A good time to bump up our IPR regime

The US has retained India among the priority watch list of jurisdictions that it claims do not provide adequate safeguards to intellectual property. The Indian response has, on earlier occasions, highlighted that its IPR regime is compliant with WTO rules. This standoff must end. The two countries are negotiating an agreement to rebalance their trade, and the obvious way forward would be for India to improve market access to US exports. The primary concern of negotiators is to bring about a reciprocity in tariffs to trim India's trade surplus with the US. Attention will also have to be paid to non-tariff barriers to trade, among which US misgivings about India's IPR regime are serious enough. Since New Delhi has chosen not to confront Washington over Donald Trump's threatened reciprocal tariffs, it may not be able to defend its IPR protection record as vociferously as it did earlier.

A new wave of American imports into India is likely to be led by energy and arms. These do not run into the thicket of IPR accusations and rebuttals. However, technology, pharmaceuticals and entertainment constitute politically sensitive bilateral trade in quest of a common ground on IPR. American companies now constitute a sizeable section of IP protection-seekers in India, and engagement between the two governments over harmonising rules is not progressing fast enough. Compliance burden and ineffective enforcement are among major concerns the US has shared with India.

Trump's trade war presents India an opportunity to fast-track its plans to create a manufacturing export base in the country. US companies seeking to diversify their supply chains from China need to be convinced about India's intent to scale up IPR protection. It is a key input for investment decisions by American companies, and should not be allowed to become a binding constraint. It may be time for India to calibrate its IPR regime against best-in-class as part of ease of doing business in the country. India, after all, is enthusiastic about being a bigger part of the world.