Delhi has remained the most innovative destination among Union Territories (UTs), while Karnataka has led the pack of major states in the Innovation Index for 2020 released by the NITI Aayog on Wednesday. Maharashtra has overtaken Tamil Nadu to grab the second spot among key states. Himachal Pradesh remained the top performer among North-Eastern and hill states.
Though the rankings are announced separately for the three categories, in terms of just the index score, Delhi tops the list, with a score of 46.6, followed by Karnataka (42.5). However, the average scores in innovation among major states and UTs are just 25.35 and 26.01, respectively, out of 100, suggesting a huge room for improvement.
The north-eastern and hill states scored even less — an average of just 17.89. Himachal Pradesh scored only 25. This also brings to the fore the huge regional disparity in innovation.
The low scores reflect markedly poor spending of states on research and development. FE had earlier reported that Huawei, Mitsubishi Electric, Samsung and Qualcomm filed more international patent applications each than the whole of India in 2019, according to the data compiled by the Geneva-based World Intellectual Property Organization (WIPO). This is despite the country’s progress in recent years.
According to the Innovation Index report, southern India has consolidated its position as the innovation hub, as four states feature in the list of the top five innovative states.
The Index is prepared by the NITI Aayog in collaboration with the Institute for Competitiveness. It has five indicators that capture aspects of conducive environment, while two others demonstrate innovation results.
Karnataka’s lead position is attributed to its strong number of venture capital deals, registered geographical indications and ICT exports and inflows of foreign direct investments, according to the innovation report. Maharashtra has scored 38, while Bihar finishes the last with 14.5.
Among UTs, Delhi’s ranking was propped up by the highest number of trademark and patent applications filed by it, along with the establishment of new start-ups and companies in the last financial year. These has catapulted Delhi in the Knowledge Output indicator. Its performance is also attributable to its conducive business environment, especially in terms of internet penetration, which is the highest in the country.
The innovation scores also show a positive correlation with the gross state domestic product (GSDP), meaning higher economic growth leads to more innovation and the vice versa.
“The government must consider providing direct R&D grants to companies. This is a deviation from R&D funding mostly going to academic institutions, with the absence of any intention to commercialise innovative concepts. Such practices have been heavily recommended by the US and Israel,” the report recommended.
Importantly, India’s R&D spending remained constant at around 0.6-0.7% of its GDP, way below the expenditure level of countries like Israel (4.3%), South Korea (4.2%), the US (2.8%) and China (2.1%), according to a statement by the ministry of heavy industries and public enterprises in July 2019.
Official expenditure, almost entirely by the Centre with negligible contribution from state governments, is the driving force of R&D in India, in contrast with the advanced countries where the private sector is the dominant force.