India's R&D Expenditure Lags Behind Global Peers, Says Finance Minister

Finance Minister Nirmala Sitharaman highlighted a critical shortfall in India’s research and development (R&D) spending during a recent industry forum. She disclosed that the nation’s gross domestic expenditure on R&D (GERD) accounts for only 0.83% of its GDP, a figure that trails the OECD average of 2.7% and is well below China’s 2.6% and the United States’ 3.5%.

She also noted that the private sector’s share in R&D activities is a modest 36%, whereas in advanced economies the private contribution exceeds 70%. This disparity, she warned, limits the growth of home‑grown innovation and reduces the pool of domestic patents.

The minister called for a systematic increase in corporate R&D budgets, encouraging collaborations with universities, research labs and start‑ups. Such cooperation, she said, would create a pipeline of new technologies and boost the quality of Indian products.

Sitharaman linked these statistics to the broader “Developed India 2047” agenda, stating that the success of the plan will be measured by the number of world‑class companies and research institutions that emerge in the coming years.

She concluded with a plea for a constructive dialogue between industry, regulators and government, emphasizing that transparency and proactive problem‑solving are essential for a mature economy.