Global Innovation Index (GII) 2025: India’s Performance and Innovation Ecosystem

Introduction

• The Global Innovation Index (GII), introduced in 2007, provides comprehensive metrics and methodologies for assessing the wide spectrum of innovations across economies.
• Published annually by the World Intellectual Property Organization (WIPO), it is a key benchmark for evaluating an economy’s innovation ecosystem.
• Recognised by the UN General Assembly as an authoritative reference for shaping Science, Technology, and Innovation (STI) policies.

Why in news?

• India climbed to the 38th position among 139 economies in the GII 2025, improving from 48th place in 2020 and rising from 81st in 2015.
• India ranks 1st among lowermiddleincome economies and in Central & Southern Asia.

Background

• Funding mechanism: India invested 0.65% of GDP in R&D, compared to China (2.43%), Brazil (1.15%), and South Korea (2.5%).
• Patent filings: India ranks 6th globally in patent applications; its patenttoGDP ratio rose from 144 (2013) to 381 (2023).
• Strategic policy support: Programmes like Startup India, Make in India, and the Production Linked Initiative (PLI) scheme provide foundational support; the Fund of Funds for Startups (FFS) has a Rs 10,000 crore corpus; a one lakh crore Research, Development, and Innovation (RDI) scheme aims to boost private sector R&D; the Startup India Hub links 1,140+ incubators and accelerators; the Startup India Seed Fund Scheme disbursed Rs 945 crore in 2023.
• DeepTech push: The National Semiconductor Mission is backed by Rs 76,000 crore; the IndiaAI Mission and PLI for quantum technologies aim to enhance selfreliance.
• Rise of unicorns and Cleantech: India hosts 100+ unicorns, the 3rdlargest ecosystem globally; the private sector leads in Cleantech with startups such as Ather Energy and Ola Electric.
• Geographical diversification: Atal Tinkering Labs (ATLs) are decentralising innovation; over 45% of DPIITrecognised startups emerge from tier2 and tier3 cities.
• Barriers: GERD remains ~0.7% of GDP, far below leading nations; the private sector contributed 36.4% of R&D funding (2020–21), with a disconnect between academia and industry; historic emphasis on defence and space led to underinvestment in areas like semiconductors, advanced materials, and pharmaceuticals; industry riskaversion favours imported technologies and business model innovations over deeptech; bureaucratic hurdles impede technology transfer due to procedural and IP challenges.
• Reforms needed: Boost R&D spending over the next decade, increase private and philanthropic contributions, and fully deploy the Rs 1 lakh crore innovation fund within 3–5 years; promote universityled research to expand knowledge frontiers and support commercialisation; establish sectorspecific public–private innovation hubs in AI, semiconductors, and clean energy with shared facilities and venture funds; enable crosssector collaboration via industry councils (e.g., a CleanTech Council for solar, EVs, and energy efficiency); build regional innovation clusters in nonmetros to support agritech and social enterprises with funding, mentorship, and infrastructure.

Significance

• India’s strengths: Knowledge & Technology Outputs (22) and Market Sophistication (38).
• India’s weaknesses: Business Sophistication (64), Infrastructure (61), and Institutions (58).
• Positive socioeconomic impact: Labour productivity rose 2.5% in 2024; global life expectancy reached 73 years; extreme poverty fell to 817 million, under half of 2004 levels.
• Rapid technological advancement: 2024 saw gains in supercomputing efficiency and battery prices; adoption slowed; progress lagged in wind power and genome sequencing; novel drug development regressed.

Facts/General knowledge

• Topranked economies: Switzerland (1st), Sweden (2nd), USA (3rd), South Korea (4th), Singapore (5th); China entered the top 10 for the first time, ranking 10th.
• Top innovation clusters: Shenzhen–Hong Kong–Guangzhou (1st) and Tokyo–Yokohama (2nd).

Bima Sugam – Unified Digital Marketplace for Insurance

Introduction

• Bima Sugam is a unified digital marketplace for all insurance needs—life, health, and general—where users can buy, renew, manage, and claim policies on a single platform.
• It will securely store policy documents to enable seamless, endtoend policy servicing and claims.

Why in news?

• The Bima Sugam India Federation (BSIF) has launched Bima Sugam, envisioned as the world’s largest integrated online insurance marketplace.

Background

• Bima Sugam functions like UPI, creating a Digital Public Infrastructure (DPI) for insurance.
• It forms part of IRDAI’s Bima Trinity and is supported by the Life Insurance Council and the General Insurance Council.
• Bima Trinity: Bima Sugam: Unified digital platform for buying, servicing, and settling insurance policies.
• Bima Vistaar: Bundled policy covering life, health, property, and accidents with quick claim payouts.
• Bima Vaahaks: Womenled grassroots network promoting insurance awareness and Bima Vistaar adoption.

Significance

• It is the first step in building DPI for insurance, supporting ‘Insurance for All by 2047’ under Viksit Bharat 2047.
• It ensures transparency, lowcost access, and a centralised database.
• It fosters innovation with quicker adoption of new products.
• It differs from private distributors by enabling endtoend policy services and claim settlement at low cost, unlike private firms that only sell policies and earn high commissions.

Facts/General knowledge

• Coverage on Bima Sugam: Life Insurance: Term plans, savings (participating and nonparticipating), annuity, pension, ULIPs.
• Health Insurance: Comprehensive medical and wellness products.
• Motor Insurance: Thirdparty liability and owndamage policies.
• Travel and Personal Accident Insurance for individuals and families.
• Commercial Insurance: Property, marine, agricultural, and industryspecific products.
• Insurance sector in India:
• India is the 10th largest insurance market globally and is projected to become the 6th largest by 2032, surpassing Germany, Canada, Italy, and South Korea.
• Insurance density increased from USD 92 in FY23 to USD 95 in FY24 (per capita premium).
• Insurance penetration declined from 4% in FY23 to 3.7% in FY24 (global average 7%).

GST New Rate List in India 2025

Introduction

• The GST Council has approved a streamlined GST structure that consolidates most items into two main slabs (5% and 18%), expands exemptions, and introduces a special 40% rate for luxury and sin goods.
• The reform reduces complexity, lowers taxes on dailyuse items, and raises taxes on highend and sin products.

Why in news?

• New GST slabs take effect from 22nd September 2025.
• Most items currently in the 12% and 28% slabs will move to 5% and 18%.
• A special 40% slab is introduced for luxury and sin goods such as highend cars and tobacco products.

Background

• Current GST slabs (2025): 0% (Exempt): Essentials like fresh fruits, vegetables, milk, bread.

• 5%: Common goods such as packaged food.
• 12%: Processed food, fruit juices, frozen meat, butter, ghee, nuts.
• 18%: Most services (restaurants, telecom, banking), cosmetics, toiletries, hair oil, toothpaste, capital goods.
• 28%: Electronic goods (TVs, refrigerators), small cars and bikes, cement, paints, highend luxury and premium cars and bikes, sin goods like tobacco.

Significance

• Easy structure with fewer GST rates to avoid confusion.
• Dailyuse items taxed lower; luxury and sin goods taxed higher.
• Easier online GST return filing for people and businesses.
• Impact highlights: Cheaper: Personal health and life insurance, hair oil, shampoo, packaged food, footwear, small cars and bikes, household appliances like ACs, TVs, washing machines.

• Same: Essentials like milk, bread, vegetables; most services under 18% such as restaurant, financial services, education.
• Costlier: Luxury vehicles, tobacco, highend lifestyle products.

Facts/General knowledge

• New GST slabs (from 22nd September 2025): 0%: Essentials plus personal health and life insurance, exercise books and notebooks, maps and charts.
• 5%: Packaged food, footwear, medicines, small household items, and other commonly used products.
• 18%: Restaurant, telecom and financial services; electronics like TVs, washing machines, laptops and dailyuse appliances; motorcycles below 350cc; cars below 1200cc.
• Special 40%: Luxury and sin goods such as highend cars and tobacco products.
• Old vs new rates (effective change from 22nd September 2025):
• Daily essentials (milk, bread, curd, etc.): Nil → Nil
• Hair oil, shampoo, toiletries: 18% → 5%
• Butter, ghee, cheese: 12% → 5%
• Personal health & life insurance: 18% → Nil
• Air conditioners: 28% → 18%
• TVs and refrigerators: 28% → 18%
• Small cars below 1200cc: 28% → 18%
• Bikes below 350cc: 28% → 18%
• Tableware, kitchenware, utensils, bamboo furniture: 12% → 5%
• Stationery items (pencils, charts, globes, exercise books & notebooks): 12% → 5%
• Cement: 28% → 18%
• Hotel tariffs up to ₹7,500: 12% → 5%
• Agriculture machinery (tractors, drip irrigation systems, sprinklers, etc.): 12% → 5%
• Aerated and sugary beverages, caffeinated beverages: 28% → 40%
• Luxury cars and premium bikes: 28% → 40%
• Tobacco, cigarettes, and other sin goods: 28% → 40%