“…Through the adoption of R&D or innovation capacity based indicators (innovations in products, processes, or patent numbers), various research conclude in favour of the positive impact of innovation on firm performance levels (Nolan et al, 1980;Hall, 1987;Amirkhalkhali & Mukhopadhyay, 1993;Singh, 1994;Lefebvre et al, 1998;Del Monte & Papagni, 2003;Nurmi, 2004;Yang & Huang, 2005;Coad & Rao, 2008;Curado, et al, 2011;Reed, et al, 2012). Some researchers find that only the innovation capacity variables impact on the firm performance of Indian firms and not those related to R&D and concluding that indices of R&D expenditure do not contribute towards evaluating firm growth and performance (Geroski, 1995;Geroski et al, 1997;Coad & Rao, 2008;Hölzl, 2009;Cavalcante et al, 2011).…”