Review committee recommendations
- Tax incentives to industry, specifically in relation to hiring PhD level personnel
- A 150 per cent tax incentive to industry to promote major joint venture projects
- Allow industry personnel to work in IIT environment for longer periods of time
- Visiting chairs for industry executives and technical leaders
- Improve IPR regime
- Develop a system to help encourage entrepreneurship of graduates and faculty
Tucked away in a corner on the 320-acre campus of IIT Delhi is a largely unknown office. Enthusiastically termed as the Foundation for Innovation and Technology Transfer (FITT), it was positioned as a "bridge" between industry and the immense talent within India’s premier engineering institutions. When it was started in 1993, its aim was to welcome India Inc to sponsor research through it. The sad history of FITT can be gauged by a few facts: it hasn’t had an MD for the past 15 months and continues to function without a marketing manager. More importantly, it has proved to be a dismal failure in its ability to attract corporate funds.
Sadly, it’s true of the other seven IITs too. Despite being in existence for 40 years, and despite their success in producing world-class engineers, the cradles of engineering education have failed to imbibe the spirit of the global standard, the Massachusetts Institute of Technology, which they were modelled on. While MIT has produced cutting-edge research in applied and basic sciences—and made money from it—the IITs failed to catch up. And the criticism gains more prominence as the country’s policymakers aim to provide special grants to the country’s institutions of excellence (like the Indian Institute of Science, Bangalore, and the Punjab Agricultural University), which hasn’t included any of the IITs till now.
It appears that the IITs are largely being funded by the government; the bulk of their annual funds come from the public exchequer, and most of their annual budgets for research projects—almost a third of the overall budgets—also come from government agencies. In 2005-2006, for example, IIT Delhi managed to attract a mere Rs 33.36 lakh from the industry, compared to Rs 27.2 crore from the government. IIT Kanpur got Rs 2.15 crore from the industry, and Rs 88.22 crore from government agencies. Ditto for IIT Bombay, with Rs 4.5 crore and Rs 33.37 crore respectively. Only IIT Madras had more balanced figures, with Rs 10.35 crore for sponsored research from the industry, and Rs 24.65 crore from the government.
So, what’s wrong with the IITS? Why is the industry disenchanted with them? Or, have the IITs failed to market their latent talents?
In 2003-2004, the ministry of human resources development formed a review committee to answer precisely these questions. Headed by P. Rama Rao, a renowned scientist, and including well-known names like R. Chidambaram, principal scientific advisor to the government, and CEOs like Anand Mahindra, C.K. Birla and Subhodh Bhargava, it aimed to pinpoint the issues that prevented a closer relationship between the IITs and the private sector. The committee noted that although there was an ongoing dialogue between the two, the size of the projects was small. From Rs 1 lakh per project in 1999-2000, the figure grew to Rs 2.5 lakh in 2002-2003. In short, as many as "2,880 projects were earning less than Rs 70 crore".
Worried at this unfortunate trend, Chidambaram and J.J. Irani, former CEO of Tata Steel, wrote a joint letter to hundreds of industry captains. "They urged them to hire engineers at payscales comparable to the best in the industry, and then leave them at the various IITs for a few years to do quality research," says Rama Rao. A quick check with the IITs revealed that neither of the two sides took such initiatives. Instead, what the industry did was to send their employees to the IITs for a few semesters at the postgraduate and PhD level, and pull them away soon after.
The malaise, however, runs much deeper than mere lack of interface. A part of the problem is the lack of adequate infrastructure in terms of both facilities and faculty. The IITs are in desperate need for trained teachers, and the ones who are employed have little time for quality research. Even the students feel their professors are hard-pressed for time. "A few years ago, a professor had to combine both the undergraduate and postgraduate classes as there was a severe paucity of time," says a recently-graduated student from IIT Delhi. The Rama Rao committee agreed that the existing infrastructure needed to be augmented. But it also added that the government needed to provide more sops to the industry to encourage the latter to sponsor research.
IIT Bombay: The Society for Innovation and Entrepreneurship is busy incubating 26 ventures
Another key reason, according to the committee, was the lack of a strong intellectual property rights regime in the country. Not only did it hamper research at the IITs, it also prevented the private players from investing money in that area. Although the number of patent applications from the IITs stood at 166 in the 1999-2003 period, the figure isn’t too encouraging for institutes that are over four decades old. Even the number of corporate-sponsored chairs at IITs is very low; of the 56 chairs now, over 95 per cent are sponsored by the government. This has proved to be detrimental as it doesn’t allow money to be funnelled into industry-related research.
"One of the major reasons why IITs are unable to forge tie-ups with industry is because they do not have the necessary structures to do so. The industry gets wary when it realises it needs a dozen clearances before it can use the talents of IITians. There should be more empowerment of the IITs," saya Surabh Srivastava, chairman, Xansa, an IT and BPO outfit. He adds that the IITs are understaffed, due to which the faculty is unable to actively go out and scout for partners.
All this is not to say that there haven’t been any success stories in the IITs. Since 1973, the IITs have experimented with two models to attract sponsored research. While the Industrial Consultancy & Scientific Research units were functioning at one level, they set up autonomous bodies to nudge a reticent industry towards their campuses. So, Delhi formed FITT, Kanpur set up the SIDBI Innovation and Incubation Centre, and Mumbai had SINE (Society for Innovation and Entrepreneurship). In 2004-05, FITT managed business of Rs 1.3 crore for consultancy projects and Rs 2.2 crore for technology development. It was an improvement over the Rs 1.84 crore that it got in 2003-2004.
In the past five years, FITT has transferred 17 technologies to industry. These relate to fibre-optics, chemical processing, image processing, bottled purified compressed biogas from cowdung as a CNG substitute and aromatic extraction. Explains K.K. Roy, who has been with FITT since its inception, "The talent available in IITs is immense, but the faculty is not geared to handle commercial projects. That is where we come in and, over the years, we have notched up considerable success in transferring technologies developed here to the market. That is the real test of our capabilities." Adds Surendra Prasad, director, IIT Delhi, "the technology being developed by us is a success. We now need to turn it into a greater success."
IIT Delhi: Their technology business incubating units persuade students to shun the American dream
IIT Delhi took further lead by setting up the Technology Business Incubator Unit (TBIU) in 1999. Since then, it has helped IITians shun the American dream and opt for an Indian one. Dipender Sekhon, who is in his mid-20s, runs a business that has posted a turnover of Rs 2.5 crore. The origins of his software development and surveillance technology company, Kritikal Solutions, can be found in TBIU. In September 2002, Sekhon and seven friends started the firm in the IIT Delhi campus with help from one of their professors.
Like Kritikal Solutions, another TBIU company, Virtualwire Technologies, founded by Akshay Sharma and Vishal Chandra, is on the verge of graduating out of the campus. With a Rs 50 lakh turnover, the duo are working in areas like wireless communication, encryption, and VoIP technologies. A marked exception is the case of a professor, who was willing to test his knowledge in the marketplace. H.M. Chawla, who works from IIT Delhi’s chemistry department, put his money where his test tubes were, and created Sanmotech Technologies, which is being incubated at TBIU and deals with synthetic and molecular technologies. "I believe any technology developed in the software sector has a quicker gestation period, but an even shorter shelf life. In chemistry, we can create technologies that last for years," he says.
Rao puts the matter in perspective by recounting a personal anecdote from his student days at BHU. "G.R. Bashforth joined the faculty after a successful stint with the British steel industry. But he did the unthinkable; he made students set up pilot steel plants using continuous casting, at a time when the technology hadn’t come to India. You have to bring people of eminence from the industry to academia, and vice versa. Look at the success of the linkages between CLRI and Madras University. The fact that 65 per cent of the leaders in the leather industry are from CLRI is a testimony to its achievement."
IIT Madras is doing pioneering work in WiMax technologies and its Telnet venture has done wonders for the telecom sector. At IIT Bombay, SINE is busy incubating 26 ventures. Two of SINE’s earlier incubations raised equity of $500,000, and another is set to be acquired for over $3 million. Says Ashok Jhunjhunwala, a professor in IIT Madras, who broke new ground with Telnet: "Innovation thrives when three sets of people interact—faculty, which encompasses knowledge, industry personnel, who have the requisite experience, and the student/youngster, who has immense energy. It’s important that they be brought together."
Even the industry has taken a few initiatives. The students of IIT Bombay are helping Sona Koyo Steerings, a leading auto components manufacturer, on conceptual framework for steer-by-wire technology which, in simpler terms, will be an advanced, more semiconductor-reliant version of power steerings. Sona Koyo’s chairman Surinder Kapoor is pleased with the progress of the joint initiative but laments the extent of coercion that is needed from the corporates to engage the IITs in such ventures. "They need to market themselves better. The IITs seem content with government grants and assistance. And that seems to be the case because there is very little competitive pressure on them to do otherwise," he explains.
Recently, ABB signed an MoU with IIT Delhi, and also established a professorial chair to facilitate technology development and knowledge-sharing between the two. "We are proud to associate with IIT Delhi. This partnership is part of ABB’s constant commitment to technology and innovation and our ongoing efforts to strengthen relationships with academia. Specific technology focus on power systems and power electronics will also help address some of India’s specific challenges in a critical and fast developing sector," feels Ravi Uppal, vice-chairman and MD, ABB India, and also the head of South Asia Pacific region. But a senior manager in ABB points out that institutes like the IITs are often caught up with the pretence of doing fundamental, highly conceptual research rather than tying up with the industry to work on development and product innovation, which might seem mundane in comparison.
What is worrisome is the ongoing trend of brain drain. In his book, The IITians, Sandipan Deb noted that 40 per cent of IIT engineers emigrate and estimated that only 2,000 IIT-trained engineers are actually involved in designing technologies and products in India. That’s a sad commentary for institutes meant to "benefit Indian society". With each student costing the exchequer nearly Rs 11 lakh per year, the IITs are probably helping subsidise Western economies, especially the US, rather than contribute to India.
Here is an argument that an IIT professor from Delhi, speaking on condition of anonymity, puts forth: "The students are trained at subsidised rates but usually push off abroad. And the remittances from them are negligible, despite the fact that they collectively earn more than the unskilled labour that we export to the Gulf countries. In comparison, the unskilled or semi-skilled workers send back nearly $2 billion dollars annually." Until this is reversed and the IITians start coming back to India in hordes, we are far away from an era where future corporate giants are incubated in IIT campuses. While leaving the readers with this grim realisation, let’s tell you that IT giants like Sun Microsystems and Cisco had strong linkages to campuses; Sun is believed to be an abbreviation of Stanford University Network.
By Saikat Datta with T.R. Vivek