"Mere reliance on 'Jugaad innovation' risks missing the crucial opportunity to innovate our way into the future," the Survey notes

The Survey calls for more R&D spending if India wants to realise its economic aspirations.

The Economic Survey takes a dig at businesses resorting to Jugaad instead of spending big on research and development activities.

"Mere reliance on 'Jugaad innovation' risks missing the crucial opportunity to innovate our way into the future," the Survey notes.

It further adds that of the ten major economies, India's businesses have the lowest contribution to R&D while it is the government that has to do the heavy lifting.

"India’s gross expenditure on R&D at 0.65 per cent of GDP is much lower than that of the top 10 economies (1.5-3 per cent of GDP) primarily because of the disproportionately lower contribution from the business sector," the Survey highlights.

The Survey calls resident firms to increase their share of patents that matches India's status as the fifth largest economy. It calls for more R&D spending if India wants to realise its economic aspirations.

The Survey says that despite liberal tax incentives in India for promoting R&D activities, Indian businesses have performed poorly.

As the pandemic reshapes how global supply chains work, India can take advantage of this reordering and come up with schemes like PLI to encourage businesses to manufacture and innovate in India.

That would help India in beating its rivals in southeast Asia that are vying for a large share of the manufacturing pie as global MNCs look to shift base to a more favourable destination in the post pandemic world.

The Survey shows that despite India's improvements on the innovation index, it still lags behind Vietnam in the lower middle income group of countries.

That scenario will need to change as India rolls out the red carpet for global giants to come and manufacture in India.