Context

• India’s ambition to become a global innovation leader cannot rest on public funding alone.
• Countries that turned scientific capability into industrial strength aligned predictable private R&D spending with university excellence through long-term partnerships.
• India now faces the task of shifting corporate research from episodic CSR activities to structured, multi-year commitments that support laboratories, doctoral cohorts, and pilot-scale experimentation.

Global Models of Industrial-Scale R&D

• Leading global firms invest in research at industrial scale. In 2024, Meta spent about $44 billion on R&D, nearly one-third of its revenue.
• Alphabet, Amazon, Apple, IBM, and Microsoft also operate multibillion-dollar research programmes. In the United States, enterprises spent roughly $692 billion on domestic R&D in 2022, close to 5% of net sales.
• Programmes such as the National Science Foundation’s Industry-University Cooperative Research Centres and the Semiconductor Research Corporation convert this investment into university partnerships that generate talent, pre-competitive research, and long-horizon consortia.
• China’s major firms show similar commitments. Huawei invested 179.7 billion yuan in R&D in 2024, amounting to 20.8% of revenue, with more than half its workforce in research roles.
• BYD spent 54.2 billion yuan, an intensity of nearly 7%, reflecting deep integration of corporate research with universities through shared laboratories, joint centres, and structured talent pipelines.

India’s R&D Landscape: Strengths and Gaps

• India’s GERD remains around 0.65% of GDP, with industry contributing about two-fifths, below levels in advanced economies.
• Yet several Indian firms demonstrate strong research commitments.
  • Tata Motors invested 6.7% of FY24 revenue in R&D, comparable to global automotive leaders.
  • Sun Pharma allocated 6.7% and Dr. Reddy’s 8.2% of revenues.
  • Bharat Electronics spent 6.24%, signalling the strategic value of R&D in defence electronics.
  • Reliance Industries recorded more than ₹4,100 crore in R&D expenditure for FY2024–25.
  • The IIT Madras Research Park brings more than 200 companies into daily proximity with faculty and student teams.
• The iDEX initiative fosters defence innovation by linking startups with military R&D units.
• The India Semiconductor Mission integrates industry investments with academic partnerships and skill pipelines, as demonstrated by the Micron ATMP facility at Sanand.
• These examples show that India has functional models of collaboration, though they remain limited in scale.

Scaling the System: Policy Pathways for India

• Set sector-specific R&D intensity targets
  • India should establish three-year R&D-to-sales benchmarks for key sectors, automotive, pharmaceuticals, electronics, defence, space, and energy, with targets that rise steadily.
  • Shared IP frameworks must reward both publication and commercialisation.
• Strengthen co-funded research and shared infrastructure
  • Government should reward co-funded projects, where industry contributions flow through higher education institutions.
  • Multi-year projects must specify open-data deliverables, industry-relevant KPIs, and a commitment to collaborative use of university resources.
  • India should create university-managed pilot lines and testbeds that firms can access on a pay-per-use basis, and invest in multi-university centres built around portfolios of problems rather than isolated grants.
• Modernise Tax Incentives
  • Weighted R&D deductions should be linked to clear outputs such as patents, standards contributions, clinical milestones, or field trials.
  • Incentives must encourage collaboration with accredited HEIs and the hiring of graduate researchers into industry roles.
• Build collaborative capacity within campuses
  • Universities need programmes that train faculty and PhD scholars in industry collaboration, IP negotiation, and the management of translational research.
  • Policies should support dual-track roles, adjunct positions, and doctoral cohorts aligned with corporate technology roadmaps.
• Increase transparency and public accountability
  • Listed firms should report total R&D expenditure and the share directed to Indian HEIs.
  • Publishing these results in Indian languages and practitioner-friendly formats can build public recognition for research careers and encourage boards to treat R&D as a strategic priority.

Conclusion

• India possesses world-class laboratories, skilled talent, and dynamic markets.
• To convert these strengths into global competitiveness, firms must set clear R&D targets, invest in real laboratory engagement, and collaborate consistently with academic partners.
• Universities, in turn, must deliver measurable value, embrace industry problem statements, and demonstrate evidence of impact.
• Achieving this alignment can transform research into a national supply chain, predictable, coordinated, and central to India’s economic future.