17 Jun Tax Exemption for State Universities: Boosting R&D
NITI Aayog has proposed tax exemptions for state universities and institutes to enhance their research and development (R&D) efforts. The aim is to alleviate financial burdens imposed by GST and income tax, allowing these institutions to allocate resources more effectively towards teaching, research, and infrastructure.
The proposal underscores current challenges in India’s R&D ecosystem, including insufficient incentives for faculty, predominant R&D focus in central universities over private and state counterparts, and financial constraints. To mitigate revenue losses from tax exemptions, NITI Aayog suggests establishing special funds or grants. It also recommends introducing incentives for state universities that excel in R&D, potentially through additional grants or recognition.
The think tank highlights disparities in intellectual property rights between state and central universities, with the latter showing superior performance, while private universities lead in patents and technology commercialization. Despite annual increases in R&D spending, India’s Gross Domestic Expenditure on R&D (GERD) remains modest at 0.7% of GDP. The government plays a pivotal role in funding R&D, prompting calls for increased private sector investment.
To bolster R&D further, NITI Aayog proposes measures to attract and retain talent, such as streamlining research processes, offering competitive salaries, and easing restrictions for foreign scientists in India. These initiatives aim to elevate India’s R&D landscape and achieve targeted GERD goals.
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