Reason should underpin stronger India-US ties and not rhetoric: Mr. Chidambaram at the USIBC leadership summit

In the past week, Union Finance Minister P. Chidambaram addressed corporate leaders, officials and senior leadership from the American Government at the 38th US-India Business Council Leadership Summit. Mr. Chidambaram particularly addressed the allegations of American companies that a strong protectionist regime exists in India especially in the arena of patent protection. The Union Finance Minister attributed these allegations to the "growing challenge" posed by Indian companies to US businesses in these areas. While recognizing that business interests of firms in both countries may occasionally collide, Mr. Chidambaram stressed on the importance of avoiding a confusion between rhetoric and reason and stated that the difference in business interests must not be made into a political issue. 

Mr. Chidambaram also clarified the reasons for the allegations of American companies being largely rhetoric. The Union Finance Minister pointed out how only one compulsory license has been granted in India as of now while other countries including the US itself had licensed one or more drugs. In such a situation, he argued that it was unreasonable for the Indian patent protection to be singled out especially since the compulsory licensing was upheld on judicial review on the three required grounds: non-availability of the drug in sufficient quantities in India, non-affordability of the drug and the non-workability of the patent in India. In any event, Mr. Chidambaram noted that the WTO was a forum that the American Government could approach if they had qualms about the Indian Government's decision and that it was a better method than "needlessly heating up the rhetoric." He also clarified that the Indian Government had little control over patent infringements that happen in India and in the event of such infringement, the judicial system could be approached where the observed trend is largely in favour of granting injunctions.

Indian officials are of the view that some degree of understanding is present between the attendees on both sides. However, it must be noted that only five of the 180 lawmakers who authored the letter to US President Obama criticizing the Indian IP regime attended the Summit. This letter and the testimony, which among other factors that led to this letter has been analysed in detail  by Swaraj here and here. Readers can also look out for Swaraj's next post in which he promises to expose more empty rhetoric from the US!