Innovation has become a key factor in the process of socioeconomic development. Innovation is no longer the prerogative of developed nations. Some developing countries have given innovation-based development a high priority in their national development plans and economic growth strategies and they are now reaping the fruits of that investment.
In this knowledge-driven world, it is vitally important for developing countries to place innovation at the top of their development agendas and bring about the necessary changes to transition from their largely natural resource-based economies to innovation-led systems.
It is imperative to have innovation systems with quality human resources, supported by a strong infrastructure and dynamic innovation policies. Information and communication technologies play an important role in the ecosystem. Combined with knowledg workers, knowledge networks and knowledge absorption capabilities, particularly in the private sector, they can lead to a stream of high value products and services that can have a significant impact on national economies.
A critically important ingredient of an innovation ecosystem is the quality of the knowledge workers. This, in turn, is reflected in the quality of education, the level of research, as evident from the scholarly articles published in top journals, the rankings of universities and the number of international patents produced indigenously.
According to the Global Innovation Index 2015, there are 11 developing countries that have shown significant improvements from 2011-2014 in their overall Innovation Index; they are Armenia, China, Georgia, India, Jordan, Kenya, Malaysia, Republic of Moldova, Mongolia, Uganda and Vietnam. These countries are investing heavily in the implementation of innovative policies, and this spending in key sectors is driving their growth.
Innovation must go beyond economic development and promote inclusive and sustainable socioeconomic development by focusing on the key problems faced by the people: health, environment and jobs for the under-privileged. The key principles that need to be implemented to promote innovation are:
(i) Promoting innovation across all industries, not just in high tech manufacturing; (ii) Promoting innovation in all areas and in all phases of development so that countries can transition from the manufacture of low value products to the manufacture of high value products; (iii) Establishing a world class IT infrastructure to provide ready access to digital knowledge and promote e-commerce; (iv) Establishing National Innovation Agencies that can promote the formulation of robust and dynamic innovation strategies. Such agencies have been established in Kenya, India, Malaysia, Thailand and Vietnam; (v) Establishing an effective tax, trade and investment environment so that innovation can be promoted and facilities such as access to venture capital, the establishment of techno-parks in key fields, financial and legal services and mentorship are available to assist new start-up firms; and (vi) Promoting mechanisms to support new technologies through ready access to R&D funds, so that new and creative ideas can be nurtured.
There are a number of initiatives taken by other fast developing countries that we can learn from. China’s remarkable economic development has been based on massive investments in science, technology and innovation. The 2006 National Plan for China (covering the period 2006-2020) lays strong emphasis on revamping the science and technology institutions and promoting innovation-led economic growth. To attract the best talent from abroad, particularly the US, China launched the ‘Thousand Talents Recruitment Program’, which has already brought more than 2,000 professionals to China through excellent salaries and research incentives.
India presents another good example of how science and technology can boosting the economy. Its investments in high quality educational institutions that produce good professionals, in the IT area for instance, have led to an industry that has passed the $147 billion mark in revenues ($99 billion in exports and $48 billion domestic) and contributes about 13 percent to India’s total annual GDP. The pharmaceutical and biotech industries have also made rapid progress, driven by highly qualified local labour and sensible industrial and innovation policies.
Malaysia presents another interesting example of how innovation policies are being implemented. The Intensification of Research in Priority Areas programme was launched in 1988 by the Ministry of Science, Technology and Innovation (MOSTI) to promote research in universities and R&D institutions. Realising the importance of promoting R&D in the private sector, the Malaysian government launched the ‘Industrial R & D Grant Scheme’ in 1997.
Production of high quality technological goods has become a key pillar in the industrial growth of Malaysia, and the progress has been nothing short of spectacular. Today, about 87 percent of total technology exports to the Islamic world come from Malaysia alone. The remaining 13 percent come from the 56 Organisation of Islamic Cooperation (OIC) member states – with Indonesia contributing about 6 percent and the remaining 55 members (including countries like Turkey Iran, Saudi Arabia, Kuwait) contributing only about 7 percent.
MOSTI coordinates closely with other key organisations, such as the Malaysia Industry-Government Group for High Technology, the Multimedia Development Corporation, the Malaysian Technology Development Corporation, the National Science Research Council and the five research universities. The establishment of a high level research centre in my name – the ‘Atta-ur-Rahman Research Institute of Natural Product Discovery’ at the largest university of Malaysia, Universiti Teknologi Mara – is illustrative of the emphasis that Malaysia is now placing on cutting edge research. Malaysia is, however, still dependent on foreign technology as is evident from the deficit balance between royalties and license fees paid abroad against those received. It needs to become a technology exporting country.
The importance of implementing innovation policies needs to be understood by the leaders and planners of developing countries. This means involving all stakeholders and then supporting them in the establishment of various innovation-led schemes in their respective fields. Pakistan needs to learn from others and have a focused implementation strategy based on the policies of Science, Technology and Innovation(STI) and backed by liberal funding, so that we too can transition to a strong innovation-driven knowledge economy.
The writer is a former federal minister, former founding chairman of the HEC and presently president of the Network of Academies of Science of Islamic Countries.