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India's Changing Innovation System: Achievements, Challenges, and Opportunities for Cooperation: Report of a Symposium Panel III Growing the Science and Technology, Research, and Innovation Infrastructure Moderator: George Atkinson Department of State Dr. Wessner introduced the panel’s moderator, George Atkinson, science adviser to U.S. Secretary of State Condoleezza Rice, as a friend of the National Academies, a friend of India, and a friend of science. Dr. Atkinson welcomed the audience, fresh from hearing the inspiring words of Minister Sibal and Dr. Marburger, to a new chance to learn more about the specifics that were to engender the very ambitious program being undertaken by the United States and India. The present panel could be expected to focus on two issues—cooperation, and mutual benefit and listening—that had been raised by the previous speakers. Recalling Minister Sibal’s reference to the geographic character of science, Dr. Atkinson opined that the transitory nature of leadership in science was evident to all. Europe had been at the forefront of science and technology in the 19th century and the early part of the 20th century, the United States had taken the leadership position in the recent past, and many now agreed that the future belonged to those able to find modes of collaboration. R. A. Mashelkar, the first of the panel’s three speakers, is the director general of India’s Council on Scientific and Industrial Research (CSIR), the largest chain of publicly funded industrial research and development (R&D) institutions in the world. He is also president of the Indian National Science Academy and, since 2005, a foreign associate of the U.S. National Academy of Sciences.
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India's Changing Innovation System: Achievements, Challenges, and Opportunities for Cooperation: Report of a Symposium RENEWING THE NATIONAL LABORATORIES R. A. Mashelkar Council on Scientific and Industrial Research Dr. Mashelkar began by recalling the evening of April 22, 2006, when, on the same stage, he signed the register signifying his membership in the National Academy of Sciences. The Academy’s president, shaking his hand, said that the Indian flag would be displayed in his honor. This was “an unbelievable matter of pride,” said Dr. Mashelkar, who added that his daughter had taken more photos of him with the flag that night than signing the register. And little did he realize then that less than two months later the Indian flag would again be flying in the auditorium and he would have an opportunity to speak from its podium. He expressed his thanks. Dr. Mashelkar proposed to tell the story of the Council on Scientific and Industrial Research within the framework of a generic discussion of national laboratories that would also include a more specific issue, that of their renewal. His opening point was that “context decides the content,” and that the context changes not only from country to country but, in a given country, with the passage of time. For this reason, laboratories designed and established to serve a particular national purpose necessarily change. As an example, he cited the Global Research Alliance, which comprises chains of national laboratories: CSIR India, CSIR South Africa, CSIRO Australia, Fraunhofer-Gesellschaft Germany, VTT Finland, DTI Denmark, TNO Netherlands, Battelle U.S., and SIRIM Malaysia. In line with the diversity of their home countries, these labs serve different purposes, and they had changed over time as well. Personal experience, acquired not only in his own country but in some others as well, would shape Dr. Mashelkar’s remarks. Over the three decades that he had spent with India’s national laboratories, he had helped restructure industrial R&D institutions in South Africa, Croatia, Turkey, Indonesia, and China. He chaired the committee that reviewed CSIR South Africa in the period 1997–2002 and, together with a member of the audience, Vinod Goel of the World Bank, worked on projects in Croatia between 2002 and 2004 and in Turkey between 2001 and 2005. What are national labs supposed to deliver? Dr. Mashelkar’s answer was private goods and services, public goods and services, strategic goods and services, and social goods and services. He summarized the activities that take place under these four categories as follows: Private: creating new intellectual property, licensing and commercializing technologies, making a country’s industry globally competitive.
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India's Changing Innovation System: Achievements, Challenges, and Opportunities for Cooperation: Report of a Symposium Public: generation and dissemination of scientific research, creation of scientific and technological manpower. Strategic: finding technological solutions for national security, strategic positioning of industry, and representation in global affairs. As an illustration, he noted that research by CSIR of India has produced, for use in the wings of the country’s light combat aircraft, carbon-carbon composite technologies that “are not available to [India] for love or money.” Radiation-shielding glasses for atomic energy work and microwave tubes for India’s space program are other strategic goods designed and fabricated by CSIR. Social: providing for employment, health care, drinking water, and other fundamental needs of those below the poverty line. Dr. Mashelkar proposed to take the audience rapidly through a study of the transformation of CSIR in India. Upon taking its helm in 1995, he was told that he would face different expectations from each of a number of stakeholders: the average citizen, women and children, farmers, industrialists, academics, politicians, bureaucrats, and the military. After a decade, how did four such groups—business, management experts, leading scientists, and the political leadership—view the direction in which CSIR had gone? Business appears to be content, as evidenced by a cover story in a leading publication, Business India, that said: “CSIR labs have been transformed by the power of enterprise and proactive management…. R&D is, at the end of the day, a commercial activity. The CSIR labs are going places with this idea to inspire them.” Management experts have examined how organizations have transformed themselves during the first decade of India’s economic liberalization, which began in 1991. In a book edited by the late management guru Sumantra Ghoshal, a chapter on best practices in managing radical change mentioned, in addition to a variety of prominent firms, only one public institution: CSIR. Leading scientists. In his 2003 book The Scientific Edge, the famous Indian astrophysicist Jayant Narlikar placed CSIR’s transformation among India’s top 10 achievements of the 20th century, in a league with the Green Revolution and the work of the country’s Atomic Energy Commission on nuclear power. Political leadership. Indian Prime Minister Manmohan Singh, the ex-officio president of the CSIR Society, said in 2004: “I would like to congratulate CSIR for the remarkable transformation into a performance-driven and user-focused organization. I am happy to see that CSIR is flying higher and further.” India’s previous prime minster, Atal Bihari Vajpayee, had said in 1997: “CSIR has regained its dynamism and prestige, besides showing itself to be capable of standing up to the challenges of liberalization and globalization.” Equally important and a particular source of pride, Dr. Mashelkar stated,
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India's Changing Innovation System: Achievements, Challenges, and Opportunities for Cooperation: Report of a Symposium was that CSIR was being used as a model of institutional transformation by the World Bank. Alfred Watkins, the head of the Bank’s Europe and Central Asia Region, has written that in the course of his work, he “recommended CSIR as a model of how countries can harness their top-quality scientific research institutions to the task of industrial technology development, innovation, and global competitiveness.” But what is the mission of CSIR? Dr. Mashelkar read its most recent formulation: “To provide scientific industrial R&D that maximizes the economic, environmental, and societal benefits for the people of India.” The domains mentioned—economic, environmental, and societal—define a “triple bottom line” whose management “through high science and technology,” he stressed, constituted “The Big Challenge” for CSIR or, in fact, any set of national laboratories. An illustration of how this challenge was being met in India could be found in the development of a method of silver sulfadiazine (SSD) microencapsulation on collagen-based biomaterials by its Central Leather Research Institute (CLRI). While this was ostensibly a “mundane research institution,” he said, it specialized in the science of collagen and had come up with remarkable systems for healing burn injuries. Noting that national labs are often judged harshly when the criteria used are revenues, patents, or publications, Dr. Mashelkar projected a photo of young children whose burns had been treated with CLRI’s collagen dressings and suggested attributing value instead based on the smiles covering their faces. “We need to recognize, particularly in a country like India,” he declared, “this larger context in which the national laboratories operate.” Thanks to its efforts to maintain the quality of its science while in pursuit of its mission, CSIR had also done quite well when it came to publications and patents. The number of basic-science papers that its researchers had published in Science Citation Index (SCI) journals had climbed rapidly, from 1,700 in 2001 to 3,018 in 2005. Currently, one in six Indian papers that appeared internationally in peer-reviewed journals comes out of CSIR, which leaves its production just 10 percent short of that of the Indian Ministry of Science, the country’s leader. At the same time, the number of U.S. patents granted to CSIR has soared, from single digits through most of the 1990s to 145 in 2002 and close to 200 in 2005. And among Patent Cooperation Treaty applicants from developing countries, in 2002 CSIR tied for first place, at 184, with South Korea’s Samsung Electronics—the latter’s R&D budget being, he said, 10 times larger. CSIR scientists had, in fact, been recognized in the media for several breakthroughs in 2005. It was a polycarbonate patent developed in one of CSIR’s laboratories that led to the founding of GE’s Jack Welch R&D Center in the state of Karnataka. A partnership had begun when the company licensed the patent a dozen or so years before, and then Welch asked one day: “If they’re so good, why aren’t we there?” Any foreign company interested in establishing an R&D center in India now wants to visit the Jack Welch R&D Center, which had become a sort of
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India's Changing Innovation System: Achievements, Challenges, and Opportunities for Cooperation: Report of a Symposium showplace but is just one of many that U.S. firms maintained in India and that had led to the country’s emergence as a global R&D hub. Recalling a challenge articulated earlier by Minister Sibal—delivery of high-quality products at low prices—Dr. Mashelkar noted that meeting it would put products within the reach of a larger part of the population. This could be achieved only through very inventive use of high science and technology. As an example of an affordable solution, he cited the application of a “process for the preparation of ultrafiltration membranes of polyacrylonitrile, using malic acid as an additive,” the object of a 2005 U.S. patent based on precipitation volumization, a unique technique allowing the creation of 20-nanometer pores that had been developed at India’s National Chemical Laboratory (NCL). It had resulted in devices able to filter not only bacteria but viruses from drinking water at a cost of one-tenth of a cent per liter, and the more than 2,000 deployed included some in rural villages without electricity that were operated by hand pumps. “This is where India and Bharat, or Hindustan as we call it, coexist in some sense or other,” he said, alluding to the image of the two Indias invoked by previous speakers. Such things have become possible thanks to a new vision and strategy embodied in a white paper entitled CSIR 2001. Dr. Mashelkar then outlined cultural differences separating the CSIR institutes from industry: time horizon—long term for institutes, short term for industry; financial structure—institutes based on cost centers, industry on profit centers; products—institutes generated packages containing knowledge and information, industry is interested in salable goods and services; basic orientation—scientific novelty for institutes, market attractiveness for industry; and focus—institutes looked at perceived needs, industry at market needs. These differences represent a significant challenge for industrial R&D laboratories to meet. With the help of the World Bank, CSIR has made attempts to bridge these gaps. As part of an industrial technology development program whose first phase started in 1991, marketing teams were created in each laboratory, decision making was devolved, specialized business development consultants were brought in, members of the CSIR staff were allowed to serve on boards of directors in the private sector, awards were given for marketing and business development, and knowledge was used as equity. At the same time, CSIR created financial incentives, linking performance to budget allocations, offering incentives to scientists, and establishing laboratory reserve funds. Under the last, labs were permitted to retain and carry forward surpluses based on a percentage of earnings, which they were then to use for development purposes as they saw fit. The amount of earn-
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India's Changing Innovation System: Achievements, Challenges, and Opportunities for Cooperation: Report of a Symposium ings accumulated in these funds had risen along a straight line that had begun just above zero in 1992–1993 and reached 4.5 billion rupees by 2005–2006. To illustrate a final aspect of this cultural change, the move away from reverse engineering and toward what Dr. Mashelkar called “forward engineering,” he offered the history of work in catalysts done at NCL. While that lab was commercializing a “me-too” catalyst, dimethylaniline, as late as 1978, by 1986 it had developed catalysts on xylene isomerization that, he said, were superior to Mobil’s catalysts. Reverse technology transfer to Europe, in the form of sending hydro-dewaxing to Akzo, was taking place by 1991; four years later, India was exporting its own technologies and products in this area; and by 2000 it had built global leadership. Looking back over CSIR’s transformation, Dr. Mashelkar judged it to have been accomplished in a responsible manner. He credited the statement of vision and strategy in CSIR 2001 as having been very critical in creating market orientation while maintaining the quality of science. The adoption of a new management strategy for intellectual property rights in 1996, when CSIR became the first institution in the country to enunciate such a policy, had been important as well. Meanwhile, numerous changes have taken place in structure and administration: The small projects of the past have given way to large, networked projects, with CSIR’s 40 laboratories no longer behaving as independent entities. A strong market orientation has replaced an atmosphere in which work was “individual and group based.” Whereas costs had once been no consideration, now time and costs are “sacrosanct” and perfunctory monitoring has given way to stringent monitoring. Similarly, there have been welcome changes in the culture of work: A formerly inward-looking enterprise is now increasingly looking outward, harnessing synergies in all systems. CSIR’s outreach has gone from local or national to global, and it currently counts among its partners firms from around the world. Power within the organization itself, traditionally concentrated in Delhi, has been decentralized, with autonomy and operational flexibility replacing the rigid rules and procedures of the past. To underline his contention that the context decides the content, Dr. Mashelkar turned from the transformation of CSIR India to that of CSIR South Africa, which had been restructured into business units in 1987 and undergone reviews in 1997 and 2002, the more recent of which he had chaired. As the institution had gone strongly commercial, becoming 70 percent self-financing, there had been a significant erosion of its science base. Creating what might be called an “optimum coupling” was very important but always very difficult, he acknowledged. “If you are too strongly coupled with industry, you are always working on today’s problems or tomorrow’s problems. If you are too far [from industry], you are far from the market and spin off in the wrong direction.” And now there was a new challenge facing CSIR South Africa: moving from exclusion to inclusion. Built in the era of apartheid, the institution had to develop a new image, something it was
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India's Changing Innovation System: Achievements, Challenges, and Opportunities for Cooperation: Report of a Symposium doing rapidly, at the same time that it needed to restore its eroded science base. Even within a given country, therefore, context decided the content. Dr. Mashelkar concluded with a list of those issues he believed to be key in renewing a national laboratory: strategy may change from country to country and from time to time; continuous repositioning is essential; local relevance and global excellence must be kept in balance; “directed” science has to be achieved; and creating a “golden triangle” uniting national labs, universities, and industry is crucial. He added a final word: “Like in every other thing in life, it is all about leadership.” Dr. Atkinson thanked Dr. Mashelkar for his well-organized and articulate description of the transformation that, he said, had clearly brought India’s national laboratories from one position in the world to another. He then introduced P. V. Indiresan, a former president of both the Indian National Academy of Engineering and the Institution of Electronics and Telecommunications Engineers and a current member of the State Planning Commission in Delhi. Dr. Indiresan had spent many years with the Indian Institutes of Technology (IITs) in both academic and administrative posts. NATIONAL AND STATE INVESTMENTS IN SCIENCE AND ENGINEERING EDUCATION P. V. Indiresan Indian Institute of Technology (retired) Dr. Indiresan began with a note of sympathy for his listeners, who, he suspected, might by now be confused as to whether India was doing well or poorly. The contrasting accounts they had heard from earlier speakers called to mind an episode from the Indian epic Mahabharata in which the teacher Drona tells one of his students, Duryodhana: “Go into the town and find a good man.” Duryodhana comes back saying, “I can’t find a good person because everybody is bad in some way or other.” Then Drona asks Yudhishthira, Duryodhana’s cousin, to “go and find a bad man.” And this boy comes back and says: “I can’t find a bad man anywhere, because everybody is good in some way or other.” Such, Dr. Indiresan stated, was India: Those looking for the bad would find plenty of it; those looking for the good would find there to be plenty of that as well. “What India is going to be, and what India will be as a partner for your own ventures,” he observed, “depends, therefore, on you.”
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India's Changing Innovation System: Achievements, Challenges, and Opportunities for Cooperation: Report of a Symposium Dr. Indiresan’s talk would be organized in three parts: what the United States had done for technical education in India, the obstacles India was currently facing, and working to overcome the obstacles in ways that would yield mutual benefits. The era of modern technical education in India dates to about 150 years before, when the British established three universities and one technical institution in the country. They did this for imperial reasons: They wanted more people trained to work in the colonial administration, and people who “would obey and not think too much.” So, rather than copy the Oxford model, they introduced a system of universities whose function was to examine undergraduates and not to do research. Change took place only after the Second World War, when a formal interest in engineering education coupled with research first emerged in India. For that, gratitude is owed to the United States, and in particular to the late Professor Norman Dahl of MIT, who helped to set up the Indian Institute of Technology (IIT) in Kanpur. Dr. Indiresan recalled from his days as a teacher at the IIT in Delhi the visit there of a British “expert” who told him: “You do the undergrad teaching, we will do the thinking and research, and that will be the partnership we will have.” But Dahl, insisting that Indians were capable of research work, introduced a large number of American practices—such basic things as the semester system, continuous evaluation, and the credit system—and encouraged graduate study overall. That spread to the other IITs, which then over time turned out numerous people who had proven outstanding in engineering design. In the same period, the United States made available through its technology cooperation mission about a thousand scholarships allowing Indians to pursue advanced study in the United States. Unlike today, Dr. Indiresan noted tartly, those who at that time studied abroad returned to India, and it was the recipients of those scholarships who upon their return completely rebuilt Indian science and technology. He therefore reiterated his gratitude for the U.S. contribution to the rejuvenation of science, technology, and technical education in India. Dr. Indiresan praised the IIT system for its production of excellent designers and analysts, observing that a Wall Street firm looking for an analyst might find that an IIT graduate could do the job better than most. Unfortunately, it has not done as well in innovation, for many reasons, one of which is its low budget—between $20 million and $25 million per year—compared with the billions that Harvard and Stanford have. Still, given that outstanding people have been educated with such scarce resources, India could be viewed either as having done very well or as having been beset with handicaps. India’s caste system presents a second problem. Under one of the ancient models, industry is considered one caste and academia another, and the two do not intersect. One of the few occasions he had had to talk with industrialists was at the present conference, said Dr. Indiresan, adding: “In India, it is hardly
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India's Changing Innovation System: Achievements, Challenges, and Opportunities for Cooperation: Report of a Symposium possible for an academic like me to meet an industrialist unless a minister is addressing the audience at the time.” A third problem is that of awakening true interest in technology among industrialists. The licensing system that was in effect until 1991 discouraged industry from taking such an interest. That system—“Believe it or not!” he exclaimed—punished a businessman who produced more than a licensed amount: If a business had been licensed to produce 100,000 bicycles and produced 110,000, it was liable to punishment. Things have changed, and quite a few industrialists have now become interested in technology, but some still equate redesign with research even though the two are not identical. And while India is very successful at redesign, research in the true sense of the term has yet to become widespread. “We have got into the habit [of being] content with the technology but dissatisfied with the profit,” said Dr. Indiresan, arguing that dissatisfaction with technology would ultimately lead to greater contentment with profit. A sign of their confusion regarding technology is that Indian industrialists, when they are in the United States or Britain or Germany, visit manufacturers rather than universities. Since they interact only with other industries, they expect IIT to produce what the capital goods manufacturer in the United States produced. “But IITs are not very good at producing capital goods,” he said, “although we produce very good human materials.” A problem specific to the IITs was that they are not free to accept donations from abroad, even if the would-be donors are Indians. All donations have to be turned over to the government, which has the absolute right over the funds despite an informal agreement under which the government is to return to the IITs gifts that are intended for them. At the height of the dot-com surge, IIT graduates had come forward with a proposal to invest $1 billion to produce a world-class institution. Dr. Indiresan said that the response of the Indian government—“‘you give us the money, and we will decide how to do it’”—had prompted the prospective investors to withdraw their offer. Taking up the question of the “two Indias,” he concurred that there existed both a burgeoning middle class that had become quite prosperous and a very large number of poor people living in conditions “no different from what they were 100 years ago.” All were concerned about this enormous disparity. In particular, Dr. Indiresan said, high-quality education has to be made accessible to the poor, in whose ranks could be found extremely brilliant children who could ill afford an education and so had no opportunity to rise. This concern has recently led the government to propose the “reservation policy,” which could be expected to have a negative impact on the IITs. While Dr. Indiresan likened this reservation policy to America’s affirmative action in that it is intended to help people who are being left behind, he pointed to what he called a “slight difference”: Under affirmative action a person who is not competitive but is competent is admitted, whereas under the reservation policy, he claimed, those who were competitive would be admitted even if they were not competent.
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India's Changing Innovation System: Achievements, Challenges, and Opportunities for Cooperation: Report of a Symposium Elaborating, he posited that under affirmative action, as long as a student satisfied an institution’s minimum entrance requirements, he or she might be accepted for admission—even without being in the upper echelons of entrants—as a member of a group that had been at a disadvantage and therefore “not had a proper share.” Under the reservation policy, in contrast, 49.5 percent of students accepted were to have marks falling below the minimum for admission. How could the quality of an IIT be maintained in this case? Even leaving this aside, whether the IITs would be able to expand was a major issue. They now admit 4,000 students per year, only 1–1.5 percent of applicants, compared to 10 percent at Harvard or Stanford. For this reason, IIT students are very good—even after four years with teachers like himself, Dr. Indiresan said self-effacingly and with a touch of humor, they emerged unspoiled. Still, certain problems stood in the way of expansion. One of them, of course, is money. The second is the availability of teachers. At the peak of his career, a professor at an IIT receives today the same salary that a new graduate commands as an intern at Dr. Kapur’s firm or that of Mrs. Piramal. Finally, Dr. Indiresan noted that a new theory has arisen concerning expansion, according to which simply increasing admissions would produce good-quality people. As he interpreted it, this theory held that “if you cultivate a million goats, you’ll get 10,000 sheep out of them.” But perhaps the fundamental problem with the IITs is that, being unique in India, they have no competition. For Dr. Indiresan, the proof was in his efforts to find candidates for admission to the Indian National Academy of Engineering when he was its president. Of 250 faculty members who appeared worthy of consideration, only one was from outside the IIT system—and this in a country with 1,560 engineering colleges. Similar evidence emerged, he said, when the Department of Microtechnology offered to provide funding that was substantial by Indian standards to institutions that would start postgraduate courses. To qualify, an institution had to be engaged in collaboration with industry—and only 11 of the 1,560 engineering colleges met this standard. The lack of competition to which this testified was having a dulling effect on the IITs, he indicated. That brought Dr. Indiresan to his own recipe for making India a producer not only of good analysts and designers, but also of true innovators: founding private universities. While stressing that he had no complaints about the IITs—he had taught in them for 40 years and found them full of “very nice people”—he maintained that competition for them could not be found within the public sector but had to come from private enterprise. The private institutions supplying this competition, moreover, would have to refrain from accepting government funding. “The government is a very good businessperson,” he said, reprising his earlier warning, “and if you take even one single penny, they will extract $1 billion worth of control.” A picture of the government’s penchant for keeping institutions of higher education on a short leash emerged from that and other playful remarks that Dr. Indiresan made during the course of his presentation. Whereas the Indian “uni-
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India's Changing Innovation System: Achievements, Challenges, and Opportunities for Cooperation: Report of a Symposium versity system was very tightly controlled and had to do whatever the government wanted,” he and his colleagues at the IITs had, he quipped, “enormous freedom: full freedom to do whatever the government says.” Reporting a conversation of that very morning, Dr. Indiresan said that Minister Sibal had asked him what the government should do to maintain standards at the IITs after the reservation policy was inaugurated. “Not that if I tell them, they will listen to me,” he commented, “but they are generous enough to ask me for my opinion.” Still, he named as his “great advantage” as an Indian the fact that if he were to “say something critical of the Indian government or the Indian system, [his] head [would] not be cut off.” Indians, he quipped, “are absolutely free to criticize [anyone] except [their] immediate boss.” Returning to the question of research budgets, he pointed to Research Triangle Park (RTP) in nearby North Carolina as an excellent example of a form of cooperation between industry and academia that India does not have. With its 7,000 acres, 50,000 employees, billions of dollars in output, and hundreds of firms, RTP dwarfs an analogous park planned for India that is to cover 10 acres and involve the “princely” investment of $1 million. The latter project, he said dismissively, amounts to expecting to make a suit from a six-inch length of cloth. What is needed is cooperation that will enable the establishment in the country of an excellent science and technology park that could be not merely self-supporting but a profit center generating income sufficient to support a world-class research university in India. In fact, it constitutes India’s “only hope” of meeting the cost of founding and maintaining a research university. One potential alternative, a scheme for the efficient organization of land called PURA—an acronym derived from “providing urban amenities in rural areas”— had been developed by Dr. Indiresan and had found favor with India’s president, A. P. J. Abdul Kalam. While an acre of land could cost as much as $200,000 to $500,000 in an Indian city, just 20 or 30 miles outside the price might be no higher than $10,000. This enormous difference could be used as a tool to fund science and technology parks. Dr. Mashelkar, he said, could explain how to do this, whereas he himself, if asked, was more likely to explain how not to do it. Summing up, Dr. Indiresan reminded his listeners of the story of Yudhishthira and asked them not to think that India was “very bad” because of what he had said. India was also “very good” and had done extremely well. The country was a world leader in space technology, and, owing to the Green Revolution that began in 1973, it had gone from dependence on agricultural imports to food surplus within 10–12 years and was now the world’s leading producer of milk. Despite its government, which “will do the right thing only after it has tried everything else,” he said, “India is a very great country when it sets its mind to be great.” Although it might seem to resemble the “young girl in the poem—‘When she was good, she was very, very good, but when she was bad, she was horrid’”—Dr. Indiresan warned the audience: “If you ignore India, you will do so at your own peril.”
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India's Changing Innovation System: Achievements, Challenges, and Opportunities for Cooperation: Report of a Symposium This problem of striking a balance served as the object of a second simile. He likened the innovative mind to a bird: If it is held too tightly, it chokes, but if it is held too loosely, it will fly away. India’s government, he observed, tended to hold things very tightly. His hope was that cooperation with the United States would benefit India now just as U.S. advice on organizing technical education had in the mid-20th century, this time both through helping the country establish science and technology parks and through teaching Indians how to hold talented people just right. Unable, it seems, to resist a humorous story, he used one to present a “warning” regarding the need to keep relations between the two countries in equilibrium. Two partners having purchased a cow, he recounted, one of them said: “You take the front part, and I’ll take the back.” And it turned out well for him, since his partner had to feed the cow, while he got the milk. In the current case, a more equitable partnership was to be desired. To underscore this final point, Dr. Indiresan commended the audience to a shloka, or verse, from the Upanishads, Vedic texts composed anonymously thousands of years ago: Sahanaavavatu—Let us both get together. Sahanau bhunaktu—Let us both enjoy together. Sahaviryam karvaavahai—Let us both do great things together. Tejasvinah avadheetamastu—Let great minds flourish. Ma vid vishavahai—Let there be no misunderstandings. Om! Shantih, shantih, shantih—The ultimate is peace, peace, and peace. Dr. Atkinson thanked Dr. Indiresan for a delightful and enlightening presentation that had not only provided tips on animal husbandry, which he had not expected to glean from the conference, but also had exemplified the value of democracy’s support for the freedom of saying, in eloquent terms, what needs to be said. He then turned to the introduction of his good friend Tom Weber, to whom had fallen the challenge of following such a delightful set of remarks. Dr. Weber had earlier in the year assumed the post of director of the Office of International Science and Engineering (OISE) at the U.S. National Science Foundation (NSF), where he had served for nearly 20 years, more than 10 of them as director of the Materials Research Division.
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India's Changing Innovation System: Achievements, Challenges, and Opportunities for Cooperation: Report of a Symposium OPPORTUNITIES FOR U.S.–INDIAN MATERIALS COOPERATION Thomas A. Weber National Science Foundation Dr. Weber said that while he could not promise to match Dr. Indiresan’s humor, he could outline some vehicles for collaboration and cooperation and, after providing a little background, tell the story of what NSF had done to further them. To get started, he projected a statement that the NSF’s director, Arden Bement, had made at the Materials World Network Symposium in Cancun, Mexico, in August 2005: “Global collaboration—among scientists, engineers, educators, industry, and governments—can speed the transformation of new knowledge into new products, processes, and services, and in their wake produce new jobs, create wealth, and improve the standard of living and quality of life worldwide.” As was evident, Dr. Bement felt very strongly about the importance of collaboration and the obligation of the United States to promote it. The occasion for his remarks had been the tenth anniversary of a Division of Materials Research program for increasing collaboration in that field between U.S. scientists and their foreign counterparts, a program that had taken some time getting off the ground. Another reason to look at collaborations was that, as Dr. Weber said with a nod to journalist Thomas Friedman, “the world is flat.” Current problems are more complex than those of the past. The number of group proposals received by the Division of Materials Research, according to a study he had just completed, have risen over the preceding few years, a sign that problems were getting harder and that solving them requires teamwork by researchers from various disciplines. The average number of citations was at 10.81 for papers published by researchers at institutions of higher learning in the United Kingdom but jumped to 23.67 for papers resulting from joint work by researchers at academies in both the United Kingdom and the United States. This presumably means that the latter papers are more interesting and better. Similarly, collaboration enables the leveraging of resources that otherwise might not be available to all—data, experience, equipment, and infrastructure among them—even as it furthers the U.S. goal of using its research grants to build a globally engaged scientific community. But what is the current level of collaboration between U.S. and Indian scientists as indicated by the number of grants? Each of the previous five years had seen between 55 and 80 NSF awards involving joint collaborations. These span all of NSF’s disciplines and range in size from several thousand dollars for dissertation research to millions of dollars for major projects. Dr. Weber, often told by the Indian government’s Department of Science and Technology (DST) that the number of such collaborations have been decreasing, said an NSF study has shown that the foundation provided $300 million to $400 million annually in
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India's Changing Innovation System: Achievements, Challenges, and Opportunities for Cooperation: Report of a Symposium overall funding. But NSF’s network was a diverse one, with the majority of these moneys going through its research directorates. His own Office of International Science and Engineering had only $34 million annually, about $10 million of which was spoken for in pass-throughs to the International Council of Scientific Unions, International Institute for Applied Systems Analysis, and other international ventures in which the U.S. government took part. That left his division around $24 million per year to cover international collaboration in all areas of science and engineering, and as a result it cofunded only around 30 percent of total awards. U.S.–India cooperation, which spans more than four decades, has a fruitful history. Before India became self-sufficient in food production and before the rupee was made convertible, the United States India Fund was set up to fund Indian agencies in rupees. Dr. Weber recalled the time that one of its program directors wanted to give one of his own program directors a bag of money to take back to India, something the latter had been reluctant to do. That initiative had given a start to the NSF–DST joint program, which was geared specifically to those two agencies. The two nations’ relationship continued to flourish during the term of President Clinton, during whose 2000 visit the Indo–U.S. Science and Technology Forum was established, and is flourishing even further under President Bush. A high-level Bi-national Science and Technology Commission is being developed in the wake of the President’s visit earlier in 2006, although it was Dr. Weber’s understanding that various suggestions had been floated as to what that actually might entail. Briefings were under way at NSF in conjunction with a fall visit to India being planned for Dr. Bement, who likes not only to update himself on scientific research when he goes abroad but also to see what is happening in industry. Future joint activities might include an institute for advanced study in nanoscience, which Dr. Weber felt would strike those who remembered the old NATO institutes as having potential. Also in the realm of possibility is an advanced institute in geophysics or, in fact, any area of science or engineering. Although some U.S. students currently have the chance to do short-term research at Indian Centers of Excellence, and MIT students were able spend a summer as a research intern at an IIT, the OISE wished to see both more U.S. students visiting India and more Indian students visiting the United States. Under its East Asia and Pacific Summer Institutes (EAPSI) program, NSF is sending U.S. graduate students to Australia, China, Japan, New Zealand, South Korea, or Taiwan for between six and eight weeks, and India could be added to the list. Dr. Weber then turned to the Materials Research Network, which links U.S. and Indian scientists and is considered the best model for international networking that NSF had yet developed. At NSF, he explained, “materials” runs the gamut from very fundamental research to devices and systems, and it involves multiple disciplines: materials science, physics, chemistry, and engineering. As director of
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India's Changing Innovation System: Achievements, Challenges, and Opportunities for Cooperation: Report of a Symposium NSF’s Materials Research Division, he was often asked what percentage of U.S. materials research the office funded. He had found it a hard question to answer because, while a chemist can go to the American Chemical Society and a physicist can go to the American Physical Society, materials is spread over at least 20 different disciplinary societies. The Materials World Network, which had actually gotten off the ground just three years earlier, had its earliest beginning with a series of international regional workshops between 1995 and 2000 that examined ways of stimulating international collaborations in the field. Though held in “nice places,” these meetings were not without their frustrations, as evident in Dr. Weber’s description of one that took place in Rio when Brazil was on its way to winning the World Cup. NSF then started, over a period of just a few weeks, six International Materials Institutes based at academic institutions in the United States, funding each at between $600,000 and $700,000 per year. One of these, the International Center for Materials Research (ICMR) at the University of California at Santa Barbara, has very strong ties with India: The Nehru Center in Bangalore ranks as its associate center, and the Indian Institute of Science in Bangalore and the Indian Institute of Technology in Mumbai are also among the 20 member institutions on six continents that form its network. Dr. Weber described the function of ICMR’s director, Anthony Cheetham, as “very delocalized” and said that researchers, including graduate students, are traveling back and forth within the network in a variety of exchange programs. ICMR held a summer school in Singapore in August 2005 that featured 35 lecturers and drew 130 participants, as well as coordinating a Singapore meeting of the Asia Materials Network in November of the same year that was attended by researchers from not only India and the United States but also Australia, China, Japan, South Korea, Taiwan, and Singapore itself. These networks, however, represented only one mechanism of the Materials World Network. Its collaborative projects often begin when investigators from different countries sent their respective funding agencies separate proposals that were then reviewed jointly; if found meritorious, they were funded separately by each agency but in a coordinated manner. Dr. Weber emphasized that proposals did not necessarily come through one central location, and he urged researchers in the audience, particularly those from India, to make their own funding agency aware of their projects and also, perhaps, to submit proposals in order to finance student exchanges. In the latest Materials World Network competition, one of the nine proposals involving Indian participation to be submitted had come up a winner. As the overall success rate of proposals submitted to NSF’s Materials Research Division stands at about 20 percent, and in light of the statistics of small numbers, one in nine is “not that bad,” judged Dr. Weber. Cofunded in 2006 by NSF and DST, the winning project, U.S.–India Cooperative Research into Anisotropic Colloidal Magnetic Nanostructures, is seen as contributing to understanding of the physical
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India's Changing Innovation System: Achievements, Challenges, and Opportunities for Cooperation: Report of a Symposium and biological phenomena that rely on nanoscale magnetic materials. A broader impact is also expected: that of facilitating the exchange of students, at both the undergraduate and graduate levels, and of faculty. Its principal investigators are Vinayak Dravid of Northwestern University and Dhirendra Bahadur of the Mumbai IIT. As an aside, Dr. Weber remarked that he had been quite impressed by the IIT system and added that the United States has benefited from the fact that a large number of its alumni have occupied all sorts of very high positions here in both industry and academia. Dr. Weber concluded by laying out obstacles and conflicts that U.S.–India cooperative research activities might face: Data access: Getting access to geosciences data was very difficult for U.S. scientists. Broadband connection: India is not connected to the highest-speed broadband research networks, among them the NSF-sponsored GLORIAD, which could be especially helpful to remote collaboration. Intellectual property rights (IPR): IPR and their enforcement need to be worked out in advance and clearly understood. When U.S. scientists work with the European Commission, there is always a struggle stemming from the universities’ refusal to sign agreements that the Commission put forward. This does not represent much of a hurdle in the case of NSF, however, since almost all of its research falls into the “basic” category. Basic versus applied research: The difference in focus between agencies can sometimes lead to problems. Bottom-up versus top-down selection: In contrast to agencies that specify the amount of money they are willing to spend in a particular area, an approach he called “top down,” NSF typically took a “bottom up” approach, examining proposals that came in over the transom and funding those it considered promising. Distributed versus centralized funding: Typically, OISE did not receive research proposals directly; rather, its program directors were contacted by NSF research divisions to which proposals with an international component had come in. This was difficult for non-U.S. scientists to understand because many funding agencies around the world, including DST, took a centralized approach to international cooperation. At a conference of the Japan Society for the Promotion of Science (JSPS) that very morning, Dr. Weber had heard the complaint that NSF’s international activity had decreased. This was unlikely to be true, he said, but the impression had arisen owing to the lack of a specific NSF–JSPS program. Bureaucracies: Their influence could be either good or bad, since they had the potential both to accomplish things and to act as a hindrance. Currency convertibility. With that, Dr. Weber thanked the audience.
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India's Changing Innovation System: Achievements, Challenges, and Opportunities for Cooperation: Report of a Symposium DISCUSSION Anubha Verma from Georgetown University, remarking that a Nobel Prize in science had last gone to an Indian citizen in 1930, asked when the country could expect its next one. Dr. Indiresan called the Nobel Prize “an accident” and recommended patience, while also remarking that Amartya Sen had won a Nobel Prize in Economics two years before. Dr. Mashelkar, praising the question, offered to send along a copy of an article he had written three months earlier explaining how Indians could be the very best in their chosen fields, whether that meant winning the Oscar, winning at Wimbledon, or winning the Nobel Prize. In it, he had analyzed the fact that, in the first 100 years of the Nobel Prize’s existence, only three were won by people working in the Third World. Dr. Newman of CalTech offered the observation that his institution had recorded 32 Nobel “accidents” as a preface to his question, which concerned the role of universities. More and more of the vitality of U.S. innovation is emanating from the universities, whose support has evolved so that it currently comes partly from private sources and partly from diverse government agencies. Suggesting that Dr. Indiresan’s bird metaphor, which illustrated the necessity of achieving a balance between control and freedom, might apply to universities and partnerships as well to innovative individuals, he asked what the next steps for India would be and what U.S. academics could do to help. Dr. Indiresan, warning that it would be difficult to find an answer, cited two of India’s chief problems: extremely limited resources, relatively speaking, and fairly limited access to information. The best way for U.S. academics to stimulate and encourage research in India would be to identify bright young faculty members in an Indian university and start collaborative programs with them. This could be of value to the United States as well, given that there were very talented people in India who could not have been as productive as they might be because of a lack of resources. Dr. Weber stated that the best way to start collaborations was for one person on the U.S. side and one on the Indian side to organize a workshop. That could bring together people who might not have known one another but who, having suddenly found a source of expertise, might want to start collaborating. Wendy Cieslak of Sandia National Laboratories, describing CSIR’s renewal as “amazing” and “impressive,” speculated that its scientists must love working in such a vibrant research environment and contributing to industrial and national competitiveness. Piquing her curiosity was the fact that the turnaround chronicled by Dr. Mashelkar, which took place in the 1990s, was followed by a steep rise in publications, citations, and patents beginning in 2000. Had there been a drive to increase the number of publications? Had this rise occurred naturally as the productivity of the laboratory grew? Was it in fact important to Dr. Mashelkar—and, if so, why?
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India's Changing Innovation System: Achievements, Challenges, and Opportunities for Cooperation: Report of a Symposium Dr. Mashelkar, recalling CSIR’s mission statement, pointed out that in the phrase “scientific industrial R&D” the word “and” appears to have been left out. The omission, however, had been deliberate. In the pre-1991 era, while CSIR did wonderful scientific research, it had no connection with industrial research at all. “There was no competitiveness because we were a closed economy,” he said. “Industry produced gums that did not stick, yet people bought them. We produced plugs that did not fit, and we bought them. We produced cars on which everything other than the horn made noise, and we bought them.” In this sellers’ market there was no innovation, and the bulk of the industrial research that CSIR did at the time was based on reverse engineering. Change began in the early 1990s: When India liberalized, competition came in, causing industry to change its attitude and look for goods that would be competitive. A story from when Dr. Mashelkar was director of the National Chemical Laboratory would illustrate one of the reasons that India had improved its strength in patenting. Before the economy opened up, whenever he went to industry with work from the lab that was ahead of the rest of the world, he would be asked: “Have they done it?” This meant, had it been done in the United States or in Europe? His response was to reconceptualize the challenge before the lab: NCL would become an international chemical laboratory whose ultimate product, knowledge, could be sold anywhere. “But,” he explained, “I couldn’t go to General Electric and say, ‘I will copy something from you. Will you buy it?’ They would kick me out.” So the lab had to be basically ahead, and that raised the bar. The patent that he had mentioned earlier—which had, in fact, been licensed to General Electric—had been the subject of a paper in Macromolecules, an EC journal. The effort to couple high science with high technology—to apply the highest level of science to economic, social, and environmental problems—had been the main driver of CSIR’s renewal. In most instances when national laboratories are transformed and great stress is put on delivering to industry, incomes go up but the science goes down. CSIR, in contrast, had achieved what Dr. Mashelkar characterized as this “subtle coupling.” Dr. Sinha of Penn State, remarking that the impressive turnaround at CSIR had been accomplished with few changes in personnel, asked Dr. Mashelkar if he could identify elements of the process that might be transferred to other settings with similar success. Dr. Mashelkar said that, while much had been written by others analyzing CSIR’s transformation, “at the end of the day, it is all about leadership.” An effort had been made to create leadership within the laboratories by finding people of outstanding merit who would stand tall in science but have a realistic view of the continuity between knowledge and wealth creation. That, he believed, had been the crux of the matter. Dr. Goel of Nanobiosym, a nanobiotechnology company she had recently started as a research associate in physics at Harvard, asked the panelists to go
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India's Changing Innovation System: Achievements, Challenges, and Opportunities for Cooperation: Report of a Symposium beyond the discussion of resources to consider the culture of innovation. America had traditionally favored risk taking and innovation; individual initiative and the entrepreneurial spirit were encouraged, and there was a high tolerance for failure. She wished to know what might be done in India, in addition to providing resources and access to education, to create a similar culture. Dr. Mashelkar said he had visited several universities in Canada before coming to the symposium and learned that, for example, the University of British Columbia had spun off a number of companies, the largest among which had a market capitalization of around $6 billion. Preventing anything comparable from happening in India was a cultural tendency that he represented metaphorically as the division of labor among two Hindu goddesses: Saraswati, the goddess of knowledge, and Lakshmi, the goddess of wealth. “Unlike in this country,” he said, “we have never understood the route from Saraswati to Lakshmi.” But cultural change are on its way, if gradually. For the first time in its century of existence, the Ministry of Science was allowing India’s scientists to act as entrepreneurs. Suddenly, people such as Ashok Jhunjhunwala were setting up companies like TeNet, or Professor Vijay Chandru Strand Genomics. These examples are of recent vintage, but to multiply them by hundreds—which, according to Dr. Mashelkar, was “entirely possible”—more than cultural change would be needed. Minister Sibal had spoken earlier in the day about an equivalent of the Bayh–Dole Act for Indian universities, as well as about early-stage financing from both the public and private sectors. All this was at its beginning, but liberalization, since it dated only to 1991, was still fairly recent. Still, risk taking was going to be very critical. Dr. Mashelkar had started a program known as the New Millennium Indian Technology Leadership Initiative, the idea of which to move away from reverse engineering and to work in areas where technologies and markets were not yet established. Funding was in the form of government-backed loans that were to be repaid only in the case of success. The results were, as he put it, “amazing”: Within four years a public–private partnership of 65 private-sector companies and more than 20 research institutions had been formed and scored a breakthrough by discovering the first new tuberculosis molecule found since 1963. Several breakthroughs of like significance were on the way, he said, “simply because the government gave us gambling money and a level playing field.” Moreover, the amount of public investment was not overly large, coming to between $10 million and $12 million per year—a sum that, Dr. Mashelkar reminded the audience, nonetheless “goes a long way in India.” The entire budget for the country’s space program was no more than half a billion dollars per year, although that depended on India’s designing, fabricating, and launching its own satellites. It provided such services to Germany and South Korea as well. Amit Mittal, a science counselor at the U.S. embassy in New Delhi when Norman Dahl and Louis Smullen visited in the mid-1980s, recalled recommending to the Indian government that one of the IITs be increased in size 10-fold.
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India's Changing Innovation System: Achievements, Challenges, and Opportunities for Cooperation: Report of a Symposium Mindful of Dr. Indiresan’s important observation about the difficulty of diluting the government’s dominance of the IITs, he asked whether this was indeed an option. Dr. Indiresan responded that the IIT Act, which had been inspired by the U.S. system, was the only act of the government of India to grant the kind of autonomy that all educational institutions should have but that no others in India did have. IITs remain, therefore, very special and privileged institutions. He would pass over the reasons that the original plan for the organization, under which it was to depend on the government for only one-third for its means, had not been followed and IIT instead had become 100 percent dependent. More recently, in 1998, the government declared that the IIT should become as independent as possible and froze the amount of grant funds it was providing. But seeing the IITs’ response—they “went merrily ahead and started making a lot of money”—government officials feared losing control and forbade them to accept further outside funding. Until this rule changed, it was going to be very difficult for the IITs to expand because that would require the permission, and the financial support, of the government. Recruiting staff of high quality would be a huge obstacle in any case, as salary levels are restricted by the system. Dr. Mashelkar said that, in fact, a new picture was emerging with regard to salaries as the entire system of science and engineering education in India was in the process of being overhauled and upgraded. He described this system as a pyramid that had the IITs at the top, followed by the regional engineering colleges, then by the government engineering colleges, with the Industrial Training Institutes referred to by Dr. Kapur at the base. Recalling that the IITs accepted only 2,000 of 200,000 applicants even though 10,000 others might be as good, Dr. Mashelkar said that the rejects ended up attending regional engineering colleges. In the aftermath of his making a case for giving the regional engineering colleges “a place in the sun,” which he had in 1999, they were converted into National Institutes of Technology that received their funding from the central government rather than the states, and their governance structure was changed completely. In addition, the government engineering colleges and hundreds of other colleges are being lifted up, thanks in part to World Bank support. One of them, the Mumbai University Institute of Chemical Technology, is probably the best chemical engineering school in the country; admission demands minimum marks of 97–98 percent. Dr. Mashelkar, its current chair, said there is a “major transformation” under way. Thanks to the autonomy gained through a public–private partnership, the institute’s director was receiving a six-figure salary for the first time ever. He described this as having been done on an “x-plus” basis, with “x” coming from the government and the “plus” from the private sector. He proposed meeting again a year later to see how change was progressing. Dr. Atkinson offered two observations in closing. The first was that, the previous day, he had had the privilege of lunching with Norman Borlaug on the oc-
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India's Changing Innovation System: Achievements, Challenges, and Opportunities for Cooperation: Report of a Symposium casion of the World Food Prize announcement at State Department headquarters. Dr. Borlaug, if he understood the story correctly, had assumed risk in conducting research based on his own commitment to doing something rather revolutionary, something that might make a dramatic change. So in the history of U.S.–India relations, an enormous change had occurred over the past several years thanks to risk taking. If there was a lesson to be drawn from that, it was that risk taking is a very important element. The second observation was that since the success of a panel was measured in the questions, this had clearly been an exciting panel. Paying his respects to the panel, he added, also amounted to paying homage to Dr. Wessner and the National Academies for putting this conference together.
Representative terms from entire chapter: