The Hindu Business Line : India scores over China as global R&D hub: Survey

HERE comes some good news for our vast intellectual capital. India is not only emerging as a global research and development (R&D) hub, it is now ahead of China in the race.

Worldwide corporate heads — top executives from firms with over $1 billion revenues — find India more attractive as an R&D destination than China.

They are keen on parking their investments for R&D facilities in India than China, as per The McKinsey Global Survey of Business Executives, July 2004.

In effect, additional investments are most likely to result in increased employment for Indian professionals.

While executives "most familiar" with the "labour landscape" in both the countries are "particularly" keen on India, the survey adds that India stands out as a source of talent and as a destination for R&D investment.

A closer look at the numbers now. Thirty-one per cent of the overall respondents from companies with over $1 billion revenue said they would be investing in R&D in India, 27 per cent said they would invest in China.

The survey was conducted across 5,500 chief executives and other senior corporate leaders worldwide in May this year.

Going by regions, while 32 per cent of European business heads say they will invest in India for R&D, a lower 25 per cent say they will do so in China. The trend is no different for North America and the developing countries.

Twenty nine per cent of North American business leaders are headed for India with their research investments compared to 24 per cent headed for China.

Similarly, 37 per cent corporate bigwigs from developing countries would be parking their R&D funds in India against 24 per cent in China.

The only exception in this trend are head honchos from companies in the Asia-Pacific region, 43 per cent of whom prefer to invest in China as compared to a lower 38 per cent in India.

However, even among the Asia-Pacific (APAC) economies, there are those who, having operated in both the countries, are "particularly keen on India".

In the APAC region, "especially the big companies that are first movers in offshore investment and so are most familiar with the labour landscape in India and China are particularly keen on India," says the McKinsey report.

In fact 71 per cent of APAC respondents see India as an important source of talent, whereas worldwide 58 per cent of respondents echo it.

As for the composition of respondents in the survey, 11 per cent were from the developed countries of APAC (Australia, Japan, Hong Kong, South Korea, New Zealand, Singapore, Taiwan), 31 per cent from Europe, 41 per cent from North America, and 18 per cent from developing markets.

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