The Role of Intellectual Property in Innovation and Economic Growth of Indian MSMEs

Abstract

Small and medium-sized enterprises (SMEs) are backbone of India’s manufacturing industry and play an important role in India’s stable money supply growth. There are more than billions of SMEs in India, with an investment of more than 1 billion rupees. The sector has recorded strong growth during past fiscal years and contributes approx. 6.11 per cent to country’s manufacturing GDP and 24.63 per cent of the GDP from service activities as well as 33.4 per cent of India’s manufacturing output. Approximately 70 per cent of employment growth comes from Asian MSMEs, which account for 90 per cent of Indian industrial companies and 40 per cent of manufacturing value added. India is estimated to have more than 13 million SMEs with 42 million employees. For these reasons, it is very important for these companies to invest in their intellectual property (IP). By introducing unique brand and product names, each retailer can ensure the high replacement cost and market position of its products and/or services. IP and its worth are usually neglected. IP is a major aspect in daily business practices in an increasingly knowledge-based sector. New technologies, brands and innovative designs are introduced to the market nearly every single day, as a result of human continual innovation and creativity. As a result, the necessity of intellectual property rights to MSMEs in product development as well as some success stories is reviewed in this manuscript. This article also showed how IP has evolved into a business tool to counter the challenge that MSMEs confront in applying the IP system.