Big news is that China joins the ranks of the world’s 25 most-innovative economies, while Switzerland, Sweden, the United Kingdom, the United States of America, Finland and Singapore lead the 2016 rankings in the Global Innovation Index released in August 2016 by Cornell University, INSEAD and the World Intellectual Property Organization (WIPO). China’s top-25 entry marks the first time a middle-income country has joined the highly developed economies that have historically dominated the top of the Global Innovation Index (GII) throughout its nine years of surveying the innovative capacity of 100-plus countries across the globe. China’s progression reflects the country’s improved innovation performance as well as methodological considerations such as improved innovation metrics in the GII.
Despite China’s rise, an “innovation divide” persists between developed and developing countries amid increasing awareness among policymakers that fostering innovation is crucial to a vibrant, competitive economy.
Innovation requires continuous investment. Before the 2009 crisis, research and development (R&D) expenditure grew at an annual pace of approximately 7%. GII 2016 data indicate that global R&D grew by only 4% in 2014. This was a result of slower growth in emerging economies and tighter R&D budgets in high-income economies – this remains a source of concern.
Investing in innovation is critical to raising long-term economic growth,In this current economic climate, uncovering new sources of growth and leveraging the opportunities raised by global innovation are priorities for all stakeholders.
Top Rankings
- Switzerland (Number 1 in 2015)
- Sweden (3)
- United Kingdom (2)
- United States of America (5)
- Finland (6)
- Singapore (7)
- Ireland (8)
- Denmark (10)
- Netherlands (4)
- Germany (12)
- Republic of Korea (14)
- Luxembourg (9)
- Iceland (13)
- Hong Kong (China) (11)
- Canada (16)
- Japan (19)
- New Zealand (15)
- France (21)
- Australia (17)
- Austria (18)
- Israel (22)
- Norway (20)
- Belgium (25)
- Estonia (23)
- China (29)
No doubt, for long USA had been the Innovation leader. Its innovation not only confines to Science and Technology but also touched other walks of life including fashion and designing. Most of the other countries try to imitate its innovations or pay a heavy price for transfer of technology.
There was a time when Germany was leader in technology, Japan imitated Germany, than south Korea and Taiwan imitated Japan. But China has followed a very different model. With its cheap labor and friendly business practices it turned out to be a outsourcing factory for rest of the world.
Soon China realized that there are far more benefits of innovation so it tried to upgrade its Technology skills, invested in research, It has jumped to 17th position in World Innovation Ranking. It is the only country from developing world to find place in top 25 innovators. I have an instance to share that how China is catching up world leaders in Innovation. I have a US friend of mine with Chinese origin, who worked with top American Pharma Research companies. The Chinese Government invite him every year for identification of talented youth and work as their mentor. My friend is not alone, The Chinese government identify innovation leaders of Chinese origin in all areas of research world over, invite them to scout the talent, hand hold and nurture them. On the other hand ,despite tall claims, India is not even among the top 50 Innovator Nations. It is little bit of a paradox, because Persons of Indian Origin are in leading positions in the most innovative companies world over. india boast to have 6-7 top Institute of Technology, each year the cream of their pass-out is grabbed by top ranking global companies. Due to its too complex reservation policy, talented and brainy young one feel suffocated in the system rather prefer to work abroad where they get more money, recognition and better life style. Problem of reservation is not one time at the time of recruitment, less talented take over the talented one fast in promotions also. And the brainy lot who simply do not want to migrate abroad, and do not want to get trapped in reservation, they have opportunity in their backyard, the global companies run their R&D Centers in Banglore, Chennai, Hyderabad or Gurgaon. Wherever the government has given free hand and fair opportunity, the our talented youth has shown the results. ISRO is the shining example, in last 10-15 years it has done path breaking work. In case India also want to be in the exclusive club of Innovator nations, it has to invest heavily in Research and Development and has to see that the brainy one are properly nurtured, encouraged and given fair opportunity to grow, they will give results, it should also see that innovative and path breaking research is translated into commercial use/ production.
With China catching up fast in technological innovations, people started questioning that how long the USA will be able to retain it's leading position. They feel that it has peaked as a superpower and is falling behind in education, research and development, and economic growth. If you look the number of foreign students in USA's top technology Institutes, they have simply outnumbered the locals. And most of the foreign students come from China and India.
No doubt the challenge is hotting up but the experts feel in a different way. Not only is the United States leading a technology revolution that will help solve the grand challenges of humanity — problems such as disease, hunger and shortages of energy and clean water — it is increasing its lead on the rest of the world. By combining its entrepreneurial strengths with its creativity, it is reinventing itself once again.
A new report from the US Council on Foreign Relations, Keeping the Edge, is one in a series that analyzes where the United States stands in key dimensions of economic competitiveness. It concludes that on innovation, which drives rising living standards in the advanced economies, no other country is even close. For example:
• Of the top 20 universities in the world that produce the highest-impact scientific research, 16 are in the United States.
• Total U.S. research and development spending — most of it by companies — is higher as a share of the economy than at any other time since the early 1960s, when the space program was started. In absolute terms, no other country invests nearly as much in R&D as the United States, and in relative terms only Japan is close. And in a recent survey, the average U.S. corporation said it planned to boost research spending this year by nearly twice the rate of its international competitors.
• The share of the U.S. economy that comes from knowledge-intensive industries has risen sharply over the past decade, reaching nearly 40 percent; no other large economy has even hit 30 percent. Innovation of Internet and Online marketing revolution are two glaring examples.
In United States most of success in innovation is a private-sector story. The United States has an entrepreneurial culture that rewards risk; a highly developed venture-capital industry; and a large market of consumers eager to embrace new commercial innovations. But one of the more interesting findings of the report is that — unlike on so many other policies, from immigration to tax reform — the U.S. government has mostly got it right on innovation.
The Small Business Innovation Research program was established by US Congress in 1982, during the Reagan administration, and has been reauthorized multiple times with little controversy. The program requires that all federal agencies with big R&D programs set aside 3 percent of their research budgets for small businesses.
The result is a $2.5 billion fund that helps to bridge the so-called "valley of death" that new start-ups face between good ideas and commercial products that are attractive to investors. Apple, Compaq, and Intel all received such funds in the 1980s; today, some 6,500 small companies are beneficiaries. In surveys, 97 percent of those companies said that the grants had been vital to their later successes.
U.S. policy in support of innovation has gotten some other things right as well. Washington relies mostly on direct subsidies, which generally favor new and smaller companies, rather than R&D tax breaks that primarily help established firms.
The U.S. university system, with its mixture of public and private support, autonomous administrations and competition-based funding for research, is also uniquely successful at generating commercially relevant research breakthroughs. The system can be improved significantly, but it has fueled world-changing innovations. Other countries are trying to find the U.S. secret sauce, but without much success.
The report does highlight some red flags. Funding for public universities, such as the vaunted University of California system, for example, is under enormous pressure. So too is funding for basic scientific research. Massive research undertakings, such as the quarter-century-long Human Genome Project, which has paved the way for breakthrough drug therapies, are impossible without generous taxpayer support for basic science. Entrepreneurs can work hand in hand with universities in commercializing scientific breakthroughs, but they can't invest the time and money to create them.
Innovation also arises from the talents and ingenuity of those residing in USA, and immigrants have long brought a disproportionate share of that precious resource to the United States. The decade-long failure to reform immigration laws to welcome the best and brightest remains a deep, self-inflicted wound.
But amid so much of the hand-wringing in Washington, the report tells a remarkably positive story. When it comes to the scientific breakthroughs and its quick adoption in industry that are building the economy of the future, the United States really is No. 1 — and no competitor is in sight in coming 10 years.
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