STRATEGIC ANALYSIS

A Comparison of Defence Sector Innovation Ecosystems in China and India

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  • January 2020
    Volume: 
    44
    Issue: 
    1
    Commentaries

    The defence sector in all major countries has historically been a source of new technologies and innovation. As China and India grow in stature, the strengths of their defence sector ecosystems and the ability to innovate become areas of focus for policymakers. Since defence deals with the security of a nation, all defence ecosystems have some element of government leadership, direction and ownership. Against this must be balanced the need to ensure efficiencies and competitive capabilities, which requires entrepreneurship, private sector companies and the market mechanism. This commentary describes the defence ecosystems of China and India from an innovation perspective and provides a comparative analysis of the potential impact of recent policy initiatives in the two countries. The analysis shows how China has adopted a top-down approach linked to future disinvestment and possible privatization, while India has adopted a more bottom-up model with emphasis on the role of venture capital and incubation of small entrepreneurial companies.

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