44

CHAPTER 3

Technology Transfer using Clean Development Mechanism

3.1. Introduction

Power has been considered as one of the important needs of a human

being. Multiple problems occur when the power fails. The power

generation in India mainly depends on the state sector as already discussed

in the previous chapter. The state sector has started concentrating on the

power generation methods with low GHG emissions by adopting new

technologies. The critical and super critical thermal power plants (SCTPP)

have the advantages of having less emission and higher efficiency

respectively. In South Korea, three SCTPP are working properly for the

last nine years since 2000.Another alternative method of power generation

is grid connected solar power plants in which the power cost amount to 17

crores per megawatt as compared to coal fired plants in which the cost of

generated power is about 4.5 crores per megawatt. So due to the higher

power generation cost the solar power technology has not been

disseminated in India. Developing country like India could promote clean

development mechanism (CDM) projects based on solar technology to

mitigate GHG emissions. The arid regions like desert and waste land

having high solar insolation for a considerable period of time are the most

appropriate place for installation of solar power plants (tower type) in this

country and other developing countries. In Spain and Canada, the solar

technology has been adopted for power generation over a large area thus

adding to the total generation of the country. The rate of retention is 5-6

percent per year of the total cost for the SOPP. Thus it will take about 16-

20 years to extract the total sum fed in the installation of SOPP. In

monsoon the power generation would less so to maintain the continuity of

45

the supply some alternative methods need to be implemented along with it.

The reduction in the cost of the SOPP would increase the rate of adoption

in other states of the country. The private sector has been investing in these

SOPP projects in order to achieve sustainable development over a long

period of time. The rate of adoption could be determined by using

technology diffusion models. The rate of adoption also tells about the

CDM potential of a particular technology in a country. In this thesis an

attempt has been made to determine the GHG reduction potential using

solar, small hydro, biomass, cogeneration (bagasse) in India. The GHG

reduction potential as determined using diffusion models corresponds to

CDM potential. India has been one of the major contributors to GHG

emissions in the world so it has larger responsibility globally. The human

being are responsible for disturbing the environment around us, so now it

has been the responsibility of human being to make some effort to

maintain the ecological balance by promoting eco friendly technologies.

The human beings increased their worldly desires thereby the power

requirements has also increased in same proportion .For their own desire

the people are even ready to pollute the atmosphere around them in which

they are living. So by disturbing the atmosphere they are indirectly

disturbing themselves and other creatures that are present in it. So we see

that the people have become selfish without any concern for others. So we

have to adopt those technologies which are eco friendly and could provide

us power in a sustainable manner. Most of the countries are aware of the ill

effects of pollution caused by the industrialization in the seventeenth

century but they are not ready for imposing a constraint on the polluting

agency because of the corruption, selfishness and increasing desire to have

every worldly comfort such as luxurious transportation means, luxurious

lifestyle involving air conditioners in houses and offices.

46

In this thesis an attempt has been made as per to evaluate the

theoretical potential of clean technologies such as wind, small hydro,

biomass and cogeneration (bagasse based) etc. By 2012 A.D., as per the

Kyoto Protocol (KP) even the developing countries like Brazil, South

Africa, India and China need to sign the agreement if they fail to reduce

their green house gases emissions (GHG). The annexed countries list is

given in Table 2.3.The CDM would accelerate the technological growth of

the country on one hand and would also reduce the GHG emissions. There

would be technology transfer to developing countries from the developed

nations thus providing sustainable development in the host nation adopting

innovative technologies.

3.1.1 Clean Development Mechanism (CDM)

The clean development mechanism under the Kyoto Protocol is

ideologically aimed at redressing balances in the use and development of

technologies. Technology has been proved as a pivotal force for economic

growth of any country (Bhalla, 1987). It is known that technology is a

dominant prerequisite for vigorous and sustained economic growth

(Schemer, 1988). It has been recognized as a major driving force behind

industrial progress and structural change, enabling countries to increase

their competitiveness and share of international business and hence to

increase the carbon dioxide emission. It has been demonstrated that in

recent decades most of the East Asian countries have increasingly

absorbed modern technology and integrated it into productive activities

(Amin, PhD thesis).

Among the living creatures on the planet Earth human beings are

considered the most intelligent. They learn and enhance their capabilities

in the right time and in the right way in order to get things done more

47

efficiently. Human beings create and apply technology to solve their (both

personal and socio-economic) daily life problems through learning, doing

and redoing by trial and error, even by accident. Everyone, everywhere for

every kind of human activity, uses technology. It also intricately involved

with human life that people often overlook it, take it for granted or given.

It has become an indispensible part of our life. Thus the technology as a

human made “object” is inextricably linked with human beings‟ life in all

ways and serving different useful functions in different kinds of situations

and problem solving (Bhalla, 1987).

Any technology, even the pre historic sharp stones to kill animals, is

simply a human-made tool or means to enhance either physical or mental

capacities of people. It does not only enhance individual capacity but also

amplifies the group capacities to control, conquer and exploit natural

resources for the benefit of human kind. Technology makes organized

groups far more powerful than individuals and allows for organized group

activities production, construction distribution etc. to be performed in an

easier way. As learning creatures, human beings are continually improving

their ability (capability) to achieve the desired goals by using technologies.

3.1.1.1 Development of Technologies

Human needs are distinctively identified as a hierarchy of at least

four levels (Maslow, 1954). At the first level are physiological or survival

needs food, air, water, sex etc. ; then at the second level come security

needs: clothing, health-care, shelter etc. ; third are social needs: education

occupation, mobility etc.; and at the last level are esteem needs: freedom ,

power and achievement . It has been also identified that within deficiency

needs each lower need must be met before moving to the next higher level

48

which means that the satisfaction with lower level needs emerges more

important than higher level needs (Maslow, 1954).

Fig 3.1 Hierarchy of needs of human beings

The higher needs also demand more and more sophisticated

technology in order to improve condition of life. To satisfy their needs,

human beings always want to do more, to do things better and faster than

before and in new ways. (Sharif ,1994) asserts that people by nature desire

to acquire knowledge through learning to enable them to improve over the

past and they do this triggered by their aspirations either as individuals or

in a group under a capable leadership. This is often described as progress.

Societies all over the world develop by increasing the productivity

of both natural resources and human resources through the use of

technology, which is reflected in skills, knowledge, tools and techniques

(Sharif,1995). In the pursuit of happier life, people increase their

consumption, which is strongly facilitated by technology. The material

possessions and consumption does not necessarily mean more satisfaction

in life which has been proven to be correct in many cases. For example, an

extremely poor person in rural areas of developing countries could be

49

happier than the rich people of developed countries having higher per

capita energy consumption because of different thinking .There has been a

need of pollution mitigation of the inner self also as it is responsible for

every wrath what the people are facing today such as global warming,

global cooling, floods, draught etc. So there should be simultaneous effort

need to be made one for making a change within us and other effort in the

environment in which we are living so as to protect the world from making

it a vulnerable place for all living creatures.

There are people who live without the use of modern technology but

in a more and more globalizing economy it has been becoming almost

impossible for someone with traditional knowledge, technologies and

skills to compete with someone who has uses latest technologies as per as

the comfort of this world has been concerned. There has been no doubt,

technology is one of the most powerful tools which could be used, misused

and abused. We have already seen the ill effects of the technology in the

last decade which has not only retarded the progress of countries but also

destroyed the cultural heritage of those countries. So while technology

transfer the pros and cons of that technology being adopted need to be

studied before adopting it and implementing it over large scale. The thesis

presents a set of parameters which could predict selection of appropriate

technology out of many.

Over thousands of years human beings have developed from an

exclusively hunting-gathering occupation based society to a combination

of farming-shifting, manufacturing-processing, synthesizing-recycling and

manipulating-controlling occupations (Sharif, 1994). The overuse of

technology had affected the natural environment making it vulnerable and

harmful for life. On the other hand, people and societies that were left in

50

poverty or exploited have become even more reliant on the environment as

a provider for their daily basic needs. Both the effect of extreme poverty

and too much affluence are often responsible for the overexploitation of

nature, misuse of technology and are threatening the future (Zeleny, 1986).

According to Davison (Davison,1999), technology is the medium

through which human beings build the world and technology as a form of

practice may sustain or enervate people‟s experience of belonging to a

world rich in goodness. However he also points out that many

contemporary forms of technological development persistently lack the

ability to sustain the well being of biotic and human communities. The

importance of technology is beyond any doubt. It is the key to the

economic growth of any nation. Technology to the economy is like food to

the child‟s body (Zeleny, 1986). It has been needed both for survival and

sustainable growth. Technological progress is a major determinant of

economic development in terms of increasing per capita income or

changing economic and social structure. Investment in development and

deployment of new technology was recognized many years ago by

economists such as Joseph Schumpeter and Robert Solow as engines for

economic growth (Amin, Thesis). The development of technologies

however requires resources, knowledge and skills that not all countries

posses. In the last several decades the transfer of technology from

developed countries to the developing countries has received increasing

attention at both national and international levels. The international

transfer of technology has been seen as a primary mechanism for „solving‟

both the traditional problem of poverty in developing countries such as

India and the newer problems of global environmental security.

51

Technology is transferred to developing countries like India

commercially through trade, contractual arrangements (licensing, technical

assistance agreements), foreign direct investment and joint ventures, with

multinational corporations (MNCs) playing predominant roles. Such

transfer takes place by and large under highly imperfect market conditions

and uneven bargaining positions between sellers and buyers.

Consequently, there are many „undesirable‟ effects from the developing

countries‟ perspective, including excessive payments for technology,

unfair restrictive controls by sellers, adoption of technologies inappropriate

to local factor use and consumption need, inhibition of local

entrepreneurial and R&D activities, continued dependence on the

developed countries and persistent economic disparities both domestically

and internationally (Zeleny, 1986).

The main problems identified for international transfer of technology

are (і) lack of access to technology, (іі) lack of demand, (ііі) lack of

finance, (іᴠ) lack of technological capabilities, (ᴠ) lack of infrastructure

and lack of relevant technology (Zeleny, 1986; Ramanathan, 1994). In

most of the technology transfer cases „hardware‟ aspects often attract the

greatest attention and are most easily quantified. The „software‟ elements

however are also equally important. Much of the know-how to operate,

maintain, and adopt production technology is „tacit‟ knowledge that forms

part of the experience of particular individuals and is not easily transferred

or codified (Amin, PhD thesis).

Developing countries have been eager to participate in technology

transfers but this has often come at a cost and not in the most beneficial

way. The strategies of the 2007 Policy (Ramanathan,1994) ,states that (і)

measures will be taken to encourage research and development (R&D) and

52

promote development, acquisition and transfer of appropriate technology,

including the creation of a market responsive institutional framework for

overall technology development, (іі) foreign direct investment (FDI) will

be targeted as an important vehicle of technology transfer, skill

development and promotion of management and marketing know-how,

(ііі) acquisition and dissemination of technology will be pursued through a

technology dissemination, trade and industries associations and Indian

missions abroad.

There have been some recent efforts to redress the situation and

develop national capacity, including institutional, technological, skills and

knowledge base. In the Eleventh Five Year Plan (2007-2012), the

government of India has been strengthening its technological base which

could be achieved through building indigenous capacity in science and

technology as well as enhanced access to the frontier of international

technology by way of adoption and adaptation. Such access to modern

technology is a means of industrial development. The government of India

encourages development of labor intensive small and cottage industries

through acquisition and development of appropriate technology. These

include (і) dissemination of various forms of renewable energy

technologies such as solar, wind, and mini-hydro, especially in rural areas

and other remote and isolated location of the country, (іі) efforts are made

to popularize bio-gas technology developed by the Council for Science and

Industrial Research (CSIR), (ііі) application of new and renewable

technologies. Transfer of modern technology is carried out mainly with the

help of volunteers from United Nations Volunteers (UNV), Japan

International Cooperation Agency (JICA), Korean International

Cooperation Agency (KOICA) and Peace Corps for youth development.

53

The development of national science and technology includes the

remodeling of the legal frame for protection of intellectual property,

providing incentives for local entrepreneurs, development, transfer and

adoption of technology. The importance of technology development has

been particularly reinforced due to the threats posed by climate change.

Technology transfer has been expected to play more important role in the

future.

3.1.2. Climate Change and the Clean Development Mechanism

Climate change has been considered as one of the major threats for

the human beings in the 21st century. The 1992 United Nations Framework

Convention on Climate Change (UNFCCC) has been one of the series of

agreements through which countries around the world attempted to band

together to meet these threats. The convention has been designed to allow

countries to weaken and strengthen the treaty in response to new scientific

developments so that they may agree to take more specific actions, i.e.

reducing emissions of green house gases by certain amounts, by adopting

amendments or protocols to the convention. The convention encourages

them to share existing technology and to develop new technology, to

cooperate with each other in other ways to reduce greenhouse gas

emissions which are produced from human activities. At the time, the most

industrialized countries committed to reduce their collective green house

gas (GHG) emissions by at least 5% compared to 1990 levels by the year

2008-2012. The Kyoto Protocol (Article 12) to the UNFCCC of December

1997 created three flexibility mechanisms: (і) Joint Implementation (JI),

(іі) Clean Development Mechanism (CDM) and (ііі) Emissions Trading to

reach the goal of GHG emissions reductions at the lowest possible cost for

the committed countries. The CDM has been perceived as an opportunity

54

for the developing countries in achieving sustainable development and

helping annexed I parties (i.e. more development countries) to meet their

emissions limitation and reduction obligations committed under the Kyoto

Protocol.

The identified specific goals of Article 12 of the Kyoto Protocol for CDM

are as follows (UNFCCC, 1998a):

To assist Parties not included in Annex I in the achievement of

sustainable development and contributing to the ultimate objective

of the convention;

To assist Parties included in Annex I in achieving compliance with

their quantified emission limitation and reduction commitments

under Article 3;and

To assist developing country parties that are particularly vulnerable

to the adverse effects of climate change to meet the costs of adoption

by ensuring that a share of proceeds of each project is assessed for

this purpose.

Specially, Article 12 of the Kyoto Protocol specifies that developing

countries also are to benefit from the CDM resulting in certified

emission reduction commitments under the Kyoto Protocol. The CDM

has the potential to fund “technological leapfrogging” that would

enable developing countries to bypass the inefficient choices such as

coal technology made by the industrialized countries.

The CDM is a modified version of Joint Implementation that was

included in the Kyoto Protocol for project-based activities in

developing countries. It was created as a successor to Joint

Implementation (JI) which consists of a bilateral agreement between

55

two entities to complete a GHG mitigation program. Mainly JI is a form

of emission trading. It is a concept where industrialized countries meet

their obligations for reducing their GHG emissions by receiving credits

for investing in emissions reductions in developing countries. The

investor is from the Annex-I industrialized country that might reduce its

emissions under the framework convention. Such an investment may

help the investor country to achieve emission reduction at a lower cost

than domestic abatement. On the other hand a developing country can

benefit from new investment which increases economic activities and

may mitigate local environmental problems.

Although well intended, nothing has been mentioned in CDM about

small scale projects that are incapable of contributing greatly to the

environmental objectives. Besides, in the name of technology transfer

through Foreign Direct Investment (FDI), Official Development

Assistance (ODA) financing has already been established and

functioning in developing countries and the gap between rich and the

poor has also been constantly widening. It is not clear how the CDM

activities will contribute for helping the poor to live in a more

sustainable way.

The CDM is a form of market tool in which valuable goods and

services are to be bought and sold. A number of technical, regulatory,

project finance and administrative functions must be performed under

this tool. Many of these functions may be most effectively undertaken

by private markets or existing international institutions. The key

questions as to what functions need to be undertaken by new CDM

institutions or how effectively they could be operated still remain.

56

Research by United Nations (Bread for the world institute, 2001)

showed that meeting the international development goals alone would

require an extra US$50 billion per year of official development

assistance, almost double the ODA that is currently provided. The

broader need for ODA, beyond these crucial goals and particularly for

sustainable development, has been certainly much greater than these

additional US$50 billion.

Achieving a reasonable minimum standard of response to

humanitarian crises would cost US$8-9 billion in a typical year; an

increase of at least $3 billion from recent spending levels (Bread for the

world institute, 2001). Events such as the 2004 Boxing Day Tsunami

had increase the need for assistance way above this figure. Furthermore,

proper humanitarian assistance will not be possible without adequate

funding by the United Nations, which today is grossly underfinanced.

The international community should urgently tackle this issue.

Table 3.1 Money Pledged in Copenhagen Meet in 2009.

S. No Countries Billion (dollar)

1. EU 10.6

2. Japan 11.0

3. US 3.6

Total 25.2$

Source: Hagen Meet. TOI, 2009.

We see that the developed nations are not committed for the cause of

climate change .The amount as required for the implementation of the

CDM has been much more than pledged in the last decade but it has

been not achieved yet as we see in Table 3.1.So we see that the total

amount in ODA comes out to be about 25.2 billion dollars which is

about half of the amount as decided in 2001 by (Bread for the world

57

institute, 2001). Another estimate suggests that 15 percent of aid

budgets are devoted to the supply of what are really global public goods

and are financing activities that often benefit donors more than

recipients (Chen, 1996).The number of projects as registered under

CDM for developing nations is shown in Table 3.2.

Table 3.2 Number of Registered CDM Projects in India (2008)

The

leading sectors incorporating CDM projects in India are given in Table

3.3.

Table 3.3 Projects sanctioned to different sectors in India (2008)

S. no. Sector No. of Projects

1. Power 68

2. Wind 54

3. Sugar 30

4. Cement 26

CDM need to develop Indian carbon market with a robust and diverse

portfolio of projects. As many 746 Indian companies representing over 40

sectors accounting for 1056 projects that have been applied. About 703

projects in India are waiting approval. The potential earnings from

certified emission reductions (CERs) are expected to be about 516 million

tonnes by 2012 A.D (CDM, 2007).

S. no. Country No. of Projects

1. India 353

2. China 260

3. Brazil 140

4. Mexico 109

5. Chile 25

58

CERs is the first global, environmental investment and credit

scheme of its kind providing standardized emissions offset instrument

operational since the beginning of 2006, the mechanism has already

registered more than 1650 projects and is anticipated to produce CERs

amounting to more than 2.9 billion tonnes of carbon dioxide. The

private and public sector are dedicated to the cause of reducing GHG

emissions. The executive director, D.K.Jain (NTPC) and BHEL are

working on the power plants based on underground coal gasification

technology. The Hindustan Unilever Limited(HUL)are committed for

the cause of reducing the GHG gases in the manufacturing operations

by 25% in the next five years from 2009 to 2014 by using agri waste to

fuel its boilers in factories.

Market based mechanisms under the Kyoto Protocol have been

effective instruments for corporative GHG mitigation. India has

responded positively to CDM and would remain an active player said

Prodipto Ghosh in a report prepared by Industrial body, Federation of

Indian Chambers of Commerce and Industry (FICCI). Net employment

generation is an indicator of social sustainalibility, measured by the

number of additional jobs created by the CDM project in comparison

without that project situation. This indicator is problematic in that it

does not register a qualitative value for employment, such as, whether

the resultant jobs are highly or poorly qualified, temporary or

permanent, secure or flexible. Figures are also subject to inflation

depending on whether direct and indirect jobs are counted.

On the other hand there is a clear tradeoff between low-cost

carbon abatement and high sustainable development benefits as can be

seen from Table 3.4 which presents the non- carbon benefits of three

59

potential technologies, PFBC(Pressurized fluidizes bed

combustion),IGCC(Integrated gasification combined cycle),and wind

based power generation, under the CDM(TERI report,2000).Non

carbon benefits are rural development, local environmental benefits,

and access to state-of-the-art technology as sustainable development

criteria.

Table 3.4 Social Benefits of Different CDM Projects

Project Cost of Carbon

Abatement(US$/Tonne

of CO2)

Rural Development Positive

Environmental

Impacts

Access to

State-of-Art

Technology

PFBC 1 Low Medium Medium

IGCC 30 Low High High

Wind Power 31 Medium/High High High

Source: TERI, 2000.

Efforts are also made to produce oil from coal. Companies such as

ONGC, Tata Group and Jindal Group are working with international

players to produce oil using coal to liquid technology. Such

environmental friendly technologies are expected to contribute towards

meeting country‟s energy security goals as Indian spends nearly 80

billion dollars every year to meet its crude oil requirements.

3.2 Technology Transfer

The Clean Development Mechanism under the Kyoto Protocol has

been ideologically aimed at redressing balances in the use and

development of technologies. Technology has been a pivotal force for

economic development of any country. It is known that technology is a

dominant prerequisite for vigorous and sustained economic growth

(Schemer, 1988). It has been recognized as a major driving force

behind industrial progress and structural change, enabling countries to

60

increase their competitiveness and share of international business and

hence to increase the carbon dioxide emission. It has been demonstrated

that in recent decades most of the East Asian countries have

increasingly absorbed modern technology and integrated it into

productive activities Those countries have thus expanded their output,

increased their employment, improved skills, raised productivity and

economic strength. The degree of contribution of technology to the

economy is obvious. However, the majority of Asian countries are

reliant upon transfer or acquisition of suitable technology as well as the

related to its management practices (Amin, PhD thesis, 2005).

Derry (1960) wrote in their short history of technology. “The

fortunes of mankind have been closely affected by the growth of

technology”. Solow (1957), one of the pioneers in studying the role of

technology in development, showed that in the period of 1909-1949,

about 90% of the increase in per capita output in the non farm sector

were attributable to technological change with only a minor portion

attributable to increase in the in the amount of capital per worker. In

relation to Germany, Fischer (1978) showed that between 1850 and

1913, technological progress contributed 42% to the average growth

rate of 2.6% per annum of the German economy. This study also

indicates that the average growth rate would have been substantially

lower at about 1.5%, had additional factors of production been

introduced into the production process without technical changes and

improvement in the labour quality. For Japan, Hirono (1985) pointed

out that between 1979 and 1995; the manufacturing industry growth of

29% and 40% respectively could be attributed to technological

progress. His study also predicts that in the 1990‟s technological

61

progress could contribute as much as 65% to the Japanese economic

growth.

Pastore (1978) showed that from the end of the Second World

War until the early 1970s the Brazilian economy grew at an average

rate of 7% annually in which technological progress contribution is

21%.The Korean Development Institute showed in its research that the

contribution of technology is about 13% from the late 1970s to 1990s

due to structural change in economy shifting from labour intensive to

technology intensive heavy and chemical industries.

According to Porter (1985), “technological change is one of the

principal drivers of competition. It plays a major role in the structural

change of industry as well as in creating new industries. It is also an

equalizer, eroding the competitive advantage of even well entrenched

firms and propelling others to the forefront. Many of today‟s great firms

grew out of technological changes that they were able to exploit. Of all

the things that can change the rules of competition, technological

change is among the most prominent.”

Technology and technological know-how is one of the most

vital factors of production that has had very strong influence on

mankind (Davison, 1999).In the pursuit of political power, human

beings have developed alternative ways to increase productivity and

technological strength both during peace as well as wartime. There is

evidence that during the First and Second World War as well as the

Cold War period technological progress outpaced the rate of advance in

technology of all other periods. Even the refinement of these existing

technologies is now contributing to the productivity increase in

developed countries in manifold than earlier stages of industrialization.

62

Development takes time particularly at the early stages. For

example, United Kingdom‟s economic growth was 2% per annum in

most of the 19th century. All industrially developed countries of today

started off from relatively low technological levels. The present

developing countries have the advantage of availability of international

capital resources and access to sophisticated technology though it is

limited. Many developing countries have good infrastructure and

advanced educational systems as compared to United Kingdom in the

18th century when it embark on the first industrial revolution. If access

to technology is facilitated, developing countries could achieve

significant changes within a relatively short period of time. However

the technological gap between developed and developing countries

have been widening, and the gap between more and less developing

countries has also been increasing.

Technological advancement is a pre condition to facilitate

industrialization and thereby augmenting economic development to

achieve poverty reduction and a more sustainable future. Technology

upgrades for a developing country depend largely on procurement of

advanced and appropriate technology (Taylor, 1971). However,

technology transfer has so far played only a sporadic role for the

developing economies. Technology transfer process can be effective

only if combined with proper policy strategies. The private sector plays

a key role as an intermediary in both the transferring and acquisition

process. The private sector entrepreneurs must have the background,

capability cognizance and judiciousness to envisage critically all factors

for decision making pertaining to technology transfer such as

assessment of appropriateness, effectiveness and feasibility of

63

technology. This has usually not being the case and often the

transferred technologies have had negative impacts and especially to

the natural environment of the developed countries.

Generally, the term “technology transfer” is interpreted as being

a process in which “technology” in use in industrialized countries is

made available to less developed countries without knowledge of the

technology. This simplistic view gives a rather misleading picture of

what technology transfer involves. Technology advancement is a

continuing process and change must be accomplished through constant

improvement, diversification and specialization. This implies local

development of knowledge and skills. Technology transfer does not

undermine innovations that are taking place in developing countries

particularly the developing of appropriate technology (TERI, 2000).

However, in certain areas, sophisticated technology has to be

introduced. For this purpose technology transfer is inevitable.

3.2.1 Conventional Definition of Technology

The word derives from the Greek words “techne” means an art or

skill, and “logia” meaning a science or study. The literal meaning of the

word technology is the study of an art or skill. The Webster‟s New

World Dictionary (Guralnik, 1984) defines it as the science or study of

the practical or industrial arts, applied sciences etc., and Webster‟s New

International Dictionary (Babcock, 1981) explains it as the science of

the application of knowledge to practical purposes in a particular field.

Ramanathan (1993) states that various classical definitions of

technology may be categorized in to three major perspectives, namely,

(1) the “technology as transformer” perspective; (2) the “technology as

64

tool” perspective; and the “technology as knowledge” perspective.

Firstly, in the transformer perspective, technology is seen as a „black-

box‟ that merely transforms inputs into outputs. Taylor (1971) says that

technology is a set of principles and techniques useful to bring about

change toward desired ends. Lal (1987) defines technology as the

application of scientific knowledge and skills to setting up, operating,

improving and expanding of productive facilities. Secondly, the

technology as tool perspective opens up partially the technology black

box. It emphasizes that technology is a tool for transformation of

activities. It also points out the importance of looking at machine-

people interactions. Technology as knowledge is very much skills and

heuristic know ledges of human being. Schemer (1988) defines

technology as any tool or technique, any product or process, any

physical equipment or methods of doing or making by which human

capabilities extended. Fullan (1970) defines technology as the manual

or machine operations performed upon an object in the process of

turning out a final product.

Thirdly, the technology as knowledge perspective opens up the

technology black box further and regards technology as knowledge.

The knowledge could be either in the form of “know-why” or “know-

how”. Edosomwan (1989) describes technology as specialized body of

knowledge that can be applied to achieve a mission or purpose. The

knowledge can be in the form of tools, processes, techniques, machines,

materials or procedures.

The Web Dictionary of Cybernetics describes “technology” also

as an object or sequence of operations created by humans to assists in

achieving a certain goal. A technology is a body of human knowledge

65

that can be passed along from one place to another and from one

generation to the next. The body of knowledge refers to the systematic

study of methods; techniques and hardware applied in the adaption of

the physical environment to human needs and wants. Technology is

also the application of scientific knowledge to build or improve the

infrastructure of agriculture, industry government and daily life.

However, technology must not be confused with the very infrastructure

it generates.

Technology has autocatalytic properties. It favors the use of

technical devices and process even in solving social problems, e.g. , by

using fertilizers to enhance agricultural production rather than a

different form of work organization, by using computers for national

planning rather than decentralized decision making process. The

systematic knowledge and the methods and producers that can be used

in a specific area in order to resolve practical problems are also

technology.

In summary, technology is the technical means people use to

improve their surroundings. It is also knowledge of using tools and

machines to do tasks efficiently. We use technology to control the

world in which we live. People use technology as knowledge, tools and

systems to make their lives easier and better. They also use technology

to improve their ability to do work. Through technology, people

communicate better. Technology allows them to make more and better

products. Our buildings are better through the use of technology. We

travel in more comfort and speed as a result of technology. Hence,

technology is everywhere and can make human life better.

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Through technology people also enter in particular relationships.

The world is often divided into technology rich and technology poor.

Hence technology also affects social and economic structures within

society. It can be seen as a state or process of development.

Irrespectively of the particular definition of technology, it is the

tangible and intangible things that help human beings to make their life

better whereas technology itself can contain good, bad and neutral

characteristics.

3.2.2. Technology Components

To open up the black box Zeleny (1986) points out that the

technology of three interdependent, co-determined and equally

important components: hardware- the physical structure and logical

layout of the equipment or machinery that is to be used to carry out the

required tasks; software- the knowledge of how to use the hardware in

order to carry out the required tasks; and brain ware- the reasons for

using the technology in a particular way. Bhalla (1987) defines

technology as consistent of three elements: the physical things- tools,

machines and materials that mankind uses for all activities; the software

aspects including technical processes design and procedures such as

heat treating sequences, computer programs, etc. and information

systems that describe the foregoing such as standards for different

motor oil, standards for heat exchanger insulation, and standards for

screw threads.

A further extension of the understanding of technology

components is given by Sharif (1993), Ramanathan (1993) and the

Asian and Pacific Center for Transfer of Technology (1989). They state

that technology consists of four interrelated and interacting components

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which are (1) object-embodied form or “Techno ware”; (2) human-

embodied form or “Orga ware”. This engineering approach is

considered useful in this study in relation the transfer of any

technology. Although it has its limitation in terms of providing

somehow fragmentized view of technology, it offers a very clear

picture of the various aspects that need to be covered for a technology

transfer to be successful. It also emphasizes the various functions

associated with the use of technology.

Techno ware: Techno ware is object embodied physical facilities. It

comprises a material transformation subsystem and an information

processing subsystem. The material transformation subsystem

performs desired mechanical operations that the techno ware has been

designed to perform. Techno ware amplifies human powers and

controls for transformation operations. In a business enterprise, techno

ware changes through a process of periodic substitution of old by new.

In general, the degree of techno ware sophistication corresponds to the

increasing complexity of the physical facilities for transformation

operations and other functions such as scale of operations,

interrelationships among operations, types of conversions, energy

requirements, quality of outputs, safety and environmental soundness

of operations etc.

An information processing subsystem carries out a three stage

control sequence namely, sensing-analysis-actuation. The information

processing subsystem may be completely or partially built into the

techno ware. There are considerable interactions between the techno

ware, the human ware that operates the techno ware and info ware

needed to operate the techno ware.

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Human ware: Human ware is the person embodied human abilities. It

consists of skills, craftsmanship, expertise and creativity. It is needed

to realize the potential of techno ware and consists of “contact human

ware” and “support human ware”. Without relevant human ware, the

techno ware is simply useless. Human ware changes through a process

of progressive learning of new things. Usually the degree of human

ware sophistication indicates the increasing level of competence of all

individuals engaged by the organization. The competencies are in

terms of skill level (derived from general education and specific

training), appropriateness of training, achievement orientation, extent

of relevant experience, productivity orientation, creativity potential and

the motivation of the personnel (Sharif,1995). Human ware

sophistication is important to understand the technology properly and

utilize in proper need. It includes ability to comprehend and use work

specific technology components, ability to mobilize setup and utilize

technology components for work, ability to optimize use of available

technology components for all tasks. It is human ware that through its

insights of the functional capabilities, limitations and extent of

manipulability of the techno ware, causes desired outputs to be

produced by the techno ware. The importance of human ware is well

elaborated by Ozaki (1991) who points out that the humanistic

economic philosophy of Japan is based on three propositions: human

resources are the most important element of production. They are the

ultimate origin of the market value of all goods produced. People,

unlike non-human resources, are intellectual (intelligence-carrying)

beings in that they are capable of thinking, analyzing, inventing,

innovating and developing information which is vital for creation of

wealth. They are psychological beings whose productivity may rise or

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fall depending on whether they are motivated or demoralized by their

work environment. Human ware includes contact human ware which

refers to the operators of the techno ware while support human ware

refers to the maintenance industries, software specialists and

production management personnel.

Human ware sophistication depends not only on formal training

related to the operation of techno ware but also involves: the attitude of

the individual towards work, workplace and fellow workers [35]. This

comes about due to the cumulative effects of the collaboration between

individuals making up a team, and applying, during a long period and

in the same conditions, a certain process that they themselves have

refined. Such know-how generation requires appropriate attitudes in

the human ware. Thus, the sophistication of both the contact and the

support human ware would depend on the academic qualifications,

experience and training including their attitude towards their work,

workplace and fellow workers.

Info ware: Info ware is record embodied knowledge .These are facts

and formulae, design parameters, specifications, manuals, theories etc.

It represents the accumulated knowledge needed to realize the full

potential of the techno ware, human ware and orga ware. Info ware

enables quicker learning and savings in terms of time and resources. It

changes through a process of cumulative acquisition of knowledge.

Normally the degree of info ware sophistication represents the

increasing utility of an up-to-date knowledge base acquired for various

enterprise functions. Sharif (1995) describes the utility as nature and

type of knowledge (relevance, timeliness and reliability of facts and

figures), ease of retrieval of stored knowledge, extent of networking

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for updating, etc. The degree of info ware sophistication includes

documented knowledge that provides awareness regarding technology

components, manuals for the operation and maintenance of physical

facilities, availability of facts and figures for acquisition and optimal

performance, and access to the latest theories of techno ware, human

ware and info ware state-of-art knowledge.

Orgaware: Orgaware is institution embodied organization

frameworks. They are methods, techniques, organization networks, and

management practices. It basically helps for the coordination of

activities and for resources utilization towards achieving desired goals.

It changes through a process of evolving arrangements and practices.

Orgaware sophistication is needed for additional increase of value, an

increase of new management techniques, systems analysis and

operations research based optimization techniques and information

technology based re-engineering and innovation techniques and

community based indigenous knowledge. It includes all the tacit

knowledge embedded in the organization. The critical need for the

development of appropriate orgaware to make the best use of advanced

techno ware and meet the challenges of dynamic market conditions has

been the theme behind many interesting papers such as those by

Cusumano (1988), Schmenner (1988) and Hill (1992). In today‟s

globalised economy its importance is higher as it is the orgaware that

mainly helps bring together all the components of technology

implementation.

It should be emphasized that the four components of technology-

techno ware, human ware, orgaware and info ware are interrelated and

influence each other. They are required simultaneously in any system

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of production that is important to be transferred. Absence of any of the

four components means no transformation in the process and thus an

ineffective system. While the human ware is the centre of all these

activities, the orgaware is the environment that allows for all

components to come together. The info ware can facilitate the process

or its lack can slow it down. We can see the interrelationship and

dependency of the four components of the technology. In any

technology transfer process it is important to be aware of all these four

components in order to achieve a positive outcome. If the emphasis is

only on one of them, e.g. techno ware (as it often the case), not all

aspects of technology would be transferred and the new operations

would be left without the complete requirements for successful

performance.

3.2.3 Technological Capabilities

The understanding of the technology alone is not enough to

ensure effective technology transfer and Implementation. Technolog

ical capabilities are the most important factors regarding effective

technology transfer as technology can be brought while you cannot

buy capabilities. Capabilities need to develop or grow or enhance

through enterprises as well as at individual level. The word capability

as noun has three meanings. Firstly, capability as capableness is the

quality of being capable either physically or intellectually or legally.

For example, someone works to the limits of his/her capability.

Secondly, capability as a sense of capacity is the vulnerability of

something to a particular treatment e.g. the capability of a metal to be

fused. Lastly, and capability as a sense of capableness and potentiality

is an aptitude that may be developed. Hence the capability is

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something individual which could be developed (Amin, thesis, 2005).

Ramanathan (1993) refers to four kinds of technology capabilities

needed to run a production process as a owner of particular technology

named operative capability, acquisitive capability, supportive

capability and innovative capability whereas Sharif (1995) refers to six

types of technological capabilities. They are: transforming

capability(operating and supporting capabilities),vending

capability(marketing and servicing capabilities),acquiring

capability(sourcing and procuring capabilities),modifying

capability(improvising and improving capabilities),designing

capability(conceiving and devising capabilities) and generating

capability(innovating and commercializing capabilities).He also

emphasizes that technology can be purchased either partly or as a

whole but technological capabilities have to be acquired gradually by

self-learning which depends mainly on the human ware. These six

types of capabilities are discussed below1in order to provide a better

understanding of what needs to be transferred during any kind of

technology transfer from a developed country to developing country to

developing nations such as India.

Transforming capability (operating and supporting capabilities) is the

utilization of available technologies for the transformation

process(Sharif,1995).They are the capability to operate and control

techno ware for all transformation activities, the capability to use

available human ware for the production of marketable outputs, life

capability to provide the human ware with the required info ware for

efficient production, the capability to apply techniques for planning

and coordination of production operations and the capability to

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undertake preventive and corrective maintenance and troubleshooting.

It also means the gradual progress towards the optimal use of the

installed technology components and the mobilization of all resources

for optimum benefits.

Vending capability (marketing and servicing capabilities) is the

capability of distributing, selling and servicing of the outputs using

technology (Sharif, 1995).This includes the capability to sell the

outputs for the optimum use of resources and production capacity, the

capability to monitor the externalities and evaluate performance, the

capability to identify new markets and the capability to provide after-

sales services to enhance customer satisfaction. It does not include

marketing gimmicks such as free gifts, lottery etc.

Acquiring capability(sourcing and procuring capabilities)is the

capability of acquisition of technology components and other

resources(Sharif,1995).It includes the capability to prepare

specifications for upgrading existing technological resources, the

capability to identify independently the sources of the procurement of

required resources, the capability to evaluate others, select and

negotiate the terms of contracts for procurement ,the capability to

secure favorable funding to upgrade technological resources and the

capability to minimize project implementation time and cost of

business modernization .It also means the ability to choose and obtain

better quotations and better negotiating ability for procurement.

Modifying capability(improving capability)is the continuous

improvement of all activities and technology components

(Sharif,1995).They are the capability to commission physical facilities

and construct civil engineering works, the capability to adapt installed

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techno ware and orgaware for better efficiency, the capability to

duplicate acquired machinery and equipment parts requiring

replacement ,the capability to carry out minor, incremental

improvements for superior quality outputs, the capability to implement

human resources development programs for all activities, the

capability to introduce advanced management techniques for effective

performance. It helps to minimize producer cost and maximize

customer value.

Designing capability (conceiving and devising capabilities) is the

actual utilization of product development technologies. This includes

the capability to undertake product design, redesign and modifications

for perceived or felt needs, the capability to relate product design to

producibility (the production process) factors, the capability to

introduce creativity and the capability to move from imitation to the

creation of new products for the future markets. Designing capability is

important recognize the customer utilities that are related to product

function and performance.

Generating capability (innovative and commercializing capabilities) is

the utilization of process development technologies. They are the

capability to carry out research and development work for product-

process innovations, the capability to derive commercial benefits by

patenting useful research results, the capability to develop prototype

and scale-up facilities for actual production, the capability to

commercialize in house or contracted research results. Generation

capability indicates the crucial realization of self reliance and control

of critical technology components for effective international market

competition (Sharif, 1995) in the face of rapid technological changes.

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The most economically feasible ways to address the long term

challenge of climate change, while meeting the needs and aspirations

of sustainable development, will require the development,

commercialization and widespread dissemination of both efficient

existing technologies and new, currently non-commercial technologies

that can help reduce greenhouse gas (GHG) emissions into the

atmosphere.

Moreover, innovation will substantially improve the future

performance of current and proposed technologies. Traditional

technology development and implementation need to be enhanced and

broadened to help support the implementation of climate policies and

objectives under the UNFCCC and Kyoto Protocol. Business is and

will continue to be a primary source of such technologies. In providing

enabling frameworks for technology development and cooperation,

government policies should encourage business to undertake the

research and development required to create innovative technologies.

Innovative technology provides the promise of powerful tools to

manage long-term risk, preserve prosperity and promote investment.

Policies should be developed at national and international levels to

encourage the research; development and deployment of technologies

that help address growing emissions, improve access to energy, and

support economic development and support adaptation, particularly in

developing countries. Electric power, transportation and fuels and end-

use energy applications will be particularly strategic areas.

3.2.4 Understanding Technology Transfer

According to Rosenberg (1982), technology is a commodity,

knowledge, or a socioeconomic process. Technology as a commodity

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can be reproduced and transmitted from one to another. According to

this view technology transfer is simple as making photocopy of

designed documents. This view of technology has been supplemented

by the view of technology as knowledge (Lal, 1987).Research and

innovation bring this knowledge from invention to new products,

processes and services in practical use. Rip and Kemp (1998)

discussed technology in relation to climate change.

Technology transfer is most basically a complex process of

learning (Lal, 1987), Chen (1996) asserts that technology transfer is

not achieved until the buyers understands and can utilize the

technology. The ability of the buyers to choose and adapt the

technology to the local socio-economic environmental and raw

materials could be a criterion for technology transfer. In lack of such

capabilities to choose technology transfer could be inadequate,

unsustainable, unsafe or bad. On the other hand, perhaps cheaper

technology and equipment transfer can take place. For example,

inefficient refrigerators, stoves, cars could be sold to the developing

countries like India, China, Brazil, South Africa etc.

Clean technologies objectives should be promoting more

widespread use of existing efficient technology in developed and

developing countries encourage earlier retirement of less efficient but

productive technology stimulate research and development to create

innovative, affordable, lower GHG technologies sooner. The potential

of maximum benefit to all partners involved in development and

dissemination of more climate friendly technologies will be greatly

facilitated if appropriate enabling environmentals are developed by all

countries. Business has been and will continue to be the main source of

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innovation, development, commercialization and wide spread

dissemination of technologies led by successful and profitable

companies bear the costs of developing such technologies and need to

realize a return on their a return on their investments for them to be

sustainable. For every one successful innovation, many good ideas fall

by the wayside-some taking substantial funding with them. Business

must be encouraged to take this risk. For such technologies to become

a global reality, governments must promote short and long term

enabling frameworks for commercialization and dissemination of

technologies. These frameworks should encourage technology

utilization, technology transfer and capacity building. So that both

developed and developing countries can benefit from technological

progress.

Investment decisions for long lived facilities typically involve

considerations extending well beyond the Kyoto Protocol‟s first

commitment period. Consequently, these decisions may be affected by

changes in the second commitment period, including emissions

obligations, participating parties, covered gases, global warming

potentials, flexibility mechanisms and procedures for compliance and

non compliance. Processes that affect later periods should be defined

transparently, so that investment risk can be assessed. In this thesis, the

clean development mechanism (CDM) potential using renewable

energy sources (RES) has been determined. A wide range of

technologies will be needed, with the choice of which technology

being dependent on local circumstances. There is no “one size fits all”

solution. No single technology appears to have the potential to provide

the majority of emissions reductions necessary to stabilize atmospheric

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concentrations of green house gases. Many technologies can make a

difference now and in many cases, are available now given the right

enabling frameworks. For the long term, innovative non commercial

technologies would be necessary.

Consequently, government policies which seek to choose

“winners” and “losers” among technologies do not provide an enabling

framework – on the contrary, they close off options and discourage

innovation. The establishment of positive or negative technologists

would serve to hinder effective long-term utilization of the most

appropriate technology for the countries where they are to be used.

Decisions to prohibit certain technologies or substances may lead to a

potential loss in emissions reductions in the short term, due to a sharp

decline in investment to optimize that technology. Decisions about

appropriate technology should therefore be part of the process by

which projects are approved by host countries.

The international marketplace should also provide supportive

frameworks for cleaner technology development, commercialization

and dissemination. Government should remove market barriers and

strengthen enabling frameworks for technology innovation and

dissemination. Trade and investment are important means for business

to promote capacity building and technology transfer, especially

through foreign direct investments according to acceptable

requirements for investment security and with the potential for a

competitive return.

There are two distinct type of technology transfer namely,

private and public. Most companies engage in bilateral, company to

company commercial arrangements. Companies enter such

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transactions based on many factors, the “right” partner an “attractive”

market, access to raw materials, transparent, stable and equitable legal

and financial structures, safe and secure working conditions and a

good, local workforce. In these situations, companies are encouraged

to make a long-term commitment and to integrate with local culture

and values and what technology should be transferred. To business it is

very evident that today the widespread use of existing, efficient

technology is indispensible. This should not be ignored in the drive

towards “break-through” and “leading edge” solutions. The 2 billion

people in the world without access to commercial electricity are not

asking for a “state of the art” solution, but clean and practicable

solutions now.

3.2.5. Technology Transfer Choices

Long term sustainable development depends on the choice of

technology to be used for economic development to reduce poverty in

developing countries like India. The choice of technology depends on

the technology itself, choice of mode of technology transfer,

acquisition, service; markets etc. These choices are different in any

specific circumstances. While developed countries are looking for

more harmonious and sustainable relationships with the environment,

identifying a way out of the accelerating energy and resources crises,

to develop a more socially conductive work environment and revitalize

local culture to counter the increasingly homogenous and sterile mass

culture propagated through the electronic media, the developing

countries problems are very different. Imitating industrialization

strategies adopted by the developed countries is not solving their

problems of poverty and inequality; they are rather increasing them.

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The main reason is because technology transfer has predominantly

served business interests and elite consumer markets in utilizing

natural resources and cheap labor without any concern for

environmental issues. As a result poverty has increased in most of the

cases and technologies have acted as an assaulting instrument for the

local culture. It is necessary for a developing country to be able to

import, adapt the imported technology if necessary and develop

technologies appropriate to their surroundings and compatible with

their resource endowments.

These concerns led to the coining of terms such as

“intermediate technology” by Schumacher(1973); “appropriate

technology” by Morawetz (1974); “Progressive technology” by

Marsden(1971); “Third world technology” by Mathur (1968);

“Alternative technology” by Dickson(1974);as well as “grass roots

technology”; “kind technology”; “barefoot technology”; “evolutionary

technology”; “non-violent technology”; “indigenous technology”;

“soft technology”; “non-polluting technology”; “self-help technology”;

and “green technology” cited by Ramanathan(1995) from others. The

researchers use each of these terms with different orientation in

specific relations. However, they all have resulted from inappropriate

technology choices for the developing countries like India because of

the specific issues which they failed to address. The proliferation of

such terms leads to a considerable confusion but they all allude to

choices of in appropriate technology. Bowonder (1979) and

Ramanathan (1993) express their views on the constraints that

adversely affect the choice of appropriate technology. A similar list is

compiled below:

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The absence of formalized and institutionalized criteria which

lead to exclusive or monocular dimensions being used in

selecting technology(Maruyama,1973);

The predominance of exogenous planners in technology

selection and in general their inability to extend the field of

vision(Linstone,1969);

Lack of coordination by different planning entities and their

inability to reach a consensus on the criteria to be used and their

prioritization in the choice of appropriate technologies;

The inability of many developing country firms to comprehend

future complexities and their restricted field of perception that

makes it difficult for them to project their aspirations into the

future(Bohler,1973);

The influence of misconstrued socio-political paradigms in

establishing technology choice criteria, for instance the

misinterpretation of self sufficiency for self reliance;

The non availability of clear information to many developing

Country firms for making technology choice decisions. Due to their

inability and lack of skills to collect relevant data and analyze it

independently many firms base their decision on edited information

from potential technology suppliers that often tend to stress only the

main message that provider of such information seeks to convey for

their business interest only.

All these limitations tend to work in a synergistic way in

weakening the technology choice process as a result of which

technology that is not appropriate is often selected. The choice of

technology by a developing country like India might depend on

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perceptions that incorporate not only pure techno-economic criteria but

also others, perhaps even more critical dimensions relevant to a

particular setting(Maruyama,1973).An alternative is to encourage

interdisciplinary interactions to facilitate coordination among planning

entities, to reach a consensus on needs assessments and their

prioritization(Maruyama,1973) and use multiple perspectives in

decision making to extend the field of vision(Linstone,1969).

It is important to incorporate all these aspects to guard against

the very narrow appropriate technology orientations that have been

introduced in the past. There are two approaches to technology choice

named “pure techno economic approach and “contingency approach”.

The pure techno economic approach depends on technical criteria and

the well established economic analysis such as cost benefit analysis. It

is the approach that satisfies the most net benefit. It is the best fit for

the well developed and successfully commercialized surroundings. On

the other hand, Sharif (1994) advocate the incorporation of other

factors such as the technological capability of the potential user, nature

of the supportive infrastructure and raw material availability as a

contingency approach which is more suitable for developing countries.

The criteria used by the first approach are not necessarily covered by

the other However, it is important to establish a set of acceptable and

usable criteria for technology to be transferred

effectively(Soele,1988)in order to assist a more sustainable

development of developing countries like India. The appropriateness of

any technology is a dynamic notion. A technology that is not suitable

for one place may be suitable for another or in a different time for the

same place. It mainly depends on the different or changed operating

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domain, different or changed objectives or both of these two Sharif

(Sharif,1995).The simple example provided by Sharif(Sharif,1995) is

the chemical pesticide DDT(which was once appropriate now is

banned due to its negative impact on the environment) and coal based

technology for power generation in late 70‟s and early 80‟s(which was

given up due to more attractive oil based technologies and its

dirtiness).The appropriateness or choice of technology for sustainable

development is not only the matter of technological intrinsic properties

but also a matter of its operating domain, especially developing

countries. Bowonder (1979) and Ramanathan (1993).

Table 3.5: Appropriate Criteria of Selecting Technology.

Criteria Preferred path for the attributes to be evaluated

Energy intensiveness Should use less energy

Labour intensiveness Should be in accordance with human power endowment of

the country but without leading to inefficiency

Cost intensiveness Affordable

Productivity High

Durability Easy to maintain (due to low capability in most cases)

Ecological stability Environmentally friendly

Waste recycling Capable of utilizing waste

Rural orientation Suitable for use in rural areas

Income disparity reduction Capable of reducing income disparity

Socio-cultural stabilization Should not have an adverse impact on socio-cultural

condition

Local ownership Capable of facilitating local ownership

Scale of operation Suitable for the use of small and medium scale

Raw material requirements Ability to use locally available raw material

Import substitution Local resource utilization

Sectoral effectiveness Capable of contributing to more than one economic sector

such as power, agriculture, forestry, industry etc.

Learn ability Easy to impart operation and maintenance skills

Delocalization Capable of being diffused into many localities

Technological complexity Degree of ease of use

Quality characteristics Degree of contribution towards the improvement of the

quality output

Profitability Degree of enhancement of profitability

Utility adjusted price ratio Comparison with other alternative technologies

Demonstrated usefulness Number of firms already using the technology

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State-of-the-art State-of-the-art of the technology in comparison to

technology existing

Interaction The type of interaction that the technology will have with

other concurrent technologies currently being used by the

organization-independent, complementary, contingent

substitute.

Suppliers actions Degree of facilitation by supplier in terms of market

selection, market segmentation, promotional

communications, pricing and infrastructure development

(after sales services, spare parts supply,

Troubleshooting etc.)

Government Actions Degree of facilitation by the government in terms of

infrastructure development, promotional, communication

and regulation/promotion (fiscal and financial incentives

etc.)

The problem of technology choice however does not end with the

selection of a suitable technology. An equally important problem is

related to the choice of a suitable technology transfer mechanism that

could effectively transfer mechanism that could effectively transfer the

technology to the potential user in the developing countries and this is

discussed in the next section.

3.2.6 Technology Transfer Mechanisms

The mechanisms in technology transfer are the means of

transmitting the technology available with the seller to buyer. As

developing countries have lower levels of technological capability than

developed countries, it is possible that the range of mechanisms which

are used for developed and developing country transfers are greater

than in the case of developed country transfers. Some of the major

mechanisms of technology transfer are as follows (Ramanathan,1993).

Market oriented mechanisms

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Purchase of plant, equipment and products;

Direct foreign investment

Joint ventures

Technical collaboration

Licensing

Technical services agreements

Engineering and construction agreements

Subcontracting

Turnkey contracts

Product in hand contracts

Management contracts

Production sharing

Joint research venture

Expert services

Clean development mechanism(CDM)

Non market oriented mechanisms

Technical information services

Industrial fairs and exhibitions

Participation in conferences, seminars and workshops

Training contacts

Sales literature

Books, academic journals, business magazines etc.

Informal personal contacts.

Purchase of plant, equipment and products: Direct purchase of

plant and equipment from machinery suppliers can play an important role

in technology transfer. In general patented machinery is freely available in

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capital markets if the machine producers hold the patent. If someone else

other than company holds that patent, manufacturing company which uses

the machine, their availability is limited and other transfer mechanisms

might have to be used (Ramanathan,1993).The conditions for direct

transfer through machinery suppliers are probably most favorable in

manufacturing sectors which are already well established in developing

countries and where there are therefore adequate indigenous technological

capabilities. These technologies are also likely to be for mature sectors

with relatively slow technological advance such textiles, leather etc.

3.3 Estimation of CDM potential of renewable energy systems using

technology diffusion models

In this research work, the technology diffusion models are

implemented for renewable energy system and the green house gases

reduction potential is calculated. The renewables which are considered are

wind, small hydro, biomass and bagasse based cogeneration. It is found

that India has a large theoretical potential of renewable power which can

be used for reduction of the green house gases emitted during use of

conventional sources. The results obtained from the technology diffusion

models shows that India has good potential of renewable sources which

could be used for green house gases mitigation.

3.4 Conclusions

Assessment is needed to set priorities. Many options have been

identified for improving greenhouse gas emissions reduction technology.

Properly conducted technology assessments would be critical in deciding

which technologies are most appropriate in a given circumstance and

which options are likely to have the highest probability of success.

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Technology only is only a part of solution to combat climate change.

Projects must integrate with social, political, and environmental needs. In

addition, the impact of population and GDP per capita must also be

considered in projecting future CO2 emissions. Multiple factors affect the

ability of a given technology to contribute to reductions in mitigation of

greenhouse gas emissions, and frameworks should provide the incentives

and flexibility to permit a wide range of options. Capacity building is an

integral part of successful technology transfer.

There would be no feasible solution to climate change without

sustainable development, poverty eradication, business development and

investment in developing countries. Inherent to this is the availability and

affordability of climate-friendly technology and energy in Asia, Africa and

worldwide. Economic growth would generate resources and stimulate

investment in research, development and commercialization of new and

advanced technologies. Industries are ready to play its part in researching,

developing and bringing to market technologies that would address climate

change. Governments should also play their part in providing the necessary

enabling frameworks. The potential of maximum benefit to all partners

involved in development and dissemination of more eco friendly

technologies which could be greatly facilitated if a number of fundamental

conditions are met. These includes: a stable economic system and an

attractive investment opportunity for investing partners, including

intellectual property right protection and strong contractual arrangements,

transparent and equitable legal and financial structure and sound

environmental laws; realistic expectations from the communities of the

benefits that may result; a long-term commitment and dedication of

resources by all partners; A fair distribution of benefits as a goal for all

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partners; industry respect for local culture and values; a safe and secure

working environment for all employees and contractors; no unnecessary

barriers to movement of personnel and materials.