EDITORIAL 1/ HALFWAY HOUSE 

The Communist Party of India (Marxist) had reservations, but because the Congress behaved sensibly, the second amendment to the Patents Act has got through the Rajya Sabha. The background is the trade-related intellectual property rights agreement of the Uruguay Round and the Indian Patents Act of 1970. India's 1970 legislation violates the TRIPS agreement on several counts - process versus product patents, compulsory licensing, duration of protection and treatment of imports as equivalent to working patents in India. But legislation need not be brought into conformity with the TRIPS agreement immediately. For most changes, a transition period till January 2005 is permitted. However, from January 1995, India was supposed to receive applications for product patents and grant exclusive marketing rights to applicants for five years. Because this was not done, India lost disputes at the World Trade Organization and the first amendment to the 1970 legislation was introduced in 1998 to incorporate these changes. This still left the 2005 modifications and some minor changes for which the deadline was 2000. Hence the proposed second amendment to the Indian Patents Act. But what is this bill supposed to do? Is it only supposed to ensure the 2000 changes? Or, since we are already in the year 2002, is it also supposed to ensure the complete 2005 transition? The parliamentary committee studying the bill was buffeted from all sides. Multinational pharmaceutical companies pushed for immediate overhaul. The domestic lobby, such as the Indian Drug Manufacturers' Association, wanted a postponement till 2005. The parliamentary committee proposed a compromise. While recognizing that the bill was violative of the TRIPS agreement, it decided to push back substantial changes till 2005. And after the report was submitted, there was the Doha ministerial declaration, which diluted the TRIPS agreement in certain areas. Hence, there is the second amendment to the Indian Patents Act of 1970. And because this is clearly WTO incompatible, there will have to be a third amendment in 2005. This presumes that stronger intellectual property protection is against India's interests and therefore it is advisable to postpone the inevitable. This is not necessarily a valid hypothesis and India's interests are not the same as those of domestic pharmaceutical manufacturers. For example, the National Innovation Foundation's database shows that small Indian farmers are capable of innovation and invention. Yet the present bill excludes traditional knowledge from being patented in India. Nothing precludes Indian traditional knowledge from being patented in the United States of America and such patenting may be done by multinational organizations. To preempt this, small Indian farmers will be expected to take out patents in the US, with high transaction costs. Neither the parliamentary committee nor the present bill appreciates which side the bread is buttered on. That will have to wait till 2005. Now there is only a statute. Other issues like ever-greening of patents will become obvious once accompanying rules are formulated. However, the message the bill conveys is one of an unhappy compromise.