UK "sleepwalking" out of Indian special relationship

India is becoming a major source of scientific innovation - and the UK is at risk of losing its special relationship if does not kick-start new collaborations, a report has warned.

Think tank Demos claims Blighty is "sleepwalking" out of its special relationship with India, and is being displaced by the US and European countries with more aggressive collaboration programmes.

Charles Leadbeater, co-author of the Demos report, said in a statement: "Many Indian policy-makers believe that the UK is in danger of complacency, with most young Indians now choosing the US and Silicon Valley over the UK."

India's high-tech capacity was put on the map by the software successes of Bangalore, and now other cities including Hyderabad and Pune are following - and forging ahead in new industries such as pharmaceuticals and biotechnology, the report said.

Demos said Indian innovation is being driven by a new class of "innovation nomads" working between the US and India. Tight links between India and the US - particularly Silicon Valley - are not matched in the UK which fails to make enough of its Indian diaspora, the think tank warned.

India is already home to around 150 multinational R&D centres, and the report said "Indian IQ is increasingly creating Indian IP", with industries such as pharmaceuticals, automobile design and IT at the forefront.