You are here

Standardization and Innovation in the ICT Sector

The Indian government has launched two ambitious, complementary initiatives designed to transform India into a global manufacturing and technology hub —‘Make in India’ and ‘Digital India’. APJ Abdul Kalam, the former Indian President and noted scientist, had pointed out that such schemes ought not to lead India to ‘become the low-cost, low-value assembly line of the world’. Rather, India ought to focus on hightechnology manufacturing and innovation. A large body of scholarly literature on intellectual property (IP)—dealing with the causal relationships between patents, innovation and economic growth—pointsto the beneficial effects of innovation.

Many have concluded, empirically and theoretically, that patenting fosters ex ante innovation because of the prospect of reward, stimulating information flows and transfer of knowledge across firms, leading to technological change and growth ex post. While sector-specific illustrations are abundant, a widely-quoted example is that of the mobile communications and smartphone industry, which has thrived not only on cutting-edge technological innovation, but also on the evolving dynamics of conducting business. The diffusion of products embodying innovative technologies across markets, which is of crucial significance to the industry, depends on the strategic use of IP, the degree of competition in the industry, and the complex intra-industry arrangements between IP holders.