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Strengthening The Patent Ecosystem

Context

There is a surge in start-ups and unicorns in India, and an efficient IPR system is a necessary prerequisite for a healthy startup ecosystem. As a result, the report emphasises the importance of a strong patent system for a knowledge economy and the advancement of technological innovations.

Relevance

GS Paper – 2 Government Policies & Interventions, GS Paper – 3 Intellectual Property Rights (IPRs)

Mains Question

What exactly do you mean by intellectual property rights? Discuss how India should deal with intellectual property rights issues. (250 Words)


Important data

  • The report also emphasises the increasing proportion of residents in the total number of patent applications filed in India, which has more than doubled in the last decade. The Economic Survey 2022-23 made the same observation.
  • For the first time, the number of patent applications filed by residents surpassed that of foreign applicants in the fourth quarter of fiscal year 2021-22.
  • The total number of patent applications filed with the Indian Patent Office increased by 48% between 2010-11 and 2020-21, with applications from residents accounting for the majority of the increase.
  • Similarly, between 2016-17 and 2021-22, the number of patents granted in India increased from 9,847 to 30,074.

The importance of R&D in India’s higher education sector

  • According to UNESCO data on science, technology, and innovation, the higher education sector’s share of gross domestic expenditure on R&D (GERD) has risen from 5% in 2013 to 7% in 2018.
  • In four years, the number of patent applications filed by India’s top ten academic institutes and universities increased threefold, from 838 in 2015-16 to 2,533 in 2019-20.
  • During the same time period, their share of patent applications by residents doubled from 6.4% to 12.2%.

Concerns raised in the report

  • Long pendency: The global best practise is disposal within 2 to 3 years, whereas in India, the average time taken is just under 5 years, with some categories, such as biotech, taking up to 9 years.
  • Manpower shortage: At the end of March 2022, the patent office in India employed only 860 people, including both examiners and controllers, compared to 13704 in China and 8132 in the United States.
  • Procedural issues: For example, the lack of fixed timelines for filing an opposition against any patent application, as well as cumbersome compliance requirements, leads to patent processing backlogs and delays.
  • Withdrawn applications: According to the World Intellectual Property Organization (WIPO), India has one of the highest rates of patent application withdrawal.
    • The withdrawal share fell to 54% in 2019 and 38% in 2020, but it remains one of the highest in the world and far higher than its global peers such as the US, Japan, Korea, and China.
  • Insignificant collusion: With a greater emphasis on the development component of R&D in higher education, collaboration between industry and academia in the area of R&D will increase.
    • However, India’s score in the Global Innovation Index (GII) for industry-academia collaboration has fallen in recent years. As a result, India’s GII ranking in this indicator fell from 48 to 65 between 2015 and 2021.
  • However, improvements in other indicators have resulted in India’s overall GII ranking improving from 81 in 2015 to 46 in 2021.
  • Finite locus: According to the draught National Auto Policy 2018, collaboration between industry and academia in India has been limited to niche research areas with low commercial significance.
    • It also mentions the scarcity of Indian innovations originating from collaborative research projects and implemented and commercialised in the automotive and other sectors.

Applications that were abandoned

  • Data: The proportion of abandoned patents in total patent applications increased from 13.6% in 2010-11 to 48% in 2019-20.
  • CGPDTM report: According to the latest Annual Report (2019-20) of the Office of the Controller General of Patents, Designs, Trademarks, and Geographical Indications (CGPDTM), the number of abandoned patent applications increased by nearly 350% from 5,186 in 2010-11 to 23,291 in 2019-20.
    • This was due to failing to meet the requirements of Sections 9(1) and 21(1) of the Patents Act.
    • Section 9(1) of the Patents Act states that applications accompanied by provisional specifications must be accompanied by full specifications within one year.
    • Section 21(1) of the Patents Act: This section requires patent applicants to re-file documents if the patent examiner finds them to be ineligible.
  • Reason for application withdrawal:
    • Failing the scrutiny test: Applicants may be unsure that their applications will pass scrutiny and, as a result, do not pursue them.
    • Long pendency: A long pendency discourages applicants from following up on their applications, especially in the case of innovations with short life spans.

Report recommendations

  • Eliminating irrational incentives: Since the adoption of the National Intellectual Property Rights Policy in 2016, there has been a lot of emphasis placed on the filing of patent applications.
    • It must be investigated whether unreasonable incentives were created in the process to encourage the filing of patent applications even when the innovator is aware that their claims will not pass scrutiny.
    • Eliminating such incentives will contribute to the improvement of India’s patent ecosystem.
  • Address manpower shortage: In the next two years, the patent office’s manpower should increase from 860 to around 2800.
  • Independence: Currently, the Office of the Controller General of Patents, Designs, and Trade Marks is a subordinate office of the Ministry of Commerce. There is a need to give the office more autonomy by providing more financial and staffing flexibility.
  • Establishing timelines for patent application processing: For example, in the United States, the time limit for any party to submit any material of potential relevance to the application’s examination is 6 months after the date on which the patent application is first published.
  • Implementing the utility model of patents: A utility patent is a type of patent right granted by a state to an inventor for a set period of time in which the eligibility requirements are less stringent, the term of protection is shorter, and these are also less expensive to obtain. These are essentially ‘jugaad’ innovations created by inexperienced inventors.
    • This encourages innovation, particularly among individual and small-scale innovators, because it does not require the strict novelty and invention conditions required by patent law.
  • This model is used in many countries around the world. In 2020, 3 million utility patents were filed worldwide.
  • Other enhancements: Outsourcing the administrative portion of the process to a third party so that examiners and controllers can focus on core technical work, as well as improvements to the portal and filing system, could be considered to help the overall patenting ecosystem in India.

Conclusion

Because the patent system is an important component of the national innovation ecosystem, investing in the patent ecosystem will help India strengthen its innovation capability.


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September 2022
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