For innovation’s sake

Working together, the US and Indian governments have the opportunity to begin bilateral relationships afresh and move forward in the global economy together. This can only take place if both countries make concrete commitments to fostering innovation.

Written by Patrick Kilbride | Updated: June 26, 2017 11:55 am
 india-us, india-us relation, narendra modi, donald trump, indian economy, india's ip framwork, innovation, indian express PM Modi addressing Indian diaspora during a community programme in Washington DC (Source: PMO/ Twitter)

Indian Prime Minister Narendra Modi’s inaugural visit with the Trump administration is more than an opportunity to continue the US-India dialogue; it’s an opportunity to improve relations and remove long-standing obstacles. Working together, the US and Indian governments have the opportunity to begin bilateral relationships afresh and move forward in the global economy together. This can only take place if both countries make concrete commitments to fostering the innovation that will propel that growth.

As one of the fastest growing economies in the word, India is an important economic partner for the US and a significant commercial partner for American companies. The World Bank estimates the Indian economy will continue to prosper, with a projected increase in GDP of 7.2 per cent in 2017-2018. With a consumer-base of 1.3 billion people, foreign companies are eager to unleash the vast potential the Indian market holds. Recognising the global interest in the Indian economy, PM Modi introduced the Invest India campaign to help attract new businesses.

Yet, in order for India to harness its full economic potential, the government must take steps to ensure that foreign companies are treated fairly in India, including through intellectual property protections. An effective intellectual property (IP) framework, working in tandem with a transparent legal and regulatory system, is one of the critical factors that businesses evaluate when considering investing in new markets. IP is the lifeblood of the innovative and creative industries, fuelling investments in new life-saving cures and the latest high-tech devices while also safeguarding consumers from dangerous illicit products. If India is to take advantage of the opportunities to engage in new dialogue with the Trump administration, the government must take seriously US industry’s concerns regarding India’s IP framework.

The Trump administration has built its trade policy agenda around the need for free and fair trade. The US government efforts have focused on ensuring that American companies receive the best treatment in markets abroad. This is where Indian policies have come under criticism: The economic and commercial barriers to US companies attempting to operate in India have placed them at a disadvantage. Chief among those barriers are the long-standing issues with India’s IP framework.

PM Modi has acknowledged the critical link between IP and innovation. In May 2016, he released India’s first National Intellectual Property Rights (IPR) policy, which included a number of positive administrative changes and called for the creation of IP education programmes. Just weeks ago, the Department of Industrial Policy and Promotion (DIPP) announced a new “Scheme for IPR Awareness” to fulfill one of the tenants of the IPR policy. We cannot underestimate the significance of this step forward; an effective IP framework begins with educated consumers at its core.

The US Chamber’s International IP Index, released annually since 2012, highlights some of the IP-related barriers that innovative and creative companies continue to face in India. Many of the long-standing challenges remain the same: Online and hard goods piracy continues to plague the Indian market, undermining the economic contributions of India’s thriving film industry. The biopharmaceutical industry continues to face challenges in securing and maintaining patents. Most notably, Section 3(d) of the Indian Patent Act, which mandates that products must demonstrate “enhanced efficacy” in order to be patentable, undermines the growth of biopharmaceutical innovation in India.

New IP challenges have also emerged. In 2015, the Indian government passed balanced and reasonable guidelines for computer-related inventions (CRIs), which allowed for the patentability of all forms of CRIs. In 2016, those positive guidelines were withdrawn and re-released as final with a requirement that software can only be patentable if it’s tied to a novel hardware invention. In an ever-evolving digital age, patentability for all forms of software will be critical to fostering technological innovation.

Additionally, Indian officials have made numerous attempts to undermine patented treatments and, more recently, medical devices. Last February, the Indian government’s National Pharmaceutical Pricing Authority (NPPA) passed mandatory price controls on medical stents, reducing the price by 85 per cent, after the Indian Health Ministry added them to the National List of Essential Medicines (NLEM). PM Modi applauded the NPPA’s policy, which had a devastating effect on innovative medical companies seeking to launch or maintain the sale of their products in India. The move also creates a slippery slope, with other medical innovators wondering if the NPPA will revive talks of targeting patented medicines in similar fashion. Such policies would undermine the legal certainty upon which biopharmaceutical innovators depend and jeopardise investment in new, life-saving cures in India.

If India is to create an environment which fosters innovation, encourages international cooperation, and cultivates a business environment welcoming to investors, IP will be critical. The Chamber’s Index illustrates how countries with top-notch IP frameworks are also more likely to have access to venture capital, create thriving high-tech sectors, and become true knowledge-based economies.

Now is the time for India to alter its course and pivot toward one which fosters respect for IP and unleashes the economic benefits that strong IP frameworks provide.

The writer is vice president of the International Intellectual Property for the Global Intellectual Property Center (GIPC) at the US Chamber of Commerce

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  1. K
    Kamal Pasha
    Jun 27, 2017 at 3:50 pm
    For a rich and world power like US, to dump friendly country is very ordinary matter for them. They have dumped Vietnam, Laos, Cambodia, Korea, Afghanistan and many more after they used them. Next will be india. Mark my words.
    Reply
  2. O
    Orion
    Jun 27, 2017 at 2:31 am
    Agree, but till yesterday GATT and WTO were 'lifeblood of innovative and creative industries'...now your priorities have shifted...
    Reply
  3. C
    ck
    Jun 26, 2017 at 10:24 pm
    It is certain that in future 2 decade the IP least part can not be implemented because of very poor per capita income for which prices can not be affordable in the market , moreover major business people capital are not satisfactory to implement and keep sustain for market prices. The IP factor can be possible when per capita income is enough to sustain this factor for the commodity prices, and further improvement may be proceed, The high level richer people may obtain the additional gain.
    Reply
  4. S
    sampat
    Jun 26, 2017 at 9:02 pm
    how about free movement of labor and agricultural goods?
    Reply
  5. E
    Employ Ment
    Jun 26, 2017 at 2:34 pm
    योजना ✔मोदी जी द्वारा चलाए गए डिजिटल इन्डिया से जुड़े और 15,000 - 50,000 रुपए ✔अब कोई नही रहेगा बेरोज़गार और नही करेगा कोई बेरोज़गार आत्महत्या ✔क्योंकि अब आ गई है 21वीं सदी की सबसे बड़ी रोज़गार क्रांति ✔हमारा सपना पूरे भारत को ही नही पूरी दुनिया को डिजिटल इंडिया से जोड़ना सबका साथ सबका विकास ➡शुरुवात कैसे करे ✔C.h.a.m.p`C.a.s.h को प्ले स्टोर से इन्स्टल करे, और साइन अप करे, $1 डॉलर बोनस : 468942 ➡चैलेंज को पूरा करे ➡और इंकम करनी शुरू करे 👇🏻इसे जरूर नोट कर ले👇🏻 : 468942 ........................ Hhgghguhghhhji
    Reply
  6. R
    Rituraj
    Jun 26, 2017 at 12:56 pm
    Patrick, If Indian policies, especially Section 3 (D) of Indian Patent Act and NPPA's NLEM list which includes stents, are wrong and against the world trade, why don't these affected BigPharma companies file cases in WTO courts? They don't/won't because even you know that India is doing nothing that is wrong or illegal. In fact, what India has done so far, has saved countless lives in Asia and Africa, the poorest regions who are constant victims of 'ever-greening' of patents. In fact, America should learn these lessons and help American people achieve better and cheaper medical care instead of running to India and Thailand. American medical system is defunct and now with Obamacare gone, it will only cater to a few ultra rich while denying care to millions of poor Americans. You want its repeat in India which is impossible. So Patrick, fix your house first. Ever-greening of patent is never going to happen in India !!! get over it !
    Reply
  7. S
    sochee
    Jun 26, 2017 at 11:26 am
    The argument for stringent IP regime sounds good on paper. It is purely transactional and nothing beyond it is acceptable. It works tremendously in favour of those who are well off and can risk investment in R D and product innovation to earn super profits from successful innovations through rigid IPR regime. The poor nations who can not afford to invest such huge sums in R D have to pay through their nose for these products making them extremely vulnerable specially in the area of health care and education. Therefore a gradual approach towards expansion of IPR regime in the case of developing world is necessary. India is following this path because it can not afford to open up these vulnerable sectors suddenly. But it should negotiate a timeline for implementation of IPR regime so that uncertainty in this regard is removed and making of super profit by the innovators is stopped.
    Reply
  8. P
    pankaj
    Jun 26, 2017 at 10:21 am
    IP is one thing that is both anti globalization and anti humanity and at the same time overdone by US companies. Sooner or later we need to find a away to get rid of this over-IP-ed model. For the time being best is that China and India do not worry much about IP. Companies are already making money from their IP as they are considered original inventor and they have the lead time to get majority market share. Excessive use of IP to keep prices high and to manipulate system and reduce compe ion should be discussed afresh to get rid of these IP acts. Line revisiting the format of UN, the laws of IP should be redefined.
    Reply
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