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 peoples 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 childs 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 () lack of access to technology, () lack of demand, () lack of
finance, () lack of technological capabilities, () 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 ()
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, () foreign direct investment (FDI) will
be targeted as an important vehicle of technology transfer, skill
development and promotion of management and marketing know-how,
() 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 () 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, () efforts are made
to popularize bio-gas technology developed by the Council for Science and
Industrial Research (CSIR), () 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 21
st
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: () Joint Implementation (JI),
() Clean Development Mechanism (CDM) and () 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

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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 CO
2
)
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 countrys 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 1990s 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 todays 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 Kingdoms economic growth was 2% per annum in
most of the 19
th
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
18
th
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 Websters New
World Dictionary (Guralnik, 1984) defines it as the science or study of
the practical or industrial arts, applied sciences etc., and Websters 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 todays
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 below
1
in 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 Protocols 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

83

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 70s and early 80s(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

86

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 CO
2
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

88

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.