Global Innovation Index (GII)

Introduction

Innovation has become a major driver of economic growth, productivity, technological progress and global competitiveness. The Global Innovation Index (GII) provides a comparative assessment of how effectively economies develop and use their innovation capabilities.

Published annually, the GII examines factors such as institutions, human capital, infrastructure, investment, business environment, knowledge creation and technology outputs. The 2025 edition covers 139 economies and uses a broad set of indicators to assess their innovation ecosystems.

India has continued its upward trajectory, ranking 38th in the Global Innovation Index 2025, compared with 48th in 2020. It is also the top-ranked lower-middle-income economy and the leading economy in Central and Southern Asia.

What is the Global Innovation Index?

The Global Innovation Index (GII) is a global ranking that evaluates the innovation capacity and performance of economies.

It goes beyond measuring research expenditure or patent applications alone. Instead, it examines the wider ecosystem required to convert ideas and knowledge into commercially and socially valuable outcomes.

A country’s capacity to generate new ideas and technologies

The environment available for research and entrepreneurship

The ability of firms and institutions to innovate

The conversion of innovation inputs into measurable outputs

Strengths and weaknesses within a country’s innovation ecosystem

The index has been published annually since 2007 and has become an important reference point for governments and policymakers.

How is the Global Innovation Index Calculated?

1. Innovation Input Sub-Index

The Innovation Input Sub-Index measures the conditions that enable innovation. It consists of five pillars:

Institutions

Human Capital and Research

Infrastructure

Market Sophistication

Business Sophistication

These indicators examine whether an economy has the institutional, financial, technological and human-capital foundations required to support innovation.

2. Innovation Output Sub-Index

The Output Sub-Index measures the results generated by an economy’s innovation ecosystem. It has two major pillars:

Knowledge and Technology Outputs

Creative Outputs

These indicators capture outcomes such as knowledge creation, patents, technological production, high-tech exports and creative products.

3. Overall GII Score

The overall GII score is derived from the average of the Innovation Input and Innovation Output Sub-Indices. This allows the index to assess not only how much an economy invests in innovation but also how effectively those investments generate outcomes.

Global Innovation Index 2025: Key Findings

European Leadership: Europe remains strongly represented among the world’s most innovative economies. Switzerland ranks first, followed by Sweden, while the United States ranks third. China has entered the global top 10 at 10th position.

Innovation Investment: The 2025 report points to slower growth in innovation investment and research activity, alongside challenges related to innovation financing and productivity.

Growing Asian Role: East Asia, Southeast Asia and Oceania continue to strengthen their position in global innovation, reflecting the growing importance of Asian economies in technology and innovation.

Middle-Income Economies: Several middle-income economies are improving their innovation performance, including China, India, Türkiye, Viet Nam, the Philippines, Indonesia and Morocco.

India in the Global Innovation Index 2025

India’s 2025 position represents a substantial improvement from its 48th rank in 2020.

38th among 139 economies globally

1st among 37 lower-middle-income economies

1st among 10 economies in Central and Southern Asia

An innovation overperformer relative to its level of economic development for the 15th consecutive year

India’s Innovation Inputs and Outputs

One of the important features of India’s performance is that its innovation outputs are stronger than its innovation inputs.

This indicates that India is relatively effective at converting available innovation resources into measurable outcomes.

India’s Major Strengths

Knowledge and Technology Outputs: India’s strongest broad pillar is Knowledge and Technology Outputs, where it ranks 22nd globally.

ICT Services: India’s ICT services exports rank first globally in the GII 2025 indicators, highlighting its strong position in software, digital services and technology-enabled exports.

Startup and Venture Capital Ecosystem: India performs strongly in startup financing and venture capital, ranking 4th in late-stage venture capital deal count, 9th in finance for startups and scaleups, and 11th in unicorn valuation as a share of GDP.

Large Domestic Market: India’s large consumer base provides firms with opportunities to test, scale and commercialise innovative products and services.

India’s Major Weaknesses

Business Sophistication: India ranks 64th in Business Sophistication, pointing to gaps in knowledge-intensive employment, business-funded R&D and university-industry collaboration.

Infrastructure: India ranks 61st in Infrastructure, indicating the need for stronger research infrastructure, logistics, digital connectivity and physical infrastructure.

Institutions: India ranks 58th in Institutions, indicating scope for improving the wider institutional environment supporting innovation.

R&D Investment: India’s R&D spending remains relatively low compared with leading innovation economies, limiting the scale of research-driven innovation.

India’s Science and Innovation Ecosystem

India’s innovation ecosystem has expanded significantly through the growth of:

Startups and unicorns

ICT and digital services

Scientific research

Venture capital

Patenting activity

Deep-tech enterprises

University and research institutions

However, India needs to improve the connection between research institutions, universities and industry so that scientific discoveries can be converted into commercially viable technologies at greater scale.

Government Initiatives to Promote Innovation

Anusandhan National Research Foundation (ANRF): Seeks to strengthen India’s research ecosystem by encouraging research and development across universities, institutions and laboratories.

Vigyan Dhara: Supports scientific research, institutional capacity and the development of science-based solutions for societal challenges.

National Deep Tech Startup Policy: Focuses on strengthening India’s capabilities in advanced science and technology while improving access to finance, intellectual property support and industry-academia linkages.

Research, Development and Innovation Scheme: Seeks to encourage greater private-sector participation in research and innovation by providing financial support for strategic technology areas.

Atal Innovation Mission: Promotes an innovation culture through Atal Tinkering Labs, incubation centres and mentoring networks.

Why is the Global Innovation Index Important for India?

Measures Innovation Capacity: GII provides a broader assessment of innovation than simply counting patents or measuring R&D expenditure.

Identifies Policy Gaps: India’s pillar-wise performance helps policymakers identify areas such as infrastructure, business sophistication and R&D where improvements are required.

Supports Competitiveness: Innovation is essential for increasing productivity, developing advanced technologies and improving India’s position in global value chains.

Encourages Investment in R&D: The index highlights the importance of sustained investment in scientific research, human capital and technological infrastructure.

Promotes Innovation-led Growth: A stronger innovation ecosystem can support productivity, entrepreneurship, employment and long-term economic growth.

Challenges to India’s Innovation Ecosystem

Low R&D intensity: Research spending remains relatively low compared with leading innovation economies.

Weak industry-academia linkages: Scientific research is not always translated into commercial applications.

Infrastructure gaps: Physical and research infrastructure remains uneven.

Limited private R&D: Greater participation of businesses in research is required.

Skill gaps: Advanced technologies require specialised scientific and technical skills.

Regional concentration: Innovation ecosystems remain concentrated around major metropolitan and technology clusters.

Limited commercialisation: Strong research output does not always translate into globally competitive products and technologies.

Way Forward

Increase R&D Investment: India should progressively raise public and private R&D expenditure, particularly in strategic technologies such as AI, semiconductors, biotechnology, quantum technology and clean energy.

Strengthen Industry-Academia Linkages: Universities, research institutions and businesses should collaborate more closely through joint research, technology transfer and commercialisation programmes.

Promote Deep-Tech Innovation: Policy support should focus on long-gestation technologies that require significant capital and specialised research capabilities.

Improve Innovation Infrastructure: India needs stronger laboratories, testing facilities, digital infrastructure, research networks and technology parks.

Expand Innovation Beyond Major Cities: Innovation clusters should be developed in Tier-II and Tier-III cities to create a wider and more geographically distributed innovation ecosystem.

Improve Access to Finance: Startups, MSMEs and research-driven enterprises need better access to patient capital, venture funding and credit.

Focus on Human Capital: Higher-quality STEM education, research opportunities, apprenticeships and specialised skills are essential for sustaining India’s innovation momentum.

Conclusion

The Global Innovation Index is an important indicator of a country’s ability to convert knowledge, research and resources into innovation-driven economic outcomes. India’s rise to 38th position in GII 2025 reflects significant progress, particularly in ICT services, startups, venture capital and knowledge and technology outputs.

However, India’s relatively weaker performance in business sophistication, infrastructure and R&D investment shows that the next stage of progress will require deeper structural reforms. Strengthening research, improving industry-academia collaboration, expanding innovation infrastructure and increasing private R&D can help India move from being an innovation overperformer to a global innovation leader.

Frequently Asked Questions (FAQs)

What is the Global Innovation Index?

The Global Innovation Index (GII) ranks economies according to their innovation capabilities and outcomes using a broad set of indicators.

Who publishes the Global Innovation Index?

The GII 2025 is published by the World Intellectual Property Organization (WIPO) in partnership with the Portulans Institute.

What is India’s rank in the Global Innovation Index 2025?

India ranks 38th among 139 economies in the GII 2025.

Which country ranks first in the GII 2025?

Switzerland ranks first in the Global Innovation Index 2025, followed by Sweden and the United States.

What are the major components of the GII?

The GII consists of Innovation Inputs and Innovation Outputs. Input pillars include institutions, human capital and research, infrastructure, market sophistication and business sophistication. Output pillars include knowledge and technology outputs and creative outputs.

What are India’s strengths in GII 2025?

India’s major strengths include ICT services exports, knowledge and technology outputs, domestic market scale, startup finance and venture capital activity.

What are India’s weaknesses in the GII?

India’s relatively weaker areas include business sophistication, infrastructure and institutions, along with comparatively low R&D intensity.

Why is GII important for UPSC?

The GII connects innovation with economic growth, technology, startups, R&D, intellectual property, human capital and global competitiveness, making it relevant to UPSC GS Paper 3.