The World's Top Innovators: The BRICS' Potential

In 2001 Goldman Sachs caused a stir by predicting that by mid-century China would be the world's largest economy, and that India, Brazil and Russia would also figure among the global top 10. What is the story of the Brics, as Goldman Sachs called them, as told by the innovation tables?

by Soumitra Dutta and Simon Caulkin, World Business
Last Updated: 23 Jul 2013

The first point is that they are not yet among the global innovation leaders overall, and although India and China (23 and 29 respectively) run neck-and-neck at the top of the second quartile, there is a clear difference between the emerging Asian powerhouses and Brazil (40) and Russia (54).

Perhaps predictably, all of them fare better on the output than input measures. For example, India ranks an excellent 7th on outputs and China 9th, both hoisted by good competitiveness and respectable knowledge scores.

However, the Brics possess huge innovative potential; for example, China and India turn out thousands of engineers and science graduates a year. But to get the full benefit of this human capacity, they must tackle several challenges. Both suffer from significant regulatory and cost barriers in many areas of capital and labour markets - often market entry to foreign firms is controlled, hindering competition.

Although absolute numbers of graduates are high, there is inadequate focus on state-of-the-art R&D - in India, the ratio of professionals employed in research to the total labour force is 157 per million compared with 4,099 in the US, 2,800 in South Korea and 589 in China.

Both countries are held back by poor infrastructure, scoring lower on this pillar than middle-ranking Brazil and even Russia. India is in the global top 10 for business and markets, and a respectable 24th in institutions and policies, but China comes in at a dismal 81st for the latter pillar.

Russia and Brazil also have solid human potential. Although Brazil enjoys better business and markets than Russia and China, all three are handicapped in innovation terms by their awful institutions and policies. While some progress has been made, corruption is endemic and intellectual property and legal systems weak. If and when these issues are addressed, the Brics will be a formidable part of the global innovation network.

Rank Country Score
23 India 3.57
29 China 3.21
40 Brazil 2.84
54 Russia 2.60

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