By Srinath Sridharan

The Economic Survey 2021-22 that was tabled in Parliament on January 31 indicates that the number of new recognised start-ups has increased to over 14,000 in 2021-22, from only 733 in 2016-17. “India had a record number of start-ups (44) reach unicorn status in 2021,” the Economic Survey noted, adding that India overtook the UK to emerge as the country with the third-highest number of unicorns, following the US and China, which added 487 and 301 unicorns, respectively, in 2021. India currently has 83 unicorns with valuations of $277 billion! More than 61,400 start-ups have been recognised in India as of January 10, 2022. During the year 2021, 555 districts had at least one new start-up, compared with 121 districts in 2016-17.

Intellectual property

The Economic Survey mentioned that intellectual property (IP), specifically patents, were key to knowledge-based economy: “The number of patents filed in India has gone up to 58,502 in 2020-21 from 39,400 in 2010-11 and the patents granted in India has gone up to 28,391 from 7,509 during the same period”.

Data from the World Intellectual Property Organization (WIPO) show that the Indian patent numbers are way below the 5.30 lakh patents in China, 3.52 lakh patents in the USA, 1.79 lakh patents in Japan and 1.35 lakh in South Korea.

If each Indian start-up is encouraged to file and secure at least one patent, that can prove to be a big leap from our current status. Part of the valuations that start-ups work towards can be from their IP, if the latter is well-protected! The start-ups get up to 80% rebate in patent filings and 50% rebate in trademark filings. The number of IP patents filed in India increased 30% in the past five years. This, in turn, has boosted India’s ranking in the ‘Global Innovation Index’, taking it from 81 in 2015-16 to 46 in 2021.

R&D efforts and IP

The Economic Survey has mentioned with concern the huge gap in patents-filing between India and other countries and attributed it to the low expenditure on research and development (R&D). The R&D spends in India were a mere 0.7% of the country’s GDP in 2020.

The other key reasons that slow down patent filings in India are the procedural delays and complexity of the patent process itself.

 According to the Survey, the average time taken for a decision to grant patents in India in 2020 was 42 months, compared to 52 months (2019) and 64 months (2017). This is far slower compared to 20.8 months (the US), 20 months (China), 15.8 months (South Korea), and 15 months (Japan). According to the Survey, the delay in India’s patent application is attributable to the low number of patent examiners in India, which currently stands at 615 examiners, compared with 13,704 in China, 8,132 in the US, and 1,666 in Japan.

Many global tech majors have some of their R&D bases in India. Yet, to fast-track their patent filings, many of them register their patent filings outside of India. Over the past 10 years, we have lost many such patents to the US, mainly as Indian computer scientists—amongst others—have found it easier to get their intellectual rights recognised elsewhere.

Regulatory facilitation

As few sectoral regulators already offer, the Indian Patent Office (IPO) can start ‘informal guidance’ to the applicants, which can then indicate the pathways to fast-tracking filing and help them robustly defend their applications.

By bringing awareness and literacy about intellectual property rights at the middle and high school level, we can generate more awareness.

This would propel partnership between industry, academia, and the registry of IPR. India can encourage its innovators to register their patents in emerging technologies like analytics, image processing, AI, cyber security, vehicle technology and IoT. In this aspect, working with start-ups from the time of their registration would enable them to work along with the patents authority to move quickly in the IP journey.

The office of the Controller General of Patents, Designs & Trade Marks (CGPDTM) is the governing office that supervises the implementation of the Patents Act, 1970, as amended, the Designs Act, 2000 and the Trade Marks Act, 1999, and also renders advice to the government on matters relating to these subjects.

Hopefully, it can use the philosophy of trust-based governance that was announced in the Union Budget FY23, and bring reforms to fast-track the patent process.

This would go a long way in achieving Ease of Doing Business (EODB 2.0), and in celebrating and recognising the ideas and intellectual prowess we have in the country.

The writer is Corporate advisor & independent markets commentator. Twitter : @ssmumbai.