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30 July 2022

India Bets Big on Emerging Technologies

Girish Linganna

Recently, Indian defense minister Rajnath Singh spoke about the growth of emerging technologies in India. He referred to Russian president Vladimir Putin’s admonition that “whoever becomes the ruler of the sphere will rule the world.” The defense minister quipped that India does not want to rule the world but added that the sphere is growing, and there is a need to strengthen emerging technologies so as not to be overpowered by anyone.

India has delivered various internationally competitive services worldwide in the past few decades. The private sector has driven this boom, especially in information technology. Until recently, the industry and investors felt the government’s lack of cultivation of capacities. This has changed drastically and Bangalore, Gurgaon, Noida, Mumbai, Hyderabad, and Chennai have emerged as formidable locations for information technology firms. This change is observable in the variety of apps we use for all aspects of our life. In 2022, not only did India boast of the hundredth “unicorn”—a startup valued at more than $1 billion—but it added eighteen more in the first few months.

A Primer On Emerging Technologies

Emerging technology is a radically novel and fast-growing field. Mastery of niche concepts such as computer science, artificial intelligence, and the internet has led to more applications of these technologies to both new and existing products and services.

Big Data, predictive analytics, and the Internet of Things (IoT) have transformed business operations. To help understand their customers and make strategic decisions, companies are learning new ways of collecting, exchanging, and using data.

Although artificial intelligence (AI) has generated a lot of attention, it is only one of the latest technological revolutions. Experts believe that AI can open up new avenues for growth and transform how work is carried out across industries. Data is more potent in exciting ways. For example, when YouTube recommends a video to watch, this technology can automatically access data and carry out tasks through predictions and detections, enabling computer systems to learn from experience.

In today’s business world, how data is used by firms to drive their strategies is critical. This is where big data analytics comes into play since businesses gain insights into hidden patterns and trends that they can use to make better decisions.

Instead of traditionally sending data back and forth to a central location, edge computing processes data closer to where it’s being created. This helps companies with large amounts of data or those who need real-time results. The network is also safer because less data is transferred over public networks. Data processing is done onsite at creation and then sent offsite, which allows the same device to multitask while still running computations or storing information.

Robotic process automation (RPA) is replacing human operators. RPA refers to the automation of business operations, including transaction processing, application interpretation, data handling, and even email answering. RPA automates routine processes and substitutes human labor.

RPA is an excellent option for businesses of all sizes, given its relative ease of use and quick implementation. The technology has also been used where operations must be completed quickly with little room for error, such as in banking and finance.

The Internet of Things (IoT) is another interesting, innovative technology. Today, many “things” are constructed with Wi-Fi connectivity, allowing them to access the Internet and one another. IoT has enabled gadgets, home appliances, cars, and more to be connected to the Internet and exchange data.

India Pushes for AI

India, the second largest emerging market, has previously lagged behind other markets such as China. However, this may change soon as AI investment in India is projected to total approximately $1 billion by 2023.

Currently, India ranks eighth in terms of private investment in AI behind Europe, the United States, and China. However, a recent “State of AI” report published by Deloitte suggests that most Indian businesses plan to increase their AI investments. This report surveyed over 300 senior executives in India and showed that Indian startups had a competitive edge from rapid returns on earlier investments. Telecommunications, financial services, and retail led the adoption of AI. Pharmaceutical and manufacturing sectors and hospitality areas, however, are lagging.

Ahead of the United States and China, India recorded the highest growth in hiring for AI from 2016-2020 and a higher AI skills penetration rate. A 2021 report estimated that AI could potentially add $957 billion of additional gross value to India’s economy by 2035. In 2019, the Indian government formed a committee to push for developing an AI policy and strategy to achieve India’s AI ambitions.

Big Hiccups for Big Data

To solve the data problem in healthcare, the Indian government has launched several initiatives and projects—one such initiative is the National Digital Health Mission (NDHM). This solid digital infrastructure base acts as a launcher for NDHM to develop and enhance healthcare services through digital management.

While it is revolutionizing businesses worldwide, India has witnessed a sharp uptick in digital management innovation. Companies are developing new ways to integrate big data analytics into their business units.

The Indian government launched the Startup India scheme by offering, among other benefits, an 80 percent rebate on patent fees to startups. Companies in the AI and Big Data ecosystem can benefit from this scheme cost-effectively, building a competitive moat around their technologies. In 2015, India’s digital transformation journey began with the launch of the Digital India initiative. Eight years later, the country’s narrative in every aspect, including transformation, innovation, implementation, and inclusion, bears its distinct mark.

After the joint parliamentary committee published its report on the Personal Data Protection Bill, 2019 (“PDP Bill”), there was a lot of discussion about Indian data protection laws. The joint parliamentary committee deliberated for almost two years and failed to reconcile the various concerns raised by multiple stakeholders.

In its present structure, the PDP Bill resembles European Union (EU) data protection laws, which are very different from the data protection laws of the United States where most big data companies originated. More detailed regulation increases the cost of operations, such as in the EU. By contrast, the self-regulation system in the United States reduces the cost of operations. It thus provides a better environment for the growth of data-centric or data-based companies.

Today, the “co-regulatory model” is at the center of the controversy surrounding the PDP Bill. The issue concerns restrictive business practices, namely, data access, data portability, algorithmic transparency, and forcible data sharing. There is a danger of making presumptions, ex-ante, about market competition dynamics that could stifle innovation and efficiency. In addition, regulation is not easy to enforce because the nature of big data is cross-border.

Consumer interests are different, but antitrust regulation should be warranted only when the market fails. For big data, the literature is not convincing. The evolving jurisprudence must be viewed in the light of the variety in advanced economies. Given the history of state intervention in India, it is best to be cautious. Regulation is also subject to lobbying and regulatory capture.

How Key Technologies Make India a Leader

After 5G, augmented and virtual reality technology has accelerated, allowing everyone to consult doctors from the comfort of home. Doctors can operate using robots from 1,000 miles with little lag time.

Autonomous car development has shifted to the fifth gear, forcing human drivers to take a back seat. The 5G-enabled driverless vehicles will revolutionize travel because of their extraordinary speed and responsiveness.

Minister of State for Commerce and Industries Som Parkash informed Parliament that the Department for Promotion of Industry and Internal Trade (DPIIT) had recognized more than 4,500 startups working in emerging technologies. The minister said that these recognized startups operate in emerging domains such as the Internet of Things, robotics, artificial intelligence, and analytics, among others.

Twenty-six centers of excellence (CoEs) have been established nationwide to create capabilities in emerging technologies. With the participation of the central government, software technology parks, state governments, industry partnerships, and venture capital firms, domain-specific CoEs are being established. These CoEs act as essential enablers to promote innovation in emerging technologies.

The government has set up Atal Incubation Centres (AIC) under the Atal Innovation Mission to incubate startups. Atal New India Challenge (ANIC) program has been launched to directly aid startups with technology-based innovations.

The two new diploma and undergraduate-level courses allowed by the All-India Council for Technical Education include a diploma in the integrated chip manufacturing process and a bachelor's degree in VLSI design and technology.

The plan to build a talent pool of engineers and shop-floor technicians was developed following consultations with global companies interested in the IT ministry’s semiconductor mission. These companies told government officials that India had many engineers at the senior level, including in management roles, but almost no employable graduates at the trainee level.

The Ministry of Electronics and Information Technology (MeitY) aims to train 85,000 high-quality engineers in very-large-scale integration (VLSI) and embedded system design technologies through its Chips to Startup program.

As per the approval, a project titled “Energy Efficient Mesh Architecture Based Indigenous Neuromorphic Processor for Extreme Edge IoT Applications” will be run at IIT Bhubaneswar for five years. Apart from the project at IIT Bhubaneswar, the IIT Hyderabad also plans to start an undergraduate course in VLSI design and technology, aiming to create a pool of highly qualified semiconductor engineers and technical experts.

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