Apparently the Reliance scientists gave answers to the U.S. experts’ liking. As the NIH revealed last week, the Indian start-up is among 10 research centers in the world holding stem-cell colonies that meet the criteria laid down by President George W. Bush–most importantly that the cells were culled from embryos no later than Aug. 9 (following story). Another Indian outfit, Bangalore-based National Centre for Biological Sciences (NCBS), has three more potential stem-cell lines, bringing the country’s total to 10 of only 64 lines identified by the NIH. Bush’s edict puts NCBS and Reliance on a shortlist of labs eligible to receive a portion of the $250 million Bush has earmarked for U.S. funding of the research. It also has cast a spotlight on the surprisingly robust state of medical research in India, where biotechnology is being targeted as the beneficiary of the country’s next wave of investment, after information technology. “Potentially it’s a huge opportunity for India,” says Kiran Mazumdar Shaw, chairman of Biocon India. “It’s a signal to the rest of the world that India is part of a small club participating in embryonic stem-cell research.”

Why such breathless excitement? Embryonic stem cells possess the powerful ability to turn into any kind of specialized cells. That means they could, at least theoretically, be cultivated to replace any of the 220 varieties of human tissue–pancreatic cells for diabetes sufferers, for instance, or brain cells for Parkinson’s patients. To get there from here, researchers need to do a lot of experimenting, which means they need a lot of stem cells from human embryos. Unlike their colleagues in the United States, Indian researchers are relatively unhampered in this work by cultural, ethical or religious considerations. In a country of 1 billion poor people, abortion is legal and common. Few undergoing in vitro fertilization treatment have moral qualms about releasing extra eggs for research purposes. India also has a surplus of scientists skilled in molecular and cell biology. In addition, cell-culture experiments don’t require much in the way of overhead, which lowers the barrier to entry. The Indian government even encourages research on embryonic stem cells up to 14 days old. “We’re open to embryonic stem-cell work and essentially there are no restrictions,” says Dr. Vijay Vinayak, the government’s Biotechnology Department genomics adviser. “If it can help cure diseases it should be looked on favorably.”

Reliance needed no encouragement. Reliance Group, the $13.2 billion conglomerate, started its life-science laboratory only last January, but already it has put 51 scientists to work on stem-cell research. In that time vice chairman Mukesh Ambani has spent $5 million on the research; he’s committed to spending an additional $20 million over the next few years. The procedure to establish a stem-cell colony that is pure beyond a doubt is lengthy and elaborate; Reliance is still six months away from claiming that it has four bona fide lines. It is only beginning the process with its other three lines. More money would help speed the process along, which is why Reliance is eager to sell stem cells to U.S. labs or to enter into collaborations. “There are opportunities for Indian scientists and business houses,” says Reliance’s Parikh, a visiting professor at Yale University School of Medicine. “But our focus isn’t commercial right now. We’re looking to address unmet medical needs in India and globally.”

Those mushrooming needs could bring a research bonanza. Reliance believes that in as little as four years the embryonic stem-cell research could yield clinical applications; treatments for diabetes and burn victims head the list. Reliance plans establishing a regenerative-medicine center in Mumbai to carry out cell transplants. “We’re talking about the ability of cell-based therapies to come up with better, more cost-effective ways to treat people,” says K. V. Subramaniam, Reliance Group’s corporate business-development senior vice president, “or even treat previously untreatable conditions.”

NCBS is more cautious about the significance of NIH’s list. For one thing, NCBS is only beginning its work; it has not yet confirmed that the three lines identified by NIH are truly stem cells. And even if they are, the institute, which is owned by Tata Institute of Fundamental Research, the organization founded by the big industrial firm Tata, has no need to peddle its stem cells abroad to raise money. The director says the institute may even ultimately choose against collaborating with its U.S. counterparts or sharing cell material.

Indian law also presents some hurdles to collaboration with U.S. firms. At present, exporting biological material is prohibited. Although there may be ways around the law, U.S. firms seeking to work with Reliance or NCBS will have to run a gauntlet of bureaucratic approvals. For these reasons, NCBS scientists maintain that the fuss over Bush’s Aug. 9 deadline is much ado over nothing. “I find all the hype puzzling,” says Krishnaswamy Vijayraghavan, NCBS director. “The problem is a U.S. one. It’s no big deal for anyone else.” Even if he’s right, stem-cell politics can only help India in this important field of medical research.