India’s position in the global innovation landscape has undergone a sharp transformation over the last six years, according to the Economic Survey 2025-26 tabled in Parliament on January 29. The Survey notes that India’s ranking in the Global Innovation Index improved from 66th place in 2019 to 38th in 2025, placing the country at the top among lower-middle-income economies and leading the Central and Southern Asia region.
The Survey underlines that this rise reflects a broad-based shift rather than a narrow sectoral improvement. India’s innovation ecosystem, once concentrated largely in select information technology corridors, has expanded across sectors such as biotechnology, artificial intelligence, clean energy, and advanced manufacturing.
A key indicator of this transformation is the growing global recognition of Indian innovation hubs. As per data cited from the World Intellectual Property Organisation (WIPO), three Indian cities, Bengaluru, Delhi, and Mumbai now feature among the world’s top 50 innovation-intensive clusters. This marks a notable departure from the past, when India’s presence in global innovation rankings was limited and geographically concentrated.
The Survey presents intellectual property creation as one of the strongest quantitative markers of India’s innovation progress. Between FY20 and FY25, patent applications in the country nearly doubled. During the same period, trademark registrations increased by 1.5 times, while design registrations rose sharply by 2.5 times.
These gains have translated into higher global rankings in intellectual property filings. India now ranks fourth globally in trademark filings, sixth in patents, and seventh in industrial design registrations. The Survey highlights the surge in design registrations as particularly significant, as it points to a shift from basic manufacturing toward product differentiation, branding, and value addition, key characteristics of economies moving up the global value chain.
The Economic Survey identifies the expansion of India’s startup ecosystem as a central driver behind these trends. The number of startups recognised by the Department for Promotion of Industry and Internal Trade (DPIIT) has increased dramatically, from around 500 in 2016 to more than two lakh by 2025. This growth has been supported by policy instruments such as the Fund of Funds for Startups and the Credit Guarantee Scheme, which have improved access to capital and reduced early-stage risks.
Alongside startups, public research institutions have also played a role in strengthening the innovation pipeline. The Survey notes that organisations such as the Council of Scientific and Industrial Research (CSIR) have increasingly shifted focus from purely laboratory-based research toward technologies with deployable and commercial applications, helping bridge the gap between research and industry needs.
Despite these advances, the Survey flags persistent structural challenges. India’s gross expenditure on research and development remains at 0.64 per cent of GDP, a level that is substantially lower than the 2 to 5 per cent range observed in leading innovation-driven economies. This constraint, the Survey suggests, limits the scale and depth of innovation, particularly in high-technology and capital-intensive sectors.
To address this gap, the Economic Survey points to the recently announced Research, Development and Innovation Fund with an allocation of Rs 1 lakh crore. The fund is expected to strengthen India’s innovation ecosystem by supporting advanced research, technology development, and commercialisation efforts.
Overall, the Economic Survey 2025-26 presents India’s rise in the Global Innovation Index as the outcome of sustained policy support, expanding entrepreneurial activity, and increasing intellectual property generation, while also underscoring the need for higher R&D investment to sustain this momentum.
