20 Dec India on the path of technology : Issues and Road Ahead (GS 3, Economics, The Hindu, Indian Express)
India on the path of technology : Issues and Road Ahead- Today Current Affairs
We have so many celebrated technologists around the world from India, but why is India still behind in the global technological ladder?
The popular narrative behind India’s failure is that India lacks to talp the market driven growth opportunities. Market driven economy works on the principle of competition and thus favors efficiency. India’s earlier commitment towards socialism favored the public sector and planning and thus damaged the opportunities to tap the efficient labor and resources. The talented left the country for the US and Europe. As of 2019 around 2.7 millions were Indian immigrants in the US who are most educated and professionally efficient.
US is a country of immense opportunities. Research shows that the US government has played a crucial role in the introduction of new technologies. From Computerization, ICT, internet, to nanotechnology and biotechnology, the US government agencies were proactive during the uncertain phases of their research.
In China also, the government is playing a prominent role in making its industries from low wage manufacturing to modern technological based products like alternative fuel cars and renewable energy. China has successfully tapped the combined strength of the public sector, market and globalization. State owned enterprises (SOEs) in China too, were bureaucratic and inefficient, but rather making them private the government restructured them. Manufacturing and export-oriented sectors were left for the private sector and the SOEs strengthened their presence in strategically important sectors such as telecommunication and petrochemicals as well as in technologically dynamic industries such as electronics and machinery.
When India initiated industrialisation and planning in the early 1950s, it was possibly the most aspiring and progressive of such initiatives among the developing world. Government funding of the modern technologies of the time including atomic and space research and the establishment of institutions such as the Indian Institutes of Technology (IITs) were among the hallmarks of that effort. Many of these institutions have attained world-class standards over the years. The growth of pharmaceutical industries and information technology has been the fastest in Hyderabad and Bengaluru. However, the roadblocks to progress have been many, including India’s poor achievements in school education and rural health services.
In 1991, when India embraced globalization and favored market economy , it should have redoubled efforts to strengthen its technological capabilities. Instead, the spending on research and development as a proportion of GDP declined in India from 0.85% in 1990-91 to 0.65% in 2018. In contrast, this proportion increased over the years in China and South Korea to reach 2.1% and 4.5%, respectively, by 2018.
India still poses the favorable supply demand dynamism. The number of persons enrolled for tertiary education in India (35.2 million in 2019) is way ahead of the corresponding numbers in all other countries except China. Further, graduates from STEM (Science, Technology, Engineering and Mathematics) programmes as a proportion of all graduates was 32.2% for India in 2019, one of the highest among all countries (UNESCO data).
Internet users will soon be double that in the US, exhibiting a large market and huge opportunities for all kinds of modern technologies. For instance, the country is operating far below its potential in electronic manufacturing. Electronic goods and components are the second largest item, after oil, in India’s import bill. Also, the country’s imports are almost five times its exports in this industry (based on 2020-21 data).
Way Forward : The Hindu Analysis
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India has to look into high value electronics components in the manufacturing which at present are manufactured by big MNCs.
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In the backdrop of its huge consumer base India needs to do better negotiation with these MNCs in terms of localizing the production and sharing technologies with domestic firms.
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Apart from ease in business, Indian industry have to broaden and deepen its technological capabilities.
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Universities and government institutions are needed to be emboldened and strengthened to enter into areas of technology developments as the private sector may have neither the resources nor the patience.
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PSUs should be engaged to create technologies and strategic and knowledge assets for potential long term contribution to economic growth, rather than just using them in short term fiscal benefits.
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Private businesses and Medium and Small enterprises will flourish more and widen their entrepreneurial base if diffused with public created technologies, along with better availability credit, finance and other forms of support.
Hopefully in the near future, the next big stories of any technological development will come from some remote entrepreneurs of the country.
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Md Layeeque Azam, Economics Faculty
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Plutus IAS Current Affairs Team Member
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