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Karnataka has bagged the top rank in NITI Aayog’s India Innovation Index, 2022, which determines innovation capacities and ecosystems at the sub-national level. The State has held this position, under the Major States category, in all three editions of the Index so far.

Highlights:

• In the Index released, Manipur secured the lead in the Northeast and Hill States category, while Chandigarh was the top performer in the Union Territories and City States category.
• Karnataka was followed by Telangana, Haryana, Maharashtra and Tamil Nadu. Chhattisgarh, Odisha, Bihar and Gujarat were at the bottom of the index.
• The report also noted that the country has not performed well in the knowledge worker pillar, as much as it has in the human capital pillar.
• The expenditure on human capital has been unable to create that knowledge base in the country…Moreover, it was also observed that innovation is skewed against the manufacturing sector due to the problems pertaining to and the missing middle. This requires inexorable efforts to overcome challenges and make the best use possible.

Measures recommended by the NITI Aayog:

• India’s average innovation score is arguably insufficient, given the country’s ambitious targets to be named among the top 25 nations in the Global Innovation Index, the report by the government think tank has recommended measures, such as
  • Increasing Gross Domestic Expenditure on R&D (GDERD),
  • Promoting private sector participation in R&D and
  • Closing the gap between industry demand and what the country produces through its education systems.
• The report went on to state that countries that spend less on GDERD fail to retain their human capital in the long run and the ability to innovate is dependent on the quality of human capital; India’s GDERD as a percentage of GDP stood at about 0.7%.
• “Therefore, GDERD needs considerable improvement and should touch at least 2%, which would play an instrumental role in India achieving the goal of a 5 trillion economy and further influence its innovative footprint across the globe.
• It added that the private sector needs to pick up pace in R&D. Taking the evidence from countries like South Korea, USA, and Germany, where the presence of private players is quite evident, the report noted that public expenditure is productive up to some extent; once the growth follows a trajectory, it is desirable to shift to R&D mostly drive by the private sector.
• Therefore, it is important for India to find that inflexion point after which private sector takes over the government sector.

About the index:

• Prepared by NITI Aayog and the Institute for Competitiveness, the India Innovation Index is a comprehensive tool for the evaluation and development of the country’s innovation ecosystem. It ranks the states and the union territories on their innovation performance to build healthy competition amongst them.
• The number of indicators has increased from 36 (in the India Innovation Index 2020) to 66 (in the India Innovation Index 2021).

• This is the third edition of the report which presents an evaluation of the innovation readiness of states and UTs and highlights potential challenges that deter the government, businesses and individuals from fully realising their potential.