Addressing Intellectual Property Matters in the Manufacturing Sector

Manufacturing is emerging as an integral pillar in the country’s economic growth. India’s manufacturing sector is a key contributor to the country’s economic growth and is projected to be one of the fastest growing sectors. It accounts for about 15% of India’s Gross Domestic Product (GDP) and employs around 12% of the country’s workforce. The sector is diverse and includes a range of industries such as textiles, pharmaceuticals, automobiles, and consumer durables. 

Global Competitiveness

India is strategically positioned to achieve a remarkable milestone by exporting goods worth US$ 1 trillion by 2030, signalling its ascent as a major global manufacturing hub. The country has invested significantly in both physical and digital infrastructure, laying the foundation for an increased role of the manufacturing sector in the global economy. This transformation aligns with India’s ambitious goal to secure a prominent position in international supply chains.

India’s push towards Industry 4.0 is evident in the proactive initiatives of the Government, as seen in the National Manufacturing Policy. The policy aims for a significant uptick in the manufacturing sector’s GDP contribution, targeting 25% by 2025. This reflects India’s commitment to adopting advanced technologies and modern manufacturing practices.

The sector holds immense potential to tap into global markets, driven by factors such as robust power growth, promising long-term employment prospects and the establishment of skill routes benefiting millions of individuals. A notable evolution is witnessed as the manufacturing industry progressively embraces automated and process-driven methodologies, promising enhanced efficiency and increased production capacity.

The nation is not merely adapting to changes but actively shaping its destiny as a prominent player in the global manufacturing ecosystem.

IPR Challenges in India

Following challenges related to the IPR highlighted by the Indian industry, which were addressed by CII in a recent report: 

1. Re-scoping of Bio-diversity Act – In the present context, the Bio-diversity Act and the Indian Patent Act intricately interact. While aligned with the overarching goal of “conservation of biological diversity,” the Act presents challenges hindering innovation speed and restricting raw material access for manufacturing firms transitioning from fossil to biomass feed-based economies. This shift is pivotal for achieving our net-zero carbon emission target by 2070.

2. Prosecution Matters – Streamlining and expediting legal processes can significantly contribute to the protection of intellectual property in the manufacturing domain.

3. Patent Classification – The complexity of patent classification presents a sectoral hurdle, demanding clarity and precision for the effective protection and management of innovative ideas. Instances have been observed where the Indian Patent Office’s classification of patent applications misrepresents their classes, particularly in cases like metal forming technology (Mechanical) being erroneously classified under Food or Chemical technology domains.

4. Manufacturing Process Inventions – Innovations in manufacturing processes require robust protection mechanisms. Addressing challenges specific to the protection of manufacturing process inventions is paramount for fostering a culture of innovation.For example In Mechanical domain, less patent weightage is given to manufacturing process inventions from an inventive step point of view as compared to inventions from chemical domain.

5. Government’s Support – Ensuring consistent government support is crucial, and collaboration between the industry and government can foster policy development for innovation and intellectual property protection. In specific instances, Section 35 (Secrecy direction) is applied for national security, causing delays in processing applications until a decision is received from the concerned government department.

6. Procedural Matters – Navigating procedural complexities can be a hindrance to the efficient management of intellectual property. Simplifying and streamlining procedures will enhance the sector’s ability to protect its innovations.

7. Abolition of IPAB – The Tribunal Reforms Act, 2021 abolished IPAB, transferring its functions to commercial courts and High Courts. This raises concerns about the fair and timely resolution of intellectual property disputes. While this move addresses delays in IPAB’s decision-making, it adds to the burden of already strained High Courts, particularly affecting the Delhi High Court, the primary choice for patent matters. The complexity and expertise required in intellectual property cases further contribute to potential delays in an already overburdened judicial system.

8. Extended Producers Responsibility (EPR) – The concept of Extended Producers Responsibility (EPR) adds a layer of responsibility to manufacturers. Clear guidelines and frameworks for EPR are essential to ensure sustainable and responsible manufacturing practices.

9. Lack of Statutory Trade Secret Protection – The absence of statutory trade secret protection poses a challenge. Establishing legal frameworks for safeguarding trade secrets is imperative for fostering innovation and competitiveness.

10. Fast tracking of patent grant for eco-friendly technologies – Fast-tracking patent grants for manufacturing technologies focused on reducing carbon/GHG emissions is crucial. This encourages the development and adoption of environmentally sustainable practices within the sector.

Addressing Sectoral Challenges and the Way Forward

As the manufacturing landscape evolves, India’s journey towards Industry 4.0 symbolizes a strategic shift, fostering innovation, efficiency and global competitiveness. The sector has the potential to grow rapidly as it moves into more advanced areas, such as semiconductors, space and advanced materials. These new areas will trigger new issues in IntellectualProperty management.

CII has been constantly working towards a robust, impactful, and conducive IP eco system in the country, especially for Indian industry. CII’s National Committee on Intellectual Property has produced a detailed report on “IPR issues with respect to the Manufacturing sector,” offering short and long-term recommendations to enhance the IP ecosystem in Indian manufacturing.

Download the full report from – https://ciiipr.in/pdf/IPR-Issues-2023.pdf