India escapes being downgraded by the US for IP violations, with a compelling self-defence.
The annual Special 301 report of the US Trade Representative has retained status quo — India has not been downgraded to the “priority foreign country list”, a directory of the worst intellectual property rights (IPR) offenders, a move that might have led to, among other things, the US not renewing duty concessions on select Indian exports. Instead, it has been retained on the “priority watch list”, a set of countries with lax IPR regimes. There had been real fears of a downgrade, given the efforts of the powerful US pharma lobby, which is unhappy with India’s IPR protection record. India, in turn, has rightly pointed to the fact that it is WTO-compliant and that disputes should be settled through that forum. This is a sensible bargaining position, since bilateral negotiations are inevitably stacked in favour of the stronger party.
The Special 301 report experience also shows how it helps to give global businesses a stake in India. India had three unexpected ambassadors for its IPR regime in Boeing, Abbott (a pharma company) and Honeywell. This, along with election-time uncertainty, may explain why it was not downgraded. In other words, India’s interests are best served by maintaining an investment-friendly environment, and creating global lobbies invested in its progress.
