India scores high on talent but some states vastly outperform others

• India’s human capital has the highest score on the Innovation Index published by NITI Aayog.
• But, it also has the highest disparity of all the indicators with scores of states and UTs within India fluctuating between 8.98 to 74.96.
• There’s also a paradoxical disparity between human capital and the number of people employed in ‘knowledge-intensive’ activities.

India’s Innovation Index ranks the country and its states on five enabling pillars. Of those pillars, human capital has the highest score hitting 32.

Even though this means that India has the ability to provide quality education and research capabilities to its workforce, not all states are doing equally well. In fact, the human capital pillar is also has the most disparity on the index with scores fluctuating from 8.98 to 74.96.


Innovation disparity among states

Southern states like Tamil Nadu, Kerala and Karnataka topped the index while Uttar Pradesh, Jharkhand and Bihar came in last. According to NITI Aayog’s India Innovation Index report, this shows that the lower ranking states are in need of more investment to improve their education system.

It also means that in order for innovation to improve, investment in the education system is a key factor.

The smaller the better


The report’s findings show that the smaller and richer the state, the better it is at producing human capital. Income has a strong correlation because it implies that a state has more resources to devote towards building up its workforce. Size, on the other hand, means that it’s easier to manage administration and focus on smaller regions.

Union territories and city states shine

Chandigarh, Puducherry and Delhi lead when it comes to UTs and city states. In fact, they even outperform the Tamil Nadu — the highest performing state. According to NITI Aayog, this is because these regions have a higher availability of educational institutions and researchers.

Addressing the paradox

Even though India’s ranks high when it comes to human capital, it doesn’t do as well when it comes to knowledge workers — another enabling pillar of the Innovation Index.

This means that even though India is producing a high number of graduates, they’re not being employed in ‘knowledge-intensive’ activities.

The Innovation Index also found that India has a serious lack of research and development (R&D) workers per million,

The disparity indicates one of two things. Either, India’s graduates aren’t employable or the employment opportunities are scarce to begin with. “Further study is required to understand the situation better,” stated the report.

But, India’s Innovation Index findings were run past a committee to figure out how to improve the country’s innovative capacity. When it comes to human capital, they highlighted two main challenges.

One, the education isn’t industry oriented so low employability is an issue. More often than not, industries normally have to take it upon themselves to train new recruits. Second of all, the Indian education system focuses on quantity rather than quality.

The committee recommends more coordination between industry players and education institutions to design a better syllabus. It also recommends improving the quality of education imparted by professors and giving them more time to focus on their own research.

The challenges identified need to addressed a policy level. It also shows for the innovation ecosystem in India holds room for improvement.