"Discussions on innovation, more often than not, serve the purpose of the degree which the student enrols for. We are unable to see innovation debates being taken to the next level of fruition. Companies should ratchet up their involvement with academic institutions to a point where ideas and research become more oriented to the needs of industry," says Kiran Karnik, who was till recently heading Nasscom, the association for the Indian IT industry.

"Innovation and entrepreneurship are two different things. Innovation is not just about idea generation, it is also about finding ways of helping small companies start up," notes Karnik.

"Venture capital funding has significantly increased over the last few years and services-level innovation is also happening without generic products being involved. IT services companies like Wipro are even able to quantify how much of their innovation lines have led to new customer wins, or changes in existing processes," Karnik says.

"A reason why innovations don't make it to the product stage in India is the lack of new and enterprising startups. We do not have a culture of risk-taking," says Samir K Barua, director, Indian Institute of Management, Ahmedabad.

"Sectors like agriculture can be monetised very well through the right product pipelines," Murphy says. He feels that the tech-product pipeline in Indian companies has not evolved to match the surfeit of capital floating around.

"Business school research on identifying a product and new markets is one thing, while identifying a real market opportunity and a product to fit it is a totally different game. This is because a lot of academic research today is not really industry-driven. There is a ‘me-too' element to it." Karnik believes that academic institutions should be at the core of innovation with industries being built around them.

A good start has been made by coaxing venture capital firms to visit on-campus innovation festivals at the IITs in Mumbai and Madras and witness product demonstration by start-ups.