2nd Edition of India Innovation Index (III 2.0) 2020 : NITI Aayog

Why in News ?

Recently, NITI Aayog released 2nd edition of India Innovation Index 2020 (III 2.0) in which Karnataka retained top position and Bihar at the bottom in the major States category.

Maharashtra has leapfrogged Tamil Nadu to occupy the second place.

What is Innovation ?

Innovation is the creation, development and implementation of a new product, process or service, with the aim improving efficiency, effectiveness or competitive advantage.

The Need to Innovate :

The need to innovate is intrinsic for a healthy economy to harbour the spirit of competition.

While truly living up to the spirit of grassroots innovation, the world economy has changed with the onset of the fourth industrial revolution, decidedly changing the way firms function in the modern world.

Key Points of India Innovation Index 2020 :

• The three new indicators have been added to this year framework - 

1. National Achievement Survey (NAS) Scores (Class X)

2. Expenditure on R&D (State Government)

3. New Business Registered

• This edition of the index consists of 36 indicators, which includes hard data (32 indicators) and 4 Composite indicators.

• The India Innovation Index is a combination of two dimensions - Enablers and Performance - with 7 pillars.

• The Innovation Index is divided into three categories -

1. Major States

2. Hill and North East States &

3. Union Territories (UTs) 

The last two categories are segregated from the rest of the Indian States (or Major States) due to their geographical categories, varied sizes and administrative capabilities.

Categories	Top Rank	Bottom Rank
Major States	Karnataka	Bihar
Hill and North East States	Himachal Pradesh	Meghalaya
Union Territories (UTs)	Delhi	Lakshadweep

1. Major States :

• Karnataka at the top with a score of 42.5 for 2nd edition.

• Karnataka at the top and followed by Maharashtra, Tamil Nadu, Telangana, Kerala respectively.

• Karnataka has been attributed to a strong number of venture capital deals, registered GIs, ICT exports and high FDI inflows.

• Out of top five States, four States from South India.

• Bottom State is Bihar with a score of 14.5 points in the major States category.

Rank	Major States	Score
1	Karnataka	42.50
2	Maharashtra	38.03
3	Tamil Nadu	37.91
4	Telangana	33.23
5	Kerala	40.58
6	Haryana	25.81
7	Andhra Pradesh	24.19
8	Gujarat	23.63
9	Uttar Pradesh	22.85
10	Punjab	22.54

2. Hill and North East States :

• Highest ranked Himachal Pradesh with a score 25, followed by Uttarakhand, Manipur, and Sikkim respectively.

• Himachal Pradesh has been Eployment generated being Knowledge-intensive, industry-friendly policies and incentives.  

• Bottom State is Meghalaya with a score of 12.15 in the North East and Hill States.

Rank	Hill & NE States	Score
1	Himachal Pradesh	25.06
2	Uttarakhand	23.50
3	Manipur	22.78
4	Sikkim	20.28
5	Mizoram	16.93

3. Union Territories (UTs) :

• Delhi at the top with a score of 46.60, followed by Chandigarh, Daman & Diu, Puducherry, Goa respectively.

• Delhi recorded the highest number of trademark and patent applications, increase new startups, conducive business environment.

• Bottom UT - Lakshadweep with a score of 11.71.

Rank	Union Territories (UTs	Score
1	Delhi	46.60
2	Chandigarh	38.57
3	Daman & Diu	26.76
4	Puducherry	25.23
5	Goa	24.92

About India Innovation Index :

• It provides the methodology followed to assess the innovation capacities and performance of Indian State.

• The first edition of the India Innovation Index was released in October 2019.

• Objective : 

It is to scrutinize the innovation capacities and performance of Indian states and UTs.  To empower Indian States and UTs to improve their innovation policies by highlighting their strength and weaknesses.

• Function : 

It intend to perform following three functions -

a) Ranking of states and UTs based on their index score.

b) Identify opportunities and challenges.

c) Assist in modifying governmental policies to foster innovation.

• The India Innovation Index measures innovation inputs through 'Enablers' and innovation output as 'Performance'.

• Five Enablers Pillars : 

It capture elements of the State economy that  act as inputs for the innovation environment. The five pillars are -

1. Human Capital

2. Investment

3. Safety and Legal Environment

4. Business Environment

5. Knowledge Workers

• Two Performance Pillars :

It depict the performance output.

1. Knowledge Output 

2. Knowledge Diffusion

This framework is an improved edition of the index as it incorporates new indicators and has a modified methodology for some indicators to capture accurate results.

Significance :

• Current pandemic triggering an economic shutdown, the role of innovation to revitalise the economy.

• Its ability to drive economic growth, economic recovery and sustaining competitiveness in hard time.

• The innovation index create an environment where innovation factors are under constant re-evaluation.

• By innovation, India can scale-up manufacturing and develop its export competitiveness.

• Innovation is at the forefront of India's "Make in India" and "Atmanirbhar Bharat" initiatives.

• It catalyse development and fostering cooperative and competitive federalism.

• It can be useful for formulating policies and devising strategies at both the state and the national levels.

• To better understand the reasons for differential performance and the areas of strengths and weaknesses.

Global Innovation Index 2020 (GII 2020):

It is a joint collaborative effort between the WIPO, Cornell University, and INSEAD that annually ranks the innovation performance of more than 130 economies. India's rank 2020 - 48th position.

India's Performance on the GII 

Year	India's Rank (GII)	Total Countries
2015	81	141
2016	66	128
2017	60	127
2018	57	126
2019	52	129
2020	48	131

Also Read : National & International Indices and Reports

References

PIB

NITI Aayog

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