A step towards Innovation

The role of innovation in spurring growth, overcoming natural resource constraints and unleashing Indian energies and synergies is widely recognised all over the world. Recognising the importance of innovation, the President ofIndia has declared this decade as the ‘decade of innovation’, with a focus on inclusive growth.

Innovation is already contributing significantly to the growth of the economy and dynamism of industry. ndianentrepreneurs are developing novel solutions for the needs of Indian consumers that provide access to services andproducts at a fraction of the cost of the solutions available from industrially advanced countries.

Three distinctions of the emerging Indian approach to innovation are worth noting. Firstly, it focusses on finding affordable solutions for the needs of people–for health, water, transport, etc.–without compromising quality. Secondly, in this Indian approach to innovation, desired outcomes are produced by innovations in organisational and process modelsthat deliver to people the benefits of technologies that may be developed in scientific laboratories.

Thirdly, there are innovations in the process of innovation itself to reduce the cost of developing the innovations. An example is the opensource drug discovery process being applied by the CSIR to develop drugs for treatment of tuberculosis, based on asemantic- search, web-based platform for collaboration developed by Infosys, an innovative approach that has cutdown the costs and reduced the time for drug development.

Role of Government

Government has a critical role to play in strengthening the innovation ecosystem. It must provide the enablingpolicy interventions, strengthen knowledge infrastructure, create markets for innovations through the stimulus of Government procurement, improve institutional collaborations, provide a mechanism for funding businessinnovations at all levels especially SMEs, and provide vision through a national level roadmap for innovations.

To spurthe Indian innovation ecosystem, the Prime Minister has set up a National Innovation Council (NInC) with the mandate toformulate a Roadmap for Innovations for 2010-20 with a focus on inclusive growth. Principal initiatives alreadyundertaken by the Council and some other innovative programs of the Government are mentioned here.

Collaborations and Clusters

Since innovation generally results from combinations of capabilities and collaborations, clusters have been globallyfound to be an effective means for more innovations. ‘Clusters’ can be physically co-located enterprises or ‘virtualclusters’ of enterprises connected through technology, or often a combination of both. In India the bio-technologyindustry is coalescing in several innovation clusters, combining research establishments and producers, the results fromwhich are appearing. Several other clusters of industries— engineering products, garments, pharmaceuticals, leathergoods, etc.—are operating around the country.

NInC has outlined a partnership agreement with CSIR to connect there sources of CSIR with such clusters to promote innovation in them. NInC is also rolling out a ‘cluster tool-kit’ withguidelines and best practices for improving cluster performance. The Open Source Drug Discovery process, mentionedbefore, is a remarkable example of a virtual cluster formed by technology enabled ‘crowd sourcing’ of collaboratorsconverging to respond to an innovation challenge. Such an Open Innovation Model, using an ‘open source’ andcollaborative approach, can enable creation of affordable solutions which would not be likely with a conventional, ‘in-lab’approach.

Supportive Financial System and Mentoring

There is no dearth of ideas in India. The ‘Honey Bee Network’ and the National Innovation Foundation havedocumented over a hundred thousand already, and only from ‘grass root innovators’. Innovators need financialsupport at an early stage to develop and test their ideas in the market-place. Venture funds are recognised globallyas the most suitable form of providing risk capital for the growth of innovative technology and breakthrough ideas.

While India is amongst the top recipients in Asia for venture fundsand Private Equity Funds, these investments are so far focussed on relatively large and ‘safer’ investments. Thus, despitethe growth in the venture capital industry in India and some government schemes for supporting entrepreneurs, theseed funding stage in the innovation pipeline, where amounts required may be small but risks high, is severelyconstricted.

To plug this vital gap in the innovation ecosystem, the National Innovation Council is considering the need for aprofessionally managed India Inclusive Innovation Fund which will invest in innovative enterprises engaged in providingsolutions for the ‘bottom of the pyramid’. It will focus on innovations that will produce socially useful outcomes forpoorer people and enterprises which are focussed on delivering these.

Innovative Enterprise Development

Affordable and accessible products and services of good quality must be the primary outcome of the country’s‘frugal innovation’ thrust. Experience of successful innovations, such as the low cost eye and heart surgery models, aswell in the micro-finance industry, shows that the employment of the country’s low cost pool of skill-able people in theproduction and distribution of the products and services is a key to enabling their affordability and accessibility. Suchinnovative models also increase opportunities for increasing employment and improving the lives of the people whoare part of the production and distribution process.

Enterprises owned by the producers enable the producers to not only earn incomes but also share in the wealthcreated by the enterprise. Organisations like SEWA, and companies formed by the chanderi weavers in Madhya Pradesh,are such examples. Such enterprises require innovations in organisational and legal forms. The Planning Commission is examining changes that would facilitate the multiplication of more such enterprises.

Through such innovations,businesses that are of the people (owned by them), and businesses by the people (in which people are a principalresource in production and distribution) can cost-effectively produce products and services for people at the bottom ofthe pyramid. Such innovative models of businesses can also very competitively produce products for the top of thepyramid and exports too, as do the chanderi weavers in Madhya Pradesh and the carpet weavers in a similar, inclusiveform of enterprise in Rajasthan.

Platform for Best Practices and Innovations

Currently, there are many enterprises across the country which are delivering benefits to citizens and meetingchallenges of inclusion in areas such as health, education, energy, low-cost housing, sanitation, through innovativesolutions. It is often said that India is a country with many successful experiments that do not achieve scale. Scaling up theimpact of such innovations requires that such ideas be spread around rapidly so that others could emulate them.

And italso requires that larger business organisations and venture funds become aware of them and support them.Therefore, the strengthening of the innovation ecosystem requires a platform for information sharing anddissemination.

While some knowledge portals for innovations in specific areas already exist, the National Innovation Council is in the process of building an IndiaInnovation Portal to enable easy access to these as well as to become a wider information repository on innovation and aplatform for collaboration as well.

Innovations in Government

Innovations should also be encouraged within Government structures and processes to enable improvedservice delivery and create more transparency and accountability in the system. The Aadhaar or Unique IdentityProgramme which will create a foundation for more transparent and efficient public service delivery is internationallyconsidered as a game-changing approach to inclusion.

By providing a clear proof of identity, Aadhaar will empowerIndia’s poorer citizens in accessing services such as the formal banking system and give them the opportunity to easilyavail various other services provided by the Government and the private sector.

Government is also leveraging ICT to reduce pendency in the legal system, encourage a move towards e-governance, e-procurement and e-tendering. It is also undertaking an ambitious initiative to connect 250,000Panchayats with fiber-based broadband to improve governance and service delivery at the last mile. GIS mapping willalso be applied more extensively to improve land record management and delivery of services in urban and rural areas.