Sridhar Vembu, CEO of Zoho, says that India needs business R&D mandates

• ByStartupStory     |    December 27, 2022

Sridhar Vembu, the creator of Zoho Corporation, stated that India needs a corporate mandate on R&D akin to CSR to foster a technology innovation culture that will aid in developing important innovations in this nation.

The Padma Shree award recipient and CEO of India’s first billion-dollar IT company claimed that the nation lacks a culture of in-house R&D and stressed that merely having manufacturing facilities for major international tech firms like Apple will not result in “high-income jobs” for the general populace.

“A corporate mandate to spend one or two percent on R&D is needed for India, like the two percent CSR (corporate social responsibility) mandate. It is a high-potential investment,” Vembu stated in a brief interview with PTI.

The Indian Chamber of Commerce and Swadeshi Research Institute invited him to the city recently to give a talk on “Transforming the Indian Economy.” Although the government has extended CSR to include R&D, there is not yet a specific corporate mandate for research in the nation.

When asked about India’s success in attracting Apple’s investment to manufacture there, Vembu made a comparison to Mexico, where US firms have factories but they don’t add much value to the product. “We (India) need to know what our long-term model is,” he said.

“We need those factories, but we also need the R&D to ‘own the technologies’ because we need high-income jobs to come here (India). Then the income will spread through the economy. Mere factories without intellectual properties will have limited benefits for the economy,” Vembu said.

The biggest plant for manufacturing Apple’s iPhone would be built in Hosur, a town close to Bengaluru, according to Union IT Minister Ashwini Vaishnaw. One factory will employ about 60,000 people.

Vembu emphasized the need to create a culture of research. “Work in R&D has significant multiplier effects. These positions are critical to our community.” Vembu stated that India must concentrate on design, development, and manufacturing for the global market.

He founded his $1 billion product company solely on research conducted by Indians, drawing on rural skills and resources.

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