Mumbai: The Indian manufacturing sector’s share in the total foreign technological collaboration (FTC) entered into by domestic companies has seen a significant surge during 2012-13 and 2013-14, a survey done by RBI said.
This bodes well for the domestic economy, as increasing foreign collaboration in the domestic manufacturing sector would help in improving the manufacturing competitiveness, which could accelerate India’s economic growth.
According to the survey, the share of manufacturing sector in the total FTC agreements increased substantially while that of services sector decreased in the tenth round of the survey as compared to the previous survey. Currently, the share of manufacturing in GDP is around 15 per cent. A recent report by Mckinsey and Company stated that India’s manufacturing has the potential to grow to $1 trillion by 2025 accounting for 25-30 per cent of the gross domestic product.
The RBI survey however noted that the proportion of FTC agreements with export restrictive clauses increased marginally in the manufacturing sector when compared with the previous survey round. A closer analysis of country-wise agreements showed that the share of agreements with export restrictive clauses increased with US, UK, Italy and Switzerland and decreased with Japan, Germany, Korea and France.
Apart from manufacturing, the share of construction sector and agriculture-related activities in FTC also increased when compared with the previous round. In terms of source of technology transfer, Japan, US and Germany were the top three countries, which together accounted for 51 per cent share in total FTC agreements of responding companies during the survey period.
When it came to the mode of payment for technological collaboration, the share of agreement involving the payment of only royalty accounted for about 48.1 per cent.
