U.S., India clear way for nano partnerships

November 28, 2005 – For the better part of a decade, the United States and India have been building closer economic ties. Now efforts to forge more scientific ties — including the lucrative field of nanotechnology — have leaped forward.

The two nations signed a long-anticipated agreement last month that cleared away the bureaucratic brush that had previously stymied research partnerships between the world’s largest democracies. Signed by Secretary of State Condoleezza Rice and Indian Science and Technology Minister Kapil Sibal, the pact settles long-standing disputes on how to share intellectual property rights as well as questions of taxation, import-export customs and similar issues.

The agreement does not create any cross-border collaborations themselves. It does, however, free academic, corporate and government scientists to strike what partnerships they can in basic research around space exploration, biotechnology, energy, nanotechnology and more.

State Department spokesmen said the deal allows more substantive collaborations that delve into potentially valuable discoveries. They added that and nanotech is certainly a high priority.

The United States and India have tried to foster research collaboration in some way or another since 1987. Until now, however, the sticking point had been how to share licensing revenues from any “co-inventions” that a collaboration might create. The October agreement gives each nation exclusive rights to license intellectual property in its own country, and promises to share licensing revenues in other countries using formulas to be negotiated on a per-case basis.

State Department officials say that both countries have wanted to wrap up a deal in recent years; once the IP provisions were settled, the rest quickly fell into place.

Speaking to reporters at the signing, Sibal said India is now “in mission mode” to develop nanotechnology, but stressed that the governments prefer that scientists develop specific areas of collaborative research themselves.

“They are already doing that at an individual level, at a project-to-project level, but under the umbrella of this agreement, the extent of collaboration will be far more diverse,” he said. “The depth of collaboration will be far more interactive.”

What happens next is not entirely clear, but Indian brainpower mixed with American venture capital and research sophistication could be a potent combination. Already, according to a survey of venture capitalists done by Deloitte & Touche last spring, 20 percent of U.S. VC firms plan to increase their investment abroad and list India as a top destination. Draper Fisher Jurvetson, a VC heavyweight in Silicon Valley, has plans to pour $200 million into Indian startups. Venture Intelligence India estimates that American VC firms put $397 million into Indian companies in second-quarter 2005 alone.

To be sure, most of those investments are going into call centers and other information technology-related businesses far removed from nanotech. Other concerns remain as well: Meyya Meyyappan, director of NASA’s Ames Research Center for Nanotechnology, lamented the tight security regulations that prevent sensitive government researchers like his staff from collaborating with foreigners. “We don’t even try to collaborate with people outside the country,” he said.

Yet even Meyyappan agreed that more commercially oriented work, especially in Corporate America, could benefit from such deals. “Nanotech is a totally unconstrained business,” he said. “They could do whatever they want to.”

“There is a lot of interest on both sides,” said Harvard University physicist Anita Goel, a trustee of the Nanotechnology Innovation and Research Foundation. Goel said she receives frequent invitations to work with Indian technology incubators or research efforts, plus inquiries from the Indian government on how they should train their scientists.

Many people want to recreate the success enjoyed by the IT industry in the last 10 years, where U.S.-based money and expertise paid for low-cost Indian skilled labor to manage large projects like reprogramming computer code for the Year 2000 bug. Since then a host of Indian IT companies have sprung up to work with U.S. corporations, stimulating Indian economic growth in the process.

The Indian government would welcome the opportunity to expand that relationship to basic sciences, and has poured money into its network of technical universities around the nation.

“They’re not making a passive effort, certainly,” Goel said.

Who might benefit from the agreement? One example is Arunava Majumdar, a mechanical engineering professor at the University of California, Berkeley and a native of India. He already exchanges annual visits with a counterpart at the Indian Institute of Technology (IIT) in Bombay, and hopes that closer ties will help researchers in both nations stay in contact with each other amid today’s tougher U.S. immigration policies.

“There are tremendous opportunities here … Just look at the quality of students,” he said. “It’s absolutely critical for us to keep in touch with the talent over there and in China.”

A graduate of IIT himself, Majumdar admits that India still lacks the sophisticated facilities necessary to do nanotech research. “The U.S. can help there. That’s a tremendous resource we have,” he said. Meanwhile, the United States can tap a large pool of scientists. “And not just graduate students — real, professional scientists,” he added, “who don’t often have the opportunity to flourish because of the poor facilities.”

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