'Made in India’ must give way to ‘Imagined in India’, says Sitharaman bats for design, patents; innovation

Finance Minister Nirmala Sitharaman has urged Indian industry to shift its focus from simply expanding in size to building enterprises that are innovative, resilient, well-governed, and capable of competing on a global scale. Addressing an event organized by the All India Management Association, Sitharaman emphasized the need for companies to enhance their capabilities in technology, design, research and development, while simultaneously improving governance and institutional practices.

She argued that India's next phase of growth should be driven by increased investment in research and development and the creation of intellectual property within the country. Sitharaman stated that the nation's objectives must evolve from products merely "Made in India" to "Imagined in India" products - those conceived, designed, and technologically developed within the country before being exported to markets worldwide.

The current level of Gross Expenditure on Research and Development (R&D) in India stands at 0.83% of GDP, significantly lower than the OECD average of 2.7%, China's 2.6%, and the United States' 3.5%. Moreover, the private sector's contribution to R&D spending in India is modest at 36%, compared to over 70% in leading advanced economies.

Sitharaman stressed the importance of combining India's growing scale with better quality, stronger governance, and improved technological capabilities as the country strives to achieve the Viksit Bharat 2047 goal. She emphasized that execution will be crucial in transforming the nation's strengths into lasting national capabilities. Sitharaman urged companies to prioritize competitiveness, innovation, trust, and resilience in addition to growth.

In addition to corporate governance, Sitharaman highlighted the need for constructive engagement between businesses, the government, and regulators. She stressed that trust should be built through consistent conduct rather than merely expecting it from the other side. Companies should proactively engage with government and regulators, present evidence, participate seriously in consultations, and work towards solutions before disagreements escalate into disputes.

Furthermore, Sitharaman called for strengthening management capabilities across Indian companies. She advocated for management education and short, practical programs for founders and early-stage employees covering topics such as hiring, delegation, financial discipline, customer management, compliance, and organizational system creation. She also suggested that family-run businesses benefit from practical programs focused on succession planning, governance, professionalization, conflict management, and delegation.

Lastly, Sitharaman cautioned companies against tailoring their products and strategies exclusively for affluent urban consumers. She urged businesses to consider a broader range of customers, ensuring their offerings cater to diverse needs and preferences as India moves towards the Viksit Bharat 2047 vision.