A Priority Foreign Country is a status reserved for those nations that are the most egregious violators of IP rights and have the most negative impact on US competitiveness abroad.
These corporates have alleged that India's trade practices are discriminatory and have failed to adequately protect and enforce intellectual property (IP).
Experts say it would lead to a trade war between both the countries if India is designated as a priority foreign country under pressure from the US industry.
Representatives of more than half a dozen influential trade organisations appeared before an inter-agency governmental panel lead by the US Trade Representatives (USTR) on Monday.
Another 60 businesses and advocacy organisations wrote two separate letters to the USTR alleging that India has discriminatory industrial policies including its blatant disregard for intellectual property.
These policies threaten manufacturing and jobs across the country, they said.
"In the past two years, the Indian government has demonstrated a pattern of behaviour that caused a rapid deterioration of the IP environment, making India an outlier in the international community," Jasper MacSlarrow, executive director of the Intellectual Property at the US Chamber of Commerce's Global Intellectual Property Center (GIPC) told the USTR panel which held a special hearing on its annual USTR Special 301 Report.
"Given the rapidly deteriorating climate in India, we urge USTR to designate India as a Priority Foreign Country in the 2014 Special 301 Report," MacSlarrow said.
"The simple reality is that over the last twelve months India has reached an inflection point both in terms of the egregiousness of its domestic policies and the belligerence of its international statements on IP protection. Its practices clearly reach the threshold for a Priority Foreign Country determination," said Brian Pomper from the Alliance for Fair Trade with India.
Herb Wamsley, executive director of the Intellectual Property Owners Association, alleged that India is systematically denying US companies the protection and opportunities afforded in its own industries, including with respect to IPR.
"These efforts not only threaten to diminish India's ability to innovate and attract investment, but they also unfairly disadvantage American businesses," he said.
"In India there are extreme delays in the handling of oppositions, cancellations and most court actions, all of which may permit infringements to continue without redress for lengthy periods of time. Some delays in contentious trademark matters have reached more than 7 years," he added.
Simultaneously, more than 50 business and advocacy organisation wrote a letter to USTR Mike Froman making a similar demand.
"Unfortunately, high-level dialogue and diplomacy have failed to reverse discrimination. Rather than engage in good faith negotiations, India has expanded its industrial policies to other products and sectors," the letter said quoting Paul Kilmer, of the Special 301 Trademark Working Group.
"It continues to deny and revoke patents for innovative medicines manufactured in the US and elsewhere. It continues to weaken protection and enforcement of copyrights, patents and regulatory data," it said.
"In the World Intellectual Property Organisation and other forums, it is actively promoting proposals that would undermine global rules safeguarding ideas, brands and inventions," the letter said.
The organisations said the US must use the enforcement tools at its disposal to address this growing challenge and to secure a fair and level-playing field for manufacturers and workers.
"In particular, we urge the Office of the US Trade Representative to designate India as a Priority Foreign Country in its 2014 Special 301 Report.
"This designation appropriately would rank India among the very worst violators of intellectual property rights and establish a process leading to concrete solutions," the letter said.
"India's egregious acts, policies and practices have a serious adverse impact on manufacturers in the United States and threaten further damage," said Linda Dempsey, National Association of manufacturing (NAM) vice president of International Economic Affairs and Alliance for Fair Trade with India Co-Chair.
"India has contributed to a climate for IP rights protection and enforcement that consistently ranks worst or among the worst in the world. The USTR and other federal agencies must consider elevation to Priority Foreign Country," Dempsey said.
In the letter, the organisations highlighted that dialogue and diplomacy efforts, including meetings between the respective countries' heads of state, have had no effect on India's discriminatory practices.
The letter goes on to detail some of India's harmful trade policies, including revocation of patents, failure to enforce patents and undermining the safeguards for ideas and inventions.
In another letter, a group of more than 10 local chambers of commerce alleged that over the last 18 months, they have seen continued policy, regulatory and legal decisions in India that have deteriorated its investment climate and particularly its IP environment.
According to the US Department of Commerce, IP-intensive industries account for USD 5 trillion, or 34.8 per cent, of US GDP, 60 per cent of US exports, and 40 million American jobs – jobs which pay, on average, 42 per cent higher wages than those in other industries.