2025 OECD Science, Technology and Innovation Outlook and the Importance of Policy Predictability

The Organisation for Economic Co-operation and Development (OECD) released its Science, Technology and Innovation (STI) Outlook 2025 on October 28, 2025, examining how science and technology can drive transformative change amid geopolitical shifts and emerging technological disruptions. The report underscores the growing urgency for structural reforms in STI systems to enhance policy agility, foster collaboration, and strengthen resilience in an increasingly uncertain world. 

A New Context for Global STI Policy 

Global challenges, rising economic security concerns, and rapidly converging technologies have reshaped the environment for STI policymaking. The OECD report calls for reforms that enhance efficiency and evidence-based decision-making, emphasizing the need for agility and adaptability in government interventions. With R&D allocations across the OECD area declining by 1.9% in 2024, the report stresses the importance of leveraging complementarities between direct and indirect support mechanisms, such as tax incentives, to optimize national competitiveness while advancing sustainability goals. Governments are urged to strengthen coordination across STI and non-STI policy domains to boost efficiency. As geopolitical tensions heighten, the report highlights a growing securitisation of science and technology. It warns that while protecting sensitive research is critical, excessive restrictions risk fragmenting international cooperation. Effective research security, it argues, must be proportionate, precise, and developed in partnership with scientists, businesses, and policymakers. 

 Broadening Innovation’s Reach 

Innovation remains concentrated in leading firms and regions, limiting its societal impact. The OECD recommends greater policy focus on diffusion spreading innovation benefits across sectors and geographies through investment, inclusive participation, and adoption strategies that integrate frontier technologies into broader development efforts. The report calls for national science systems to adapt through structural reforms that support multidisciplinary research, transparent career pathways, and mobility across academia and industry. It emphasizes greater citizen engagement, open science practices, and performance metrics that value diverse scientific contributions while safeguarding academic freedom. Convergence among emerging technologies such as synthetic biology, neurotechnology, quantum systems, and earth observation is driving innovation. The OECD highlights artificial intelligence’s role in advancing breakthroughs from personalized therapies to mental health treatments and advocates for “convergence spaces” that enable deep interdisciplinary collaboration. 

Adopting an Ecosystems Approach 

Moving beyond sectoral boundaries, the report promotes an industrial ecosystem perspective that integrates upstream and downstream stakeholders including firms, investors, and workers to reflect the complexity of modern industry. This approach requires strong data systems that can track and understand how different industries  such as energy, technology, and manufacturing   interact and evolve within shared value chains. To remain effective amid uncertainty, STI policy must become anticipatory and experimental. The OECD urges governments to embed strategic foresight, policy experimentation, and real-time evaluation into national frameworks, enabling evidence-based agility. Successful interventions, it notes, should be scaled up, while ineffective ones phased down. 

Stay informed on global innovation policy and technological governance. For expert insights on STI reform, resilience, and strategic intelligence, visit www.tsaaro.com  

Source – https://www.oecd.org 

News of the week 

1. Nvidia isreportedly planning a robotaxi project to challenge Tesla, Waymo.  

Nvidia is reportedly developing an internal robotaxi project led by senior director Ruchi Bhargava, according to 36Kr. The initiative, announced at a recent company meeting, is expected to follow a single-stage “end-to-end” approach similar to Tesla’s Full Self-Driving system, using simulation-generated world models to train neural networks. Building on its Cosmos world foundation model pre-trained on over 20 million hours of multimodal data Nvidia aims to leverage synthetic driving environments to enhance autonomous driving capabilities. While the company already collaborates with automakers like General Motors, Mercedes-Benz, and Toyota on autonomous fleets, this project is separate, with plans to invest USD 3 billion and launch operations in the US. The move comes as the robotaxi market gains momentum in 2025, with Waymo and Tesla expanding commercial services amid supportive regulatory shifts. For Nvidia, the project represents both a strategic expansion beyond chips and a practical testbed to strengthen its engineering and deployment capabilities in embodied intelligence.  

Source – https://kr-asia.com/nvidia-is-reportedly-planning-a-robotaxi-project-to-challenge-tesla-waymo 

2.Deep tech startups, VCs seek tax incentives, regulatory clarity

A number of deep‐tech and semiconductor startups, along with over 30 venture capital firms, engaged in a roundtable with Piyush Goyal to seek tax incentives, regulatory clarity, and extension of Startup India benefits beyond the current 10-year limit.   The discussion highlighted the need to improve clarity around grant accounting and Foreign Contribution Regulation Act (FCRA) rules for R&D funding, reform Department of Scientific & Industrial Research (DSIR) registration norms, and introduce targeted tax incentives to support private investment in innovation.   Startups operating in areas such as semiconductor design, AI, quantum computing, robotics, advanced materials and machine-learning infrastructure  including Agnit Semiconductors, QpiAI, Nabhdrishti Aerospace, EtherealX, Fabheads, Ethereal Machines, Dozee, Exponent Energy, SignalChip Innovations and QNu Labs shared their experiences of long development cycles, the need for patient capital, and challenges in technology commercialisation.   Investors including Celesta Capital, Blume Ventures, Avaana Capital, Peak XV, Creagis and 3one4 Capital emphasised the need to build longer-term innovation pathways and explore sustainable exits.   The minister reaffirmed the government’s commitment to scaling domestic capital, nurturing homegrown funds, and promoting frontier technologies under the Aatmanirbhar Bharat mission.   A follow-up mechanism will be set up to monitor progress and document actionable recommendations to support long-term innovation.  

Source- https://cfo.economictimes.indiatimes.com/news/policy/deep-tech-startups-vcs-seek-tax-incentives-regulatory-clarity/125009089 

3. OpenAI backs $30M investment in biosecurity startupValthos to stop AI-engineered biological attack     

OpenAI has joined forces with Founders Fund and Lux Capital to invest $30 million in Valthos, a New York-based biosecurity startup developing AI systems to detect and counter engineered biological threats in real time. Emerging from stealth mode, the nine-person team comprising veterans from Palantir, DeepMind, the Broad Institute, and the Arc Institute is building software that scans biological data from global databases to identify early signs of synthetic pathogen risks. Led by co-founder and CEO Kathleen McMahon, Valthos aims to create a “biosecurity shield” capable of generating countermeasures on the fly, effectively outsmarting biological evolution through “applied biological intelligence.” The funding comes amid growing concerns over AI-enabled bioterrorism, with recent reports warning that AI could be misused to create highly contagious and lethal hybrid pathogens. For OpenAI, the investment reflects a proactive stance toward managing the dual-use risks of its own technology, aligning with broader calls for stronger oversight of biological data and coordination between tech and health sectors. Founders Fund and Lux Capital’s involvement signals increasing investor confidence in biosecurity as a critical frontier of innovation. With its new funding, Valthos plans to scale its partnerships with governments and research institutions worldwide, advancing its early-warning and rapid-response systems designed to prevent AI-fueled pandemics before they begin. 

Source- https://oecd.ai/en/incidents/2025-10-24-9394