Canada-India relations

When Prime Minister Harper visits China next week he should not limit his marketing pitch to stuff we continue to dig out of the ground, but include those that comes from the deep alleys of our brains.

China’s insatiable appetite for energy is obvious to all. What is less obvious is its thirst for new knowledge and technologies, especially in priority sectors such as biotechnology and pharmaceuticals. In fact, among many key markets in Asia, there is growing demand for what Canada has to offer including knowledge, state-of-the-art technology, and the know-how to deliver world-class healthcare.

The question is will we seize on these emerging opportunities by seeking markets for our technologies as we do for natural resources?

Considerable and growing investments in science and technology in Asia has seen demand and capacity for new technologies grow rapidly. R&D expenditures have been growing faster in the Asia-Pacific region than in the US, Europe and most other developed nations.

The same trend holds for patenting and publication rates, as well as human resources training. China, in particular has increased its R&D commitment from 0.57% of GDP in 1996 to 1.5% by 2008, reaching approximately US$ 102 billion. India’s R&D investments nearly doubled during the 2002-2007 period rising from US$ 13 to 25 billion.

For China’s pharmaceutical market alone, it was estimated to reach estimated to reach US$ 50 billion in 2011, making it the third largest market of its kind in the world. Since 2009, the country has also undertaken an ambitious initiative to provide basic healthcare to all its citizens and has thus far spent about US$200 billion on related initiatives.

These developments present significant opportunities for Canada. According to BIOTECanada, the health, medical and pharmaceutical sectors compose 63% of Canada’s US$ 86.6 billion bio-economy and account for 7% of GDP. The country had 532 biotech companies in 2005, employing over 86,000 people. We have a large pool of knowledge, lead products, platform technologies and know-how within Canadian universities, research institutes and life science companies. The key challenge is to find ways to leverage these in ways that supports technological aspirations of key emerging markets while benefiting from their growth and development.

There is little question that the rising technological and innovation capacity in Asia, and in some other emerging markets, can pose a longer-term competitive threat. At the same time to consider this emerging capacity only in competitive terms misses half the story – namely the considerable opportunities that these developments present for the Canadian industry and healthcare consumers.

So far, relatively few Canadian biotechnology firms have tapped into the market opportunities in China including Welichem Biotech, Symbiosis Genetics Microbix Biosystems Inc. and ProMetic Life Sciences Inc. It is not clear that Canada is making the necessary adjustments to adapt to contemporary realities that demand not only knowledge generation but also efficient knowledge and technological exchange at a global level.

To effectively connect and market ourselves in a more globalized and network-based innovation model, we need to:

- build and fortify knowledge and intellectual property pipelines,

- build competence in global knowledge and technology transfer,

- support our researchers and companies to establish appropriate partnerships and linkages in emerging markets,

- support Canadian entrepreneurs not only in seeking markets for products, but also the emerging markets for high-tech services, technologies and intellectual property,

- capitalize on the opportunities for ‘reverse’ flows of knowledge and other resources.

There is considerable consensus that Canada is a resource-based economy. We should think of knowledge as one of these resources – to be discovered, processed, protected and traded. We need to position ourselves appropriately within the global innovation value chain if we are to diversify our economy and reduce our dependence on natural resources. Effective relations with key emerging markets, and explicit mechanisms to facilitate knowledge and intellectual property exchanges can help us to compete in the knowledge-economy.

Prime Minister Harper should offer China what they really want, knowledge, in addition to what they really need, oil.

This op-ed was first published in The Embassy Magazine on February 1, 2012. 

Dr. Rahim Rezaie is a Post Doctoral Research Fellow with the Asia Pacific Foundation of Canada and the Munk School of Global Affairs, University of Toronto. This op-ed is based on Dr. Rezaie’s Canada-Asia Agenda on ‘Rising Innovative Capacity in Asia and Opportunities for Canada: Focus on the Biopharmaceutical Sectors in China and India.’