One of the most important Bills to be introduced in the current Monsoon Session of Parliament is National Research Foundation (NRF) Bill, 2023, While a draft is not in the public domain, it is envisaged A new, centralized body for funding researchWith a budget of ₹50,000 crore over the next five years. The NRF is based on models such as the National Science Foundation of the United States, whose budget of approximately $8 billion is the major source of funding for college and university research, and the European Research Council, which funds basic and applied research. However, according to public statements from administrators, the NRF plans to draw a large part of its budget – ₹36,000 crore – from the private sector. For many years, India’s spending on research has ranged between 0.6%-0.8% of GDP, or less than the 1%-2% spent by countries with an economic base dependent on science and technology. In countries such as China, the US and Israel, the private sector contributed to about 70% of research expenditure, while in India, it accounted for about 36% of India’s total research expenditure – about ₹1.2 lakh crore – in 2019-20. Therefore, the Center argues, the way to spur university research in India would be to attract more private funding. Although this is a reasonable expectation, it is unclear how such a proposal could be implemented. One of the suggestions is to allocate funds to private companies as part of their annual Corporate Social Responsibility (CSR) obligations. directed to nrf, Data from the Ministry of Corporate Affairs shows that during FY2022, companies spent ₹14,588 crore as part of their CSR obligations. CSR trends show that around 70% of such funds were spent on education, health care and sanitation projects. Furthermore, many companies spend it on initiatives that are located within their own communities, with the government having no say in how it should be spent. It remains to be seen whether the government can force some of these funds to be included in the NRF or offer tax benefits.
The relatively large contribution of private sector research in many countries is due to continued government support to universities and research institutions, which has then encouraged individuals to form companies, and institutions to see value in investing in research and development. The challenge in India is not the absence of such companies but the fact that they are few in number. Organizations like the NRF should work to create conditions that encourage the growth of private sector organizations that see value in inventing and developing proprietary technology. Philanthropy is unlikely to be a panacea.