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Global Business Review
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Technology Absorption: An Overview

A. Rao

Department of Scientific and Industrial Research, Ministry of Science and Technology, Government of India

Absorption of imported technology is at the centre of developing countries' tryst with (technological) 'catching-up'. The astounding success of the Japanese in converting imported technology into a decisive advantage with adaptation and improvements has apparently fuelled this ambition. India invested heavily in technology absorption, with several policies/programmes in the lead. This article compiles the activities reported under technology absorption from companies' annual reports and published data of the Department of Scientific and Industrial Research on in-house R&D achievements. These were grouped under several heads in separate categories: technology absorption, adaptation and improvement. The various initiatives taken by Government of India to facilitate absorption are summarized. Finally, reasons and causes for the difference in performance of Indian industry from that of the Japanese are analyzed, based on Japanese writers' perceptions of their own showing. The article suggests that the time has come to reorient technology absorption efforts by shifting focus from substitution of components, which are fully codified and embodied, to internalizing capabilities, which are mostly tacit (uncodified).

Global Business Review, Vol. 1, No. 1, 101-111 (2000)
DOI: 10.1177/097215090000100107
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