Manufacturing sector accounts for 78 percent of foreign technical collaborations: RBI

NEW DELHI: The foreign technical collaboration (FTCs) in the manufacturing sector entities accounted for 78.4 percent of the total reported FTCs, of which, machinery and motor vehicles together accounted for 30.6 percent, while FTCs in the services sector constituted 16.6 percent between financial year 2023-2025 (FY23-25), data from Reserve Bank of India (RBI) showed on Tuesday. 

Japan, the US, and Germany remained the top three countries contributing to the technical collaborations in the Indian entities.

"Around 61 percent of FTCs involved technology know-how transfer by the foreign collaborators and 8 percent of FTCs were for the use of trademarks or brand names," the RBI noted.

Meanwhile, royalty payments --- including both royalty and lump sum technical fees --- were the payment mode for around two-thirds of FTCs.

Of the 601 reported FTC agreements, 187 had export restriction clauses, and 188 FTC agreements had a provision for exclusive rights on assets transferred, the central bank highlighted.

The manufacturing sector had the highest share of production value among the FTC companies. Within manufacturing, the motor vehicles sector had the largest share.

The exports of the FTC reporting entities grew at a faster pace (20.3 percent) as compared to the imports (4.6 percent) in 2024-25 - they had 17.7 percent and 18.6 percent shares, respectively, in the total value of production.

The data showed in the fifteenth round of the biennial survey on foreign collaboration in Indian industry (FCS) covering the financial years 2023-24 and 2024-25. (IANS)

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