Economic Affairs Secretary Anuradha Thakur on Friday, 7 August 2026 called on Indian private enterprises to significantly scale up investment in research and development, warning that the country's corporate sector currently funds only 41 per cent of gross R&D — far below the 75 to 79 per cent share seen in advanced economies. Speaking at the National Council of Applied Economic Research (NCAER) India Policy Forum 2026 in New Delhi, she said industrial dynamism would ultimately hinge on the private sector's willingness to invest, innovate, and scale.

Government Capex Has Grown Five-Fold in a Decade

Thakur highlighted that the government's capital expenditure has risen more than five-fold over the last decade — from ₹2 lakh crore in 2014-15 to ₹10.7 lakh crore in 2025-26. She described public investment as playing a catalytic role by crowding in private investment, and cited a Confederation of Indian Industry (CII) survey indicating that private sector investment is moving upward at a steady and stable pace.

The R&D Deficit: Where India Falls Short

Despite the positive investment trajectory, Thakur pointed to a structural gap in innovation spending. Private enterprise accounts for just 41 per cent of India's gross R&D outlay, compared with 75 to 79 per cent in leading advanced economies. 'India's corporate ecosystem holds immense headroom to lead national innovation,' she said. 'Industrial dynamism ultimately will depend on the willingness of private enterprises to invest, innovate, and scale.'

She underscored a broader shift in the drivers of economic growth: 'Economic growth is increasingly driven by knowledge and technology rather than just the accumulation of labour and capital alone.' This framing positions R&D not as a discretionary expense but as a strategic imperative for long-term competitiveness.

University-Industry Collaboration as the Next Frontier

Thakur stressed that the next stage of India's development requires stronger R&D investment alongside deeper collaboration between universities and industries. She argued that long-term growth will be determined not merely by the volume of capital mobilised, but by how effectively that capital is deployed to create productive assets, globally competitive industries, quality jobs, and transformative innovations. 'We are on that path,' she added.

She also flagged the critical need to improve access to finance for micro, small and medium enterprises (MSMEs), describing them as the backbone of India's manufacturing sector.

India's Growth Resilience Amid Global Headwinds

Thakur noted that despite a challenging global environment — marked by geopolitical tensions, energy market volatility, and fragmented trade patterns — the Indian economy has clocked an average growth rate of 7 per cent over the last three years, underpinned by strong domestic demand. The remarks come as India positions itself for a knowledge-led growth phase, making the private sector's R&D commitment increasingly central to policy discussions.