The Great Indian IPR Dilemma

Close on the heels of the allegation by the  foreign banks that India is not playing by the  rules in revealing the names of account holders in foreign banks, another controversy is awaiting to happen. That is the stand of the United States Trade Representative (USTR) to  review patent regime in India and to find out whether Indian authorities are adhering to tenets of compulsory licensing, data protection and incremental innovation. The problem is mostly with the pharmaceutical  companies based in US and operating in India. Some of the companies, which have raised their voice against Indian patent regime are having a long term association with Indian market.

A proper understanding about about the Indian health sector is important in this regard. Only a fraction of Indian population has an health cover to take care of their needs. An average citizen will have to spend a lot once he or she visits a doctor not only in terms of doctor's fee but also for medicines that one buys. He or she is not getting any reimbursement for such medicines and has to bear from his or her sources unlike the case in the US or in other developed countries. Things are worst, if they are afflicted with a terminal diseases like cancer or a chronic disease like diabetes or blood pressure, which  are  very common in India. The government is planning comprehensive health plans through the insurance route. But its coverage is too little. Even where the coverage is there, high incidence of disputes by the insurance companies deny any quick benefits to the common man. The rural health schemes, initiated by the earlier dispensation  has not made any dent. There are widespread scams and mismanagement in the scheme, which prevent the benefits being percolated to the grassroots.

Given this situation, it is difficult for the government to de-regulate  all medicines. Recently, the government had taken a long list of medicines out from the administered prices and allowed the prices to be determined by the market forces. The prices all on a sudden shot up, leading to public uproar. So far the discontentment is through whispers and innuendos. Once the honeymoon period of the government is over, the media will actively pickup the issue to the discomfiture of the government in power. 

Interestingly, many US companies like PEPSI, Honeywell, Boeing etc, which are operating in other sectors have indicated their satisfaction about the operation of the IPR rules in India. Even if thy have any concern, it is not orchestrated at high decibels. They feel that these issues can be sorted out through bilateral discussions and an approach of give and take. One has to keep in mind that these companies are operating in sectors which are not  immediately relevant to the common man. That is the not the case with pharmaceuticals. 

Also, pharma companies have to bear in mind that the incremental progress in the IPR regime of India. Even in the case of pharmaceutical comapnies, India had come a long way in granting the product patents as against process and becoming a signatory to the Paris  Convention. As years roll by, there will be improvement in these spheres also. One point about the compulsory licensing. it is something that can be resorted to under WTO agreement on TRIPS. However, there is merrit in the assertion of th multinational companies that there should be a dialogue for that and it should not be unilateral unless vitiated by emergencies or stubborn positioning of the patent holder.

For more details: Contact Business Economics Services Team (BEST)  E Mail:jthac1234@yahoo.com or  jthac1234@gmail.com

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Today in Kerala is the day of Boozers

If yesterday was the day of the booze haters today belongs to the opposite camp. A bench of Kerala High Court stayed the order of the single judge regarding closure of bars in three and two star hotels. The stay is for one month till the double bench court decides on the issue. it has given the bar owners a short reprieve and some degree of confidence to fight out the case.

 The stay  of the order of th single bench which  allows  status qua, was immediately picked up by the Kerala Opposition (LDF) to lash out the ruling UDF. it is alleged that there was a politcal brinkmanship game over the closure of the bars, between the two factions of the ruling alliance, one led by the chief minister Ommen Chandy and the other VM Sudheeran, KPCC President, each claiming the ban as the victory of theirs.

One has to see how the game is going to be played out in future. The liquor lobby has considerable stake in the game since they stand to loose considerably if over 65o bars   are closed down. They will play all the games up in their sleeves to avoid that eventuality, or atleast delay it till the time they have to renew their licenses. The bar licenses are auctioned out and the licenses are pricey. Also, by that time they can exhaust their stock, which according to some unofficial report, run into several crores of rupees.

One possibility is that if the court decision is delayed by any case (if  the bar owners do not get the right decision from Kerala High Court, they will approach the Supreme Court and vice versa) the issue can be precipitated as an election issue. Importantly, Kerala is going to polls in 2016. Also, the ruling UDF will not be able to take credit for the liquor ban. Also, the powerful liquor lobby will trow their support to the LDF in anticipation of favoring them once they come into power.

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MGNREGA Connect

If  you ask me what is the lasting connect between governors and governed in India, I  would say it is the Mahatma Gandhi National Rural Employment Guarantee Scheme, popularly known by its acronym MGNREGA. Of course, I owe an explanation. Because, it is the only scheme that gives the employment cover for those who are willing to work. Though it guarantees work up to 100 man days in a year, in effect the total employment per year works out to an average close to 40 man days or so. Perhaps, this is the only time the government gives money directly to the person as a dole and a guarantee against unemployment. In developed countries, there are regular schemes to take care of the financial, educational and health needs of the unemployed and the people dependent  on them.  That cast a huge expenditure on their exchequer.

The thinking in the government to downsize the scheme is borne out of the fact that there are considerable pilferage in the scheme. Fictitious names are created to corner the benefits. In several instances, there are mismanagement and corruption. The other reason is said to be thin coverage of the scheme, which makes the impact too shallow. Therefore, they want to concentrate the program to such identified areas where poverty is predominant and make the scheme exclusively tailored to poverty alleviation.

To me all these alibis to cut short the scope and range of the program is myopic. Admittedly, there will be pilferage and it is the duty of the government to plug the loopholes that are leading to mismanagement of funds. One way of doing it is to link the scheme with Aaadhar so that only one person from a household can take advantage of the scheme. Secondly, the government with its huge infrastructure at its command can undertake a survey for mapping the beneficiaries and in identifying the pockets where the mismanagement is taking place. Stirct punitive action should be taken against the people involved in complicity. This will send strong signals across the country.

About restricting the coverage of the scheme to limited number of blocks, say 2500 blocks or so, where poverty is crucial, I believe is  against the tenets of justice, equity and fair play. That would mean only such clusters where there are higher incidence of poverty will be covered under the scheme. By import, a  family  living in abject poverty in an affluent area will be outside the purview of the scheme.

 There is a lot of gainsay in the opinion that only rich in India are protected and the poor are thrown to the vagaries of nature. Credit from the banks and financial institutions flow only to the rich, whatever may be the incidence of default in repayment. Big infrastructure companies are granted  something called bridge loans, which comes almost free. The nexus between politicians, businessmen and bureaucrats are known. The CAG has come out with documentary evidences  how the rich  and  mighty have stashed funds meant for the entire nation.

The successive governments are showing leniency  in protecting them. Political parties compete  with each other in protecting them. The recent stand on black money revelation is a case in point. How the views of the UPA and NDA converge with each other, though they had diametrically opposite views  earlier? How Finance Minister lashed out at the  CAG and exhorted them not to become activists and confine to  their responsibility as mere auditors? Paradoxically, he held a diametrically opposite view  as the leader of the opposition in the upper house a few months back.

My limited point is that one cannot ignore the rights of the poor and underprivileged just because they do not have the perquisites of lobbying and the scant attention that they get from the media. MGNREGA is their legitimate right, which should not be encroached upon by anybody. Ofcourse, the pilferage can be plugged and nobody is against it.  

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