Business Standard: US lambasts India on IPR, trade policies

Business Standard

US lambasts India on IPR, trade policies

Alleges that it is adversely impacting American firms present in the country

May 6, 2015 

By: Nayanima Basu

US industry has once again lambasted the Indian government on domestic trade and industrial policies alleging that it is adversely impacting American firms present here during a hearing conducted by the US International Trade Commission (USITC).

USITC, which is a quasi-judicial federal agency giving trade policy advice to the American government, heard the submissions of their industry lobbies on Tuesday that included some large-scale lobby groups representing a host of American companies across all sectors.

The various organisations that gave their report to the body were – International Intellectual Property Alliance (IIPA), National Association of Manufacturers (NAM), American Insurance Association (AIA), US India Business Council (USIBC), US Chamber of Commerce and Alliance for Fair Trade with India (AFTI) among others.

“Despite the election of Prime Minister Narendra Modi last year on an ‘open for business’ platform, the Indian government has taken very few concrete steps to improve the trade and investment relationship with the US other than engaging in high-level dialogue with the US government,” said Linda Dempsey, vice president (international economic affairs), NAM in her pre-hearing statement to USITC.

Dempsey said that the chamber continues to hear from its members of a “deteriorating trade, investment and property protection environment for manufacturers across many sectors since Prime Minister Modi took office.”

Post this critical hearing, the USITC will form a report which will be the basis of America’s trade policy with India. The hearing by USITC comes at a time when the two-way trade between India and US in goods and services has reached $103 billion. Both sides are now aiming to achieve $500 billion.

“Over the last several months, the Modi Government has not made any substantive effort to address longstanding issues of concern for US industry. Instead, the flurry of high-level meetings between the US and Indian governments that encouragingly characterized the first several months of the new government has simply resulted in the retention of the status quo. This status quo includes a range of discriminatory policies and practices with which the US,” said Brian Pomper, executive director, AFTI.

AFTI, formed in 2013, is specially focused on the trade and non-trade barriers faced by the American companies operating here. It mainly highlighted their concerns in the field of information and communications technology (ICT), discriminatory patent practices and forced transfer of technology.

According to Patrick Kilbride, executive director of the International IP Global Intellectual Property Center, US Chamber of Commerce, although the Modi-led government has taken steps to address concerns regarding the intellectual property rights (IPR) regime in India, it has failed to pacify the concerns of the American industry.

“Despite the increased attention to IP by the Modi Administration, US industry has become concerned by a number of troubling developments which continue to threaten IP protections in India and, in turn, the greater business environment and India’s economic growth and global competitiveness,” Kilbride said during the hearing.

He specifically pointed the controversial section 3 (d) of the Indian Patents Act, stating that India is using this provision to “deny innovation companies’ patents.” He also exhorted the government to not to use the flexibility of compulsory licensing, laid out under the World Trade Organization’s Trade-Related Aspects of Intellectual Property Rights (TRIPS) agreement, as a “commercial tool.”

Last week, the US Trade Representative (USTR) in its annual Special 301 Report, threatened India that it might resort to taking “action” if the IPR laws are not implemented properly in the country.