India’s Innovation story is complicated, while we are extraordinarily good at generating ideas however not very great at owning these ideas and deploying them. India's publication and patent output already exceeds what our research investment levels would predict the Global Innovation Index identifies us as an 'overperformer' by input-output measures. And yet, the ideas generated in Indian institutions rarely convert into products that Indian firms own, sell, and monetise on their own terms.Growth (Representative Image)This is the seam where arbitrage and autonomy diverge. The problem is not that India fails to think; it is that our thinking, far too often, enriches someone else's balance sheet. Closing this gap between Indian knowledge and Indian capability is the defining industrial challenge of our time.The geopolitical and economic disruptions of 2026 have made this plain. The West Asia conflict and the restrictions on the export of Anthropic technologies have exposed a structural dependency which needs to be navigated. For a nation charting its course toward Viksit Bharat by 2047, the question is no longer whether we must build indigenous intellectual property. It is how urgently, and through what means.Consider where core intellectual property is actually developed, owned, and monetised in any large enterprise: At the headquarters. India has successfully attracted hundreds of Global Capability Centres, and they play a vital role in our employment ecosystem. But the most substantial financial and intellectual investment always remains at the centre of an organisation and that centre is often not in India.When multinational corporations expand outward, they deploy managerial oversight to regional outposts. In contrast, the founders of domestic enterprises undergo a rigorous crucible of local market survival. This localized resilience cultivates an agility and determination that is difficult to replicate through decentralised corporate management. It is no coincidence that over the past two decades, we have seen numerous instances in consumer technology, in retail, in financial services where domestic enterprises, despite possessing fewer resources, eventually outperformed multinationals in their own markets. Depth of ecosystem integration is an advantage no headquarters memo can manufacture.The strategic implication is this: India cannot build the intellectual foundations of an advanced economy by being the world's most capable executor. We must become the author of our own technological future.The trajectory of leading world economies’ R&D investment follows a recognisable pattern. Entry-level manufacturers, typically focused on emerging markets, allocate around 3% of their revenues to research. Mid-tier organisations striving for global market share through incremental improvement invest approximately 8%. Apex global players routinely commit upwards of 22% of revenue to research amounting to tens of billions of dollars annually, placing them in the same echelon as the world's most prominent technology conglomerates.India's picture, by honest assessment, is bleak. As per NITI Aayog's 2026 report on the ease of doing R&D, India's Gross Expenditure on Research and Development (GERD) has remained near 0.64% of GDP for over a decade against roughly 2.4% for China, 3.4% for the US, and over 5% for South Korea. Indian private enterprises spend less than 1% of revenue on R&D, against the 8% or more committed by global technology leaders. Even that modest spending is concentrated in a handful of sectors, with pharmaceuticals and automotive leading, while aerospace, IT, and diversified conglomerates trail far behind global benchmarks. India's researcher density remains a fraction of what advanced and even comparable emerging economies maintain. The same report recommends increasing our GERD to at least 2% of GDP over the next five years a minimum threshold. Critically, the report's findings on weak technology transfer offices, unresolved IP ownership in co-funded research, and the absence of any systematic programme for technology indigenisation mark the precise structural failure points. These are the levers that, if addressed, could begin to convert India's overperformance on ideas into lasting industrial advantage.Building technological capability within a nation is akin to building physical strength: one must lift weights appropriate to one's stage of development. In the initial stages of economic growth, developing nations rightly focus on joint ventures and technology transfers. The ability to efficiently replicate and optimise manufacturing for cost-effectiveness is, in itself, a commendable innovation effort. But to emerge as a global leader, a nation must transition toward fundamental innovation both to navigate the structural pressures of rising operational costs and to retain top-tier scientific talent.India holds a structural advantage here as per capita income in India remains comparatively lower than in advanced economies, a similar or even smaller financial investment can fund a significantly larger scientific workforce. Emerging global giants have leveraged precisely this arithmetic building an overwhelming engineering scale that eventually competes with, and in several sectors overtakes, the incumbents.India's demographic dividend is real. But a dividend unclaimed is a dividend lost. As Indian enterprises increasingly channel this advantage toward genuine innovation we possess the potential to build an unparalleled scale of engineering and scientific endeavour. Three interventions are necessary, and they must move in parallel.First, the funding architecture must be simplified. The NITI Aayog report's recommendations on streamlining R&D funding mechanisms deserve urgent implementation. Complex approval chains and opaque eligibility criteria have historically deterred private sector participation. A predictable, accessible funding environment is the foundation on which private investment can be crowded in, not out.Second, IP ownership in co-funded research must be resolved. The current ambiguity where Indian researchers generate knowledge in Indian institutions with Indian public funding, but where the resulting IP is effectively unclaimed or transferred outward is an inefficiency and a structural haemorrhage of national capability. Clear, fair frameworks for IP ownership and commercialisation will determine whether the next generation of Indian researchers builds for India or for others.Third, private sector commitment must rise substantially and verifiably. The gap between Indian enterprise R&D spending and global benchmarks is not a function of incapacity. It reflects an incentive architecture that has not yet made indigenous innovation the path of least resistance. Tax structures, procurement preferences, and industry-academia linkages must all be calibrated to make this the rational choice, not the patriotic one.Fourth, Anusandhan National Research Foundation (ANRF), India’s body to promote research and development should focus on transforming scientific and technological breakthroughs into marketable products via dedicated multi-disciplinary teams, mile-stone based project funding and private-public -academia-industry partnership instead of research publications.India's overperformance on innovation inputs is a proof of latent capability. The work ahead is not to generate more ideas it is to build the institutional architecture that ensures those ideas become assets India owns, products India sells, and industries India leads.(The views expressed are personal)This article is authored by Alkesh Kumar Sharma, member, PESB and former secretary, Meity.