Establishment of R&D Units In Public ~ector Industrial organizations has been Initiated by the Production Dlvlson and It Is hoped that alI major Industries In the public sector wll I have their own R&D fecit ltles by the end of the Sixth Plan period. Production Dlvlson proposes to spend one per cent of the sales revenue of their Industries on R&D. Incentives wll I be provided to the private sectors to establish R&D units within the Industry for quality control and productivity Improvement. R&D cess fund (equivalent to half percent of sales of Industrial production} proposed In thr pol Icy ~ould be used to provide financial assistance In deserving cases, especially for the formation of R&D associations for groups of small Industries. Risk Fund for Research Development/R&D Corporation: It Is a well known fact that the funds spent on R&D to create new technologies and products are often only a small fraction of the amount required tor taking the results of research upto 1 ndustr 1 a 1 product ion. There Is at I east a ten fo I d .I ncreese In cost and effort after the R&D phase before the product based on a new Invention/Innovation can reach the market. Cash flow continues to be negative for a long while until full manufacturing 0 capacity has been establ lshed and Initial operational, marketing ~ and financial difficulties are overcome. The cost of the N commercial scale manufacturing project would vary over wide limits and the process often carries considerable financial risks. 14-4 205 Private capital. particularly In developing countries like Pakistan, Is extremely shy_ regarding participation In such risky venture. It is, therfore, proposed to estab I Ish, in due course, a statutory autonomous organization as has already been done In a 
**Analysis**
The text discusses the establishment of Research and Development (R&D) units in public sector industrial organizations and the proposal for a statutory autonomous organization to support R&D projects. The focus is on the industrial sector, with mention of incentives for private sectors and a fund to provide financial assistance. This suggests that the category should be related to industry and economic development.

**Category**
Industry, Economic development