Asia-Pacific National Innovation Systems
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Asia-Pacific Forum - Promotion of NIS


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Summary Of Country Presentations


The need for faster technological development is being increasingly felt by a developing country like Bangladesh, where the public sector plays a dominant role in economic development. Due to scarcity of resources and lack of skill, technological development has suffered. Here, research in science and technology is mainly carried out in universities and in institutions financed by the public sector. The Ministry of Science and ICT is currently providing 187.5 millions BDT, equivalent to U$3 million every year, from its revenue budget for research and development in S&T, especially in the field of bio-technology and information technology, to promote R&D in the country. The ministry also has a fellowship programme for science students and researchers. It has introduced an internship programme in the field of ICT to encourage innovation software development by young ICT professionals. At present, Bangladesh is exporting software to a number of developed countries including USA, UK, Australia, Canada, Denmark, KSA, Japan, Sweden, UAE, Germany, Italy, Netherlands, Norway, Switzerland, France, Nepal etc. Some important users of Bangladeshi software are Nokia, Japan Airlines, World Bank, HP, US Postal Department, US Department of Agriculture, etc.


The 16th National Congress of the CPC made an important strategic decision to compile the country's medium and long-term S&T development planning since it is a key measure for fulfilling the scientific development perspective, and ensuring the realization of the overall objective of building up society in an all-round way. It was also an important strategic decision to enhance the country's core competitiveness in an all-round way and establish an innovative country. It met the rule of S&T development, and was an important decision to welcome the challenges of new S&T reforms in the world. It was a model for the CPC and the state governments to make scientific and democratic decisions by integrating the wisdom of S&T personnel and the whole society. The medium and long-term S&T development plan will be the guiding document for the development of China's S&T sector.


The Government of India has recognized the power of innovation, and launched a new initiative during the year 2000 to enable Indian industry to attain a global leadership position in a few selected niche areas by leveraging innovation-centric scientific and technological developments in different disciplines. It started the 'National Innovation Foundation' (NIF) in March, 2000 by providing a corpus fund of Rs. 200 million. The national expenditure on research and development (R&D) has increased from Rs.89,136.1 million in 1996-97 to Rs.12,9015.4 million in 1998-99. R&D expenditure as a percentage of GNP in 1998-99 was 0.81%. By applying the appropriate rates of growth for different sectors, national R&D expenditure was estimated to be Rs.176,602.1 million in 2000-2001. The total investment on R&D by the industrial sector has increased from Rs.4,505.6 million in 1985-86 to Rs.34,414.2 million in 1998-99. Data for 1999-2000 and 2000-01 has been estimated by applying the rate of growth for the period 1994-95 to 1998-99, and it was estimated at Rs.41,091.1 million and Rs.49,104.5 million respectively. The Small Industries Development Bank of India launched a new venture capital fund (SME Growth Fund) dedicated to the SME sector in the year 2004, with a large corpus of Rs.5000 million. The life of the Fund is eight years, and its objective is to meet the long-term risk capital requirement of innovative and technology oriented units in this sector. The Government has also adopted several measures towards promoting industrial research in industry itself, besides making attempts to establish workable linkages between national laboratories, educational institutions and industry.


In the absence of significant direct financial provision for industrial R&D, the government has introduced some incentive schemes. These include tax incentives, soft loans for venture capital for technology based SME's, and joint cooperative R&D projects between the government and the private sectors. Along with such measures, the government proposed a legal draft (under deliberation) that demanded the private sectors compulsorily devote funds for R&D. Such measures are aimed at increasing the role of the private sector in funding. The target was that the share of the private sector should eventually reach 80% of the national R&D budget. Upgrading of science and technology, human resources and infrastructure that deteriorated during the recession, needed to be carefully addressed. Around 70% of the research and development budget is spent in the government sector, 25% in the industry and 5% is spent in universities.

Islamic Republic of Iran

The Islamic Republic of Iran, a middle-income developing country with a real GDP of about 2000 $ (7000 PPP) in 2004, is still largely a natural resource-based economy. The uniqueness of the National Innovation System in the Islamic Republic of Iran is that almost all of the research institutes, universities and an overwhelming majority of the enterprises are under government ownership. Although the Islamic Republic of Iran is endowed with both natural resources and well educated scientists and engineers, this potential advantage has not yet been capitalized on in achieving the transition from an oil-driven to an innovation-driven growth due to the weaknesses in the National Innovation System. The Government of the Islamic Republic of Iran should give a "big push" to the development of small and medium enterprises (SME's).

Republic of Korea

This is an era of severe global competition based on scientific and technological achievements. Technology innovation is an enabling growth engine. It is conducive to innovation in all sectors of society as well as economic growth, and thus brings about systemic changes at the national level. The science and technology system of the country has recently been restructured. The priorities are to secure quality S&T manpower, the backbone of technology innovation; to strengthen the innovative capability of SMEs that are the engine of innovation-driven economic growth; and to contribute to socioeconomic development through facilitating industrialization of R&D and innovation results. These and other steps are expected to establish private-public partnership and enhance strategic resource distribution & utilization, and establish an innovation-driven economy that is equivalent to the level of OECD countries.


The Government of Nepal envisions building up the country as a developed, dynamic and prosperous state by raising the living standards of the people through the appropriate development and use of science and technology. The Ministry of Science and Technology was set up in 1996 with the aim of carrying out research and development in appropriate sectors of science and technology that contribute to national development, poverty alleviation and increase in the productivity of the economic sectors. The National Science and Technology Council will constitute technical committees to carry out the functions of the Council. It will also coordinate and monitor functions such as research and development and human resource development, operated within the country, by keeping contact with the foreign institutions in the field of science and technology. The Government has signed agreements with India, Italy and the Asian Institute of Technology, Bangkok in the field of Information Technology, Bio-technology and Alternative Energy. DANIDA and the European Union are the major donors for the development of Alternative Energy (Solar, Micro and Hydro energy).


The vision for the future is the development of a knowledge based economy and industrialization for socio-economic uplifting of the country. The National Innovation System (NIS) envisages linkages between industry, academia and research and development. For the National Innovation System to succeed, research and development organizations will be restructured. The committee constituted for the restructuring has prepared a draft ordinance regarding the steps that need to be taken. As part of the strategy for the future, new initiatives for strengthening NIS have been planned. The initiatives in the field of science and technology are to increase allocation for the science and technology sector, development of human resources, infrastructure strengthening, restructuring of research and development organizations, technology development and industrialization, and development of information technology.


The President's address in 2001 guided the formulation of the National Science and Technology Plan (NSTP) 2002-2020. The NSTP was a result of more than a year of extensive nationwide consultation with business and industry leaders, S&T experts, government departments and agencies, and other stakeholders. The Plan provides the policy framework and directions for science and technology in the Philippines. By 2010, the Philippines shall have carved niches and become a worldclass knowledge provider and user in selected S&T areas; developed a vibrant Filipino S&T culture; and by 2020, the Philippines would have developed a wide range of globally competitive products and services which have high technology content. As of 31 December 2004, the Department of Science & Technology core funding for SET-UP implementation covering the period 2001-2004 amounted to P 125.16 million. Of this amount, P 79.04 million (63 %) went to direct investments to 206 SMEs for technology upgrading and/or acquisition. In fact, of the P 30.11 million investments made from 2001 to 2004, P 17.24 million investment directly benefitted SMEs in general. Over the past years, DOST's budget has shown a decreasing trend. In fact in real terms, its current budget is much less than in 1994 as in 1994, the dollar to peso exchange rate was less than 30 pesos, and today it is almost double. The budget went up to 3.8 billion pesos in 1998, essentially to provide the required budget cover for the World Bank - OECF funded Engineering and Science Education Project (ESEP). As DOST's budget continues to go down, the Philippines may have to rely less and less on government funds for technology development.

Sri Lanka

The National Innovation System (NIS) is a new concept for Sri Lanka. The policy makers have not addressed this issue so far, and as such, there is no Strategic Innovation Policy for the country. Some of the related works are in the form of Research and Development, and encouragement of innovation by school children and other individuals. Most of the scientific research in the country was started by the British during their occupation of the country and were restricted to the plantation and agriculture industry. Recent additions after independence are the Ceylon Institute of Scientific and Industrial Research (now known as Industrial Technology Institute), National Engineering Research and Development Centre of Sri Lanka, Sugar Research Institute and the Post Harvest Research Institute. The Ministry of Finance is planning to set up a SME Bank, which will consider granting soft loans to those who have promising innovative ideas, but lack the collateral required by the traditional banks. The Ministry of Science and Technology is setting up Vidatha Centres in each Divisional Secretariat Division, numbering three hundred and sixty throughout the country. Each of these Centres will be manned by a Science graduate and will showcase some of the research findings of the R&D institutes. It will also have a computerized database of all possible industrial ventures. This Centre will act as the broker between the entrepreneur and the R&D institute that would help him to develop his technology. They have already set up six such Centres, and are in the process of setting up several more in the near future.


Innovation and the innovation system are regarded as one of the most important factors in a knowledge-based economy. It is therefore essential not only for developed, but also for developing countries like Thailand to foster innovation in their countries. Thailand's national innovation system is in transition. It is gradually changing from a 'weak and fragmented' system, to a 'stronger and more synergistic' one. The transformation is slow and difficult. It is not easy to increase the capabilities of actors in the National Innovation System and establish/strengthen their linkages. Above all, it is difficult to change the mindsets and routines of these actors. The rates and depth of transformation also appear to be varied from one actor to another. While emerging signs of change in the government and in a significant numbers of private firms are quite noticeable, the rest, especially universities, seem to adjust more slowly. A longer timeframe is needed for serious examination of the extent of these changes and whether the change is large enough to make significant impact on Thailand's innovation capabilities and competitiveness.

Viet Nam

Viet Nam needs to transform its National Innovation System because it is undergoing double rapid transitions - from a centrally planned to a market economy and regional integration. This will have implications on the relationship between R&D institutions and enterprises, including private ones. NIS provides the theoretical framework to understand the dynamic interaction between actors involved in innovation, including public R&D institutions and enterprises. The approach to innovation and competence building involves many things, including looking for missing links such as weak user competence as well as a weak knowledge base on the supply side. It also involves changing the mindset of the concerned stakeholders/actors of the NIS, focusing more on dynamic interaction between actors and the key role of enterprises in contributing to the capability of the innovation system. Our recommendations to APCTT include setting up a regional network of administrators and managers on NIS, and exploring the possibility of applying the NIS approach to govern innovation and strengthen the competitiveness of member countries.