Bangalore: Texas Instruments (TI) was the first foreign company to set up an R&D center in India. It opened its Bangalore (now Bengaluru) center in 1985. Although initially developing and supporting proprietary software systems for their Integrated Chip design, it became a full-fledged design center for application-specific products by 1990. The company has evolved since then. TI India has opened a design center for 3G wireless chipsets and a center for developing wireless Local Area Network (LAN) chipsets. The company has developed 225 intellectual property rights (IPRs) at its center in Bangalore.

India’s share in global R&D spending has increased over the last five years. According to Battelle, India is estimated to have had the eighth largest annual R&D investment in the world in FY10. Its share in global R&D spending is estimated to have risen to 2.8 per cent in FY11 from 2.6 per cent in FY10.

Exhibit 1

R&D spending in India (USD billion) Source: Battelle, 2012 R&D spending estimate by Battelle, 2012 R&D Funding Forecast, Aranca ResearchThe ratio of R&D expenditure to the national GDP increased over the years to 0.9 percent in 2008 and has been maintained over the last couple of years. The government has planned to further increase the figure to 2% by the end of the 12^th plan, in line with its aim to project the country as a global R&D hub. India’s 11^th Five-Year Plan (FYP) (2007–12) stipulates a 220 percent increase for science and technology investments compared to the earlier plan (2002–07). The government is partnering with established R&D leaders globally for improving the local R&D capabilities. For instance, India and Russia have partnered for military hardware, wherein the latter would be constructing 12 nuclear power plants over the next 10 years for India.

A recent study has revealed that Pune surpassed Bangalore as nation’s most admired and favorite hub for big MNCs, who desires for their engineering and development work outsourced through their R&D outposts.

Conducted by Zinnov, an IT advisory firm, the study said that 12 percent of Pune based product teams are doing better product development work compared to Bangalore’s 8 percent. The facts were revealed in Zinnov’s Maturity Benchmarking Study that surveyed 220 product teams across 30 MNC R&D firms in the country.

Pune’s product teams have come up to their full potential, as they are no more behind other states in terms of coding, testing and quality insurance, the study said. And when it comes to product pipeline, customer interface and channel partnerships, clearly Pune is the best.

The study also revealed a slow make-shift in the trend on setting up of R&D centers across the nation. All though Bangalore is still recognized as the hot-bed for MNCs, off lately Pune has emerged out of nowhere for its product development skills and capabilities in its executive product design and engineering skill-sets.

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