The Gross Expenditure on R&D Should Be Increased to 2 PC of GDP: Niti Aayog

India’s Niti Aayog has proposed raising the country’s gross expenditure on research and development (GERD) from the current 0.64% to 2% of GDP over the next four to five years. This shift is critical to realizing the government’s Viksit Bharat 2047 vision, which aims to position India as a developed nation by fostering technological advancement and scientific excellence. The report emphasizes systemic bottlenecks in the research lifecycle, including slow funding approvals and limited industry participation. To address these challenges, Niti Aayog suggests introducing time-bound fiscal incentives for increased R&D spending, including tax deductions for corporate contributions to research funds. It also recommends establishing an optional R&D expenditure reporting line to improve transparency and encourage private sector investment. Key proposals include a six-month maximum timeline for processing R&D proposals, direct grant transfers for extramural research, and a 20% annual increase in postdoctoral fellowships in science and technology. Additionally, the government is urged to reduce the GST rate on R&D-related procurements to 5% and implement performance-linked incentives to reward excellence in research. To strengthen collaboration between academia and industry, Niti Aayog proposes developing standardized templates for technology co-development agreements and an Ease of Doing R&D assessment framework. This framework would require institutions to conduct periodic self-assessments using a standardized national scoring mechanism. The report also calls for clearer institutional guidelines on intellectual property, industry partnerships, and research governance. A Centre for Technology Indigenization (CTI) is recommended to prioritize domestic technology development, maintain a centralized repository of innovations, and coordinate with MSMEs. The goal is to accelerate the indigenization of critical technologies and reduce reliance on foreign solutions, aligning with broader economic and strategic objectives.