USTR – 301 Priority Watch list – UPSC GS3

By /
USTR Priority Watch List Issue:
USTR prepares list of countries whose IPR regime has negative impact on American products. And US govt can put sanctions on countries listed under Section 301 Report. India has been in “priority watch list” since beginning of Special 301 report in 1989.
Implications on India:
  1. It is a warned caution to India to ensure that its IPR regime is in-line with global norms. Under extreme cases, it may lead to economic sanctions.
  2. It may have an adverse impact on US investments in India especially in R and D sector
  3. It may be next step towards more extreme category of “Priority foreign country”.
Concerns raised by US:
  1. Issues related to Movie and Internet piracy. India doesn’t have separate Anti-camcording law or severe punishment regime for such piracies (genuine concern)
  2. Drug Price Control Order, 2013 imposes MRP restriction on more than 350 essential drugs. But some drugs can be sold at higher prices, if they are manufactured in India using Indian technology while foreign companies have to sell same drug at a fixed. Price by National Pharmaceutical Pricing Authority (NPPA). This hurts IPR of Pharma MNCs (invalid concern)
  3. Trademarks misuse and counterfeiting: India has backlog of 1.5lakh+ cases related to trademark misuse. Even FICCI report says trademark owner loose nearly $12 billion annually because of counterfeit products in Indian market (valid concern)
  4. India doesn’t have separate law to punish trade secrets violations and relies on outdated “Contracts Act” (valid concern)
  5. SC ruling in Novartis/Glivec case restricting their renewal of patent (by making superficial changes in drug molecule structure) and India’s Controller-General of patents order in NEXVAR judgment- giving compulsory licence to NATCO Hyderabad. MNC lobbyists have used this to wrongly portray India as biased against foreign MNCs (invalid concern as it was in public interest and also complies with TRIPS)
  6. US companies tried to patent various Indian ancient products like neem, basmati etc. The concerns raised by people that it is a community right and should not be misused by patenting it by some US company agonized US companies. (India’s concerns)
  7. India doesn’t have separate Anti-Camcording law to combat video piracy
  8. India doesn’t have special takedown procedures against piracy websites
Stand of the Indian Government
  • India does not recognise “unilateral measures” such as the U.S. Special 301 Report that tries to create pressure on countries to enhance IPR protection beyond the World Trade Organisation’s Agreement on Trade-Related Aspects of IPRs (TRIPS).
  • India will not undertake commitments beyond TRIPS.
  • IPR Policy will ensure that no changes are made in Section  3(d) of (Indian) Patents Act (which prevents ever-greening of drug patents) as well as the patent-disabling Compulsory Licensing (CL).
  • Compulsory licensing and norms similar to Section 3(d) are among the flexibilities available in international treaties and TRIPS Agreement to ensure availability of essential and life-saving drugs at affordable prices.
With rise of knowledge economy IPR regime of India surely needs overhauling; in this process US can be suitably involved to address American concerns
Trade Facilitation and Trade Enforcement Act of 2015.
  • The focus of the law is to enhance enforcement of IPR over the U.S.’s trading partners. It introduces important measures relating to intellectual property rights (IPR) issues
  • This law is expected to impact India’s ability to develop an IP policy suited to its own developmental needs
How this new law aggravates situation?
  • The Act specifically requires the USTR to develop action plans with benchmarks for PWL countries. The USTR has traditionally developed action plans in consultation with the country in question. However, under Trade Facilitation Act, the USTR is not required to consult with the listed country
Steps taken by India:
  • India has prepared a National IPR policy to allay apprehensions of Us government.
  • The policy was drafted confirming to the World Trade Organisation’s Trade-Related Aspects of Intellectual Property Rights (TRIPS).
  • However, Us has placed India in “Priority Watch List” owing to USTR’s view that India has not made adequate changes in its intellectual property (IP) laws and regulations.
  • Similar to USTR’s Special 301 Report, India is being ranked poorly in the IPR index being done by the US Chamber of Commerce’s Global Intellectual Property Center (GIPC).
Related Questions:
  • In its annual report on intellectual property right (IPR) laws and patent regimes of partner countries, the US Trade Representative (USTR) has again kept India on a ‘priority watch list’. What does it mean to India? Critically comment if concerns raised by US regarding India’s IPR laws are valid. (200 Words)

Leave a Comment

Your email address will not be published. Required fields are marked *

Scroll to Top