In this week’s Techlife column in Financial Express the focus was on Research and Development and how that fules innovation. The original title was “What is fuelling innovation and entrepreneurship.”

Here is the article:

There appears to be an upward worldwide trend when you look at innovation and entrepreneurship. Fuelling this trend is good old research and development (R&D) efforts in different parts of the world. As one entrepreneur put it R&D is the life blood for companies and entrepreneurs. It is out of R&D efforts that corporations increase their profits or new companies are born and go IPO. A good example of this is Silicon Valley-based VMware, the virtualization company that was born out of the research findings of Prof. Rosenblum and his students at Stanford.

There is a definite upward trend in R&D at a global level. This upward trend is confirmed by the findings of the latest Booze Hamilton’s annual study on The Customer Connection: Global Innovation 1000 that looked at R&D spending by the world’s top 1000 corporations. Additionally the study also uncovered that there is an overall connection between innovation and corporate goals and directions. How much did the world’s top 1000 corporations spend in R&D? How about $446.7 billion? Out of this $127 billion was spent in computing and electronics; $97.8 billion in health care and $74 billion in auto. The question then arises where does R&D for these innovations come from? Universities, research organizations, corporations and business are leading the R&D efforts in various parts of the world. It should come as no surprise that US universities lead the way in R&D, where a good portion of the patents filed are by people of Indian and Chinese origin. For instance, Prof. Kerr of Harvard Business School recently released a study on Ethnic Scientific Communities and International Technology Diffusion, where he discovered that 8-10 percent of the patents filed in the US are from the Indian and Chinese communities. Prof Kerr via an email interview said, “The ethnic contributions have been a substantial boon to US innovation and business leadership for a long period.”In India the R&D impetus is coming not from universities and research organizations. “Instead, private industries are leading R&D efforts in India,” points out Vivek Wadhwa, Duke Executive in Residence and Harvard Fellow. Wadhwa is heading a research team that is looking at R&D trends in India and China in 6 different industries that includes: Pharmaceutical, Semiconductors, Aerospace, Cell Phones, Computer Networking and Automotive. Their initial research findings revealed that the number of patents from India is on the increase in all these sectors. “GE is developing all sorts of medical devices, steam turbines and locomotives, while HCL is doing some amazing things in the aeronautical area. Wipro, HCL, Infosys R&D labs are doing a whole lot of interesting and new things,” Wadhwa adds.Wadhwa’s research is borne out if you look at the number of US corporations that have increased their R&D presence in India and in many cases the Indian R&D centers headed by US-trained researchers. For instance, Dr. Naresh Gupta, MD of Adobe India also heads Adobe’s R&D labs in India, China, Japan and Romania. Naresh has a PhD from a US university and has a bunch of patents to his credits, some of those patents resulted in key features of Adobe’s popular Photoshop and other products. As head of the global R&D Naresh’s task is to look for new business opportunities in emerging markets, where the needs and desires of customers is very different from those in developed countries. Adobe spends about 20 percent of its annual revenue on its global R&D efforts. Adobe’s revenue in 2007 was $3.158 billion and $2.575 billion in 2006. Ironically, while US universities and corporations recognize the potential and contributions of Indian scientists and researchers, it seems that the Indian government and universities are lagging behind in their efforts and recognition. As Prof Pradeep Khosla, Dean, School of Engineering, Carnegie Mellon pointed out none of the major Indian IT & Services companies were based on research done in Indian universities. He is right. And Wadhwa points out that the number of PhD candidates in Indian universities is very low. So, clearly there is something lacking in India in terms of harnessing the research potential and capabilities of Indian researchers and scientists. I mean even in this new and emerging India that has managed to shed its sluggish rate of growth and almost reach double digit growth. What those reasons for Indian government’s sluggish participation in promoting R&D can be the dissertation topic for a budding researcher in an Indian university.