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‘Made in China’ or ‘Make in India’

Prime Minister Narendra Modi’s ‘Make in India’ program claims that there has never been a better time to make in India. The program invites the Global companies to come and manufacture in India in as many as 25 different sectors where Government is welcoming the Foreign Direct Investment (FDI). It is worth mentioning that Global corporations consider the Intellectual Property Rights (IPR) enforcement ecosystem of the Investee destination as seriously as any other factors like cost, skilled human resource and local market. The similar concerns were experienced by China when the world decided to go “Made in China” way. Though the Chinese started fixing the IPR issues seriously since 2008 and have come a long way, Whether India’s Intellectual Property Rights (IPR) Ecosystem is ready for the Lion’s prowl?

Make in India

A roaring lion stands for his strength and tenacity, so does the IPR ecosystem of any country. If the Intellectual Property is being examined and enforced efficiently, even a small country like South Korea or Germany can appear as the Kings of the economic Jungle.

Lion’s Roar

Lions roar to communicate their position to other prides, and if they don’t they might end up fighting for the same territory. Similarly any investee company planning to ‘Make in India’ would like to have their IPRs secured, if they don’t see the IPRs being honoured in any jurisdiction they are not even bothered to file IPs in such markets. The dragon (China) understood it long back when they rolled in National Intellectual Property Strategy in 2008 and ensured that more and more developed countries secure Patents in the dragon-land and strong measures are set for enforcement of IP. China granted 64000 Patents to foreigners as opposed to 3400 by India in 2012-13. Today China is the most favourite manufacturing destinations of the world and India receives less than 30% of Patent Applications from foreigners when compared to the former.

Lion’s Strength

The strength of the IPR framework in any country is represented by its Laws, as well as administering and enforcement prowess. Though the IP laws in India are strong and up to date, the administration and enforcement of such laws is either inconsistent or does not exist. India has renovated the four different branches of IP offices in Kolkata, Mumbai, New Delhi and Chennai and made their functioning transparent. However, just like the 411 lions left in India, the population of Patent Examiners is thin in these understaffed offices. Many Patent Examiners are poached in to the Private Jobs as their experience at the Patent office is perceived beneficial by the private enterprises. India has less than 250 functioning examiners across four Patent offices’ today, as compared to 8500 in China and efforts to re-populate the endangered species of this workforce need highest attention.

Lion’s Tenacity

Lions are known for their tenacity, which is firmness of the grip with which they hold the prey, however our IP offices are known for timid approach and pace in granting Patents. The average time to issue a First Patent examination report in India is over 55 months as compared to 15-25 months in majority of the other Patent grating countries. It takes about 5-9 years to issue a Patent in India. Going by the arithmetic, if a Corporation intends to Make a hi-tech product in India and secure an IP associated therewith as a precursor, they might have to wait up-to 9 years to receive Patent Grant Certificate and the rights to sue infringers. The technology being patented itself loses its relevance in the market by the time a Patent is awarded. The enforcement scenario is darker as only few forums would understand IPR cases and fewer would dispose in time whereas IP enforcement in China is much more advanced, cheaper and faster than most people realise.

Recommendations

With a balanced political leadership and momentum at the centre, the Government needs to continue the initiatives of the predecessors and fix the Intellectual Property administration and enforcement framework in the country. Though the NDA government has announced in October this year that it will come up with a National IPR policy in 6 months, the policy should be aligned to the National IPR strategy on which the UPA government spent 2.5 years, otherwise a step forward might take us two steps back. The National IPR strategy focussed on IPR reforms in seven areas: (i) stimulating creation (ii) Strengthening protection (iii) service oriented administrative infrastructure (iv) developing human capital (v) Promoting respect & effective enforcement (vi) Facilitating commercialization and (vii) addressing global issues in International fora. The current government should come up with a detailed time bound action plan for recruiting more Patent Examiners and clearing backlogs. Yet another recommendation is that the government should provide an out of turn/accelerated examination for the applications that cover products the investee company wants to make in India by way of an additional declaration. An efficient and transparent IPR ecosystem can be one of the major advantage over “Made in China” mission which has already changed the way world manufactures the goods.

Best time to plant a tree was 20 years ago; the second best time is today∞ A Chinese Proverb