Monday, 11 June 2012


Technology excellence in different sectors is achieved through a process of Capability Development. Capability development itself is a long process, which involves so many phases like creating infrastructure, developing human capital, building centers of excellence, building institutions, facilitating industries to build absorptive capacities (ability to recognize the value of new information, assimilate it, and apply it) and creating synergy among them to create an environment, where technological innovations and technological development may take place. Porter (1990) has shown how national advantage is increasingly concentrated in particular industries and even industry segments, reflecting specific and differing sources of competitive advantage. Therefore, it becomes necessary for any country aspiring to excel in technology to do a scenario analysis and adopt strategic policies to create supportive environment for sectors identified to be advantageous.     

When it comes to technology transfer in a specific sector (in any liberal economy), mostly it is the strategic intent to rise up in the value chain of key players, which makes critical difference. Companies with clear motive for technological excellence often execute long term vision to develop competitive advantage through technological innovations. In one of their paper 'Learning by Doing, Technology Transfer to an Indian Manufacturing Firm', Shekhar Choudhari and Tushar K Moulik, have done a detailed study on technology transfer in a firm from tractor industry and found that "The total process of technology assimilation is conceptualized as consisting of three sub-processes: (a) Technology Adaption; (b) Technology Utilization and (c) Technology Development, which are characterized by differences in the organizations' goals and actions taken by management at each stage." 

Experts of International Economics converge with the view that few (advanced) countries lead technological inventions and are the primary innovators, while the rest of the countries (developing) adopt new technologies through process of technology transfer (initially suggested by - Krugman, Rethinking International Trade, 1990).

Global Technology Transfer is closely related with trade-related policies, such as competition, incentives, export, and taxation policies as well as intellectual property rights. Therefore, mutual agreement among the countries on strategy for trade becomes important. International community is concerned about enhancing efforts for technology transfer to developing world. In this regards, it would be mention worthy that Articles 10 and 11 of ‘Kyoto Protocol to the United Nations Framework Convention on Climate Change’ insists on co-operation among party countries to facilitate technology transfer (for a sustainable world).

On the other hand, consistent progress in R&D is necessary for promoting advancement in technology. 2012 Global R&D Funding Forecast emphasizes on growing worldwide emphasis on basic research.  In this context, a detailed study by Sujit Bhattacharya & Kashmiri Lal done in 2008 on 'Industrial R&D in India: Contemporary Scenario' still holds relevance and following excerpts from the study summarizes Indian R&D scenario very well:-

“India is presently the 4th largest economy of the world (in PPP - Purchasing Power Parity term) and a favoured destination of global R&D firms. Many Indian firms have created global footprints. In two sectors that have potential of driving the world economy i.e. ICT and biotechnology, India is among a few emerging economies to make its presence felt. However, inspite of these impressive statistics, Indian industrial R&D investment is still at a nascent stage. India compares poorly with industrial economies in terms of R&D spending. Unlike India, the major driver of R&D investment in developed economies comes from the industry. This is true even in case of China, where industry accounts for 57% of R&D investment. India’s R&D investment from industry was 23% in 2007, which was even less than industrial investment in Brazil (38.2%).”  

With this, it can be assumed that for future advancements in technology, India is well poised to pursue a two way approach of a) accelerating technology transfer and b) developing capabilities for indigenous technology development. This would require a focused effort for developing a culture of Industrial Creativity and Sustainable Business Leadership within Corporate India.

Please refer to REFERENCES section given in the blog ‘ICT FOR DEVELOPMENT IN INDIA’


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