Patents in the cause of development

The author views trade and TRIPS not in isolation, but as a part of the development process

January 07, 2013 09:23 pm | Updated 09:23 pm IST

Chennai: 03/1/2013: The Hindu: oeb: Book Review Column:
Title: Patent and Trade Disparities in Developing Countreis.
Author: Srividya Raghavvan.

Chennai: 03/1/2013: The Hindu: oeb: Book Review Column: Title: Patent and Trade Disparities in Developing Countreis. Author: Srividya Raghavvan.

In the post war years, i.e. long before financial globalisation captured the imagination of economists as the lever of growth, a great deal of work in the U.S. and the U.K. universities was on the impact of technology on growth. Many observed a direct link between the two. Joseph Schumpeter’s vision of “innovations” lifting economies to higher levels of growth held sway. Allow trade, especially international trade, and the cross fertilisation will generate faster growth.

Technology development had become a study by itself and its nurturing was related to the socio-economic ethos of the country in question. Development Economics came to be integrated with technology economics and planners in newly emerging economies were advised to promote technology and, if necessary, to “re-engineer” products made abroad.


Indigenisation was at the core of post-war import substitution strategies of many developing countries. Countries like India and Brazil which had reached high levels of indigenisation began to have their battles with drug multinationals. These dreams were in jeopardy when trade related intellectual property rights (TRIPS) were linked to international trade.

The linking of TRIPS with trade was a strategic ploy played on hapless developing countries by the advanced countries. The background to the Uruguay Round is well documented. So are later rounds of WTO ministerial leading up to Doha in 2001. The attempt of the advanced countries was to enforce TRIPS as condition precedent to market access. Even as the Doha Development Round is moribund, the larger question has been haunting trade theorists: How sustainable is the TRIPS regime?

In this book, Srividhya Ragavan goes deep into sustainable issues. Her study differs from many others in that she views trade not in isolation, but as a part of the development process. Significantly, the TRIPS regime visualised in the WTO applies only to developing countries, the assumption being that the advanced countries have sound systems in place.

Ragavan’s book is rather devoted to the impact of patents in the larger developmental context than in mere trade. Unlike many economists, who are apologists of the WTO, she is not dreamy-eyed about trade. She doubts the role of trade as a tool to achieve development. As she explains, “The concept of trade is a market-dependent beast; consequently, ‘tradability’ is contingent on variables and disadvantages that generally characterise any market place. Hence, the developmental promises from trade are limited to and commensurate with the market.”

Sustainability transcends ‘trade’ and has to encompass equitable development that results without compromising the national framework including the ecological, economical and socio-political complex. As she says, the book’s “ambit revolves around the hybrid of interactions between trade and sustainable development. It is the missing piece of the puzzle that has not been studied by others.

The book is organised imaginatively and driven by a synthetic view of sustainable development. Each chapter deals with one aspect of patents and leads on to other ramifications or what she calls ‘building blocks’ to develop a framework.

The first chapter describes seminally the manner in which developed countries addressed questions over patent protection in different periods in history. The U.S. and the U.K. took more than a century and a half to evolve a system and their effort was to promote national objectives. Now, the same developed countries are denying developing countries the tools that they resorted to in linking industrial progress through a flexible patent regime. Don’t these countries need the “choice”, the policy space and the “time” to evolve a system which does not compromise national objectives? TRIPS is a strait-jacket which is rigid and lacks flexibility. Thereby they create distortions and tensions across the globe.

The second chapter studies at length the experiences of India and Brazil in evolving a patent system and their conflicts with the WTO regime. She narrates the sad story of India gradually succumbing to WTO pressure and abandoning the healthy national system it had legislated way back in 1970s based on Rajagopala Ayyangar Report.

Drug industry

Protection for “process” as distinguished from “products” led to the growth of domestic drug industry and, along with drug price control, ensured adequate and reasonably priced supply of drugs. These benefits are lost under the TRIPS and the two countries have paid a heavy price in the process.

Ragavan excels in describing the need for enforcement machinery to offer protection and how developing countries are yet to evolve them. This leads to conflicts with big corporations, especially drug giants.

Developing countries may not hope to have systems comparable to those in the U.S. or EU which were historically the result of close interaction between the national market, the corporates, government agencies and courts. Without being highly legalistic, she offers rare insights into those developments.

Against this light, she examines, at several places, the complexities attached to enforcement of “compulsory licensing” and how developing countries are at a great disadvantage. She narrates how the U.S. intransigence over the issue in Doha was broken by the threat of anthrax back home and how the U.S. had to force drug companies to license the drug. The same U.S. was stubborn when African countries were keen to save millions of their citizens afflicted with AIDS/HIV.

She gives a convincing account of how in Doha the developing countries won the limited battle over the issue. Her accounts of India’s battles with Novartis, Roche and Bayer over life-saving drugs are valuable. These are continuing struggles and developing countries tend to get weaker in holding up and/or defending their national interests.

Equally interesting are the chapters dealing with patents in biotechnology, plant genetics, biodiversity and plant protection. These are newer areas which bristle with legal, ethical, moral and political issues. She narrates how there is no common ground between the U.S. and the EU and the objectives of bio control vary. There are issues concerning patentability of living organisms (bacteria), genes, et al and these are examined closely and the differential approaches captured.

Ragavan offers evidence that the era of assured patents, as in the days of early industrial revolution, are over.

The last two chapters highlight concerns over enduring conflicts between sustainable bio-diversity and promoting trade within the “compulsive one-dimensional developmental perspective promoted by the trade and intellectual property (IP) agenda.” The issues she raises are constantly agitated by NGOs, etc., with great heat and passion. But, she does it with rare panache and scholarly detachment. Thus, it is a great help to developing countries in their future negotiations with the advanced countries. It is also a warning to those who plumb for reforms through TRIPS/WTO — the road is paved with mines.

PATENT AND TRADE DISPARITIES IN DEVELOPING COUNTRIES: Srividhya Ragavan; Oxford University Press, YMCA Library Building, Jai Singh Road, New Delhi-110001. Rs. 1095.

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