This study examines the factors driving research and development (R&D) activity in India’s manufacturing units, with a focus on international exposure and managerial resources. By analyzing the roles of foreign suppliers, buyers, and owners, alongside the moderating effects of managerial resources, all at the level of the manufacturing unit, our findings provide nuanced insights into the determinants of R&D in an important emerging economy. The results demonstrate that international exposure through foreign ownership, exports, and imports significantly increases the likelihood of R&D activity. These effects are further amplified by managerial resources, highlighting the pivotal role of dynamic managerial capabilities in fostering value-added activities.