The recent India Innovation Index Report 2020 was unveiled by NITI Aayog, highlighting the innovative capabilities of Indian states and Union Territories. Interestingly, Karnataka once again clinched the top position in the major States category. This article details the index’s approach, involved institutions, indicators used, categories, key points, challenges, and suggestions for improvement.
India Innovation Index Institutions and Approach
The Index is a collaborative initiative between NITI (National Institution for Transforming India) Aayog and the Institute for Competitiveness. It is modelled after the Global Innovation Index (GII), aiming to enhance the innovation ecosystem across Indian states and Union Territories. The approach extends beyond traditional measures of innovation, such as patents per million of population and research spending as a percentage of GDP. It incorporates parameters unique to the Indian economy, like demographic dividends, providing a comprehensive assessment of innovation.
Key Indicators Used
The survey uses a plethora of indicators to measure the level and quality of education and other essential parameters. These include the number of Ph.D. students, knowledge-intensive employment, enrolment in engineering and technology, highly skilled professionals, investment in R&D, filed patents and trademark applications, internet subscribers, FDI inflows, business, safety, and legal environments.
Index Categories and Key Points
The Innovation Index consists of three categories—major states, Union Territories, and hill and North East states.
In the major states category, Karnataka achieved the highest score of 42.5 for the second consecutive year, primarily due to high numbers of venture capital deals, registered GIs and ICT exports, and substantial FDI inflow. Four southern states – Karnataka, Tamil Nadu, Telangana, and Kerala — alongside Maharashtra, occupied the leading positions on the index. Conversely, Jharkhand, Chhattisgarh and Bihar scored the lowest, placing them at the bottom in the “major States” category.
In the North-East states category, Himachal Pradesh topped the list, followed by Uttarakhand, Manipur, and Sikkim.
Among Union territories, Delhi scored the highest with 46.6 points, attributed to the most significant number of trademark and patent applications, as well as the establishment of new start-ups and companies during the last fiscal year. On the other hand, Lakshadweep had the lowest score.
Identified Challenges and Suggestions
Several challenges were identified, including enticing private investment in research, bridging the North-South divide in innovation capabilities and the need for micro-analysis of state-level policies for more effective policy formulation.
India needs to enhance its spending on R&D, which currently stands between 0.6-0.7% of GDP, significantly lower compared to countries like Israel (4.3%), South Korea (4.2%), the US (2.8%), and China (2.1%). Investing more in research and encouraging collaboration between industries and educational institutions could potentially boost innovation output. The development of platforms linking innovators, researchers, and investors from various industries is also recommended, to strengthen industry-academia linkages and facilitate technology transfer.