Can India power its economic growth via IPR

An analysis of how intellectual property regime in India needs to be upgraded

 Can India power its economic growth via IPR

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• The story: The world economy was driven by merchandise trade, till recently. But from 1980s, the services sector rose dramatically, and by 2000s, the internet and IT revolution had created a whole new engine - intellectual property (IP). Nations investing in IP surged ahead of the rest.
• What about India: The Department Related Parliamentary Standing Committee on Commerce presented its 161th report, the Review of the Intellectual Property Rights (IPRs) Regime in India. IP refers to copyrights, trademarks, patents, design marks and so on, which spur innovation and protect inventor rights.

1. The Committee, in its interactions with different organisations, was informed about the absence of any study undertaken by India to analyse the economic impact of IPRs on its GDP, growth of industries, generation of employment, trade and commerce, etc
2. The committee compared the Indian system with other foreign jurisdictions, and outlined the need for India to follow/consider/emulate the policies of the US or the EU.
3. The IPR regime study is important in order to understand the impact of the IPR ecosystem on the economy.
4. It is of the opinion that strengthening IPRs in India would also spur economic development by encouraging foreign exchange inflow thereby increasing productivity and generation of employment opportunities.

• India's National IPR Policy: It is a vision document that encompasses and brings to a single platform all IPRs. It views IPRs holistically, taking into account all inter-linkages and thus aims to create and exploit synergies between all forms of intellectual property (IP), concerned statutes and agencies. The Union Cabinet approved the Policy on 12th May, 2016 that lay the future roadmap for IPRs in India.
• Need for IPR study: Most countries undertake studies on how much IPRs contribute to their economies. Countries also study how much is lost when inflexible IPRs affect access to healthcare. IPR studies are important in India where healthcare expenses are soaring and the cost of some medications is beyond the reach of common people.
• Contribution: A study by the Organisation for Economic Cooperation and Development (OECD) titled ‘Policy Complements to the Strengthening of IPRs in Developing Countries, 2010’ stated that

        1% increase in trademark protection increases Foreign Direct Investment (FDI) by 3.8%;
        1% improvement in patent protection increases FDI by 2.8%; and
        1% improvement in copyright protection increases FDI by 6.8%.

• Challenges and issues for India: First is the low number of patents being filed. In the year 2019, only 24,936 (~25000) patents were granted in India which is very low as compared to 3,54,430 and 4,52,804 patents granted in the U.S. and China respectively. The rate of increase in the number of patents in India has not been very impressive compared to that seen in U.S. and China.

1. IP crimes including counterfeiting and piracy are the rising threats to IPRs which should be regulated and deftly handled by taking appropriate measures.
2. Foreign investors and MNCs allege that Indian law does not protect against unfair commercial use of test data or other data submitted to the government during the application for market approval of pharmaceutical or agro-chemical products. For this they demand a Data Exclusivity law.
3. India continues to remain on the United States Trade Representative's (USTR’s) ‘Priority Watch List’ for alleged violations of intellectual property rights (IPR). In its latest Special 301 report released by the United States Trade Representative (USTR), the US termed India as “one of the world’s most challenging major economies" with respect to protection and enforcement of IP.

• Creating awareness: India's State Governments could play the role of constructive partners in evolving a strong IPR regime by formulating their own strategies and policies within the broad framework of India’s policy on IPR. They should participate in evolving policies that focus on sensitizing people on significance of IPRs, encouraging innovation in educational institutions and establishing State level Innovation Councils, enforcement of IPR laws and curbing IP crimes. Suggestions from members of civil society are crucial too. They have relentlessly highlighted the welfare interventions of development.

1. NGOs associated with craftsmen, artisans and those working in hilly and tribal areas may be engaged in spreading awareness about IPR to the target group
2. IPR Facilitation Centers should be established in Tier-I, Tier-II and remote regions of the country with a focus on enhancing the awareness of MSMEs, small businessmen and traders
3. The training programmes and workshops being organized by the Department (especially for MSMEs, small tradesmen, local artisans) should be oriented towards inculcating scientific temperament and knowledge about identification of novelty in their products and protection of such novelties as IPRs
4. The re-assessment of the policy is imperative in the wake of new and emerging trends in spheres of innovation and research which requires concrete mechanisms to protect them as IPRs. The relevance and utility of cutting edge technologies such as Artificial Intelligence (AI) and machine learning would increase manifold in the present world.

• Summary: India is an emerging economy that needs to balance economic development with welfare issues. An efficient and equitable intellectual property system can help it realize intellectual property’s potential as a catalyst for economic development and social & cultural well-being.
• EXAM QUESTIONS: (1) Explain how a strong IPR regime helps build confidence in an economy. (2) What are the various kinds of IP that can be created? List and explain their distinct features. (3) Why do Indians file fewer patent applications compared to foreigners? Explain.

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