Tuesday, 5 July 2011

An autochthonous path for India

The patent regime in India underwent a sea change in 2005. Up until then, India only granted patents for the production process and not the final product itself (which was meant to protect the pharmaceutical generics trade). The enactment of the Patents (Amendment) Act of 2005 brought the patent regime in India more or less in line with international patent laws. Nevertheless, there have been murmurs from multinationals about the Government of India effectively bypassing the protection granted to patents in the form of compulsory licenses.

For the benefit of the uninitiated: patents are granted only to inventions which constitute new findings hitherto unknown and which are capable of industrial application. Patents (for inventions), Trademarks (for commercial signs) and copyrights (for works of art) constitute the three most common forms of intellectual property rights.

The very concept of intellectual property rights (IPR) is largely alien to the Indian mindset. Historically, sharing of knowledge has been an integral part of Indian culture. The Arthashastra for example, a seminal work on statecraft, borrowed liberally from existing works wherever the author was in agreement with those teachers. The Ramayan and the Mahabharat, the two Indian epics have been embellished over the centuries by multiple writers (incidentally, the legendary Laxman Rekha is not mentioned anywhere in Valmiki’s Ramayan). Most Indian music is based on ragas that were conceived hundreds of years ago.

The very concept of Intellectual Property Rights (IPR) has exclusivity at its foundation, with the originator of the idea conferred exclusive right to exploit the commercial potential of the idea. Excellent as the idea sounds, it does not suit a predominantly rural society like India, where the vast majority of the people are poor. 

For any idea to be useful in rural India it should fulfil two criteria: (a) it should be capable of being implemented rapidly and (b) it should be available at a low cost. Given the time it takes to obtain a patent and the legal costs associated with obtaining and then protecting an intellectual property right in India, it would be far more commercially viable to leave the invention unpatented. For starters, it would enable the inventor to bring his product out in the market immediately and keep the prices low (and as such, affordable).

Secondly, leaving such products unpatented would allow other entrepreneurs to exploit the idea. Most rural entrepreneurs are people with limited financial wherewithal who can serve only a very limited market. An open field not only presents opportunities to other entrepreneurs who can modify inventions freely to respond to varied local conditions, but also makes it possible to spread the benefit of an idea among a much wider user base. Small entrepreneurs offer the twin benefits of high degree of customisation and the ability to provide last mile connectivity. Such flexibility and reach would be simply beyond the means of a major corporate entity.

Another factor that needs to be kept in minding is the Indian way of doing business. Unlike in the west, where the contract is sacrosanct, in the Indian scheme of things the signing of the contract is only the beginning of the relationship and ultimately, the personal relationship between parties to a transaction decides the manner in which the business is done. As such, the concept of granting a license to use the patent would appear to be not only tedious, but also alien to the Indian way of working.

Not even for a moment am I advocating that India should disband its patent regime. The point I wish to make is that while we encourage innovation in this country, we need to take care to ensure that we do not impose conditions that could stifle innovation or in any way prove self-defeating. For reasons already mentioned above, there are far too many innovations that are best left unpatented and as such, it is neither feasible nor desirable to create a patent regime resembling the one used in developed countries. If India is to truly benefit from innovation and entrepreneurial spirit, we need to adopt an autochthonous approach best suited to Indian conditions.

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