India Should Remain on Special 301 Priority Watch List, Be Subject to Out-of-Cycle Review

Despite encouraging dialogue between President Obama and Prime Minister Modi as well as other high-level officials over the past 18 months, numerous concerns and issues with India’s intellectual property rights (IPR) remain. Today, the Alliance for Fair Trade with India (AFTI), along with several of its members, testified before the Special 301 Subcommittee to detail how India’s policies and practices continue to negatively impact their industries and member companies.

As detailed in AFTI’s 301 submission, longstanding issues include:

  • Weaknesses in the Indian copyright system that harm U.S. and Indian creators alike;
  • The use and threatened use of compulsory licensing on biopharmaceutical, environmental technology, and other products as a tool of industrial policy; and
  • Measures in Indian law that add a legally questionable additional criterion for the patentability of medicines and agrochemical products.

Though AFTI’s members recognize that Prime Minister Modi has made an effort to address India’s IPR policies by creating a National IPR Policy, the most recent version leaked in October was disconcerting. The Policy includes onerous local manufacturing requirements and fails to address measures to ensure the protection of regulatory data.

Overall, very few improvements have been made to India’s IPR regime since the 2015 Special 301 report. Therefore, AFTI and its members recommend India remain on the Priority Watch List for 2016 and that the Office of the U.S. Trade Representative (USTR) conducts a rigorous Out-of-Cycle Review.

Outlined below are just a few examples of how India’s weak IPR regime continues to impact a broad range of U.S. and Indian companies:

“In 2015, the Indian delegation at the UNFCCC sought to undermine the incentives to develop green technologies by compromising intellectual property protections through the use of forced technology transfer mechanisms and enhanced patentability standards.” – U.S. Chamber’s Global Intellectual Property Center, 2016 Special 301 Submission, pg. 97.

“India continues to deny patent protection for inventions that would otherwise meet internationally accepted criteria. Since 2012, patents for at least 25 products have been undermined through rejection, invalidation, or other revocation.” –National Association of Manufacturers, 2016 Special 301 Submission, pg. 4.

“Copyright piracy is widespread across India, despite reforms passed in 2012. Nearly two-thirds of all software, valued at $2.9 billion in a 2014 study, is not properly licensed.”- BSA, The Software Alliance, “The Compliance Gap – BSA Global Software Survey,” June 2014. 

“[T]he current legal structure for the protection of confidential test data and other data are inadequate and discourage the introduction of new crop protection products and technologies. A recent report by the Federation of Indian Chambers of Commerce and Industry (FICCI) estimates that 30% of the pesticides in India are counterfeit.” –FICCI and the Tata Strategic Management Group, “Substandard, Spurious/Counterfeit Pesticides in India (2015)”.

Piracy of movies, music and illegal downloads in India is estimated to have cost the music and entertainment industry approximately $4 billion dollars per year, the bulk of which affects local content.” – Ernst & Young, “The Effects Of Counterfeiting And Piracy On India’s Entertainment Industry (2008)”.