Innovation Not Yet Common in Indian Manufacturing: NMIS 2021-22 Survey

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• The NMIS 2021-22 evaluated innovation performance of Indian manufacturing firms.
• 1 in 4 firms implemented innovation, and over 80% benefited from it.
• Study focused on 5 key manufacturing sectors: textiles, food & beverage, automotive, pharma, and ICT.
• The survey will strengthen baselines for manufacturing value-chains.

The Department of Science and Technology (DST) has released the "National Manufacturing Innovation Survey (NMIS) 2021-22: Summary for Policymakers," revealing insights that can help enhance the competitiveness of Indian manufacturing. 

The survey was conducted jointly by DST and the United Nations Industrial Development Organization (UNIDO), aimed at evaluating the innovation performance of manufacturing firms in India. The findings of the survey are expected to be of great interest to policymakers, researchers, and practitioners in the field of innovation and economic development.

The survey was launched by Dr. S. Chandrasekhar, Secretary, Department of Science and Technology, who highlighted the importance of the findings for the Make-in-India programme. He emphasized that innovators should come up with affordable, environmentally friendly innovations that require minimal changes in processes. The study covered 8,087 firms and 5,488 non-firms, analyzing their innovation processes, outcomes, and barriers.

“The survey findings offer wide-ranging insights into the enabling activities and barriers to innovation by firms and has closely evaluated how states and sectors have performed with respect to the manufacturing firms’ ability to produce new products, services and business processes. The detailed analysis of the survey results also provides valuable insights on the innovation ecosystem in India. Thus, I anticipate this report to be of great interest to policymakers, researchers, and practitioners in the field of innovation and economic development”, Dr Chandrasekhar elaborated.

Innovation Not Yet Common in Manufacturing, But Profitable

The National Manufacturing Innovation Survey (NMIS) 2021-22 revealed that while innovation is not yet widespread in the manufacturing sector, it has proven to be profitable for those firms that have implemented it. According to the survey, only one in four firms had successfully implemented an innovation during the observation period. However, the firms that did innovate reaped significant benefits, with over 80% of them reporting expanded markets and production, as well as reduced costs. These findings suggest that there is ample room for growth and improvement in the manufacturing sector through increased innovation.

Firm-level Survey and Sectorial Systems of Innovation Survey

The NMIS 2021-22 survey consisted of two components: the firm-level survey and the sectorial systems of innovation (SSI) survey. The firm-level survey captured data related to types of innovations and innovative measures taken by firms, including the process of innovation, access to finance, resources, and information for innovation, besides also recording the factors impacting the innovation activities in a firm.

On the other hand, the SSI survey mapped the manufacturing innovation system and its enabling role in achieving innovations in firms. The study measured the interactions between stakeholders of the innovation ecosystem, relative barriers to innovation, as well as the convergence or divergence of current policy instruments in select five key manufacturing sectors important to the Indian economy – textiles, food & beverage, automotive, pharma, and ICT.

The NMIS survey provides valuable insights on the innovation ecosystem in India and shows that focus on manufacturing innovation is needed in addition to expanding production. It is expected that the findings of the survey will contribute to strengthening the baselines to some of capacities and capabilities, opportunities and challenges in the manufacturing value-chains that require immediate attention.

The National Manufacturing Innovation Survey 2021-22 findings offer wide-ranging insights into the enabling activities and barriers to innovation by firms, with a close evaluation of how states and sectors have performed with respect to the manufacturing firms' ability to produce new products, services, and business processes. The collaborative study by DST-UNIDO has allowed a 360-degree approach to measuring manufacturing innovation outcomes, processes, and barriers at the firm level, mapping the contributing processes and interactions, and assessing the performance of states, sectors, and firm sizes.