Purdue News

November 9, 2005

India expands global presence in chemical, pharmaceutical industries

WEST LAFAYETTE, Ind. – India is poised to become a major venue for outsourcing in chemical and pharmaceutical manufacturing, says a new report prepared by researchers involved in the first joint conference between Indian and American chemical engineers.

"Up to this point, India's dominant industry has been software," said Doraiswami Ramkrishna, a professor of chemical engineering at Purdue University. "But the idea of this conference was to recognize that India is now expanding into many other areas and that there is a large amount of intellectual talent available in India for research and technology."

Ramkrishna recently completed a report to be submitted to the National Science Foundation about the U.S. India Conference — First Joint Meeting of the American Institute of Chemical Engineers and the Indian Institute of Chemical Engineers, held last December in Bombay.

Ramkrishna was co-chair of the conference, which received support from the NSF and several corporate sponsors from the United States and India.

There is no lack of highly skilled labor in India, where universities are producing thousands of graduates annually with advanced degrees in engineering and the sciences.

"I am told that research and development establishments in India are going to be hiring a substantial number of Ph.D.-level employees in the coming years," Ramkrishna said. "The chemical-engineering strength in India is definitely something to reckon with now, with very good high-quality personnel in academia and industry."

Speakers during the conference covered critical issues in four special sessions focusing on science and technology policy; corporate activity in a global setting; future challenges in chemical engineering education; and collaborative research between U.S. and Indian institutions.

India is on the verge of expanding its capabilities into many outsourced manufacturing areas, including the chemical industry, textiles and pharmaceuticals. The south Asian nation has the second largest number of pharmaceutical manufacturing facilities approved by the U.S. Food and Drug Administration, meaning it is in position to ramp up its pharmaceutical industry, said Kenneth H. Keller, the Charles M. Denny Jr. Professor of Science, Technology and Public Policy and a professor of chemical engineering and materials science at the University of Minnesota.

"India is not yet a major player, but its research and development spending is increasing at a tremendous rate," Keller said. "India is beginning to contribute to the world scientific literature, and it is beginning to account for a significant number of granted patents in the United States.

"What we are seeing are changes indicative of a developing country that's moving quickly to establish a technological base for its economic growth."

Research activity has recently surged in India, where there was roughly a 200 percent growth in published technical papers from 1998-2003, Keller said.

"The United States used to produce more than half of all of the technical papers published worldwide," he said. "Now the number is closer to one-third of all papers. It's not because we are producing fewer papers; it's because others are producing more."

Keller said India's emerging industrial prowess shouldn't be viewed as a threat to the United States but rather as an opportunity.

"I think it's a question of global optimization. There are more smart people working on more problems, which benefits everybody," he said.

India is expanding into chemical and pharmaceutical manufacturing with a cost advantage, said Hari Pujar, chemical engineer and research fellow for Merck Research Laboratories at Merck & Co. Inc. in West Point, Pa.

"I think the key is that during the late 1990s and early 2000s the big area for outsourcing in India has been information technology, and now other areas are taking off, especially pharmaceuticals and biotechnology," Pujar said. "The area of custom organic synthesis, which is vital for developing new drugs, is becoming a major area for outsourcing. Contract biotech drug and vaccine manufacturing also is thought of as a new opportunity because of a shortage of capacity and high cost in other countries."

Whereas the chemical industry is stagnating in the United States and many other nations, India will experience dramatic growth in coming years. Expansion is being seen in many manufacturing areas that depend on the chemical industry for materials.

"For example, India will become one of the largest polymer-consuming countries in the world by the end of this decade," Pujar said. "This will be a major boost for the petrochemical industry. All in all, chemical engineering is a particular growth area for India."

The United States, meanwhile, needs to become more aware of Indian research and innovation.

"Are we being sufficiently cognizant of the fact that there is important work going on there that we could learn from?" Keller asked. "I think we could do a better job.

"There are useful patents. Why aren't we taking advantage of them? Why aren't we licensing that intellectual property?"

On the other hand, India needs to better protect its patents to foster industrial growth.

"The developing world has always argued that patents are a way of protecting American corporations so that nobody can use the corporation's processes or manufacture similar products more cheaply, and therefore people in the developing world are disadvantaged by patents," Keller said. "Well, one of the points I made strongly, and many of the Indian presenters agreed, was that in the long run a failure on the part of India to protect intellectual property rights will mean that corporations aren't going to collaborate with Indian corporations because their intellectual property will just get stolen. Moreover, if India doesn’t cooperate in international regimes protecting intellectual property, its own exported products and processes will not be protected, hurting Indian development.

"It's a two-way street. You protect your own innovations by having government regulations, which ensure that companies are prosecuted for stealing other people's ideas and using their patents without paying for them. The whole system of patent protection is a stimulus for more technological development."

Writer: Emil Venere, (765) 494-4709, venere@purdue.edu

Sources: Doraiswami Ramkrishna, (765) 494-4066, ramkrish@ecn.purdue.edu

Kenneth H. Keller, (612) 626-9547, keller@cems.umn.edu

Hari Pujar, hari_pujar@merck.com

Purdue News Service: (765) 494-2096; purduenews@purdue.edu


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