Content

1. Atmanirbhar Bharat and Management of External Dependencies: Navigating Big-Power Rivalries
2. India’s Research, Development and Innovation (RDI): Ambition vs Structural Weakness

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Atmanirbhar Bharat and Management of External Dependencies: Navigating Big-Power Rivalries

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Context

• The article argues that India’s Atmanirbhar Bharat strategy represents a pragmatic attempt to manage external economic dependencies amid intensifying geopolitical competition among major powers.
• Global politics is witnessing renewed great-power rivalry, particularly between the United States and China, forcing middle powers like India to balance strategic autonomy with economic interdependence.
• India’s response combines economic self-reliance, supply-chain diversification, and strategic partnerships, reflecting a calibrated approach rather than isolationism.

Relevance

GS Paper II – International Relations

• Evolution of India’s strategic autonomy from Non-Alignment → Multi-alignment.
• India’s diplomacy in managing great-power rivalries (US–China–Russia).
• Strategic partnerships: Quad, Indo-Pacific cooperation, supply-chain alliances.

GS Paper III – Economy

• Atmanirbhar Bharat Abhiyan (2020) and domestic manufacturing.
• Supply-chain resilience, PLI schemes, semiconductor ecosystem.
• Managing external economic dependencies (energy, technology, defence).

Practice Question

Q. “Atmanirbhar Bharat is less about economic isolation and more about managing external dependencies in a world of great-power competition.” Examine. (250 words)

Static Background: Evolution of India’s Strategic Autonomy

Non-Alignment and Cold War Era

• After independence, India adopted strategic autonomy through the Non-Aligned Movement (NAM), avoiding formal alliances during the Cold War rivalry between the United States and the Soviet Union.
• The Jawaharlal Nehru doctrine of non-alignment sought to maintain policy independence while leveraging economic and technological cooperation with both blocs.
• However, security crises such as the Sino‑Indian War exposed limitations in India’s defence preparedness and reliance on external suppliers.

Economic Crisis and Liberalisation

• India’s 1991 Balance of Payments crisis forced the government to approach the International Monetary Fund, leading to structural reforms under P. V. Narasimha Rao and Manmohan Singh.
• Economic liberalisation integrated India into global markets but also increased dependence on foreign capital, technology and energy imports.

Strategic Partnerships Era

• In the 2000s, India strengthened ties with major powers through strategic partnerships, including the India‑US Civil Nuclear Agreement, which ended India’s nuclear isolation.
• Simultaneously, India deepened engagement with Russia, the European Union, Japan and ASEAN, reflecting a multi-alignment strategy rather than traditional non-alignment.

Concept of Atmanirbhar Bharat

• Atmanirbhar Bharat Abhiyan, launched in 2020, aims to enhance domestic manufacturing, technological capacity and resilient supply chains while remaining integrated with global trade.
• The initiative emphasises five pillars: economy, infrastructure, systems, vibrant demography, and demand, aiming to strengthen India’s productive capabilities.
• Contrary to protectionist interpretations, the policy advocates “self-reliance with global integration”, encouraging domestic capacity while participating actively in international value chains.

External Dependencies in India’s Economy

Energy Dependence

• India imports nearly 85% of its crude oil requirements, making energy security highly vulnerable to geopolitical shocks and price volatility.
• The Russia–Ukraine conflict (2022) highlighted the importance of diversified energy sourcing, as India increased imports of discounted Russian crude.

Defence Dependence

• India has historically relied on foreign suppliers for military equipment, with Russia accounting for roughly 45–50% of defence imports in recent decades.
• Dependence on external defence suppliers limits strategic autonomy during geopolitical crises.

Technology and Supply Chains

• India’s electronics, semiconductor and telecommunications sectors depend heavily on imports from East Asian economies, particularly China, South Korea and Taiwan.
• The COVID-19 pandemic exposed vulnerabilities in global supply chains, prompting renewed emphasis on domestic manufacturing capabilities.

Policy Instruments to Reduce External Dependence

Production-Linked Incentive (PLI) Scheme

• The government introduced Production Linked Incentive Scheme to incentivise domestic manufacturing in sectors such as electronics, pharmaceuticals, automobiles and semiconductors.
• The scheme aims to attract global firms to establish manufacturing bases in India, enhancing export competitiveness and technological capability.

Defence Indigenisation

• The Make in India initiative in defence encourages domestic production of military equipment through private-sector participation and technology transfer.
• India has also released negative import lists for defence equipment, restricting imports of specific military systems to promote indigenous manufacturing.

Supply Chain Resilience

• India participates in initiatives like the Supply Chain Resilience Initiative (SCRI) with Japan and Australia to diversify critical manufacturing supply chains away from overdependence on single countries.

Managing Big-Power Rivalries

India–US Relations

• India and the United States have strengthened cooperation through strategic platforms such as the Quadrilateral Security Dialogue, focusing on maritime security, technology and infrastructure.
• Defence cooperation has expanded through foundational agreements including LEMOA, COMCASA and BECA, enhancing interoperability and strategic coordination.

India–Russia Relations

• Russia remains a key defence and energy partner for India, reflecting long-standing geopolitical ties and technological cooperation.
• India’s continued engagement with Russia despite Western sanctions demonstrates strategic autonomy in foreign policy decision-making.

India–China Dynamics

• India’s economic relationship with China is marked by high trade dependence combined with geopolitical rivalry, particularly after the Galwan Valley Clash.
• This duality has accelerated efforts to reduce reliance on Chinese imports in strategic sectors such as telecommunications and electronics.

Economic and Strategic Significance

Economic Dimension

• Reducing critical external dependencies strengthens economic resilience and industrial competitiveness, enabling India to withstand global supply disruptions.
• Domestic manufacturing expansion can generate employment, enhance export capacity and support long-term economic growth.

Strategic Dimension

• Self-reliance in defence and technology enhances strategic autonomy, enabling India to make independent foreign policy decisions without external coercion.
• It also improves India’s capacity to respond to security threats in the Indo-Pacific region.

Diplomatic Dimension

• India’s approach combines self-reliance with multi-alignment, maintaining partnerships with multiple global powers while avoiding exclusive alliances.
• This approach allows India to maximise economic opportunities while preserving policy independence.

Key Challenges

Economic Constraints

• Building domestic manufacturing capacity requires large capital investment, skilled workforce development and technological innovation, which cannot be achieved rapidly.

Risk of Protectionism

• Excessive emphasis on self-reliance may lead to trade protectionism and reduced competitiveness, potentially undermining export growth.

Technological Gaps

• India still faces significant technological dependence in semiconductors, advanced electronics and defence systems, requiring sustained research and development investment.

Geopolitical Balancing

• Maintaining balanced relations with rival powers such as the US, Russia and China requires careful diplomatic management to avoid strategic over-alignment.

Way Forward

• Promote strategic sectors such as semiconductors, renewable energy and defence technology through sustained public-private investment.
• Strengthen innovation ecosystems and research institutions to reduce dependence on imported technologies.
• Expand trade agreements and supply chain partnerships with trusted economies to diversify economic linkages.
• Maintain strategic autonomy in foreign policy while leveraging partnerships for economic and technological advancement.

Prelims Pointers

• Atmanirbhar Bharat Abhiyan launched in 2020 to enhance economic self-reliance.
• India imports about 85% of its crude oil requirements.
• Production Linked Incentive Scheme aims to boost domestic manufacturing.
• Quad includes India, US, Japan and Australia.

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India’s Research, Development and Innovation (RDI): Ambition vs Structural Weakness

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Context

• India’s innovation ecosystem is experiencing renewed policy momentum through expanded funding, regulatory reforms and improved global rankings, yet structural weaknesses persist in research intensity, technological influence and industry-led innovation.
• Despite policy commitments aimed at building a “Viksit Bharat powered by innovation”, India continues to underperform in key indicators such as R&D expenditure, high-quality patents, research commercialisation and private-sector participation.
• The contradiction highlights a broader governance challenge: India’s innovation problem is no longer policy intent but systemic execution, particularly the weak role of industry in long-term technological development.

Relevance

GS Paper III – Science & Technology

• India’s R&D ecosystem and innovation capacity.
• Deep-tech sectors: AI, semiconductors, quantum computing, biotechnology.

GS Paper III – Economy

• Innovation as driver of productivity, industrial competitiveness and growth.
• Role of startup ecosystem and industrial R&D.

Practice Question

Q. Despite significant policy initiatives, India’s research and innovation ecosystem continues to face structural weaknesses. Analyse the key challenges and suggest reforms to strengthen India’s innovation capacity. (250 words)

Static Background: Evolution of India’s Innovation Ecosystem

Post-Independence Science and Technology Framework

• India’s early science policy emphasised public-sector research institutions and state-led technological development, resulting in strong laboratories but weak industry-driven research ecosystems.
• Major public research institutions such as Council of Scientific and Industrial Research, Indian Space Research Organisation, and Defence Research and Development Organisation shaped the foundation of India’s scientific capabilities.
• This model produced strategic achievements such as the space programme and nuclear technology, but failed to develop a broad industrial innovation ecosystem comparable to advanced economies.

Liberalisation and Technology Integration

• Economic reforms after 1991 liberalisation integrated India into global technology and trade networks, but innovation remained largely dependent on imported technologies and multinational research collaborations.
• India’s development model prioritised services and IT sectors rather than manufacturing-led technological development, resulting in limited domestic technological breakthroughs.

Recent Policy Push for Innovation

Research, Development and Innovation Fund

• The Government announced a ₹1,00,000 crore Research, Development and Innovation (RDI) Fund aimed at supporting deep-tech sectors such as artificial intelligence, quantum computing, semiconductors and biotechnology.
• The Union Budget 2026 also created a ₹20,000 crore corpus for deep-tech startups, signalling renewed emphasis on strategic technology development.

Innovation Ecosystem Programmes

• The government expanded funding for Atal Tinkering Labs from ₹500 crore to ₹3,200 crore, aiming to nurture innovation and problem-solving skills among school students.
• These labs function under the Atal Innovation Mission, which promotes entrepreneurship, incubation centres and startup ecosystems across India.

Regulatory Reforms

• The three-year existence requirement for deep-tech startups under the Industrial R&D Promotion Programme was removed, allowing earlier access to research support schemes.
• The Sustainable Harnessing and Advancement of Nuclear Energy for Transforming India Act, 2025 (SHANTI Act) now allows patents for peaceful uses of nuclear energy and radiation technologies.
• This reform opens nuclear technology innovation to private-sector participation, which was previously restricted under atomic energy regulations.

Global Innovation Index Performance

• India ranked 38th among 139 economies in the Global Innovation Index (GII) 2025, representing a significant improvement compared to previous decades.
• Patent filings increased from 59,000 in 2020–21 to over 1,10,000 in 2024–25, indicating a growing culture of intellectual property protection.
• Domestic patent filings now account for around 62% of total applications, suggesting increasing participation by Indian inventors.

Structural Weaknesses in India’s Innovation System

Low R&D Intensity

• India spends only 0.65% of GDP on research and development, significantly lower than innovation leaders such as South Korea (over 4%), Israel (over 5%), and China (around 2.4%).
• Among BRICS nations, India’s R&D spending remains among the lowest, indicating limited national investment in knowledge creation and technological advancement.

Weak Private-Sector Participation

• In most advanced economies, industry contributes over 60–70% of national R&D expenditure, whereas in India the government continues to bear the majority share.
• The limited private-sector appetite for high-risk research reflects short-term profit orientation and inadequate innovation incentives in Indian corporate strategy.

Limited Global Patent Influence

• India filed 4,547 Patent Cooperation Treaty (PCT) applications in 2024, representing a 22% increase from 2023.
• However, this number remains far below China (over 70,000), the United States (over 54,000), and Japan (over 48,000), highlighting India’s limited global technological influence.
• Even smaller innovation economies such as Switzerland filed over 5,300 international patent applications, exceeding India’s contribution despite a far smaller population.

Weak Human Capital Indicators

• According to GII 2025, India ranks 95th in employment in knowledge-intensive sectors, indicating limited absorption of highly skilled researchers and engineers.
• India ranks 80th in the number of full-time equivalent researchers, reflecting insufficient research workforce capacity.
• Gender disparity remains severe, with India ranking 101st among 119 economies in employment of women with advanced degrees.

Structural Gap in the Innovation Pipeline

Weak Research-to-Market Translation

• Universities and public research institutions generate significant scientific publications, but technology transfer and commercialization mechanisms remain underdeveloped.
• Institutional structures for technology licensing, venture creation and industry partnerships remain weak compared with innovation ecosystems such as the United States or Israel.

Startup Ecosystem Limitations

• India hosts one of the world’s largest startup ecosystems, yet many unicorns rely primarily on labour-intensive digital services such as delivery platforms rather than deep-technology innovation.
• Deep-tech sectors require long-term capital, strong intellectual property protection, and patient investors, which remain limited in the Indian ecosystem.

Missing Industrial Transformation

• India’s economic development trajectory lacks large-scale labour-intensive industrialisation, unlike East Asian economies such as South Korea, Taiwan and China.
• As a result, the economy remains heavily dependent on services and agriculture, limiting the emergence of globally competitive manufacturing and technological firms.
• The absence of strong industrial R&D investment reduces the probability of globally significant technologies originating from India.

Emerging Opportunities

Space Sector Innovation

• Liberalisation of India’s space sector has enabled private startups to collaborate with Indian National Space Promotion and Authorisation Centre, creating new opportunities for commercial space technologies.

Deep-Tech Ecosystem

• The newly created RDI fund may support emerging sectors such as artificial intelligence, quantum computing, robotics, advanced materials and semiconductor technologies.
• Future technologies such as 6G telecommunications standards will provide opportunities for India to increase participation in Standard Essential Patent (SEP) ecosystems.

Key Challenges

Institutional Challenges

• Fragmented governance across ministries and agencies often results in policy overlap and inefficient allocation of research funding.

Financial Constraints

• Deep-tech innovation requires large-scale patient capital and long gestation periods, which are difficult to sustain in India’s risk-averse financial ecosystem.

Talent Retention

• India continues to experience brain drain of highly skilled scientists and engineers, reducing the domestic research talent pool.

Innovation Culture

• Indian corporate culture often prioritises incremental improvements and cost efficiencies rather than disruptive technological innovation.

Way Forward

• Increase national R&D spending to at least 1.5–2% of GDP, aligning India with emerging innovation economies.
• Provide strong tax incentives and innovation-linked procurement policies to encourage private-sector research investment.
• Strengthen industry–academia collaboration through technology transfer offices and joint research programmes.
• Expand venture capital and sovereign innovation funds for deep-tech sectors.
• Promote women’s participation in STEM fields through targeted fellowships, research grants and leadership opportunities.

Prelims Pointers

• India ranked 38th in Global Innovation Index 2025.
• India’s R&D expenditure: ~0.65% of GDP.
• Patent filings increased to over 1,10,000 in 2024-25.
• India filed 4,547 international PCT applications in 2024.