,expenditure worth USD1.07 billion was incurred.

As of October 2016, GSAT-18, India’s latest communicationsatellite was launched from spaceport of Kourou in FrenchGuiana.

On February 15, 2017, ISRO launched 104 satellites, using its

workhorse rocket PSLV-C37, from Satish Dhawan Space Centre

in Sriharikota.


RISING R&D ACTIVITIES IN THE INDIAN PHARMACEUTICAL SECTOR


Source: Make in India, FICCI, Ministry of Chemicals & Fertilizers- Department

of Pharmaceuticals, TechSci Research

Note: F denotes Forecasted, (1): For FY15(2): up to Dec 2015, (3): up to March 2016

R&D - Research and Development

Indian pharmaceutical market is expected to expand at a

CAGR of 12.89 per cent during 2015-2020

Key drivers that will fuel the sector’s growth include rising

income levels, increase in chronic diseases, better medical

infrastructure, wider health insurance reach & supportive

healthcare policies

Creation of new drug testing laboratories and further

strengthening of 31 existing state laboratories

A weighted tax deduction is given under section 35(2AA) of

the Income Tax Act

Allocation of USD364.96 million to set up 4 more institutions

of the stature of AIIMS in J&K, Punjab, Tamil Nadu,

Himachal Pradesh & Assam. Another AIIMS to be set up in

Bihar

Setting up of projects in special areas such as the North-

East, Jammu & Kashmir, Himachal Pradesh & Uttarakhand

Companies need to develop drugs for diseases local to

India and other tropical countries

Overall R&D expense by Indian companies has been

around 5 per cent of sales & is expected to increase in

coming years

Indian pharmaceutical marketUSD’ billion

30

55

2015 2020F

R&D spending by top six pharma giant FY16 (upto

September 2015)

(USD million)351.67

198.59244

164

2885 58

Sun Pharma⁽³⁾

Dr Reddy⁽²⁾ Lupin⁽³⁾ Cipla Cadila Wockhart⁽¹⁾Aurbindo⁽¹⁾


THE WAY FORWARD … (1/2)


Source: Science, Technology & Innovation Policy

2013; Department of Science and Technology

• The aim is to accelerate innovative Indian technologies into the global market

• This programme is a joint initiative of FICCI, Dept. of Science and Technology, Govt. of India, and others

• The Government’s focus is on using the world class commercialization strategies and business development

assistance to expand in the global market

• Special incentive mechanisms are being developed to stimulate research in universities and develop young

leaders in science and engineering

• The policy framework is being devised to enable school science education reforms, by improving teaching

methods and science curricula

• Through Science, Technology & Innovation Policy, the Government is promoting the establishment of large

R&D facilities in PPP mode with provisions for benefits sharing

• Promoting multi-stakeholder participation in the Indian R&D system

• As per recent RBI (Reserve Bank of India) norms, start-ups can now access foreign currency loans of up to

US$3 million in a year, under the external commercial borrowing (ECB) route.

India Innovation

Growth Program

Human capital

development

Investment in basic

research

Attracting investment

from private sector

• Government is promoting investments in basic research to improve research quality to meet global standards

and to address national challenges

• Leveraging international S&T co-operation, the government has planned co-investment of resources for joint

initiatives with Australia, Canada, Germany, etc.

• The government has its focus on investing in research & development of technologies that address the needs

of rural India

• In FY16, India’s investment in science and research sector, is estimated to be 0.9 per cent of its GDP.


THE WAY FORWARD (CONTD.) … (2/2)


Source: Science, Technology & Innovation Policy 2013

R&D laboratories

collaboration

Promoting innovation

• Through Science, Technology and Innovation policy, the Government promotes

mechanisms for nurturing technology business incubators and science led

entrepreneurship

• Also promoting incentives for commercialisation of innovations with focus on green

manufacturing

• The Government is focused on setting up inter university research centres to enable

researchers from different disciplines and universities to come together and address the

challenges of Science & Technology and its applications

• In FY16, India and UK collaborated as R&D partners in Solar Alliance and Nano Material

Research.

Gravitational Laser

Interferometer

Gravitational-Wave

Observatory

• The Indian Institute of Science Education & Research (IISER), which served as a part of a

global team of scientists, proposed to set up a LIGO (Laser Interferometer Gravitational

Wave Observatory) detector in India. LIGO will help in detection and observation of

gravitational waves.

SUCCESS STORIES


3232FEBRUARY 2017

1966 1998 2005 2008 2014 2015 2016


SUCCESS STORIES: TATA MOTORS LEADING THROUGH INNOVATION


Source: Tata Motor’s website

Notes: (1) Excluding Jaguar and Land Rover, LCV - Light Commercial Vehicle; (1) - Data is for Half Year Ended September 2015

A Combination of

technology and

imagination,

Tata Motors has been

driving the innovation

tend in the

Indian automobile

industry

Production

of first

indigenously

designed

LCV

Establishment

of engineering

research

centre

Launched

India’s first

indigenously

designed car

Launched

world’s

cheapest

car, Tata

Nano

Launched Prima

LX Trucks’ 6 new

models in the cargo

segment and 4 new

models in tippers,

along with various

others

FY15

USD43.75

Billion

turnover

Introduced

new SIGNA

range of

commercial

vehicles

Feb 2016

FY16(1)

USD20.08

Billion

turnover

2016: Products

anticipated to be

launched in 2016: Tata

Nexon, Tata Hexa, Tata

Kite Sedan, Tata

Megapixel, Tata Indica

Vista Electric


INFOSYS: NURTURING INNOVATION IN IT

Source: Office of the Controller General of Patents,

Designs and Trademarks Annual Report, Company

Annual Reports, TechSci Research

Note: (1) - Data is for FY15;

Indian IT patent applications ( FY14)Infosys has 3rd highest number of patents applications in

India.

Research activity for different areas is allocated amongst

dedicated labs such as Software Engineering lab,

Convergence lab, Security and Privacy lab, Distributed

Computing lab and E-Com lab.

During FY12-16, the company’s revenues increased at a

CAGR of 7.30 per cent to USD9.54 billion from USD7.20

billion in FY12.

During the same period, net profit grew at a CAGR of 3.82

per cent to USD2.06 billion from USD1.77 billion in FY12.

Infosys spent USD63.40 million in R&D expenses during

FY16(1)

Income and net profit (USD Billion)


6 6.9

7.4

8.2

8.7

9.5

4

1.51.7 1.7 1.8

2.01

2.05

0

0.5

1

1.5

2

2.5

0

2

4

6

8

10

FY11 FY12 FY13 FY14 FY15 FY16*

Sales Net Profit

Indian Institute of Technology(Collective)

Wipro Limited

Samsung India Software OperationsPrivate Limited

Infosys

Samsung R&D Institute India ⁽¹⁾

Tata Consultancy ⁽¹⁾

USEFUL INFORMATION



Department of Science & Technology

Technology Bhavan, New Mehrauli Road

New Delhi – 110016, India

Phone: 91 11 26567373, 26962819

Fax: 91 11 26864570, 26862418

E-mail: [email protected]

AUTONOMOUS & PROFESSIONAL BODIES … (1/2)


Indian National Science Academy

Bahadur Shah Zafar Marg,

New Delhi – 110002, India

Phone: 91 11 23221931, 23221950

Fax: 91 11 23235648, 23231095


Indian National Academy of Engineering

117 Nalanda House, IIT Campus,

Hauz Khas, New Delhi 110 016, India

Phone: 91 11 26582475, 26582635

Fax: 91 11 26856635



National Academy of Sciences

5, Lajpatrai Road,New Katra

Allahabad - 211 002, India

Phone: 91 532 2640224

Fax: 91 532 2641183


Indian Science Congress Association

14, Dr Biresh Guha Street

Kolkata – 700017, India

Phone: 91 33 22474530

Fax: 91 33 2402551


Indian Academy of SciencesC. V. Raman Avenue, Post Box No 8005

Sadashivanagar, Bangalore 560 080, India

Phone: 91 80 23612546, 23614592, 23612943

Fax: 91 80 23616094


AUTONOMOUS & PROFESSIONAL BODIES … (2/2)


CAGR: Compound Annual Growth Rate

FDI: Foreign Direct Investment

FY: Indian Financial Year (April to March)

So FY12 implies April 2011 to March 2012

GOI: Government of India

MNC: Multinational Company

GERD: Gross Expenditure on Research & Development

STI: Science Technology & Innovation

Y-o-Y: Year on Year

INR: Indian Rupee

USD: US Dollar

LCV: Light Commercial Vehicle

PPP: Public Private Partnership

Wherever applicable, numbers have been rounded off to the nearest whole number

GLOSSARY


3838FEBRUARY 2017

Exchange rates (Fiscal Year)


EXCHANGE RATES

Exchange rates (Calendar Year)


Year INR equivalent of one USD

2004–05 44.81

2005–06 44.14

2006–07 45.14

2007–08 40.27

2008–09 46.14

2009–10 47.42

2010–11 45.62

2011–12 46.88

2012–13 54.31

2013–14 60.28

2014-15 61.06

2015-16 65.46

2016-2017E 66.95

Source: Reserve bank of India,

Average for the year

Year INR equivalent of one USD

2005 43.98

2006 45.18

2007 41.34

2008 43.62

2009 48.42

2010 45.72

2011 46.85

2012 53.46

2013 58.44

2014 61.03

2015 64.15

2016 (Expected) 67.22

3939FEBRUARY 2017

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