India has seen notable progress in its renewable energy capabilities. The Union Budget 2024 also reflects the government’s emphasis on energy security and employment generation in clean energy sectors. But, the country’s energy companies do not fare better than their global counterparts on R&D intensity. They also fall behind on the proportion of employees with PhD degree, and patents per billion dollars revenue, according to a recent report by Foundation for Advancing Science and Technology (FAST) India.
Global renewable energy firms surpassed domestic firms on R&D intensity and proportion of PhD employees by 2.5x and 4.0x respectively. Despite Coal India ranking first in R&D intensity (3.8 per cent), global energy sector firms outperformed Indian firms in this parameter.
Two other Indian energy firms — Reliance Industries Ltd (RIL) and ONGC — rank fourth and fifth for R&D intensity across all firms studied by the report.
Proportion of PhD qualified employees
Indian firms also do not perform well for the proportion of PhD qualified employees. Global firms lead Indian firms in the percentage of PhD employees on their rolls. While Bharat Petroleum Corporation Limited (BPCL) and ONGC have the highest proportion of PhD employees among Indian firms, many firms have negligible to no PhD employees. Coal India, which ranks the best in R&D intensity, has only 0.02 per cent employees with PhD degree.
Fig1: India vs. Global Energy Sector Firms Comparison on R&D intensity and proportion of PhD employees
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Indian firms excel in publications
In terms of patents per billion dollar revenue, global firms produced 9.9x the number of patents per billion dollar revenue. Indian energy firms, however, performed better in terms of publications per billion dollar revenue by 1.1x, as compared to patents by revenue indicators.
Coal India holds the top position in publications per billion dollar revenue, producing over 3.4 times more publications than the second-ranked firm, Tata Power. This highlights Coal India’s strong emphasis on research and dissemination among all firms studied. NHPC Limited ranks fourth on this parameter. Indian firms perform well in publications per revenue parameter, competing well with global firms.
Global firms lead in patents
Global energy firms occupy the top six positions in patents per billion dollar revenue parameter, emphasising innovation and intellectual property strongly. Global firms generally have a higher number of patents per revenue compared to Indian firms.
The performance of firms varied across the three parameters. While RIL performed well for patents by revenue as compared to other Indian firms, it failed to rank amongst the top five global and Indian firms overall, revealed the FAST India report. The absolute value of R&D expenditure of RIL was $361.6 million for FY23, the highest among all the Indian firms studied, after Coal India. But RIL has only 0.06 per cent PhD qualified employees, despite ranking well in R&D intensity. This can, however, be attributed to a large workforce employed by RIL across various levels.
Fig2: India vs. Global Energy Sector Firms Comparison on publications per USD billion revenue and patents per USD billion revenue
India’s rising energy consumption
India accounts for 6 per cent of global primary energy consumption and is ranked as the world’s third-largest primary energy consumer, according to India Energy Outlook 2021, published by the International Energy Agency (IEA). It ranked fourth globally for total renewable power capacity with the highest year-on-year growth in renewable energy additions of 9.83 per cent in 2022.