With innovation and entrepreneurship identified as the new drivers for China's economic growth, the question for the government is how it can best encourage and complement the energies of individuals and markets to achieve its vision of the nation's future.

For Paul Stein, former director of general science and technology at the defense ministry in the United Kingdom and since 2009 in charge of innovation at Rolls-Royce Holdings Plc as chief scientific officer, the role of the government in fostering innovation is a tricky one.

"When a government tries to interfere in the details of innovation it often goes horribly wrong, because the government ends up slowing things up with bureaucracy," Stein said.