R&D Thrust in Developing Countries - A Case of Indian Automobile Ancillary Industry
NMIMS Management Review, Vol. 7, No. 2, July – December 1995, pp. 50-67
18 Pages Posted: 4 Apr 2013
Date Written: July 1995
Technological developments in developing countries are governed by the nature of socio-economic structure of the countries concerned, and depend on factors like technological absorption capacities, administrative and management efficiencies, prevailing technological base, available R&D infrastructure and the availability of high level human resources. These governing factors in developing countries, in general, are at lower level or inferior when compared to the developed countries and therefore, the nature, scope, and quality of technology progress is different than that of developed nations. An important type of technical knowledge is exploratory/basic research, which starts with a small stock of accumulated knowledge and tries to make a substantial addition to it. The application of this sort of knowledge in developing countries is rare. The major thrust of industrial R&D and technological efforts in developing countries is, therefore, embodied in the capabilities of product/process development, adaptation and absorption. To test this hypothesis, an attempt has been made to study the R&D thrust of Indian automobile ancillary industry which has been keeping abreast with the latest developments in the vehicle industry.
To analyse the nature, dimensions and thrust of R&D activities, the study has classified various R&D activities into seven categories viz. development (diversification), absorption, adaptation, updation, indigenisation (import substitution), trouble shooting and quality control. The findings of this study reiterate that in the context of developing countries, R&D activities are primarily directed towards development (not innovation), absorption (not creation), adaptation and updation. Planned indigenisation/import substitution programmes, in consonance with liberal technology import have accelerated the limited R&D activities in line with material substitution, improvements in product designs/modifications, intelligent imitations with minor modifications, etc. Thus, more emphasis has been placed on product adaptations. Thrust of absorption is found in units have foreign technology to suit with the local conditions, the process, however, has been rather slow and continued dependence on technology suppliers has been reported widely. Quality control truly has been considered a basic necessity irrespective of the unit having or not its own separate quality control section. Towards the end, certain recommendations are made regarding further efforts to be made to make in-house R&D more absorptive, adaptive, innovative and creative with more R&D investments in this particular industry.
Keywords: Product Development, Product Adaptation, and Technology Absorption (DAA); R&D Thrust, Automobile Ancillary Industry, R&D activities.
JEL Classification: D21, F14, F23, L62, O3, O32
Suggested Citation: Suggested Citation