the economy. (Though it is unfair to single out a well-conceived, if experimental, patent system for a failure endemic to the broad, statist economy in which the government embedded it.) This atypical regime also failed to generate much interest in India’s patent system: India issued relatively few patents, and even fewer valuable ones, under its auspices. Between 1975/76 and 1984/85, for example, the Indian Patent Office received an average of about 3,000 applications a year and issued an average of fewer than 2,000 patents a year.<sup>13</sup> According to most accounts, few if any of those patents created lucrative business opportunities that would not have existed absent IPRs, generated significant licensing fees, or even led to infringement litigation. By way of contrast, the U.S. Patent and Trademark Office (USPTO) issued an average of 56,500 patents a year during that same decade<sup>14</sup> —many of which led to businesses, licenses, and litigation—even though most observers of U.S. patent law view that period as the tail end of a weak patent era during which U.S. corporations downplayed the potential of patents as mechanisms for enhancing revenues and profits.<sup>15</sup>

# **1.4 Goals of This Study**

Over the past 15 years, India’s thinking about economics in general and patents in particular has undergone radical change—change that the numerous amendments to India’s patent laws since 1995 both reflect and helped herald. Several factors have induced this change, including the shift from a planned economy to a more liberal one, WTO accession and India’s acceptance of TRIPS, and India’s recognition of the role that its knowledge industries and technology companies will play in fostering the country’s economic development. These factors—and likely several others—have impelled India to enact radically amended patent laws, and to create the regulatory and adjudicatory bodies needed to make them work. These laws have already begun to play an important role in India’s integration with the global economy and in India’s emergence as an increasingly important player in the global knowledge economy.

Because the basic structure of India’s patent regime is relatively new, many of the recent changes remain controversial, and many proposals relevant to implementation and augmentation remain. Of greater significance to the overall study of India’s innovation system, however, is that the overhaul of India’s patent system is incomplete. The past decade’s efforts—culminating in the 2005 amendments to the Patent Act of 1970—have constructed a solid foundation for a vibrant, fully functioning patent system. But as virtually every member of India’s small, young, patent community recognizes, significant work remains to build such a system atop that foundation. This study describes the steps that remain for India to continue its journey from a patent system that looks good in theory to one that functions well in practice.

In particular, this study discusses several pressing issues that India has yet to resolve in its journey toward an effective patent system:

- The remaining statutory gaps critical to regulating ideas in the quintessential information age industries of software and health care. In software, India must consider the relationships

> 13 Compiled by CSIR from Annual Reports of the Controller General of Patents, Designs and Trademarks.

> 14 _See_ http://www.uspto.gov/go/taf/issuyear.htm.

> 15 _See generally,_ Fred Warshofsky, _The Patent Wars_ , (Wiley, 1994).

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