It is a very special honour and privilege for me to deliver the 97th Convocation Address of the Pune University. I am especially happy because I am speaking in ‘my city’ and in ‘my university’. This University has established itself as a great leading center of learning and scholarship in India. The products of this University have done the nation proud. There are enormous expectations from everyone about this University’s role in building the new India of our dreams.
Let me begin by extending my wholehearted congratulations and my very best wishes to the young graduates. You are going to enter a new exciting world. You will see a sea change in the economic, political and technological environment the world over and especially in India. There are extra-ordinary opportunities for those, who are prepared to face the challenge of change. Indeed, only those of us will survive and succeed, who will be able to anticipate the change and also exploit the change. And those who do this will one day lead the change. All of you should have the ambition of leading the change and make things happen on our own terms as far as India is concerned.
I was in this very campus of Pune University delivering the Presidential Address of the 87th Indian Science Congress almost four years ago. That Congress was a historic one. People of Pune proudly remember it as ‘People’s Congress’ and ‘Knowledge Congress’. One still remembers how charged the city of Pune had become at that time. The mile long queues of enthusiastic young school and college students around this campus are still vividly in front of our eyes.
In my presidential address, I remember I had spoken about a “New Panchsheel of the New Millennium”, which simply stated, was
• Child centred education;
• Woman centred family;
• Human centred development;
• Knowledge centred society;
• Innovation centred India.
All of us have the right to dream. Only then the dreams come true. I remember that I had concluded my address by dreaming about the 21st Century India. One of my dreams was:
‘Indian brain drain has been completely reversed this year. In fact India is in an enviable position of having a queue of American and European scholars to join its unique global knowledge production centers in India’.
The key words here are India’s emergence as ‘global knowledge production centre’ and ‘reversal of brain drain’. Can this really happen? Or is it just some wishful thinking? I want to assure you my young friends that just four years after I had spoken these words, India is indeed beginning to emerge as a global knowledge production center and there are already some visible signs of the beginning of the reversal of the brain drain.
Let us take the issue of brain drain first. Why does brain drain take place in the first instance? Why do our young students migrate to other developed countries, especially USA? I found the answer one day.
I was involved in the process of interview for the Chief Innovation Officer of National Innovation Foundation, which I chair. I found that the individual that we were interviewing had experience in branding a product. I said ‘I want to brand my India. How would you do that?’ He was puzzled. He had branded a soap, a refrigerator, but he wondered as to how he could brand a nation? I said ‘I will make it easy for you. Let me tell you as to how other nations brand themselves. For instance, US brands itself as a land of opportunity!’ He immediately replied, ‘I will brand India as a land of ideas’. Now here is the issue. India is a land of ideas but it is USA that is a land of opportunities. That is why our young people with aspirations go to USA, which provides them an opportunity to reach their own potential.
Invariably it is assumed that the main driving force for brain drain is economic. People go to the developed world in search of gaining a higher income – physical income to be precise. But I do not think that is the only reason. Otherwise, why would the proportion of scientists and engineers from Japan who went to USA, and never returned, would have increased by 50% in the last five years? Japan is a rich developed country unlike India.
I believe that for the young people, it is the ‘psychic income’ that matters much more. Their incentives are not just financial. The fun of creation, admiration received from their peers, the excitement and glory of taking part in the process of creation of something new and exciting, and especially one which can make a big difference to the nation, matters to them much more. That is why a computer engineer works on the challenge of the Param computer in C-DAC on a salary that is a small fraction of what he would get from IBM. That is why a space scientist in ISRO works on the satellite launching vehicle GSLV rather than joining NASA. That is why I came back to this country in 1976 on a princely salary of Rs. 2100 per month, leaving aside a prestigious professorship in a leading university in USA that was offered to me. And it is not only me, there are several others present here who have done it.
But then one must realize that these are stories in isolation. The draw for the young people must not just be in Indian public institutions funded by the Government. A major draw must come from the massive enterprises of Indian industry. Unfortunately before India opened up in 1991, in a protected environment, our industry had no motivation to innovate. Under the garb of ‘import substitution’ we copied – and copied more and more. There was no exciting challenge for a young mind to create something new. The situation was so serious that someone, while commenting on ‘brain drain’ had said that if these bright people stayed here, then it will be ‘brain in the drain’! But my young friends, I want to assure you that this has changed dramatically in recent times – especially during the last two to three years.
Let us look at a silent revolution that is taking place in India. India is rapidly becoming a global research, design and development hub. More than one hundred companies around the world have set up their R&D centres in India just during the last five years. These are not small centers employing 10 or 20 people. Many of them employ over a thousand people. The biggest would be the R&D centre of General Electric (GE) at Bangalore. Its current size of 1600 employees will increase to around 2400 employees, making it the second largest R&D centre of GE in the world. This is what I meant by India becoming a global knowledge production centre.
What is interesting, however, is that around 40% of the 400 or so Ph.D.s employed by GE R&D Centre are young people, who have chosen to return from USA to work in India. But this is not the only case. This is happening in other R & D centers too.
I spoke to the Chairman, NASSCOM recently. They have done research on returning Indian professionals. Can you believe that during the last three years over 25,000 professionals have returned, around 90% of them being IT professionals! Many of them have opted out to work in their companies in India rather than in USA. I spoke to the CEO of a major venture capital company, which exclusively funds biotech start up companies. He told me that 60% of the proposals they have cleared are from young techno-entrepreneurs, who want to return from USA. This is what I meant by the first signs of the reversal of the brain drain.
But are we creating conditions that are truly ‘welcoming’ the returnees. I believe we are witnessing a dramatic change. As someone, who returned as a scientist at the age of 32 to join National Chemical Laboratory in 1976, I can speak from my personal experience. The personal comforts as well as professional opportunities then were unbelievably limited. I remember my wife having to cook on a kerosene stove because we had to wait in a queue for the allocation of a gas cylinder for an year. No more so now. I remember depositing money for buying a Bajaj scooter and waiting for more than two years to get one. No more wait now. I remember having to wait for a black & white EC TV set for six months. This is a story of the past. I remember getting my first telephone connection at home at the end of a waitlist of about three years. See the contrast. I understand that just last month, 1.5 million mobile phones were sold in India! So, the personal comfort levels have gone up.
Even on the professional side, there were several difficulties. To buy the first imported rheometer, it took me two years. We had to go through the arduous process of getting Not Manufactured in India (NMI) Certificate, DGTD clearances, etc. The country then had an acute foreign exchange shortage. No more so. Just last week, the Finance Minister proudly announced that we have touched a foreign exchange reserves figure of 100 billion dollars! One struggled for a few kilobyte computing power. We now have our own supercomputers. Scientific journals arrived by sea mail, and we were outdated in our research even before we started. The cyber world has changed all that. I am as empowered as my American counterpart. This dramatic change in the personal and professional comfort level continues unabated. This will mean that things will only get better.
But the real good news is from the side of Indian industry, which is beginning to realize that if they do not innovate, they will perish. Indian drugs and pharmaceutical industry survived so far by copying known molecules. Now at least ten Indian companies are inventing their own new molecules by getting into discovery research. I spoke to several pharma industry leaders. Collectively, they are looking to employ now hundreds of bright young Ph.Ds. In fact, they are complaining about the shortage of suitably skilled Ph.Ds. in India!
Other sectors of industry are booming too. In auto industry, the wheel has turned the full circle. Fifty years ago, it was British Morris Oxford, which was sold as Indian Ambassador on Indian roads. Today, it is Indian Indica that is being sold as City Rover on London roads! And Tata Motors will have to stay competitive by displacing their own models themselves so that their competitors do not do it for them. That means again innovation at the cutting edge – and more demand for creative scientists and engineers! So it is not only the foreign companies – but also the Indian companies, which are going to pose greater demands on skilled scientists and engineers.
Why are the foreign companies, some of whom having budgets higher than India’s R&D budgets, moving their R & D to India? There are several reasons. First, the cost of doing R&D is a fraction of that in the developed world. Last year, the entire spend of India’s R&D was US $5 billion, less than the R&D budget of one company like Pfizer alone! A dollar in India delivers so much more than anywhere else in the world.
Indian advantage is not just the cost – but cost-cum-competence, considering the huge talent pool. I heard a presentation by the chief executive of a German software company set up in Bangalore. He showed that the ideas generated per employee in their Indian outfit were on the average, three and a half times higher than in their outfits elsewhere in the world!
Second, there is a world-class technical manpower. India has over 250 universities, 1500 R&D units, several IITs and engineering colleges. India has the world’s largest chains of publicly funded R&D institutions. This is an extraordinary rich resource, which was underutilized even within the Indian space of R&D opportunity.
Third, the trend is also being fuelled by the shortage of R&D personnel in some emerging high technology areas in industrialized countries. The companies have to bridge that demand-supply gap in skills by external outsourcing. Obtaining access to high-quality scientists, engineers and designers is on the top of the agenda of many major companies now.
The fourth reason is that R&D in high-technology industries such as biotechnology, microelectronics, pharmaceuticals, information technology and new materials has become highly science based. The costs of doing R&D are also increasing phenomenally. To put one new drug molecule in the market takes a staggering Rs.30,000 crore! That is a huge cost. Moving to highly skilled but lower cost countries like India is one solution.
There are other reasons too. There is an increasing pressure on shortening international market penetration times for new products, on shortening R&D times, and on decreasing the market life times for new products. Therefore, multiple geographical and organizational sources of technology with increasingly differentiated and innovation specific patterns of diffusion have become a rule rather than an exception. In such outsourcing, for most of them, it is ‘Destination India’ now!
What would be the impact of the creation of these global knowledge production centers in India on “brain drain”? One school of thought is that there will be gradual reversal of brain drain. A normal Indian scientist would love to stay in India, provided he is given a challenging job here. He would love to have his children grow up here in India. All this would become possible for him as India becomes a great R&D web, with world’s best companies doing their most challenging R&D here in India – whether it is Intel designing its latest chip, or GE designing its latest aero engine. But again it is not these companies alone. Our own auto companies too will be designing the next versions of an Indica, or a Scorpio or a Pulsar in India to beat the competition. The pharma companies will be designing new molecules, exploring new mechanisms. So there will be challenges galore for our young innovators.
For some time now, there has been a deep concern about the declining interest in science in India. This is reflected in terms of lower enrolment in science and also those who study science, deciding not to stay in science, but move away to other lucrative careers in finance, marketing, management, etc. But with these new exciting opportunities opening up, the demand on science in India itself will increase enormously. This will lead to the demand on the creation of new human capital, both in numbers as well as quality. The present production of 5000 Ph.Ds annually is too small a number for India, which is one sixth of humanity! This number had not grown, since there was no demand on science in Indian industry with some notable exceptions. This number can be raised several folds. This will augur well for India.
The Indian industry itself will benefit in the long run. The researchers who will work in these non-Indian innovation enterprises will acquire insights and skills, which are difficult to acquire. All such Indians resided abroad so far. No more so. In the coming years, they will prefer to reside and work in India. The Indian industry will benefit from the supply of superior R&D manpower, trained in advanced R & D tools as well as management techniques.
Let us look at another angle that is going to emerge. An average idea can only give an average product. This average product survived in the sellers’ market in protected India before 1991. No more so. The customer now has the choice to buy the best. Therefore, we have to create a winning product, which will withstand global competition. That can come from a winning idea. But such winning ideas will come only from creative people with the highest intellectual energy. What is the distribution of intellectual energy across populations? There are scientific studies in the literature to address this question. Last month, I read a brilliant paper by Gangan Prathap in Current Science. He argues that ecology of the intellectual process throws up outstanding scientists and inventors in a pyramidal and power-law fashions. Let me explain this further.
In 1926, the distribution of scientific productivity was analyzed by A.J. Lotka of the Metropolitan Life Insurance Company. The result of Lotka’s investigation was an inverse square law of productivity, by which the number of people producing n papers is inversely proportional to n2. This means that for every 100 authors who produce one paper in a given period of time, there are approximately 100/22, or 25, who produce two papers. Simultaneously, there will be 100/(102) or one, who will produce ten papers, and so on. Interestingly, the same law applies to patents too.
In pre-liberalized India, we were happy to use the services of an average researcher, who was capable of producing that one paper or one patent per year. But when we are competing globally, we will require those individuals, who are capable of producing those ten papers or those ten patents.
It certainly appears that technological creativity and productivity, just like scientific creativity and productivity, lies in the minds and abilities of a relatively small number of highly talented individuals. We lost them to the western world so far. For instance, the cream of the cream from IITs kept on going abroad. We comforted ourselves by saying that if we lose a small number, it does not really matter. But we did not realize the implications of Lotka’s law that they were the ones, who made a huge difference to the economies abroad. We did not realize that when we lost 1% of our top talent, we also lost 90% of the intellectual energy. We watched hopelessly, because we had nothing to offer to these creative people. No more so. We have plenty to offer now as you have seen.
As Indian industry becomes globally competitive, it will require people with skills, which have to be again globally benchmarked and will have to be globally sourced. Thus there will be enhanced competition among institutions, and also both Indian and foreign industrial R & D Centres, to seek the best brains to work for them. This will automatically mean that CSIR like institutions will really have to create an intellectually stimulating, rewarding and ‘hassle free’ environment to keep these researchers with them. Indian industry will have to offer competitive salaries and challenging and fulfilling jobs matching with those offered by foreign R & D outfits. Competition will draw the best from everyone and will benefit everyone, especially the scientific community in terms of more challenging opportunities and vastly improved remuneration.
Another implication of India’s emergence as a global R&D hub is linked to India’s positioning in the comity of nations. Just imagine around one third of the new knowledge of major firms around the world being produced in India. Take this fact along with the crucial dependence of the big economies of the world on this new knowledge. It is obvious that India’s interest in international fora cannot simply be ignored by these large economies – as all this critical knowledge capital will find its abode in the human capital that will reside in the innovation centres located in India. As you can see, India’s emergence as a major global knowledge production center has huge social, cultural, political, economic and strategic imperatives.
Our Government, realizing all these imperatives, will have to play an even greater role to influence the turn of events, both positively and proactively. A sustained commitment to investment in science and technology to strengthen the research infrastructure, development of capabilities to rapidly integrate new knowledge and technologies into products, gaining strategic access to growing global sources of innovation, creating government driven incentives, protection of intellectual property extended to science based high technology inventions are some of the key steps that will have to be taken.
Let me conclude by reminding you about the Goldman and Sachs predictions for 2050. It is predicted that India, along with China and USA, will be the three top economies of the world. Going further, I can confidently predict that if India plays its cards right, by 2025, it can become the number one knowledge production center of the world.
Finally, my friends, let me assure you that it is a great time to be an Indian. Even more, it is a great time to be in India. Enjoy being a part of the action in this land of great past and even greater future. My best wishes to you, young friends, for the exciting journey ahead on that limitless ladder of excellence. Let your journey up this ladder bring unprecedented glory to this great country.