Science and Technology in China – Implications and Lessons for India – Edited by Maharajakrishna Rasgotra – Sage Publications (I) Pvt. Ltd., New Delhi; Year of Publication:2013; Pages:256; Price:Rs.795
Reviewed by Brig. Suresh C. Sharma, advisor to the telecom industry and freelance writer. E-mail: firstname.lastname@example.org
The book is a collection of papers discussed at a seminar organized by Observer Research Foundation [ORF].
S. Ramamurthy has narrated two examples of the progress by China in manufacturing high technology items. It invested in a rare earth refining plant in USA, closed it down and shifted it to China. China has now a monopoly of this important item. In 2008, China outbid Bharat Electronics of India and a German firm to offer Doppler weather radars. It should not be a surprise since PSUs get cost plus profits for sale to Government organizations and there is little effort in keeping costs low. China’s investment in research is much higher than that of India and China has a larger number of scientists and engineers under training.
Dr. V. P. Kharbanda has explained that following liberalization, China decided that Science and Technology [S & T] work must be oriented to economic construction. There has been continuous effort to institute a reward mechanism in the S & T system. The highest academic institution to control the scientific work is the Chinese Academy of Sciences [CAS]. The CAS established new research facilities based on open, mobile system serving the whole country in place of the earlier system which was isolated with universities and industry. Till the year 2000, 400 high-tech spin-off companies were formed under the CAS in the areas of IT laser technology, pharmaceuticals, energy and bio-medicine. The best scientists and engineers were recruited and a close relationship maintained with the political elites. National knowledge and innovation programme was started in 1995 to convert CAS into a research base of international standard. Simultaneously, the number of institutes of higher learning has increased and so has the number of research papers. State allocations to research institutes were reduced and institutes encouraged to commercialize their research results. S & T organization has been structured to encourage research institutes and industry cooperation. The success of Chinese efforts in innovation and research is due to the political will. There is an open environment for import of advanced technologies, better tax incentives and promotion of MNCs. India’s efforts need a big political push.
China started its space programme in the 1950s while India embarked into it in 1963. U R Rao has given a comparison of the progress by the two countries. China is far ahead due to being able to allot large resources and has gone ahead with building anti-satellite system. China’s objectives are to assure or deny access to and deny freedom to operate in space. Its missile programme aims at stocking adequate number of medium, long range and inter-continental missiles and change “no first use of nuclear weapons” to use against any nuclear power showing signs of attacking China. Rao has warned against our tendency to over-claim and over-advertise our accomplishments which creates a false sense of comfort within the country. India should not overreach its financial resources just to compete with China.
Chinese aviation policy has given more importance to the civil sector due to economic reasons. Half of the global profits in civil aviation are being made in China. In the military sector, China is going ahead in producing stealth fighters. The Western companies are in a dilemma whether to help Chinese industry for quick profits now and face it as an adversary later. Dr. R. Rajaraman estimates the number of nuclear warheads in China at 240 and it has the capability to assemble another 240 weapons. The warheads can be launched by any of the three systems – land based missiles, submarines or aircraft. India and Pakistan have about 90 to 100 nuclear warheads each. They are lagging behind in high energy physics. A number of bright scientists of Chinese origin and working in the West have a strong interaction with mainland Chinese scientific groups and quality work may emerge from China. We have not been able to get similar effort from NRIs. In India, the IT industry skipped the hardware component of IT and communications. In China, it covered all aspects like manufacturing, communications, software development and cyber security. China is believed to be indulging in violation of intellectual property rights. IT industry has been growing rapidly in China due to a well-planned system of investments and novel policies. It is robust and sustainable.
Ashok Parthasarathi has given a detailed account of the use of science and technology in China and its implications for India. China’s industrial development started with setting up of 300 heavy industry plants with the help of the former Soviet Union [FSU]. Major dislocation occurred due to the Cultural Revolution and ideological break-up between China and the FSU. New economy policy was adopted after Mao’s death and western multinational companies went into China in a big way. India was forced to open its economy to foreign participation in 1991 owing to low level of foreign exchange. Political will has made it possible for China to achieve high rate of industrial progress but has led to distortions. Steel production in 2009 was 600 million tonnes while the domestic consumption was merely 370 tonnes. The industry was highly fragmented. There are 7000 iron and steel companies. Some of them have a capacity of only 100 tonnes per year. These inefficient units cannot be closed down due to ownership or patronage of local party leaders.
India has eleven plants producing 55 million tonnes of steel per year. We should look beyond China. The former Governor of Reserve Bank of India pointed out that landed cost of steel from Japan which imported coal and iron ore was lower than the cost of steel from Indian plants. To his discomfort, a student showed by a quick calculation that the cost of steel in India was high due to the cost of coal and iron ore supplied by Public Sector Units [PSUs]. The quality of power generating equipment from China is lower than that from BHEL of India. Some of the State Electricity Boards imported Chinese equipment which was offered at a much lower price due to dumping. It was unsuitable for the Indian plants using coal with high content of ash and had to be discarded early.
China plans 15% of energy demand from non-fossil sources by 2020. India is likely to reach a target figure of 18% for renewable energy by that time. Both the countries are promoting solar and wind energy systems. In India, there is a greater reliance on private companies and an involvement of international players in production and financing. Sam Pitroda successfully developed electronic exchanges in C-DOT and 42 million exchange lines of this technology were inducted into the network by 2006. There is a similar success story of Wireless-in-Loop [WILL] technology developed by Professor Ashok Jhunjhunwala of IIT, Chennai. During 2005 to 2007, cell phones made a rapid growth. Indigenous component of telecommunication equipment declined from 70% to 20% and the imports of these equipments in 2008-09 were Rs.46,200 crores. China, on the other hand, insisted that foreign companies in China use 95% Chinese staff and content. India needs to take similar steps. In pharmaceuticals, India is far ahead of China.
India stood at 62 and China at 29 in the Global Innovation Index. Smita Purushottam has narrated the different economic and technological paths taken by the two countries which have resulted in this gap. They both started with investment in heavy industries with help from USSR. In 1978, China switched to a model of Comparative Advantage Following [CAF]. The state owned units were free to participate in the market and massive investment was made in infrastructure. The manufactured products were competitive due to cheap labour, reverse engineering, leadership and FDI. India woke up only in 1991 and the Government did not give due importance to manufacturing industries. IT Service sector could provide limited employment opportunities. The author has made recommendations for high growth which can be 10% per year. Some of the suggestions are to develop manufacturing industries and not allow any damage to Indian units even at the cost of appearing protectionist. We need to develop both hard and soft capabilities. Civil and military technologies should be integrated. The book has well covered the reasons for comparatively lower performance in economic growth.