The competitiveness of Indian major life sciences clusters has positioned the country well ahead of its peers as the Covid-19 pandemic highlights the vital role of research and development (R&D). The country placed seven of the 10 most competitive locations for research and development functions in the life sciences sectors, according to a model developed by fDi Benchmark, fDi’s benchmarking service. 

Hyderabad is the world’s most competitive location for life sciences R&D functions, according to fDi Benchmark data, followed by another two Indian cities, Noida and Chennai. Chinese city Guangzhou comes in fourth, followed by Mumbai and South Korea’s capital city Seoul, far outdoing other cities in developed countries. The top-10 is completed by another three Indian locations — Bangalore, Gurgaon and Pune — and Chinese Chengdu. 


The model benchmarks the world’s largest destinations for foreign direct investment (FDI) into life sciences R&D operations, according to each location’s quality and cost competitiveness. In short, it finds the best location for a 50-person life science R&D lab occupying 3000 square metres of office space. 

Indian locations scored very highly in most of the cost data points, with the yearly cost of running the modelled 50-person R&D hub falling below $1m in the cases of Noida ($830,653) and Hyderabad ($902,567) — about half the cost of their closest Chinese competitors, Wuxi ($1,626,101) and Suzhou ($1,679,679). Unsurprisingly, this is just a fraction of the cost of renowned R&D hotspots in developed countries of the likes of Cambridge, UK ($4,484,667) and Boston, US ($7,567,706). 

On the other hand, Indian locations fared less well in the quality component of the assessment, which considers factors such as the availability of specialised labour, quality of infrastructure and business environment. However, their performance was good enough to maintain the lead gained the cost component of the assessment, with Mumbai even making the top-five in the quality assessment and Hyderabad coming 12th. 

Quality-wise, Seoul topped the ranking, thanks to its access to specialised staff. The city has proved its prowess in life sciences R&D operations since the outset of the pandemic. Notably, Seoul-based Kogene Biotech brought to market the first Covid-19 testing kit as early as February 2020, helping the country rapidly deploy mass testing and thus avoid a major national lockdown throughout the crisis. Guangzhou and Tokyo came in second and third, respectively, for the quality of their life sciences R&D clusters, with Guangzhou in particular standing out for the depth of its existing cluster. 

Despite spearheading the most sophisticated life sciences research projects, European and North American locations lagged behind their Asian peers for competitiveness. Istanbul was the best European location, placing 14th overall, and New York the best North American location in 22nd position. In developed Asia, Tokyo ranked 18th overall and Singapore 33rd overall. 

FDI figures partially reflect this trend. China and India were second and third, respectively, behind the US with regards to the amount of greenfield life sciences R&D FDI they have been able to attract between January 2015 and August 2021, according to estimates by investment monitor fDi Markets.

This article first appeared in the October/November print edition of fDi Intelligence. View a digital edition of the magazine here.