Growth of core technologies

India has consistently showcased its potential to create revolutionary “core” technologies, from the discovery of the Raman Effect in 1930 to advancements in modern semiconductor technology. However, the nation has struggled to translate these breakthroughs into commercially viable solutions, often ceding market opportunities to foreign competitors. A persistent disconnect among academia, industry, and government has left India reliant on imports for critical technologies, despite possessing the intellectual capability to develop them domestically. Addressing this gap in converting scientific achievements into commercial success is essential for India to realize its aspiration of becoming a technology-driven developed economy.

What is Core Technology?

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Core Technology (Core Tech) refers to foundational, advanced, and critical technologies that serve as the backbone of innovation, driving growth across industries, economies, and national priorities.

Key Characteristics of Core Technology

Foundational Nature: Core technologies act as essential building blocks for other technologies and applications.

Wide Applicability: These technologies have diverse applications spanning defense, healthcare, education, manufacturing, and more.

Strategic Importance: Core technologies play a pivotal role in shaping a nation’s economic, military, and geopolitical strength by driving security, governance, and innovation.

Examples of Core Technology

• Semiconductors: Essential for electronics, computing, and artificial intelligence.
• Artificial Intelligence (AI): Encompasses machine learning, natural language processing, and automation technologies.
• Quantum Computing: Utilizes quantum mechanics for unmatched processing capabilities.
• Cybersecurity: Protects digital infrastructure and sensitive data from cyber threats.
• Space Technology: Includes satellites, launch vehicles, and tools for space exploration.
• Advanced Manufacturing: Incorporates 3D printing, robotics, and Industry 4.0 innovations.
• Green Technologies: Focuses on renewable energy solutions like solar panels, wind turbines, and green hydrogen.
• Telecommunications: Powers next-generation communication systems such as 5G and fiber optics.

Why is Investing in Core Technologies Crucial for India?

Economic Growth and Global Competitiveness

• Investing in core technologies such as Artificial Intelligence (AI), semiconductor manufacturing, and quantum computing is essential for accelerating India’s economic growth.
• These technologies foster innovation, enhance productivity, and generate high-value employment opportunities.
• The global AI market, projected to reach $900 billion by 2030, presents significant opportunities for India through initiatives like the National AI Mission.
• Similarly, the Production Linked Incentive (PLI) scheme for semiconductors aims to position India as a global chip manufacturing hub, addressing the projected $110 billion semiconductor market gap by 2030.

Strengthening National Security

• Technologies like cybersecurity, drone systems, and AI-powered surveillance are pivotal for addressing contemporary security challenges, including cyber threats and border management.
• For example, AI-driven tools enable real-time monitoring of sensitive borders like the Line of Actual Control (LAC).
• In 2022, CERT-In reported over 1.39 million cybersecurity incidents, underscoring the need for indigenous cybersecurity solutions.
• Defense Ministry initiatives like iDEX have driven advancements in drone and anti-drone technologies, enhancing India’s security framework.

Reducing Technological Dependence

• Heavy reliance on imports for critical technologies, such as semiconductors and high-end electronics, compromises India’s strategic autonomy.
• Investments in domestic R&D foster self-reliance in key sectors like 5G telecom, defense, and space technology.
• The Semicon India program, launched in 2023, aims to establish India as a self-sufficient hub for semiconductor production.

Building a Knowledge-Based Society

• Core technology investments improve education, healthcare, and governance through innovation and expanded accessibility.
• The Digital India Mission has connected rural households, advancing e-learning and telemedicine services.
• AI applications like disease outbreak prediction and platforms like e-Sanjeevani, which facilitated over 276 million teleconsultations, demonstrate transformative healthcare impacts.
• India’s EdTech sector, valued at $7.5 billion, exemplifies how digital technologies are reshaping education.

Driving Climate Resilience and Sustainability

• Advanced technologies such as renewable energy systems, smart grids, and climate modeling are critical for India’s energy transition and climate action goals.
• India has pledged to achieve 500 GW of non-fossil fuel capacity by 2030 under its Nationally Determined Contributions (NDCs).
• Investments in green hydrogen and solar technology support these commitments, while AI-driven crop monitoring enhances agricultural efficiency and resource conservation.

Boosting Startups and Entrepreneurship

• A vibrant technology ecosystem nurtures startups and encourages entrepreneurship, fueling economic diversification and innovation.
• With over 100 unicorns and 157,000 startups, India is emerging as a global innovation leader.
• Programs like Startup India and DPIIT initiatives for tech startups play a vital role in fostering this growth.

Geopolitical Leverage

• Investments in core technologies strengthen India’s strategic positioning and global partnerships.
• Initiatives like iCET (India-U.S. Initiative on Critical and Emerging Technologies) demonstrate technology’s role in enhancing bilateral relations.
• India’s participation in semiconductor alliances like the Quad Semiconductor Supply Chain Initiative underscores its position in countering China’s dominance in tech supply chains. 

Key Challenges Hindering the Growth of Core Technologies in India

Inadequate R&D Investment and Ecosystem Support

• India invests only 0.65% of its GDP in research and development (R&D), significantly lower than global leaders like Israel and South Korea, which limits innovation in critical areas such as AI, semiconductors, and robotics.
• Insufficient funding discourages private sector engagement and academic collaboration, essential for driving breakthroughs in technology.

Shortage of Industry-Ready Workforce

• The lack of a skilled workforce to meet the demands of emerging technologies, such as quantum computing and AI, hampers industrial innovation and global competitiveness.
• According to the Economic Survey 2023-24, only 51% of Indian graduates are employable.
• Demand for roles like AI specialists and data analysts is projected to grow, with employment for 2.5 to 2.8 million professionals expected by 2030, yet existing training programs fall short of industry needs.

Dependence on Imports for Strategic Technologies

• India relies heavily on imports for critical technologies like semiconductors, lithium-ion batteries, and advanced machinery, undermining self-reliance and exposing the economy to global supply chain risks.

For example, 95% of India’s semiconductors are imported from nations like China, Taiwan, and South Korea.

• The global semiconductor shortage during the pandemic significantly impacted India’s automobile and electronics sectors, causing billions in lost revenue and highlighting the urgency for domestic capacity building under the “Make in India” initiative.

Policy Inconsistencies and Bureaucratic Delays

• Frequent policy changes and procedural delays deter investments in core technologies and stall critical projects.
• Despite the government allocating ₹76,000 crore for semiconductor manufacturing in 2021, no large-scale fabrication facilities have become operational due to a lack of clarity and delays in approvals.
• India’s 63rd ranking in the 2020 World Bank’s Ease of Doing Business Report reflects these challenges, affecting foreign direct investment (FDI) for technological innovation.

Weak Collaboration Between Academia and Industry

• Limited partnerships between academic institutions and industries result in fragmented research efforts with minimal commercialization.
• Although India saw a 31.6% rise in patent applications in 2022, only a small percentage were successfully commercialized.
• In contrast, the U.S. uses policies like the Bayh-Dole Act to mandate the commercialization of federally funded research, fostering a thriving innovation ecosystem.

Limited Deep-Tech Startup Funding

• India’s startup ecosystem is predominantly focused on consumer tech and e-commerce, with inadequate venture capital support for deep-tech sectors like AI, quantum computing, and space technology, which require long-term investments.
• Nasscom reported a rise in deep-tech startups in 2023, but funding in the sector fell by 77%.
• For example, space-tech companies like Agnikul Cosmos face challenges in securing funding despite groundbreaking achievements in India’s private space sector.

Fragmented Approach to Climate-Tech Innovation

• A lack of coordinated policies and investments hinders climate-tech innovation, even as India aims for sustainable technologies like green hydrogen and advanced battery storage.
• While India has committed to achieving 500 GW of renewable energy capacity by 2030, investments in energy storage technologies remain insufficient.
• By contrast, nations like Germany and Japan have advanced significantly in hydrogen technology through substantial R&D funding and public-private partnerships

Measures India Can Adopt to Enhance Core Technology Development

1. Boost R&D Investment and Foster Public-Private Collaboration

• Increase R&D spending to at least 2% of GDP, aligning with global leaders like South Korea and the US, to enable breakthrough innovations.
• Establish a dedicated National Core Technology Fund to support advanced research in AI, quantum computing, and semiconductors, encouraging private sector contributions.
• Link programs like Semicon India with academia and industry through the National Research Foundation to bridge the gap between research and commercialization.

2. Build World-Class Core Technology Infrastructure

• Prioritize infrastructure development, including semiconductor fabs, quantum labs, and AI testbeds.
• Offer incentives for technology parks, such as the Bangalore Technology Cluster, to attract global tech giants.
• Integrate PLI (Production Linked Incentive) schemes with the Smart Cities Mission to create advanced industrial zones with robust supply chains and sustainable logistics.

3. Develop a National Talent Strategy

• Implement a nationwide strategy for skilling and reskilling the workforce to meet industry demands in emerging technologies.
• Partner Skill India with global firms for hands-on training in AI, robotics, and blockchain.
• Reform STEM curricula to include emerging technologies, embedding AI and data analytics courses in engineering programs.

4. Invest Strategically in Domestic Manufacturing

• Focus on high-tech manufacturing sectors like semiconductors, lithium-ion batteries, and advanced machinery to reduce import dependency.
• Align the National Manufacturing Policy with the Atmanirbhar Bharat initiative to support startups and MSMEs in these sectors.
• Integrate FAME (Faster Adoption and Manufacturing of Electric Vehicles) with domestic lithium-ion battery production to build a sustainable EV ecosystem.

5. Strengthen Collaboration for a Unified Innovation Ecosystem

• Foster collaboration among academia, startups, and industries to drive innovation and commercialization.
• Expand programs like Startup India to provide funding and mentorship for core-tech startups.
• Create an Innovation Exchange Platform connecting IITs, NITs, and industrial hubs to replicate Silicon Valley-style ecosystems.

6. Prioritize Cybersecurity and Indigenous Solutions

• Expand programs like Cyber Surakshit Bharat to include AI-driven real-time threat monitoring tools.
• Build indigenous cybersecurity infrastructure to safeguard critical sectors amid rising cyber threats.

7. Leverage Global Partnerships for Technology Transfer

• Deepen collaborations through initiatives like India-US iCET for expertise in semiconductors and AI.
• Expand partnerships with countries like Japan (robotics) and Germany (green hydrogen) to accelerate technology development.
• Link the Quad Semiconductor Initiative with domestic efforts under Semicon India to build resilient supply chains.

8. Enhance Tech Accessibility in Rural Areas

• Accelerate programs like BharatNet to provide broadband connectivity in rural regions, enabling digital inclusion.
• Combine with the Digital India Initiative to promote AgriTech solutions such as AI-driven crop monitoring and precision farming tools.

9. Promote Sustainable Tech Development with a Circular Economy

• Focus on recycling e-waste and adopting eco-friendly practices in core tech development.
• Establish Green Technology Zones under the National Green Hydrogen Mission to promote sustainable innovation.
• Combine solar energy with battery recycling plants to create a circular economy for clean energy technologies

To realize its vision of becoming a technology-led developed economy, India must bridge critical gaps in the commercialization of core technologies. By enhancing collaboration between academia, industry, and government and significantly increasing investment in research and development, the nation can foster a vibrant innovation ecosystem. Strengthening these initiatives will accelerate economic growth while advancing national security, sustainability, and global competitiveness.

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