INDIAN ECONOMY CURRENT AFFAIRS 2017 NATIONAL IPR POLICY, 2016

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1 INDIAN ECONOMY CURRENT AFFAIRS 2017 NATIONAL IPR POLICY, 2016 Intellectual property (IP) refers to creations of the mind, such as inventions, literary and artistic works, designs and symbols and names and images used in commerce. Intellectual property rights are the rights given to persons over the creations of their minds. They usually give the creator an exclusive right over the use of his/her creation for a certain period of time. RECENT DEVELOPMENT In recent years, the US Trade Representative has kept India on its Priority Watch List for inadequate improvement in it s IPR protection. Being placed in the list means that India continues to figure among countries that the USTR feels have serious intellectual property rights deficiencies and do not give adequate protection to American companies. While the US does not threaten action against countries on this list, US laws say that retaliatory measures may be taken if a country slips further. However, brushing aside concerns of the US on India s IPR regime, the Government said its IPR laws are legal-equitable and WTO-compliant. Thus, the India has not yielded to pressure from the US to amend it s patent laws. In response, the Government rolled out a National IPR Policy in The National IPR Policy tries to balance yesterday s protectionist political tendencies with the needs of tomorrow s dynamic Indian economy. NEED FOR AN IPR POLICY: To formulate incentives in the form of tax concessions to encourage research and development (R&D). To maintain the sanctity of innovations so that litigations in this domain are minimal. To provide the required thrust to protect the traditional knowledge of India. To strengthen various government schemes like Make In India, Startup and Digital India. The IPR policy comes at a time when India and other emerging countries face fresh IPR challenges from developed nations and mega regional trade agreements such as the RCEP. Also, Global drug brands led by US companies have been pushing for changes to India s Intellectual Property rules. They have often complained about India s price controls and marketing restrictions. NEO IAS , , Page 1

2 DESCRIPTION The Government released India s National Intellectual Property Rights (IPR) Policy recently, which is in compliance with WTO's (World Trade Organisation) agreement on TRIPS (Trade Related aspects of IPRs). It is India s first IPR Policy. The policy seeks to put in place a legal framework that will encourage an IPR regime that fosters creativity and innovation and thereby, promoting entrepreneurship. It also aims to realise IPRs as a marketable financial asset, while protecting public interest. OBJECTIVES There are seven major objectives; 1. IPR AWARENESS: To create public awareness about the economic, social and cultural benefits of IPRs among all sections of society. 2. GENERATION OF IPRS: To stimulate the generation of IPRs. 3. LEGAL AND LEGISLATIVE FRAMEWORK: To have strong and effective IPR laws which balance the interests of rights owners with larger public interest. 4. ADMINISTRATION AND MANAGEMENT: To modernize and strengthen serviceoriented IPR administration. 5. COMMERCIALIZATION OF IPRS: Get value for IPRs through commercialization. 6. ENFORCEMENT AND ADJUDICATION: To strengthen the enforcement and adjudicatory mechanisms for combating IPR infringements. 7. HUMAN CAPITAL DEVELOPMENT: To strengthen and expand human resources, institutions and capacities for teaching, training, research and skill building in IPRs. NEO IAS , , Page 2

3 HIGHLIGHTS OF THE POLICY It will be reviewed every five years in consultation with stakeholders to keep pace with further developments in the sector. It also calls for updating various Intellectual Property laws, including the Indian Cinematography Act, to remove anomalies and inconsistencies. The Policy suggests making the Department of Industrial Policy and Promotion (DIPP) the nodal agency for all IPR issues. It calls for financial support to the less empowered groups of IP owners or creators, such as farmers, weavers and artisans, through financial institutions like rural banks or co-operative banks offering IP-friendly loans. For IP commercialization, it seeks for financial support to develop IP assets through links with financial institutions, including banks, VC funds, angel funds and crowd-funding mechanisms. It proposes to create an effective loan guarantee scheme to encourage start-ups. The Policy allows the Government of India to leverage legislative flexibilities in the international treaties and TRIPS agreement. These flexibilities include the sovereign right of countries to use provisions, such as those concerning Compulsory Licensing (CL), for ensuring the availability of essential and life-saving drugs at affordable prices. The Policy has essentially left the country s patent laws intact. BENEFITS The National IPR Policy is a vision document that aims to create synergies between all forms of Intellectual Property, concerned statutes and agencies. It puts in place an institutional mechanism for implementation, monitoring and review. It will likely bring India s IP regime in line with global standards and help improve its ranking in the World Bank s Ease of Doing Business index. It will help focus on enhancing access to healthcare, food security, environmental protection and also preventing film and music piracy. For Ex, Indian Cinematography Act, 1952 may be amended to provide for penal provisions for illegal duplication of films. It will help substantially reduce the time taken on clearing the backlog of Intellectual Property Rights (IPR) applications from the current 5 to 7 years to few months. It seeks to promote R&D through tax benefits available under various laws and simplifies procedures for availing of direct and indirect tax benefits. The Policy correctly identifies IP as a strategic tool for furthering India s economic goals. It ensures credibility to potential investors and encourages them to invest in India and will provide both domestic and foreign investors a stable IPR framework to work with in the country. NEO IAS , , Page 3

4 CHALLENGES The Policy is silent on the issue of Traditional Knowledge and it s protection. Experts are also skeptical of how much the Policy is applicable to the informal economy especially in rural areas. The reason is that, rural economy and creativity is not understood completely. Superimposing a formal IP regime here may do more harm than good. The measures suggested in the Policy envisage large Government funding for protecting and promoting foreign IP in India even though it stated that the primary obligation of protecting IP rights was on the IP owners. Reference to State legislations in the context of copyright protection show how the balance in the policy was tilted in favour of IP holders against society. Experts also feel that the National IPR policy lacks specifics and won t be enough to foster innovation. It s fundamental flaw is its assumption that more IP translates to more innovation. Due to this, the Policy advocates that all knowledge should be converted to IP. But, monopoly rights stifle radical innovation and do not promote sustainable innovation methods. Barriers to research collaboration may also develop. The diffusion of knowledge suffers and Industry and Science tend to innovate with difficulty. Thus, a strong IP system means a reduced access to innovation for Indians. Moreover, the Indian pharmaceutical industry became the pharmacy of the Third World due to the rejection of a strong Intellectual Property Rights (IPRs) system in the 1970s. The Policy could have announced a law favouring Open Source licensing. Even corporates today recognize that IP does not work well in certain technology sectors, for which a free flow of Open knowledge is more suitable. 25 countries NEO IAS , , Page 4

5 including Australia, France and Germany have provided legislative support to Open Source. While the stated rationale of this policy is that a strong intellectual property rights system is necessary in order to promote creativity and innovation in India, there is plenty of evidence to the contrary. IP wrongs are essentially civil wrongs and should not be criminalised. For e.g.: Criminalising violation of the Indian Cinematographic Act is too severe and disproportionate. Intellectual Property must maximise disclosure, diffusion and dissemination, access to knowledge, and Public Interest. The Policy is vague about how such a balance can be achieved and how the rights of IP owners will be implemented in a manner conducive to social and economic welfare that prevents the misuse of IP rights. CONCLUSION In today s knowledge era, it is imperative to create an Intellectual Property strategy. India s National IPR Policy does so by taking a nuanced position whereby the interests of both the industry as well as the public have been considered. It states that policy formulation is not intended to have the force of law but merely serve as the guiding principles in the administration and enforcement of IP norms. The Policy has also safeguarded the interest of the generic biomedicine sector of India and has not yielded to the ever-mounting international pressure and lobbying by big MNC's. India s first IPR policy comes at a time when developed economies are trying to put in place even stronger IPR frameworks through mega-regional trade agreements. MODEL QUESTION 1. How will the National IPR policy help create a conducive environment for IPR in India? Also examine the role of IP in promoting innovation in India. NEO IAS , , Page 5