According to a recent analysis, India is the main global economy that saw the highest rise in intangible investment from 2011 to 2020. Intangible investments have proven to be remarkably resilient when compared to tangible assets in recent times.
Based on a research by the World Intellectual Property Organization (WIPO), Sweden and the US, the two economies with the highest levels of intangible investment relative to GDP, were surpassed by India, which saw the fastest growth in intangible investments.
According to the WIPO research, “India’s performance is also comparable with that of certain advanced economies, with its intangible investment level in 2020 being close to that of Sweden.”
Research and development (R&D), software and data, design, brands and reputation, supply-chain know-how, elite talents, and any other assets that either originate from or interact in some way with intellectual property (IP) are examples of intangible assets.
Despite being intangible, these assets have the potential to generate enormous value for businesses, economies, society, and people all at the same time, claims the paper.
In today’s competitive market, intangible assets wield tremendous influence over the fate and fortunes of both enterprises and nations, according to the research.
In India, the growth of intangible investments has outpaced that of tangible investments. If the unorganized sector is not included, the differences become even more pronounced.
With the informal sector excluded, intangible investment accounted for more than 10% of India’s GDP in 2019. This is higher than the 9% average in Japan and comparable to the 10% average for the EU-22.
In spite of the disruptions caused by the pandemic, the GDP share of intangible investment in India in 2019 (10.4 percent) remained similar to that in 2020 (9.4 percent), according to the research.
In economies like Sweden, the US, and France that rely heavily on intangibles, intangible investment made up more than 16 percent of GDP in 2023.
The paper states that over the past ten years, software and data have grown at the quickest rates across all categories of intangible assets, with brands, organizational capital, and new financial products coming in second and third.
Between 2011 and 2021, software, data, and brands expanded three times faster than research and development.
