state of r & d in ict sector in india by dr t.h. chowdary* * director: center for telecom...

State of R & D in ICT Sector in India

By

Dr T.H. CHOWDARY** Director: Center for Telecom Management and Studies

Chairman: Pragna Bharati (intellect India )Former: Chairman & Managing Director

Videsh Sanchar Nigam Limited &Information Technology Advisor,

Government of Andhra PradeshT: +91(40) 6667-1191/ 2784-6137(O) 2784-3121®

F: +91 (40) 6667-1111, [email protected]

[email protected]

Talk @ Birla Science Center- Sixth Indo-Italian Workshop : 31st August 2007

THC_CTMS S357_Aug 07 2

R & D Establishments

• Telecom Research center

• C-DOT

• C-DAC

• CEERI

• DRDO [+Allied Unit]


Production/Manufacture Supported

• I T I

• B E L

• E C I L

• Scores of Private enterprises

• Members of TEMA


R & D – Hardly any in India

• ITI – (Established:1948) R&D spend in 2006- Rs.38.73 Cr [2.21% of sales, down from 2.66% in 2005

• Ranbaxy 17.88%

• SuvenLife Sciences 26.59%

• Astra Microwave 13.26%

• Himachal Futuristic 0.8%

• Ramco 26.47% & Visual Soft 4.36%

• US IT Companies spend 15% to 30% of Sales on R &D

• Telcos (Mfg) in Mfg countries spend– 10% to 15% of Sales on R&D


Growing National Champions

• China’s HUAWI; ZTE• Korea’s LG, Samsung…• Investing in R&D; Create IPR• Have we a Bell Labs & British Telecom research• Mfg. Cos ( Lucent, NEC, Fujitsu, Nokia, LG,

ZTE, INTEL, Motorola) spend ( 8 to 15)% of sales on R&D

• ZTE & HUAWI begotten & nourished by PLA


Scientists Per One Million of Population

Japan 5,095

USA 4,099

Australia 3,393

UK 2,666

China 545

India 157


Foreign Companies Engaging Indian intellect (1/2)

• Motorola – 1700 employees• 40% of software in its mobiles developed in India

• The Internet browser and multi-media messaging

system conceived and developed for 3G and GSM by Indian engineers working for foreign companies.

• The software going into US cars is being developed here in India .


Foreign Companies Engaging Indian intellect (2/2)

• GE – Largest R&D center outside USA is in India in Bangalore with 2300 researchers, double that in Shanghai; A 2nd one in Hyderabad with 2000 researchers

• GE put in $ 80 mln in the Bangalore R&D facility

• GE’s Bangalore R&D field for 260 patents in the USA (37 already approved)

• Boeing USA is outsourcing Aircraft design to Russia ( $ 120/ Hr)

• Russians are outsourcing parts of the design to HAL (BG) at $ 30/Hr

• Gorbachev went to USA to recommend Moscow as Bangalore’s rival!

• An Indian retained does the work of 2 or 3 Europeans;

does not take 6 weeks of holidays & costs one-fourth


New IT Townships

Co. Reliance DLF Tatas Unitech Baba kalyani

Acres. 100,000 50,000 30,000 30,000 27,000

Mahindra EMAR ANSAL’s Infosys

10,000 10,000 10,000 2,145


Telecom Equipment & Services Market for 2003-2004

Figures in (Rs) crores

S. No

Product Total Market

Local Manufacture & Services

Imports

1 Switching-Wireline including CDMA 3,500 2,600 900

2 Switching-Wireless-GSM 9,650 500 9,150

3 Terminals- Fixed & Voice solution 850 600 250

4 Terminals-Wireless GSM & CDMA 11,375 600 200

5 Transmission Equipment – including line, 2-way radio, Multi-Channel Radio Relay System, DWDM & DLC

2,500 34 5

6 Cables – PIJF, OFC and Structured Cabling

700 50 -


Telecom Equipment & Services Market for 2003-2004 (contd..)

S. No



Imports

7 EPBT, Feature Phones, CLI, PABX Phones, Customer Premises Equipment and voice solutions

850 250 244

8 VSAT Equipment 234 34 200

9 Signalling Equipment ( Road, Railways, Defeance etc.)

55 50 5

10 UPS, Power Plant, Inverter etc. 250 250 -

11 Test & Measurement Equipment 294 50 244

12 Miscellaneous Equipment, Data Communication Equipment – Call Monitoring, Antenna, Answering machines etc.

440 440 -


Telecom Equipment & Services Market for 2003-2004 (contd..)

S. No



Imports

13 Billing equipment including OSS & BSS

175 50 125

14 Turnkey Services 2,272 2,272 -

15 Production by BSNL Factories 155 155 -

16 Export of Telecom Hardware an d Services

700 700** -

Total 34,000 14,000 20,000

•Source: DIT figures, estimates of V&D checked with DOT Annual Report and reference from selected

TEMA Members• The figures include grey market•Expenditure on infrastructure & terminal equipment assumed to be made during the same financial year

** 250 cr. Hardware, 450cr. Services


What’s at stake… Telecom equipment

Market size Growth per annum

Wireless $2.5 mln 68%

Mobile handsets $2.38 mln 13%^

Others* $3.97mln 50%

Total $8.85 mln 43%

Telecom services**

$15.12 mln 16%

^ the GSM market grew by 76.2 per cent, but he CDMA market fell by 65 per cent during the last fiscal

* includes enterprise solutions and telecom software

** includes fixed line, mobile, national long-distance, international long distance, VSAT and radio trunking

(Source: Business World, 26 Dec 2005)


Production and Export of Telecom Equipment During 1992-1993 to 2003-2004

Figures in (Rs) crores

S.No Year Production Export

1 1992-1993 3,985 24

2 1993-1994 5,500 58

3 1994-1995 7,000 131

4 1995-1996 7,750 310

5 1996-1997 8,300 240

6 1997-1998 9,960 296

7 1998-1999 10,000 250


Production and Export of Telecom Equipment During 1992-1993 to 2003-2004

(contd..)

S.No Year Production Export

8 1999-2000 10,760 180

9 2000-2001 12,271 450

10 2001-2002 15,437 150

11 2002-2003 14,400 402

12 2003-2004 14,000 250

Source: TEMA/ DOT


R&D Spend

• 9th plan 0.7% of GDP

• In a period 1985 to 1990 - 0.9% to 0.98%

1996-97 - 0.66%

2003 - 1.0%

• Developed countries spend 2% to 6% of GDP on R&D


R&D Spend ( some ) in India

• S&T departments , GOI • 9th Plan Rs. 12,022 cr.• 10th Plan ( 2000- 07) Rs. 25,243 cr.• Automobiles Rs. 869 cr. 2% of sales• Forma Rs. 427 (1.5% of sales)• 24% or 17,000 R&D personnel (70,000) have

Ph.Ds• 11% or 7,700 R&D people are women


Post Liberalisation &Privatisation of Telecoms

• R & D declined, almost nil

• P-Telcos & PSUs – all use imported equipment

• Indigenous R & D has no takers for production


PSUs -

• HCL & HTL – Closed Shop

• ITI takes know-how from “all quarters of the world” [Aah nah bhadraa Kritavo yaantu Viswatah...] including from China’s ZTE & HUAWI


Share of India in GlobalBPO & KPO Markets

Year 2003-’04 2010-’11 BPO 36% 55%

KPO 56% 71% Leaders:

Eng. Design Basic Data Biotech & Search Pharma

Integration &Mgment

400m $ 300m $ 280Education coming up


India’s Global Companies

• Steel,

• Telecoms,

• Pharma,

• Wind-power,

• Construction,

• Oil & Gas [Co-opetition with China]


Over 50 globals have R & D centers in India

• Motorola• CIT-Alcatel• Nokia• QUALCOM• HUAWI• Siemens• BT......• IPR created by Indians but owned by foreign

companies


R & D in Engineering Institutions

• 1400 & Engineering colleges

• <100 have PG & Doctorate programs

• IISC, BITs, IITs, IIITs; NITs – must be developed as R & D centers.


Creating IPR

• Learn; go up the food-chain Morph into ZTE/HUAWI/HAIET…

• Mission: Intellectual Property Reagan’s Funding: Chrysler (IACOCCO)

• SEMATEC (IBM, INTEL, Bell Labs; …Rivals’ together set up R&D to beat Japan to design and build FABs

• Fund Defence Research; contract Research (private sector salaries: Government Mission)

• Fund: IISC; IIIT’s; IITs


Creating IPR (contd..)

• Tatas to take over C-DOT/ transform it into Bell Labs / BELCORE…

• Nation Telecom & I.T University(ies)• National Council for Development of Information

Society (NCDIS)• Incubators in about 50 universities/ Research

Institutes• Amend TRAI/ ITA to Constitute Statutory Research

Funding & Management of NCDIS• India as Home for MNC’s R&D & I.P Creation


India to create IPR

• State Intervention thro’ Defence Establishments

• National Board for ICT - IP creation• A NASCOM ‘varsity (PG; R&D; Foreign

Trade; Management) • Select ‘varsities / Defence collaboration

(anything from CEERI-Pilani? From CSIR’s labs?


Dhanyawad:Thank You

state of r & d in ict sector in india by dr t.h. chowdary* * director: center for telecom...

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