2 minEconomic Concept
Economic Concept

Knowledge Economy

Knowledge Economy क्या है?

A Knowledge Economy is an economic system where the production and services are based on knowledge-intensive activities. Its primary asset is intellectual capital, driven by innovation, research, education, and information technology.

ऐतिहासिक पृष्ठभूमि

The concept emerged in the late 20th century, signifying a shift from industrial economies to those where knowledge and information are key drivers of growth. It gained prominence with the rise of the internet and digital technologies, leading to the 'information age'.

मुख्य प्रावधान

8 points
  • 1.

    Characterized by a high reliance on intellectual capital, innovation, and technological advancements.

  • 2.

    Key pillars include a robust education system, strong innovation ecosystem (R&D), widespread Information and Communication Technology (ICT) infrastructure, and an institutional regime that supports entrepreneurship and intellectual property.

  • 3.

    Emphasizes human capital development through continuous learning, skill upgrading, and creativity.

  • 4.

    Focuses on value addition through research, design, and specialized services rather than just raw material extraction or basic manufacturing.

  • 5.

    Examples include sectors like IT services, biotechnology, pharmaceuticals, high-tech manufacturing, and creative industries.

  • 6.

    Requires significant investment in research and development (R&D) and fostering a culture of entrepreneurship.

  • 7.

    Leverages digitalization and data analytics to create new products, services, and business models.

  • 8.

    Often associated with high-skilled jobs, global competitiveness, and improved living standards.

दृश्य सामग्री

Knowledge Economy: Pillars, Drivers & India's Strategy

This mind map illustrates the core components and drivers of a knowledge economy, along with India's strategic initiatives to transition towards this model, emphasizing its relevance for UPSC preparation.

Knowledge Economy

  • Key Pillars
  • Characteristics
  • India's Strategic Initiatives
  • Key Sectors

India's Knowledge Economy Indicators (2025 Estimates)

This dashboard presents key statistics reflecting India's progress and potential in building a knowledge economy, covering areas like R&D, digital penetration, and the startup ecosystem.

Gross Expenditure on R&D (% of GDP)
0.7%+0.1% (YoY)

While increasing, still lower than developed nations (e.g., 2-3%), indicating scope for greater investment in research and innovation.

Internet Penetration Rate
78%+5% (YoY)

Rapidly expanding digital access is a cornerstone for a knowledge economy, facilitating information flow and digital services.

Number of Recognized Startups
>1,20,000+20,000 (YoY)

India is a global leader in startup ecosystem growth, fostering innovation and entrepreneurship, crucial for knowledge-based value creation.

IT-ITES Sector Contribution to GDP
9.0%+0.5% (YoY)

The IT-ITES sector remains a dominant force, showcasing India's strength in knowledge-intensive services and its global competitiveness.

हालिया विकास

5 विकास

India is actively promoting a knowledge economy through initiatives like Digital India, Startup India, and increased focus on research and innovation.

The National Education Policy 2020 emphasizes skill development, critical thinking, and multidisciplinary education to build a knowledge-based workforce.

Growth of India's IT and ITES sector and emergence as a global hub for software development and digital services.

Increased investment in deep tech startups and R&D infrastructure.

Leveraging the demographic dividend and diaspora network to fuel knowledge-based growth.

स्रोत विषय

Kerala's Economic Reboot: Charting a Path to Knowledge Economy

Economy

UPSC महत्व

Highly relevant for UPSC GS Paper 3 (Economic Development, Science & Technology) and GS Paper 2 (Social Justice - education, skill development). Frequently asked in Mains (economic models, development strategies, role of technology) and occasionally in Prelims (concepts, related initiatives).

Knowledge Economy: Pillars, Drivers & India's Strategy

This mind map illustrates the core components and drivers of a knowledge economy, along with India's strategic initiatives to transition towards this model, emphasizing its relevance for UPSC preparation.

Knowledge Economy

Robust Education System

Strong Innovation Ecosystem (R&D)

Widespread ICT Infrastructure

High Reliance on Intellectual Capital

Focus on Value Addition & Services

Digital India Programme

Startup India Action Plan

National Education Policy 2020

IT Services & ITES

Biotechnology, Pharma, Deep Tech

Connections
Key PillarsCentralConcept
CharacteristicsCentralConcept
India's Strategic InitiativesCentralConcept
Key SectorsCentralConcept

India's Knowledge Economy Indicators (2025 Estimates)

This dashboard presents key statistics reflecting India's progress and potential in building a knowledge economy, covering areas like R&D, digital penetration, and the startup ecosystem.

Gross Expenditure on R&D (% of GDP)+0.1% (YoY)
0.7%

While increasing, still lower than developed nations (e.g., 2-3%), indicating scope for greater investment in research and innovation.

Data: 2025
Internet Penetration Rate+5% (YoY)
78%

Rapidly expanding digital access is a cornerstone for a knowledge economy, facilitating information flow and digital services.

Data: 2025
Number of Recognized Startups+20,000 (YoY)
>1,20,000

India is a global leader in startup ecosystem growth, fostering innovation and entrepreneurship, crucial for knowledge-based value creation.

Data: 2025
IT-ITES Sector Contribution to GDP+0.5% (YoY)
9.0%

The IT-ITES sector remains a dominant force, showcasing India's strength in knowledge-intensive services and its global competitiveness.

Data: 2025