Global Competitiveness and Technology

National Conference on IP for MSME

Organised by CII-MoMSME-WIPO

19th Oct 2010
Deepak Bhatnagar Indian Institute of Foreign Trade (IIFT) headcitt@iift.ac.in headcitt@gmail.com

India: Competing with the World
A peep into the past……

• Indian Steel in arrows and swords: - Iron tipped arrows used by Indians in the Persian army (480 BC) - Alexander the Great prized a gift of 100 talens of steel from Porus in 326 BC - Indian „Wootz‟ steel used for making Damuscus blades and became famous in Europe („Wootz‟ derived from the Kannada word „UKKU‟ meaning steel) - British Royal Society made a detailed examination of Wootz Steel in 1790: their report says….“the steel of India is decidedly the best I have yet met with!” - “Should Tatas make steel rails to British specifications, I would undertake to eat every pound of it”
Sir Fredrick Upcott, Chief Commissioner of Indian Railways.

“If Upcott had carried out this undertaking he would have had some slight indigestion” (comment by Dorabjee Tata when the rails were sent to UK)

They are the “new masters of management” . Instead. producing breakthroughs in everything… from telecom to car making to health care.Competing for the Future Forget that the „World is flat‟ The world of business is turning upside down (The Economist April 17th 2010) - - World‟s Centre for economic gravity is shifting towards emerging markets Emerging countries are no longer content to be sources of cheap hands and low-cost brains. they too are becoming hot beds of innovation. They are redesigning products to reduce costs not just by 10% but by upto 90%. They are redesigning entire business processes to do things better and faster than their rivals in the West.

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Reliance.200 Nano Car or the $ 350 laptop: this sort of advance – dubbed as “frugal innovation” is not just exploiting cheap labour. shake many industries to their foundations All sorts of CEOs will scream for protection! • • . Fortune 500 companies now have 98 R&D facilities in China and 63 in India Huawei. applied for more international patents than any other firm did in 2008. a Chinese telecoms giant. It is redesigning products and processes to cut out un-necessary costs. Order book in India $ 2 Billion (Rs. 000 crore) with BSNL. the company owns 17 R&D centres with a strength of 40.g. Tata Indicom and Bharti Airtel. as they spread to the rich world. e. MTNL. Globally. Even more striking is the emerging world‟s growing ability to make established products at dramatically lower costs.Innovation and Technology Breakthrough ideas are tilting the balance • • Rich-world companies are doing more R&D in emerging markets e. 9.g. the $2. disruptive innovations that will. It set up R&D operations in India in 1999. (Similar to the concept of “lean manufacturing” when Japanese car industry beat the American giants 30 years ago!) Emerging economies are not merely challenging that lead in innovation.000 Engineers. They are unleashing a wave of low-cost.

• The capacity of firms to use new technologies and improved organizational methods is central in explaining industrial leadership and the competitiveness of regions and countries. • The extent and manner in which innovation occurs in an economy depends on the development of new production and business capabilities. • Technology is high up the agenda in both policy and academic debates. institutions. and competitiveness is not clear. scientific research. contingent (among other things) on business strategy and government decisions on public research funding. the relation between industrial innovation. • Nevertheless. and infrastructure-factors which are. organizational change. .Technology and Competitiveness -these two are the most popular buzzwords of our time. in turn.

The concept can also be defined as the collective ability of firms in the sector to compete internationally. market share and technology. . • Industry/Sector Competitiveness: Extent to which an industry or a business sector offers potential for growth and attractive return on investment. considering the price and non-price qualities. produce and/or market products or services superior to those offered by competitors . A more performance-oriented definition of industry competitiveness can be given as: Collective ability of an industry on performance factors such as productivity. cost. • Company Competitiveness: Ability to design.Defining Competitiveness • Country Competitiveness: Extent to which a national environment is conducive or detrimental to business.

The Global Competitiveness Report 2010-11 Long term prosperity in the wake of Global Economic Crisis: Since 2005. The report defines “competitiveness as the set of institutions. - - The productivity level also determines the rates of return obtained by investments in an economy. The concept of competitiveness thus involves static and dynamic components. A highly comprehensive index which captures the micro economic and macro economic foundation of national competitiveness. . the World Economic Forum has based its competitiveness analysis on the Global Competitiveness Index (GCI). policies and factors that determine the level of productivity of a country” Thus. more-competitive economies tend to be able to produce higher levels of income for their citizens.

• Strong inter-relations of the 12 pillars.in fact. they tend to reinforce each other . each of which reflects one aspect of the complex concept that we call competitiveness. These are broadly grouped into 12 pillars of competitiveness.The 12 Pillars of competitiveness • The GCI provides a weighted average of many different components.

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FDI plays a key role.9th Pillar . India is the 2nd favourite destination for FDI (after China) Level of technology available to firms in a country needs to be distinguished from the country‟s ability to innovate and expand the frontiers of knowledge .Technological readiness • This measures the agility with which an economy adopts existing technologies to enhance the productivity of its industries. technology has increasingly become an important element for firms to compete and prosper. Among the main sources of foreign technology. whether the technology used has or has not been developed within national borders is irrelevant for its effect on competitiveness. • In this context. In today's globalised world. The central point is that the firms operating in the country have access to advanced products and blueprints and the ability to use them.

supported by both public and private sectors. standards of living can be expanded only with innovation. Particularly important for economies as they approach the frontiers of knowledge. Protection of Intellectual Property (IP) Organizational strategy for competitiveness: Develop and Integrate the Technology Strategy with Business strategy . Firms must design and develop cutting edge products and processes to maintain a competitive edge.Innovation • • • • • • • In the long run. This requires an environment that is conducive to economic activity. especially by Private Sector.12th Pillar . Presence of hi-quality research institutions Extensive collaboration in research between university and industry. Sufficient investment in R&D.

which slipped to 4th) India: no 51 slot (slipped from 49th spot last year) China: no 27 slot (up from 29th spot last year) .Strong collaboration between academic and business sectors ensures that much of this research is translated into marketable products and process. reinforced by strong IP protection .High rate of patenting : 148 per million inhabitants.Key factors for the top spot in GCI Switzerland has: .46 per million inhabitants) Sweden: no 2 slot ( has replaced USA .Scientific research institutions are among the world‟s best .High spending on R&D .Excellent capacity for innovation . (India: 5.

.What are the requirements for enhancing competitiveness ? • Prevent obsolescence – sustained R&D • Making the future work for you! • • • • Are you confident about… Future trends: how they may affect you? Where the new opportunities will be? How S&T can help you seize these opportunities? What you should be doing NOW? For every person and organization priorities may differ. The need to anticipate and prepare for the future is crucial. But one thing is certain: We live in a world of change!.

Government schemes to encourage R&D and incentives) • create and nurture a „culture of innovation‟ . uncertainity and complexity • technological knowledge to sustain competitiveness in an uncertain business context • issues become manifold because of globalization of technology • technology financing (VCs.Need to “Manage” Technology • rapid technological change.

those who have not. who have a dream or a vision.NEED FOR A TECHNOLOGY VISION… „Blessed are those. are dead while living!‟ . for.

Stories and new ideas… Opportunities on how frugal technology helped companies become globally competitive .

not just about re-designing products: it involves re-thinking entire production processes and business models. Gives abundant supply of bacteria free water for an initial investment of about $ 24 and recurring expense of $ 4 for a new filter every few months. Plan to produce 1m next year and hopes for an external market of 100 mn. Frugal Innovation.using rice husks to purify water developed by TCS in Chennai.a hand held ECG device developed by GE‟s health care lab at Bangalore.Global Leadership through Technology the charms of frugal innovation • • • • Mac 400. Companies need to squeeze costs to reach more customers and accept thin profit margins to gain volume . Tata Chemicals is making these filter. This miracle sells for $800 (conventional ECG is $ 2000) Water Filter.

Under development at Amrita School of biotechnology with support from TIFAC. . 1. .Partnership with Bio-Con. numbers increasing at alarming rate.Globally competitive product.Low Cost Insulin Pump . Imported pump costs Rs. .A boon for diabetics. . a leading manufacturer of human re-combinant insulin. .75 lakhs. DST.Price range in the 1000s.

FUNGISOMETM Pride Product of Public-Private Partnership FUNGISOMETM development at Delhi University & KEM Hospital. MoST. R&D at Lifecare Innovations led to the commercialization of FUNGISOMETM which was supported by DSIR. . Mumbai was supported by DBT. MoST. Technology transferred to Lifecare Innovations Through National Research Development Corporation. GoI under the auspices of PATSER (Program Aimed at Techonological Self Reliance). GoI.

Liposomal Amphotericin : Produced in the lab LAMP LRC 1 Liposomal Amphotericin : TM Produced at Lifecare FUNGISOME Bench to Bedside .

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000 11. only ‘some’ successfully treated 33.325 300 .6 58.FUNGISOMETMBrand Complete Partial Successful Response Response Response (%) (%) (%) Nephrotoxicity incidence7 (%) Minimum Daily Treatment Cost (Rs.3 31.900 30.0 17.) FUNGISOMETM1 AmBisome2.4 Conventional Amphotericin B6 73.1 77.0 42.000 30.0 .3 Amphocil/ Amphotech5 Ampholip/ Abelcet3.0 25-40 42-63 24.0 35.0 91.6 34-40 17.5 19.100 17.325 282 out of 473 patients enrolled in different groups of fungal infections.1* 10-20 5.0 46.

PATSER Providing Strength • Special issue of Journal of Postgraduate Medicine onSystemic Fungal Infections and development of Indian Liposomal Amphotericin B The special issue of the Journal highlighted matchless safety. therapeutic success and economy of treatment .

Indian Institute of Foreign Trade Specialised Centres in IIFT: • SME • CITT • WTO .

Netherlands . submitted to NMCC • 2. Impact of Global Financial crises on SMEs from India B. Capacity Building of SMEs at Chennai (Leather cluster).Training: SME Centre has been involved in Capacity Development of SMEs both at National and International level. Student training in collaboration with CII and CBI. Market research reports in collaboration with Centre for Promotion of Imports from developing countries G. Tirupur (Textiles cluster) and Hyderabad (Agriculture) C. plays a crucial role in conducting research and capacity building programmes for SMEs at national and international levels IIFT is being increasingly recognized as Regional Resource Centre for Capacity Building of SMEs 1. set up in May 2005. Inventory of Food Safety Standards for Agricultural Exporters from India F. Product Market Identification for SME Textile exporters : case study for Tirupur Exports D. The SME Whitebook: Essential Handbook for Small and Medium Enterprises 2009-10 E. Research: Some of the important research conducted by the Centre includes A. Product Market Identification for Agricultural exporters from Andhra Pradesh C. Some of the important Capacity building programs conducted by the Centre for the year 2009-10 includes A. Increasing Competitiveness of Informal sector in India. Training the trainers for SMEs in Greater Mekong Sub Region at Bangkok in Dec 2009 B.IIFT : SME Centre • SME Centre of the institute.

. Sensitise Government of India towards an enabling and proactive policy regime. Underscore the importance of technology exports and strive for its inclusion in the curricula of the concerned academic institutions. Develop a cadre of experts and trainers in international technology trade.IIFT : Centre for International Trade in Technology (CITT) Objectives: • • • • Support industry by providing analytical information on technology export potential sectors and markets.

Technology Financing for SMEs: A Survey Report on Auto-Component SMEs. Exportable R&D Services in the CSIR System. Global Marketing of Research and Development Services: Some Conceptual Issues. Technology-Intensive Exports from India. . Policies and Incentives for Accelerating Technology-Intensive Exports: Exporters' Perspectives. Valuation of Intangible Assets . GATS Provisions on R&D Services and Export Potential for India.A Perspective.Focused studies by CITT: Technology Branding in SMEs Technology Support Services in Special Economic Zones (SEZs) Survival of Startups Foreign R&D Centres in India.

• Organize ‘tailor-made’ training programmes for capacity building on the interface between technology and trade.How can IIFT help ? • Develop an export strategy for SMEs by linking technology with trade. technological & business environment in the domains of your interest.  International branding/marketing of technologies  New business opportunities for Global trade  Impact of changing global. .

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