Innovation economy: How to realise India's techade

With techno-nationalism spurring significant policy decisions from the US to Australia on investments to reshape the global supply chains, the Budget announcements will be keenly watched

With Finance Minister Nirmala Sitharaman set to deliver the last full Budget of the second term of the Narendra Modi government before India goes to general elections next year, there is a heightened sense of anticipation. With techno-nationalism spurring significant policy decisions from the United States to Australia and Japan to the UK on investments to reshape the global supply chains, the Budget announcements will be keenly watched on the road ahead for hi-tech in India. The 2023 Budget is also the first after the Prime Minister’s clarion call from the Red Fort on “Jai Anusandhan”, to realise the dream of India’s techade. With India’s digital public goods infrastructure taking centre stage in the discourse around G20, it is clear that India’s leadership in large-scale digital innovations, for greater public good, has much to offer to the world. However, there are significant geopolitical risks to India’s techade that will need to be pre-emptively managed to realise Prime Minister Narendra Modi’s vision.

India’s history of technology-led innovation over the past few decades has certain unique characteristics. While the advanced nations have seen technology in multiple domains evolve linearly, going through a series of chronologically sequential steps, India has defied this linear evolutionary path. In the case of telecommunications as an example, while much of the West went from the plain old telephone system to broadband even as mobile telephony evolved in parallel, India took a quantum jump to cellular telephony from poor penetration of landlines and the jugaad economy of public call offices or PCOs, which were a source of local employment. The growth of cellular telephony in India has been such that the present generation has neither the knowledge of rotary phones or dial-up internet nor the memory of PCOs that have vanished. Similar is the case with television, with India altogether skipping the linear evolution from analogue terrestrial television to digital with the advent of cable TV and the jugaad economy of cable operators who grew through local monopolies in the absence of regulation or competition. With the growth of smartphones and the disruption in mobile data pricing, India once again took a quantum jump to mobile video consumption with rooftop TV antennae becoming obsolete and cable networks and DTH platforms seeing fast decline in subscribers.

From payments to health records, India’s technology evolution has been in quantum spurts skipping many of the interim steps that have characterised linear evolution of technology in the West. These quantum spurts have often been ahead of regulations and traditional enterprises, with consumer adoption of new technologies going past both that have been forced to play catch-up. The recent controversy over the BBC documentary is a case in point with regulations to block certain URLs proving to be inadequate in stemming the viral sharing of copyrighted content through assorted internet-based platforms unmindful of the implications to content piracy. With the internet lowering the barriers to the flow of ideas and information, the Indian consumer’s embrace of new and emerging technologies can be seen from the manner in which US-based OpenAI’s ChatGPT has gained popularity in India quite unmindful of its commercial and geopolitical implications.

While ChatGPT has dominated headlines, the advances in artificial intelligence (AI) in less well-known areas are of significant implications to India’s techade. While India is yet to see its policy intentions in developing a domestic semiconductor ecosystem take concrete form, the technology gap in hi-tech is not merely widening in a non-linear manner but is poised to grow exponentially with AI powering semiconductor design. As an example, recent announcements by US-based Nvidia on how more than 13,000 circuits designed using AI tools are accelerating AI development shows electronic design automation that powers the semiconductor industry is set to grow leaps and bounds in terms of sophistication. Similarly exponential widening gaps in a swathe of areas from quantum computing to autonomous systems could mean that the quantum spurts that have characterised India’s periodic technology leaps will no longer be enough to play catch-up. If the late 1990s and early 2000s saw India’s technology exports grow, thanks to the IT workforce, the exponential advancements in AI could render much of that workforce redundant as can be seen from the manner in which ChatGPT is able to generate source code in programming languages.

The exponential pace at which technology is likely to advance in the coming decade calls for a fundamental rethink in how India aspires to achieve its techade both in the magnitude of public investments earmarked towards the innovation economy as well as the manner in which these investments are made to achieve tangible results in a short span of time. The moment calls for unconventional approaches where the quantum spurts become exponential leaps drawing on lessons from across the world while devising uniquely Indian methods. With expectations high from Budget 2023, it would be interesting to see what ground is being laid for India’s innovation economy to take a global leadership position over the next decade.

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The writer is former CEO of Prasar Bharati