R&D India

Newsletter 

Oct. 2007

Project Sponsored by 

DSIR, New Delhi

Oct. 2007

Global R&D Investment Scales New Heights

National Awards for Industrial R&D Efforts 2007

Best Innovations of the Year from Around the World

China's  R&D Still has a Long Way to Go

 

R&D News of the Quarter

Statistically Speaking

Global R & D Spending   

Share of Total Global R&D Spending  

Gross Domestic Expenditure on R&D

 

End Notes

 

Global R&D Investment Scales New Heights  R&D spending continues to grow globally. It has exceeded $ 1 trillion in 2006 and continues to expand at a rate substantially higher than the inflation rate of most countries. Global R&D Report of the R&D Magazine (Sept. 2007) forecasts that the global spend on R&D will reach $1,210 billion in 2008, 7.6 percent higher than in 2007. china is contributing to much of this expansion, whose spending is expected to grow by nearly 24 percent in 2008 to $ 216.8 billion – about 18 percent of global spending. This is 4 percent more than what it used to be just two years before.  R&D is growing in all geographical regions, though at less inflated rates than China. Much of the present attention is focused on growth of off shore R&D outsourcing in whole of Asia – China, India, South Korea and Singapore.  China has built up its economy and its tremendous balance of trade surpluses with mostly low-cost consumer goods. However, it has increased its high-technology exports as well, from 5 percent in 1990 to over 30 percent in 2005. The high-tech exports are heavily concentrated in office machinery, TV, radio and communication equipment. It is not necessarily the foreign owned companies that invest in R&D, in fact, they seem to invest for less as a part of their operation in China. In the communication, computer and other electronic equipment area, Chinese domestic firms have an R&D intensity that is about seven-times greater than the foreign owned firms.  India’s R&D spend ranks 5th in the world with $ 38,850 billion in 2006. Chinese R&D investment is about four-folds more than this in the same year and that of the U.S. ten times more.  It is in the biotech R&D that show a new surge. This technology which was exclusively in the realm of Europe and the U.S. for many years has now become a global industry. China and India are among the leaders in this new growth. In a scale of 1 – 7, biotech country attractiveness index, U.S. stands first with 6.88, followed by China 6.1 and India 5.58. In these exiting times for R&D we are bound to see a sea change in the years to come.   National Awards for Industrial R&D Efforts 2007  In order to provide recognition to the efforts of industry towards innovative research and development, the Government of India has instituted national awards. This has been in force over the last two decades and over 150 companies have won these awards during these years. The awards are given away under 17 categories, catering to all broad specializations independently, including one for successful commercialization of a technologies. The following are the National Award winners for the year 2007. Laila Impex, Vijayawada (AP) Laila R&D has successfully developed patented and commercialized 5-Loxin/Boswin a novel anti-inflammatory & anti-arthritic product. Pest Control (India) Pvt. Ltd, Bangalore PCI established the country’s first full-fledged facility for pheromone synthesis and launched sex pheromone lures of 4 different sugarcane tissue borers.  The research involved development of protocols for synthesis of eight different pheromone compounds of high purity on laboratory scale, scaling up for commercial production, blending them in the appropriate ratios and production of lures.  A unique, cost effective and easy to use portable water trap has been designed and patented, for use with the sex pheromone lures.  This is a stand alone and environment-friendly method of managing these noxious pests.    United Phosphorous Ltd, Vapi (Gujarat) United Phosphorus Limited has successfully developed in their Chemo Electronic Laboratory (CEL) and commercialized Gas Monitoring Devices for fumigation industry. Flammable Gas Detection Devices for industrial and domestic segment, breath alcohol analyzer for traffic police, railways, hospitals etc.  Indigenous technology was developed for the first time for producing Electrochemical Sensors for many gases like phosphine. Carbon monoxide, sulphur dioxide, hydrogen sulphide, chorine, and nitrogen dioxide.  Minda Industries Ltd, Gurgaon Minda Industries Ltd., has designed, developed, patented and commercialized intelligent backlit non-contact handle bar switch with self-cancellation blinker for two-wheelers.   This advanced control system has got body control unit with in-built microprocessor controller that can be programmed as per the customer needs and requirements for the first time in the world.  Safety feature such as self-cancellation blinker has been incorporated for the first time in India in 2-wheelers.  New control switch has got another safety feature in the form of illuminated symbols that glows at night and facilitates the rider; man-machine interaction during night riding.    Crompton Greaves Ltd, Mumbai Crompton Greaves has developed a new technology platform of electronically controlled Brush Less Direct Current (BLDC) motor technology that has yielded a series of motor applications which are energy efficient substantially maintenance free and having a very efficient speed control.  They typically consume 50% input power of that of conventional motors and are 55% less in weight and make 5dB less noise.  Ananth Technologies Ltd, Hyderabad Ananth Technologies Ltd., has developed a 12 channel rotary telemetry system for monitoring the strain and temperatures from the blades of a rotating turbine.  This system uses “non-contact” technology for power and data transfer:  This system developed first time in India has many advantages compared to the conventional slip ring system.  Sasken Communication Technologies Ltd, Bangalore Sasken communication technologies has conceptualized, designed and developed an optimized multimedia subsystem. It is a highly commendable R&D effort as the software product is the best in its class globally. Sasken multimedia subsystem has made a difference to the society by making multimedia communication accessible to a larger customer base on affordable handsets.  Reliance Industries Ltd, Surat Reliance industries Hazira has developed and commercialized a novel process for recovering the Cyclohexane from the waste stream.  The process, which uses low value waste by-product stream from Polyethylene plant as a raw material is eco-friendly and energy efficient.  Tata Steel Ltd, Jamshedpur Tata Steel Ltd. In collaboration with Central Leather Research Institute (CLRI), Chennai has developed and commercialized an alternative environmental friendly process to minimize the carcinogenic hexavalent chromium in chromite concentrates to trace levels by using an organic reductant known as Myrobalam. R&D News Picks of the Quarter DRUG COMPANIES IN PATENT WAR TO PROTECT TURF  Manufacturers of generic drugs are now waging legal battles against each other to protect their market share in the US. This will affect the Indian generic industry in 2 ways. Firstly, challenging patents will become expensive, as an Indian generic company will have to invalidate an innovator's patent as well as wage a legal battle with other generic companies wanting to enter the same market. Secondly, Indian generic makers will have a fight on their hands for launching their drugs in the US, as large generic manufacturers employ all legal and technical means to prevent new companies from entering the market. In 2006, $54.1 billion worth of generic drugs were sold in the US as compared to sales of $220.6 billion worth of branded pharmaceuticals. The market for unbranded generic drugs grew by 22.3 percent in the US in 2006. In the US, generic drugs account for 63 percent of the drugs prescribed. In 2007, $27 billion worth of blockbuster products are coming off patent while $29 billion worth of these drugs are coming off patent in 2008. Generics are cheaper by 30-80 percent than branded counterparts saving consumers $8-10 billion every year.  R&D GROWTH SEES SHORTAGE OF DRUG SCIENTISTS  India is witnessing a steady growth in R&D work in pharmaceutical sector in the recent years. The number of scientists working in laboratories across the country has increased to 5,000 now from 4,000 in 2006. The strength is likely to grow by 30 percent annually in the next three to four years. With such a growth, the sector is likely to face shortage of drug scientists in the years to come. This is because Indian pharmaceutical companies are investing large amounts in R&D. In addition, overseas companies are re-locating R&D work to India to save costs on discovering a new drug. Besides, contract organisations like Advinus, promoted by Tata Group, have come up in the country to take part in the global R&D initiative. With these growth in opportunities, the salaries of the scientists are expected to match that of the corporate executives.  INDIA, CHINA TO DRIVE GLOBAL PHARMACEUTICAL SECTOR  A survey by PricewaterhouseCoopers (PwC) reveals that India and China are growth drivers of Asia's pharmaceutical industry. Asia will register increased multinational companies (MNCs) in the next one year through green-field projects and acquisitions. There is a spurt in research and development (R&D) activity and clinical trials by MNCs in India. The survey covering 9 countries shows that 34 percent of Asian companies plan acquisitions and 52 percent are eyeing for overseas stake.  R&D COSTS MAKE MNC PHARMAS RUSH TO INDIA FOR NEW MOLECULES  Global pharmaceutical companies are facing rising discovery research costs.This is prompting them to look at alternatives to develop innovative drugs at a lower cost. They are increasingly looking at India for new molecules in-licensing opportunities. Boehringer Ingelheim of Germany is completing its first in- licensing deal with an Indian pharmaceutical company.It is also talking to two Indian companies for new molecules in advanced stage of development. Indian pharmaceutical companies like Dr Reddy's Laboratories, Ranbaxy Laboratories Ltd, Glenmark Pharma, Orchid Chemicals & Drugs and Wockhardt Pharma are looking for international research partners.Glenmark Pharma is in talks with potential European partners for its asthma molecule Oglemilast. It is also in talks with several global companies for two research molecules targeted at neuropathic pain,inflammatory and dental pain. It recently licensed out its diabetes molecule to Merck of Germany in a deal potentially worth Euros 190 million.  HAL TO OUTSOURCE R&D AND MANUFACTURING OPERATIONS  Hindustan Aeronautics (HAL) is planning to outsource a part of its R&D and manufacturing operations. The move, which is part of the company's cost cutting strategy, would result in cost savings of 20 percent to 30 percent. HAL will outsource R&D to small technology centres in its campus to ensure safety of the data. The company will outsource the production of components and sub-assemblies and carryout the final integration itself.  COMMERCIALISING EMERGING TECHNOLOGIES  The Technology Development Board (TDB) of the Department of Science & Technology of the Government of India intends to encourage commercialisation of emerging technologies. It intends to provide 50 percent of the project cost. It also proposes to exempt import of equipment for research and development from customs duty. TDB funding is not available for basic research or for establishment of new research and development (R&D) centres. It has funded more than 150 projects with over Rs780 crore.  BANGALORE IS LARGEST NON-UK R&D SITE FOR CAMBRIDGE SILICON RADIO Bangalore has emerged as the largest research and development (R&D) centre for Cambridge Silicon Radio (CSR) outside the UK. CSR is a provider of personal wireless technology, including Bluetooth and FM receivers. The company's customers include Apple, LG, Motorola and Nokia. CSR has a 130-member team working at its Bangalore centre. The Bangalore centre is at present involved in standardising Bluetooth-Embedded Control Interface (BECI) standards.  BEML TO OUTSOURCE R&D // BEML TO SPEND 3% OF TOTAL EARNINGS ON R&D  Bharat Earth Movers Ltd BEML), which has an order book position of about Rs2,500 crore as of Jun 2007, will focus on outsourcing and research and developmentR&D) to meet the growing demand for its machinery and equipment. BEML will increase the level of outsourcing from 30 percent in 2006-2007 to 45 percent in 2007- 2008. The company, which currently has 350 active vendors supplying components and hardware,will increase their number to 450-500. BEML will also increase its investment in R&D from 0.5 percent of earnings in 2006-2007 to three percent in 2007-2008. The company is looking at producing new equipment and reducing costs through R&D.  PHARMA MAJORS OPEN NEW R&D CHAPTER  Indian pharmaceutical companies are outsourcing part of their research to medical colleges and universities to save time and money. Major pharma companies such as Ranbaxy Laboratories, Nicholas Pharma and Biocon,have formed partnerships with medical institutions. Biocon has tied up with the Deakin University of Australia. Deakin will set up a Deakin research institute in Bangalore.USV of Mumbai has tied up with All India Institute of Medical Sciences (AIIMS) to develop an indigenous novel typhoid vaccine. Nicholas Piramal India Ltd (NPIL) has tied up with Apollo Hospitals for the molecular profiling of tumours to develop a new drug for cancer.  R&D TO DRIVE ENGG OFFSHORE SERVICES GROWTH  A study by Nasscom and Booz Allen Hamilton shows that engineering offshore services would touch $40 billion by 2020. The study reveals that the global engineering services market is set to touch $150-250 billion by 2020, with about $10-15 billion being offshored. India accounts for $1.2-1.8 billion (12 percent) of the total offshore market, and this could go up to $40 billion by 2020 (20-25 percent). This indicates a job potential for over 2.5 lakh Indian engineers.  MS THINKING OF `SHARED PC Microsoft is planning to launch a personal computer (PC) with two mice and two keypads. The company expects the shared PC to enable children to use the computer for learning and playing games. Microsoft Research India (MSR), Bangalore and Microsoft India Development Centre (MIDC), Hyderabad, have showcased the concept at an in-house event. The research and development centres in India have helped the company in developing over 20 global products. MIDC has received 80 patents and MSR has brought out over 90 publications in 2006.  FACILITY FOR E-FILING OF PATENT LAUNCHED The Government of India has launched a new facility for e-filing of patent and trademark applications. Applicants can file their patents and trademark applications through the Internet. The National Informatics Centre has developed the modules for e- filing and online processing. State Bank of India is providing the payment gateway. The Government intends to make the Indian Patent Office an International Search Authority and International Preliminary Examining Authority.  DELL LAUNCHES BIGGEST R&D FACILITY IN BANGALORE  Dell has launched its biggest research and development (R&D) facility in Bangalore. The centre has 600 employees now working in 20 laboratories. Dell proposes to work on its next generation of network servers, data storage systems and software products in the centre with an area of 2,00,000 square feet.  MICROSOFT INDIA CENTRE WORKING ON WINDOWS 7  Microsoft's research and development centre at Hyderabad is working on development of Windows 7, the next generation operating system slated for release in 2009-2010. Indian developers have also played an important role in development of the XP Service pack 3, which is one of the important releases from Microsoft. Engineers at the company's Hyderabad centre have secured more than 180 patents in the last three years.  COKE PLANS R&D CENTRE IN INDIA  Coca-Cola is planning to establish a research and Development (R&D) facility in India. The facility would mainly focus on non- carbonated drinks and flavours. The operations of the R&D facility would include product development, packaging, environment, scientific and regulatory affairs and sales equipment. After commencing the operation, the centre is likely to cater to the Asia Pacific region. Currently, the company, which is considering to launch juices in local flavours, energy drinks, sports drinks and flavoured water, outsources its R&D function to its Shanghai facility.  NEW GE R&D HUB IN HYDERABAD  General Electric (GE), which has research and development (R&D) centres in New York, Shanghai, Munich and Bangalore, is considering setting up its fifth R&D hub in Hyderabad. It is looking for 25 acres of land in Hyderabad. The Government of Andhra Pradesh has suggested that GE should consider establishing the unit within the campus of the University of Hyderabad. GE is likely to hire 2,000 scientists and engineers to work in the facility by 2009.  MNCs STILL BULLISH ON INDIA R&D Multi-national pharmaceutical companies including Allergan, Eisai Pharma, Dupont, AstraZeneca and Bristol-Myers Squibb have selected India as a safe destination for investment in drug research and development (R&D) since Jan 2005. Johnson & Johnson is investing about Rs37 crore to expand its Analytical and Pharmaceutical Development Centre (APD) in Mumbai. About 10 multi- national pharma companies are conducting large-scale clinical trials in India while others are engaged in contract research and contract manufacturing business with Indian partners.  AUTOMOTIVE RESEARCH ASSOCIATION BETTING BIG ON R&D PROJECTS  The Automotive Research Association of India (ARAI) is optimistic about its R&D projects. The association has doubled its income to Rs62 crore in the last five years. ARAI derives nearly 60 percent of its revenues from homologation and certification activities. The association expects to earn 60 percent of its projected revenue of Rs120 crore from self-funded R&D work by 2010. ARAI has launched four self-funded projects since Jan 2007.  INDIA IS NO IPR PARIAH: US DRUG LOBBY REPORT  The Pharmaceutical Research and Manufacturers of America (PhRMA), an association of US drug manufacturers, have stated that IPR protection in India is better than rival destinations such as China. According to PhRMA, US pharmaceutical companies have suffered a 34 percent loss on their total sales in China owing to inadequate IPR protection in 2006. US pharmaceutical companies account for $43 billion of the $55.2 billion global drug R&D investments.  SATYAM COMPUTER SETS UP R&D CENTRE FOR AUTO SECTOR IN CHENNAI  Satyam Computer Services has set up a Centre of Excellence in Chennai to undertake research and development for the automotive sector. The centre will offer digital support services in areas such as alternate fuels, hybrid engines, virtual test drive solutions and infotainment. The Rs6 crore centre is scheduled to be inaugurated in another month's time.  IOC TIES UP WITH IIT-MADRAS  Indian Oil Corporation's R&D centre and the National Centre for Catalysts Research of the Indian Institute of Technology Madras have signed an agreement in Chennai on 10 Sep 2007. Under the agreement, the two centres will undertake joint research and development of process for the preparation of alumina with special characteristics. The alumina will be used for making cost- effective and state-of-the-art hydroprocessing catalysts. The two centres will also explore methodologies for establishing structure property correlations of indigenously developed catalyst system from the alumina.  RENAULT-NISSAN'S R&D CENTRE TO WORK ON CARS FOR GLOBAL MARKETS The Renault Nissan Technology and Business Centre India Pvt Ltd (RNTBCL) is planning to develop products for global markets. The company is a 50:50 joint venture between Renault of France and Nissan of Japan. RNTBCL is expected to provide computer aided design (CAD) services initially. The company is planning to employ nearly 1,500 technicians by 2010. Renault and Nissan are setting up a new plant near Chennai in association with Mahindra & Mahindra Ltd.  Dr REDDY'S GETS USFDA NOD FOR RANITIDINE  Dr Reddy's Laboratories of Hyderabad has received final approval from the US Food and Drug Administration for its abbreviated new drug application for Ranitidine (Zantac) 150 mg tablets. DRL is the only generic manufacturer to receive FDA approval for this product following the expiry of innovator patents. This is the first approval received by the company's over-the-counter business in the US. The company had announced the launch of a Store Brand OTC Division in the US in mid-May 2007.  INNOVATION NOT PRIORITY, FIRMS SPARE ONLY A LITTLE FOR R&D The ratio of Research & Development (R&D) spending to net sales of 251 large Indian companies declined to 0.66 percent in 2006- 2007 (0.68 percent in 2005-2006). The aggregate net sales income of the 251 companies, however, increased by 25.4 percent to Rs9,42,659 crore (Rs7,51,722 crore). The aggregrate R&D expenditure of the 251 companies increased by 21 percent to Rs6,206 crore (Rs5,129 crore). Tata Motors registered the highest R&D spending in 2006-2007 of Rs796.86 crore, followed by Ranbaxy Laboratories with Rs483.82 crore, Dr Reddy's Laboratories Rs292.80 crore and BHEL Rs253 crore. In terms of sectors, textiles sector registered the highest increase in R&D expenditure in 2006-2007 of 192.1 percent, followed by electric equipment 75.9 percent, paper 55 percent, fertilisers 49.4 percent and automobiles 48.5 percent.  MICROSOFT REASSERTS ITS INDIA FOCUS  Craig Mundie, the research and strategy officer of Microsoft, has said that the company was focussed on continued expansion in India in terms of research and development (R&D) capability as well as business performance. Microsoft's innovation centre will be set up in 2008. It will revolve around requirements of the local geography.

Global R & D Spending    GDP 2006 Billion U.S.$ R&D % GDP 2006 R&D PPP 2006 Billion U.S.$ R&D PPP 2007 Billion U.S.$ R&D PPP 2008 Billion U.S.$ Americas 15,155 2.47 374.9 387.0 401.1 U.S. 12,416 2.76 343.0 353.0 365.0 Asia 19,203 2.02 387.2 436.2 494.4 China 8,815 1.61 141.7 175.0 216.8 Japan 3,995 3.40 136.7 143.5 150.4 India 3,779 1.03 38.8 41.8 45.0 Europe 14,072 1.88 264.3 276.3 288.8 Rest of world 2,073 1.11 23.0 24.4 25.9  Total 50,503 2.08 1,049.4 1,123.9 1,210.2  Share of Total Global R&D Spending    2006 2007 2008 Americas 35.70 34.40 33.10 U.S. 32.70 31.40 30.10 Asia 36.90 38.80 40.80 China 13.50 15.60 17.90 Japan 13.00 12.80 12.40 India 3.70 3.70 3.70 Europe 25.20 24.60 23.90 Rest of world 2.20 2.20 2.10 Gross Domestic Expenditure on R&D   2006 GDP PPP Trillions US $ 2006 R&D as %  GDP 2006 GERD PPP Billions US $ 2007 GERD PPP Billions US $ 2008 GERD PPP Billions US $ United States 12.416 2.760 343.000 353.000 365.000 China 8.815 1.610 141.706 174.958 216.824 Japan 3.995 3.400 136.692 143.501 150.379 Germany 2.430 2.500 63.541 64.608 65.694 France 1.850 2.200 42.143 43.977 45.898 India 3.779 1.000 38.850 41.810 44.996 United Kingdom 2.002 1.900 37.540 40.084 42.819 South Korea 1.064 2.600 34.726 37.733 41.000 Canada 1.078 2.000 23.058 24.529 26.000 Taiwan 0.681 2.200 17.913 19.852 22.000 Sweden 0.294 3.900 11.831 12.402 13.000 Israel 0.179 4.500 9.247 10.124 11.000 Switzerland 0.265 2.600 8.262 8.623 9.000 Finland 0.169 3.500 5.996 6.366 6.700 Denmark 0.184 2.600 4.709 4.906 5.110   Best Innovations of the Year from Around the World  R&D Magazine selects annually 100 awards recognizing the best in innovation from the technology powerhouses in academia, government, and industry, worldwide. The selection of the top 100 is done with the help of 50 independent technical experts who evaluate the details of the product and technology comparing with the existing ones. The selection process spans almost the entire year. Here are the select ten from among the 100 for this year. Product Inventing Lab / Company Description of the Product / Utility Rootviz FS Phenotype Screening Corp., Seymour, Tenn X-ray based imaging system optimized to non-invasively and non-destructively provide high-resolution images of living plant root systems in a green house setting. It includes the capability to acquire stereo images and then generate images with depth of view information. Motorola Printed Active Display Motorola Inc., Shaumburg Unites traditonal offset printing, nanotech and light emitting ink to create display materials that lights up in ways traditional posters cannot. Magnetoresistive random access memory (MRAM) Free Scale Semi conductors, Austin, Texas Combines the best features of  non volatile memory with random access memory.  Combines non volatility with unlimited, high speed reading and writing of data.  Carbon Foam Graphite Battery Firefly Energy , Inc.,Peoria Can overcome the two major problems of corrosion and sulfation of conventional batteries. weight is reduced and capacity, energy density, cycle life are increased. GRAFCELL Expanded  Graphite Flow Field Plates GrafTech international ltd.., Lakewood, Ohio Developed for polymer electrolyte membrane fuel cells with applications in back-up power systems, portable electronics. Their high corrosion resistance, good electrical and thermal properties, light weight and low production costs make these flow field plates a key enabling technology for the commercialization of fuel cells.  DataLase Casemark DataLase, Inc.,Norcross Datalase casemark is a fully integrated solution that features a smart ink which changes colors when exposed to a low-power laser. It is an imaging solution for secondary packaging comprised of a pigment reacting with low power laser light for direct marking on corrugate boxes.  INSORB | 20 Subcuticular Skin Stapler Incisive Surgical Inc., Plymouth Minn This is a mechanical skin stapler that places up to 20 absorbable staples underneath the skin for fast, cosmetic, and convenient closure of surgical incisions.