Taxing ‘Frivolous’ Industries Will Not Fund India’s Science, Pg6

Key Highlights:

• A common proposal to increase funding for Indian science involves taxing "frivolous" industries such as cinema, sports, and tourism.
• The article argues that this "tax-this-to-fund-that" approach is flawed, as these industries generate significant economic cascade effects and employment.
• It highlights inefficiencies in government science funding, including rigid earmarking of funds and cumbersome procurement processes.
• Archaic regulations like the University Grants Commission Act (1956) for recruitment and high import duties on scientific equipment are identified as barriers.
• The piece advocates for liberalizing private and foreign investment in science and reforming existing government expenditure rules to foster scientific growth.

Detailed Insights:

• The proposition to tax profitable ventures like the Indian Premier League (IPL) is criticized for overlooking their broader economic contributions and job creation.
• The article emphasizes that wealth creation is not a zero-sum game, meaning the success of one industry does not inherently detract from another.
• Government funding for science is often rigidly compartmentalized, leading to the purchase of "allowed" items rather than genuinely "needed" equipment.
• Procurement delays and the mandatory use of platforms like Government e-Marketplace (GeM) often force scientists to acquire substandard domestic equipment.
• Strict compliance requirements under Corporate Social Responsibility (CSR) rules and tedious Foreign Contribution (Regulation) Act (FCRA) procedures deter private and foreign investment in research.
• High Goods and Services Tax (GST) and steep import duties on scientific equipment increase research costs and slow down knowledge creation.
• The article suggests that reducing dependence on government funding and liberalizing capital flow into academia are crucial for India's scientific advancement.

Key Concepts Involved:

• Zero-sum game: A situation where one participant's gain is exactly balanced by the losses of other participants.
• Economic cascade effects: The ripple effects throughout an economy where an initial economic activity generates further economic activities.
• Licence Raj: A term referring to the elaborate system of licenses, regulations, and accompanying bureaucracy that hampered economic growth in India.
• Import Substitution: A trade and economic policy that advocates replacing foreign imports with domestic production.