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Ambar Singh Roy

Technology Business Incubators or TBIs present a technology-oriented variant of business incubation. They help start-ups hatch right and bright and go strong and steady.

TECHNOLOGY Business Incubators (TBIs) have evolved from the convergence of two global movements, namely the recognition that small and medium enterprises (SMEs) are the instruments of economic growth and the accelerated pace of technological change. TBIs are making a significant contribution to the economic development of various nations and the era of TBIs has now arrived in India as well.

The TBI model of facilitating the growth of knowledge-based enterprises has much scope in India, thanks to the scientific and technological base, both in terms of infrastructure and manpower. In India, however, TBIs are associated with and are aided and supported by centres of educational/technological excellence. The prominent industry segments where TBIs can play a major role are information technology, pharmaceuticals, biotechnology, instrumentation, sensor-based electronics, embedded systems, bio-medical drugs and agro-biotechnology. The focus on any specific industry segment is in consonance with the core competency of the TBI in question.

Good bet on all counts

According to Dr P.K.B. Menon, Adviser & Member-Secretary of the National Science Technology Entrepreneurship Development Board (NSTEDB), the TBI model greatly facilitates the proliferation of technology-based start-up companies even as it ensures speedy commercialisation of R&D findings. "TBIs nurture hi-tech start-ups and present a technology-oriented variant of business incubation. Besides, they improve the prospects of survival of start-up companies.''

Dr Menon says TBI projects are typically implemented in one year. They generate revenue from the first year itself and attain self-sufficiency in five years. While profits are shared with the host institution, indirect benefits also accrue to the Government, the R&D community, the corporate sector, the tenant company and society at large.

Says Prof. K.L. Chopra, Advisor to NSTEDB and a former Director of the Indian Institute of Technology, Kharagpur: "The growth of global economies and lifestyles of civilised societies are being increasingly determined by knowledge and innovation created and nurtured by knowledge institutions. The close interaction of such institutions with entrepreneurs, communities and industry has, therefore, to be mandated as a social contract with society.''

Dr Vadim Kotelnikov, Adviser to the United Nation's Asian and Pacific Centre for Transfer of Technology, feels the importance of TBIs must be gauged in the context of the global "shift in emphasis from decaying industrial economies comprising large firms to a knowledge-based entrepreneurial economy driven by innovative technology.''

Dr Kotelnikov says it's "e-ncubate, e-nnovate and e-nvest'' for the present generation of business incubators which are focussed on profit-orientation. "The for-profit incubators are intended to mobilise information and communication technology and provide convergence of support towards creating knowledge-based ventures. Some of these, in turn, can expand rapidly and contribute to economic growth.''

According to Arindam Dutta, Adviser to Science & Technology Entrepreneurship Park, IIT Kharagpur, TBIs enhance national intellectual property, provide opportunities for others, help create wealth and facilitate global competitiveness.

In fact, there are about 3,000 incubators of various kinds the world over, with the US alone accounting for over 800 of them. Germany and Korea have about 300 incubators each, while China houses over a 100 of them.

Vast scope in India

The scope for adopting the TBI model in India to nurture knowledge enterprises is immense, given the fact that the country has over 600 technical institutions and 200 universities. Besides, over four lakh engineering graduates are out every year. Additionally, over 400 national laboratories and 1,300 in-house R&D units in the corporate and university sector provide the critical mass that can make all the difference.

The NSTEDB launched a scheme for TBIs in 2000-2001. Financial assistance is provided for infrastructure creation and recurring expenditure for a period of five years from inception. Under the NSTEDB umbrella, four TBIs have been set up in Noida, Chennai, Hyderabad and Bangalore. These nurture enterprises in areas such as IT, biotechnology, materials and composites. Plans to set up five more TBIs by end-March 2003 have been firmed up.

SIDBI Venture Capital Ltd also has its own scheme for financing incubation centres. The organisation has provided grants for at least two incubation centres — at the Indian Institute of Technology, Kanpur, and the Birla Institute of Technology, Mesra. Grants for other incubation centres are under consideration, too.

ambar_singhroy@rediffmail.com

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