‘Urgent need to reimagine India’s R&D strategy’: NITI Aayog paper draws lessons from China

Written by Debjani Ghosh, Distinguished Fellow at NITI Aayog, and Sharad Sharma, founder of iSPIRT, the paper identifies China’s strategic initiative “Made in China 2025” (MIC 2025) for fundamentally transforming its position in global high-tech manufacturing.
https://twitter.com/NITIAayog/status/1909133004796219591

China’s 10-year R&D push

The MIC 2025 initiative, a ten-year plan formulated in 2015, sought to develop China’s industrial R&D capabilities, with a focus on strategic sectors including electric vehicles (EVs), renewable energy, telecommunications, and quantum computing.

“The Chinese government allocated over $300 billion initially for the MIC 2025 initiative, with an additional $1.4 trillion invested post- COVID-19 to accelerate progress. India’s approach tends to be more diffuse, with less concentrated investment in specific industries,” the paper said.

Sharing the paper on its X account, NITI Aayog posted, “To shape India’s technological and economic future, we must move beyond mere planning to create a bold 10-year Vision backed by a robust execution strategy and rigorous accountability.”

To carry out India’s R&D strategy, it also proposed setting up a National Industrial Strategy Task Force to “ensure that plans are not just made, but realized”.

India’s R&D intensity low, creates funding gaps

Compared to China’s R&D intensity at 2.68 per cent, indicating R&D expenditure as a percentage of GDP, India’s figure hovers at around 0.7 per cent, which creates a funding gap and hinders its ability to innovate at scale, the paper said.

“The infrastructure supporting China’s R&D ecosystem is equally impressive, with 40 dedicated R&D centers and national laboratories established specifically to drive innovation across priority industries. These research facilities serve as convergence points where academic expertise, industrial know-how, and government priorities align to solve complex technological challenges,” it said.

While the paper noted institutions like IITs and Council of Scientific & Industrial Research (CSIR) laboratories in India, it said “these often function with greater independence and less industrial integration”.

“The Chinese model actively promotes knowledge transfer between research institutions and industry through formal mechanisms and incentives… India’s academic-industry gap remains wider, with fewer structured pathways for commercializing research,” the paper added.

China dominates global supply chains

Highlighting China’s global market share in key sectors like EVs, solar panels, and telecommunications equipment, the paper said “Indian firms have achieved similar dominance only in select legacy niches like generic pharmaceuticals and IT services”.

“China has significantly reduced dependency on foreign technology in multiple sectors, with MIC 2025 targeting 70% self-sufficiency in core technologies by 2025. India continues to heavily import technology in many high-value areas, particularly in electronics, advanced materials, and precision manufacturing,” it added.

Other key insights from China’s R&D strategy mentioned in the paper included meticulous monitoring of progress through patenting, maintaining policy continuity, and developing robust investment frameworks like the MIC 2025.

“China’s patent portfolio has grown to 4.76 million valid domestic invention patents by the end of 2024, a 16.3% increase from the previous year. India’s patent filings, while growing, remain at a fraction of China’s output,” the paper said.

Source: NITI Aayog discussion paper titled “Beyond Planning: India’s Urgent Need for a 10-Year R&D Vision, Action, and Accountability”