Incentivising Innovation and Technology Commercialisation in India

Abstract

Intellectual property rights, in general, and patents, in particular, are associated with innovation, economic growth, jobs creation and higher wages. In fact, IPR-intensive companies amount to a much higher percentage of the GDP of a country than companies that do not own IPRs. Recognising the many pro-competitive effects of IPRs, in recent years, India has driven several initiatives to promote IP and, thus, innovation. However, some challenges remain. For instance, India faces low levels of R&D investment, insufficient domestic patenting, slow process to obtain and enforce patents, a too-small percentage of commercialised patents, and no national companies contributing to cellular standardisation, which is responsible for driving the digitalisation globally. This article examines several measures that would help India reach its full innovative potential: 1) further increasing the overall IP awareness in society by embarking on training judges, lawyers, and entrepreneurs on IP matters; 2) improving the efficiency of Indian patent system by focusing more on patent quality, which includes hiring more patent examiners at national patent office and providing them with more resources, as well as increasing the number of judges that would be specialised in IP matters; 3) providing direct financial support and tax incentives for domestic R&D and innovation; 4) introducing a centralised approach to support innovative MSMEs, start-ups and universities, especially when they choose to commercialise their IPRs and 5) the government could actively support domestic companies to participate in international technical standardisation and invest in the development of the next generation of standards in order to catch up with Chinese, US and European companies. Taken together, with the right policy measures, India would be one step near its goal of being one of the leading knowledge-based economies to the benefit of Indian society.