Defence research stays underfunded
MAJOR DETERRENT. With establishment costs eating into research funding, where does that leave innovation of national importance? By M Ramesh
Data from the Ministry of Defence suggests that India’s spend on defence research has grown far less than headline numbers indicate. The Defence Research and Development Organisation (DRDO) spent ₹13,258 crore on R&D in 2014-15. By 2024-25, this had risen 87 per cent to ₹24,793 crore, which, at first glance, appears to signal a steady expansion of research effort. But this is in nominal terms. Adjusted for economy-wide inflation, using the GDP deflator, the real annual growth is only 1.5–2 per cent.
The picture becomes starker when looking at how this money is spent. The portion devoted to specific projects and programmes — missile systems, aircraft engines, radars and the like — has moved from ₹3,770 crore in 2014–15 to about ₹5,900 crore in 2025–26. After adjusting for inflation, this implies virtually no growth in real terms over the period. This also suggests a shift in composition: While overall spending has increased, the share going to R&D projects has not kept pace. A growing proportion of the budget appears to be absorbed by establishment costs rather than programme funding.
Budget trends reinforce this concern. In 2025–26, the allocation for defence R&D was raised by 12 per cent, from ₹23,855 crore to ₹26,817 crore. Yet the revised estimate came in slightly lower, at ₹26,747 crore, indicating that even the allocated funds were not fully utilised. The increase over the previous year’s revised estimate was about 8 per cent. Spending on projects and programmes grew only about 9 per cent in 2024–25. The pattern raises a broader question: Is higher allocation translating into more research?
The Budget for 2026-27 provides ₹29,100 crore for DRDO, a 10 per cent increase year-on-year. Whether this results in a meaningful increase in programme spending — or is again absorbed by costs — remains to be seen.
A WIDER PATTERN
This scenario is not unique to defence research spending. Across six key science departments — science and technology, biotechnology, scientific and industrial research, space, atomic energy, and Earth sciences — government R&D spending rose from ₹28,014 crore in 2020–21 to ₹39,057 crore in 2024–25. That translates to a nominal annual growth rate of about 8.8 per cent. Adjusted for inflation, however, the real growth rate is only 2–3 per cent a year.
The pattern is consistent: headline increases mask modest real expansion. India’s gross expenditure on research and development (GERD) has remained stuck at 0.6–0.7 per cent of the GDP for over a decade. This is not merely because the GDP has grown rapidly, but also because R&D spending has struggled to grow meaningfully in real terms.
EFFICIENCY FACTOR
It can be argued that limited resources have been used efficiently. India’s rank in the Global Innovation Index has improved significantly over the past decade, and government-backed schemes in areas such as biotechnology have helped start-ups raise follow-on funding and generate intellectual property.
But these are, at best, partial indicators. Improvements in innovation rankings reflect a broad set of factors, and start-up success in specific sectors is not a fill-in for sustained investment in core research capabilities. The more fundamental question remains unanswered: What might outcomes look like if real R&D spending grew faster?
For a country seeking technological self-reliance, particularly in sectors such as defence, flat real spending and stagnant programme outlays are not neutral outcomes. They imply a slower build-up of capabilities, regardless of improvements in efficiency at the margins. India may indeed be getting more value out of each rupee, but over the past decade, it has not been putting significantly more real resources into research.
Group of Ministers, Secys to be formed to deal with critical needs of citizens
Our Bureau New Delhi
Prime Minister Narendra Modi on Sunday directed the formation of a group of ministers and secretaries to work dedicatedly in a whole of government approach. According to a statement issued following a Cabinet Committee of Security meeting chaired by Modi, the ongoing conflict in West Asia is expected to have significant short, medium, and long-term impacts on the global economy. The meeting, attended by 13 Ministers including the Home, Defence, and Finance Ministers, focused on assessing these effects on India and discussing both immediate and long-term countermeasures.
The committee conducted a detailed assessment regarding the availability of critical needs for the common man, specifically highlighting food, energy, and fuel security. The impact on farmers and their requirements for fertilizer for the kharif season was a key point of discussion. The government stated that measures taken over the last few years to maintain adequate stocks would ensure timely availability, though alternate sources of fertilizers were also discussed to secure future supply.
IMPORT SOURCES
The meeting further deliberated on diversifying sources of imports necessary for the chemicals, pharmaceuticals, petrochemicals, and other industrial sectors. Additionally, the government plans to develop new export destinations to promote Indian goods in the near future.
Modi instructed that all arms of the government must work in coordination to ensure minimal inconvenience to citizens. He specifically called for proper coordination with State governments to prevent black-marketing and hoarding of important commodities.
Demographic fixation
AP set to repeat failed pronatalist projects in China, Japan
The draft Population Management Policy recently unveiled by Andhra Pradesh Chief Minister N Chandrababu Naidu marks a continuation of the State’s long record of intrusive demographic engineering. The new policy attempts to raise fertility from a total fertility rate of around 1.5 towards replacement levels by offering financial incentives for a third child, extended maternity benefits, subsidized fertility treatments, and childcare support.
Among the southern States, AP has long stood apart for adopting a rigid, neo-Malthusian approach to population control, often at the expense of women’s reproductive autonomy. Previous measures included coercive disincentives, such as barring couples with more than two children from contesting panchayat elections, effectively linking civic participation to reproductive behavior. By focusing narrowly on fertility reduction, other critical dimensions of women’s health have deteriorated; the State now records one of the highest hysterectomy prevalence rates in the country at 8.7 per cent (nearly three times the national average) and a caesarean delivery rate of 42.4 per cent, double the national average. Early marriage also persists, with nearly 29 per cent of women aged 20-24 married before 18.
These statistics suggest systemic distortions where women's bodies become sites of policy excess. International experience offers little comfort, as countries like South Korea, Japan, and China have deployed extensive incentives to boost fertility with limited or no success. Lessons from these nations show that financial incentives may alter the timing of births but rarely change the total number of children families choose to have, as those decisions are shaped by factors like education, housing costs, career pressures, and work-life balance.
AP’s policy raises deeper concerns about rights. Having once imposed limits, the State now encourages larger families without addressing the structural inequities that constrain women's choices. If demographic anxieties regarding labor shortages are driving this shift, less intrusive solutions exist, such as inter-State migration from more populous states like Uttar Pradesh and Bihar. The real challenge is not an absence of people, but how effectively they are educated, employed, and able to move toward existing opportunities.
Betting big on India
The author explains factors that favour India’s rise
BOOK REVIEW. Sudhirendar Sharma Title: Era of India Author: Minhaz Merchant Publisher: Penguin Vintage Price: ₹999
The India growth story is fascinating. During the middle of the Mughal regime in the 1700s, India accounted for 24 per cent of global GDP. In the next 190 years of brutal British colonialism, it had become an impoverished economy accounting for just 3 per cent of global GDP. For half a century after gaining Independence in 1947, India had too small an economy worth taking note of. However, after several years of steady GDP growth since, it overtook Britain and is on track to overtake Japan and Germany as the world’s third-largest economy by 2030.
Using empirical data and research evidence, Minhaz Merchant argues that there won’t be any European country among the world’s three largest economies. The US believes that as India is on economic ascent, it will be the third economy alongside China to drive global growth. Much will, however, depend on how towards the middle of this century, India upgrades itself with digital technologies and artificial intelligence to lead the world. It is expected that by year 2030, an estimated 70 per cent of Fortune 500 companies will have their capability centres located in India. Its technological infrastructure and expanding consumer market will provide a perfect ecosystem for these companies, and through them for India, to grow.
It isn’t as linear as it may seem. The ongoing trade and technology war between the US and China is recasting global alliances. In such a situation, will India act as a balancing pivot between the two warring factions? At this crucial time when the US is pushing an ‘America First’ policy for seeking revival of its hegemony and China is rising as both an economic and military power, not much can be expected from a third party. The geopolitics of global change is turbulent, with the US playing a vital part in its strategic calculations.
Era of India provides an immensely readable perspective on the social, religious, political and economic history of the world. It traces the rise and fall of civilizations from antiquity to the present. History has been complicated as the weapons of war allowed for invasion and colonisation. Much has changed since then; the stockpile of weapons are used instead to influence and enforce change. The book goes a step further to assess the shift in power, triggered by the decline of the West and the rise of the rest. It is an engaging assessment of shifting global power.
GLOBAL POWER TRIAD
History will come full circle, argues Merchant, and applies growth data to prove that three countries — the US, China and India — will exert centripetal force in world affairs in 2050. However, despite economic and military superiority, the three may not be without their own weaknesses and vulnerability. Counting India in this global power triad will favour the US. With India being a major consumer of a variety of products, the US will explore the markets by enforcing a favourable tariff regime to dump its products. Incidentally, India may not have any choice.
As the title suggests, Era of India narrates all that favours the rise of India. But the questions worth asking are: Where does India stand in this emerging world order? How can China’s role in reshaping the world be ascertained? The homogeneity of Chinese society should be an advantage in taking decisions, whereas the noisy, multicultural societies in the US and India may act as deterrents. Understanding China is critical, strategically. It has not only lifted more people out of poverty faster, but is also the only economic power that has moved closer to the size of the US economy. How India leverages its soft power will determine its status amongst the triad. Merchant leaves it for the reader to take a call.
The reviewer is a writer, researcher and academic.
No exam is too hard for AI?
STUDIOUS MACHINES By N Nagaraj
Someone, at some point, perhaps as a joke, decided to call it “Humanity’s last exam”, or HLE. By the time it was published in Nature in January, its designers had already announced a replacement. The replacement is updated continuously; it has to be.
HLE is a benchmark of 2,500 questions assembled by nearly 1,000 experts from 500 institutions across 50 countries, introduced by researchers at the Center for AI Safety and Scale AI. At launch, the best AI models scored under 10 per cent. The live leaderboard now shows 38.3 per cent; the trajectory, more than the absolute score, is the point.
The benchmark was designed in response to a failure in existing tools for measuring AI capability. Frontier models had already exceeded 90 per cent accuracy on MMLU (massive multitask language understanding), which was once considered a serious challenge. When all systems can clear a test, the instrument no longer reveals the differences between them or predicts where they may be in a year.
HLE’s design logic was deliberately adversarial. Questions were submitted by experts across more than a hundred disciplines. Before entering the dataset, each question had to defeat all current frontier models and pass two rounds of expert review. The result was a set of questions that, by construction, no existing AI could reliably answer.
EVALUATION RESULTS
The results confirmed the difficulty. At launch, GPT-4o scored 2.7 per cent, Claude 3.5 per cent, and Sonnet 4.1 per cent. However, scores have climbed rapidly; the live leaderboard now shows Gemini 3 Pro at 38.3 per cent, while Gemini 2.5 Pro reached 21.6 per cent.
Calibration errors across models ranged from 50 per cent to 89 per cent. Calibration measures whether a model’s stated confidence matches its actual accuracy. On HLE, models routinely expressed high confidence while being wrong. This is not a quirk of one system but holds across architectures, suggesting a structural feature of current AI design.
Accuracy improved with more reasoning compute, but only to a point. Beyond roughly 16,000 output tokens, performance declined. The paper also reports an expert disagreement rate of 15.4 per cent, rising to 18 per cent in biology, chemistry, and health. Nearly one in six questions could not be answered consistently even by specialists, making the benchmark harder than any existing AI can reliably handle and harder for any single human expert.
The authors clarify that high performance on HLE would not constitute evidence of artificial general intelligence (AGI). Instead, it would demonstrate expert-level performance on close-ended academic questions.
DYNAMIC TESTING
While MMLU took years to saturate, HLE is showing pressure within months. The designers acknowledge this by announcing HLE-Rolling, a dynamically updated version intended to stay ahead of the models. Once a benchmark is published, it becomes a target for developers, and the instrument and the thing it measures cease to be independent. The inability to build a stable yardstick suggests that capability is moving faster than the ability to define what is being measured.
BUSINESS CONSEQUENCES
For businesses, this has significant consequences:
- Unstable Claims: Procurement decisions are often made on capability claims built on benchmark performance; if benchmarks are unstable, so are those claims.
- Confident Wrongness: A model that cannot signal its own uncertainty is unsuitable for contexts where errors compound, such as credit assessment, medical triage, and document-intensive work. Confident wrongness is operationally worse than uncertain wrongness because it removes the incentive for a human check.
- Short Shelf-life: The pace of improvement means current understandings of AI capability have a short shelf-life. Regulatory and planning assumptions require revision cycles that most institutions are not designed to support.
The scores are rising so fast that it may not be possible to decide, in any meaningful way, which model is leading. At the margins of a high-difficulty benchmark, the difference between the best and the second-best is often just statistical noise.
Kochi to repeat water metro feat in Mumbai
WINNING IDEA. By V Sajeev Kumar
In a landmark step towards redefining urban mobility in India, Kochi Metro Rail Limited (KMRL) has submitted a detailed project report (DPR) for developing a modern passenger water transport (PWT) system across the Mumbai Metropolitan Region, in collaboration with the Maharashtra Maritime Board (MMB). Building on the success of the Kochi Water Metro, the proposed initiative aims to leverage Mumbai’s extensive coastline and waterways to create an integrated, efficient and environmentally sustainable transport network tailored to the region’s unique geography.
The proposed PWT system is envisioned as a low-emission, eco-friendly alternative that will enhance regional connectivity, reduce congestion on existing road and rail corridors, and support economic growth and tourism. The DPR outlines a comprehensive approach for developing both new and existing routes, including the construction of modern terminals and upgradation of existing jetties.
The proposed network includes 11 new routes supported by 24 terminals, which will be integrated with 25 existing terminals, including six common terminals serving both systems. The total route length would increase to over 215 km from the existing 128 km. The project envisages a fleet of 148 boats for the proposed routes and 49 boats for the existing network, alongside six emergency response vessels. The estimated cost of the project is ₹6,067 crore.
The routes would connect key urban centres and growth corridors across the Mumbai Metropolitan Region, including Vasai and Mira Bhayander, Kalyan-Dombivli and Thane, Airoli, Vashi and the Navi Mumbai International Airport, as well as prominent coastal and business hubs such as the Gateway of India, Bandra, Worli and Nariman Point. These corridors are expected to significantly improve multimodal integration and last-mile connectivity, offering commuters a faster and more comfortable alternative to conventional modes of transport. The project also focuses on the development of new terminals and the modernisation of existing infrastructure, ensuring seamless integration with other modes of public transport. The key terminals at Gateway of India, NMIA and Nariman Point are being aligned with the parallel infrastructure initiatives undertaken by the MMB to maximise efficiency and commuter experience.
MF equity cash holdings up by ₹4,000 crore in Feb
Suresh P Iyengar Mumbai
Mutual fund houses have increased the cash holding of equity schemes by ₹4,000 crore to ₹2.10 lakh crore in February against ₹2.06 lakh crore logged in January due to the market volatility, according to a JM Financial report. However, steady systematic investment plan (SIP) inflows and the recent fall in markets opening up fresh buying avenues have kept the cash holdings under check.
Part of the cash build-up could also be due to eight equity schemes raising ₹3,955 crore through NFOs last month. In January, four equity NFOs mopped up ₹806 crore. The inflows through SIP in the last 11 months of this fiscal were up 10 per cent at ₹3,17,502 crore against ₹2,89,352 crore logged in the whole of FY25.
Akshat Garg, Head-Research & Product at Choice Wealth, said that less than 5 per cent cash holding of MFs does not necessarily mean there is no redemption pressure but it is simply under manageable limits. “If there was real stress in the system, cash levels would have moved up sharply as fund managers prepared for outflows. That is clearly not happening right now,” he added.
The MF ecosystem is heavily supported by consistent SIP inflows, which continue to remain strong even during volatile phases. These steady inflows act as a natural counterbalance to redemptions, allowing fund managers to manage liquidity without holding excessive cash. In fact, in a falling market, holding higher cash could actually become a drag if the markets rebound quickly, which is why most funds prefer to remain close to fully invested.
The gross redemption from equity schemes reduced to ₹36,098 crore in February from ₹41,639 crore in January. However, a consistent sharp fall in equity markets may scare new MF investors, leading to higher redemptions and lower inflows. Gibin John, Senior Investment Strategist, Geojit Investments, noted that MFs continue to receive strong and steady SIP inflows of around ₹29,000-₹30,000 crore per month, providing consistent liquidity support.
Despite the huge volatility and the recent meltdown in markets, the overall equity asset under management has increased 16 per cent to ₹35.39 lakh crore in February against ₹30.57 lakh crore in April 2025. However, the March numbers will be crucial as the Sensex has already fallen 7 per cent so far this month to 74,533 on Friday from 80,239 on March 2.
AT A GLANCE
- Mutual fund houses have increased the cash holding of equity schemes to ₹2.10 lakh crore in February from ₹2.06 lakh crore in January.
- SIP inflows in the last 11 months of FY26 were up 10% at ₹3,17,502 crore against ₹2,89,352 crore in FY25.
- The gross redemption from equity schemes reduced to ₹36,098 crore in February from ₹41,639 crore in January.
India’s silent newborn crisis
CRITICAL WINDOW. A heel-prick blood test 48-72 hours after birth can detect congenital hypothyroidism By Kishore Kumar
India is confronting a silent, yet entirely preventable postnatal crisis. One in every 1,000 babies born in India has congenital hypothyroidism (CH) which, if left undetected, can lead to permanent intellectual disability.
CH occurs when a baby is born without a thyroid gland or an underdeveloped or poorly functioning one. The thyroid produces thyroxine (T4), a hormone essential for brain development, growth and metabolism. In the earliest weeks of life, thyroxine plays a decisive role in neuronal development and brain maturation; this period represents a narrow but critical window.
If adequate thyroid hormone is not available during this time, the consequences can include irreversible intellectual disability, stunted physical growth, hearing impairment and delayed motor development. The most alarming aspect is that affected babies almost always appear completely normal at birth. Without screening, there are no obvious clinical signs to alert families or healthcare providers.
Globally, the incidence of CH is one in 2,500-3,000 live births. In India, given the higher prevalence and an estimated 26 million births annually, at least 10,000 babies are born with CH each year. That means roughly 27 babies each day and one baby each hour. Every one of these infants could lead a normal, productive life if diagnosed and treated within two weeks of birth through mandatory early newborn screening.
AFFORDABLE TEST
CH is identified using a simple heel-prick blood test conducted 48–72 hours after birth. The test measures thyroid stimulating hormone (TSH) levels and, when implemented at scale, costs approximately ₹50 per baby. While treated infants can achieve normal development, untreated CH can reduce IQ by 30-50 points. The difference between a healthy future and lifelong disability rests on testing a single drop of blood.
The lifetime care of a child with severe intellectual disability includes special education, medical consultations, and long-term dependency. In a country where out-of-pocket healthcare expenditure is high, this can push households into financial distress and intergenerational disadvantage.
THE PATH FORWARD
The next phase of progress must focus on safeguarding neurodevelopment and ensuring quality of life. Most developed nations have implemented universal newborn screening for CH for nearly six decades, virtually eliminating it as a cause of avoidable cognitive impairment. India still lacks mandatory nationwide screening.
Universal newborn screening for CH must be integrated into all public and private birthing facilities. This requires policy mandates, structured funding, standardised testing protocols, and centralised data monitoring systems to ensure compliance and accountability.
The science is unequivocal; the screening test is simple and affordable, and the treatment is effective. What is missing is collective will. Protecting a child’s brain at birth is a vital necessity.
Sports economy doubled in four years, crossed $2 billion-mark in 2025 : WPP Media report
Cricket business alone grew 17.9 per cent to ₹16,704.2 crore last year By Meenakshi Verma Ambwani, New Delhi
India’s sports economy crossed the $2 billion-mark for the first time in CY2025, reaching ₹18,864 crore ($2.13 billion) and marking a 13.4 per cent growth over the previous year. Sports ad spends, the largest industry component, rose 19.8 per cent to ₹9,571 crore, while sponsorship spends grew 7 per cent to ₹7,943 crore. Additionally, athlete-oriented endorsement deals were valued at ₹1,350 crore, up 10.3 per cent from 2024.
According to Vinit Karnik, MD – Content, Sports and Entertainment at WPP Media, South Asia, the industry has doubled from ₹9,530 crore in 2021. He noted that CY2025 represents a structural inflection point where sports has moved from an emerging market to a story of consolidation and scale, reflecting deep advertiser confidence.
Cricket continues to dominate, contributing nearly 89 per cent of the total industry. Despite a ban affecting real money gaming (RMG) players, cricket media spends reached ₹9,026 crore in 2025. Furthermore, IPL franchises achieved a milestone by crossing the ₹1,000 crore-mark in cumulative team sponsorship revenues. Karnik stated that the void left by RMG players was filled by other sectors, proving that cricket's commercial foundation has broadened beyond a single advertiser cohort.
SPORTS REVENUES
Conversely, emerging sports revenues declined by 12.2 per cent in 2025 to ₹2,159.9 crore. This drop was attributed to the postponement of the Indian Super League and a lack of major non-cricketing multi-nation tournaments. Emerging sports now account for 11 per cent of the total industry, though event-based tournaments like the Neeraj Chopra Classic provided some positive momentum.
