India Lags Behind China by Ten Years with Respect to Patent Application Filings

Released on: June 19, 2008, 11:04 pm

Press Release Author: Pvt. Ltd.

Industry: Industrial

Press Release Summary: India Lags Behind China by Ten Years with Respect to Patent
Application Filings

Press Release Body: New Delhi, India - June 20, 2008: Approximately 35,000 patent
applications (those with a validity of 20 years from their filing date, once
granted) were filed at the Indian Patent Office (IPO) during the 2007-08 fiscal
year, which indicates a 21 percent growth over the previous year. In contrast, the
State Intellectual Property Office of China (SIPO) received a total of 245,161
20-year patent applications in 2007. This made China the third most prolific
patent-filing country in the world after the United States and Japan. Patent filing
has been growing both in India and China at approximately 20 percent per year.
However, the SIPO received approximately the same number of 20-year applications in
1997 as the IPO did in 2007-08. This implies that India is approximately 10 years
behind China.
Another remarkable difference between China and India is in their ratio of domestic
to foreign filing:
 In 2007, filings by domestic applicants in China accounted for 62.4 percent
of the 20-year patent applications with the SIPO. Furthermore, during this period,
the year-on-year increase in domestic 20-year patent application filing in the
country was 25 percent, whereas that of foreign filings was only 4.5 percent.
 In contrast, only 24,505 patent applications were filed at the IPO in
2005-06, of which domestic applicants filed approximately 20 percent (4,855
applications) and foreign applicants filed 80 percent (19,650 applications).
Further, while the number of patent applications filed by foreigners in India rose
dramatically and witnessed an annual growth of 77 percent in 2005-06, the
corresponding growth in domestic application filing (applications first filed with
the IPO and then elsewhere) was only 20 percent during the same period.
The research conducted by Evalueserve - a global research and analytics firm - on
IPO patent applications published during 2005 to 2007 indicates that only 22 of the
top 200 filers (11 percent) were 'pure-bred' Indian organizations, of which nine
were pharmaceutical companies and six research institutes. During this period, the
Council of Scientific and Industrial Research (CSIR), Qualcomm, Bayer, Philips,
Hindustan Unilever, Honda, Microsoft, Samsung, Pfizer and BASF were found to be the
top 10 filers.
Evalueserve's study analyzes the patenting trends of the top domestic Information
Technology (IT) and IT Enabled Services (ITES) companies, and illustrates that these
firms had a disproportionately low number of patent filings, especially in view of
the revenue that they generate. None of these companies, including TCS and Infosys
with only 35 and 29 published applications, respectively, feature in the Top 200
list of filers with the IPO. On the other hand, six domestic pharmaceutical and
biotech companies - Ranbaxy, Dr. Reddy's Labs, Orchid Pharmaceuticals, Cadila
Healthcare, Cipla and Sun Pharmaceuticals - appear in the Top 100 list and another
three - Aurobindo Pharmaceuticals, Torrent Pharmaceuticals and Matrix Labs - appear
in the next 100 list of filers with the IPO.
The study concludes that low patenting activity in domestic Indian companies will
hurt their global competitiveness in the long run. It ascribes three reasons for
this: (a) lack of awareness among domestic Indian companies, (b) the time taken -
often as long as five years - to get a patent granted by the IPO, and (c) the high
(US $500 or more) IPO filing fee. Keeping these factors in mind, the study suggests
that India should allow a second category of patents, known as utility model
patents, which have a validity of 10 years from their filing date and which can be
granted within 6 to 12 months since they are not examined substantively. Germany,
Japan, France, South Korea, Australia and China are some of the countries whose
patent offices grant such 10-year patents. In fact, in China, the filing fee for
10-year patents is only US $70, which is less than one-seventh the cost of the
application fee for a 20-year patent; furthermore, the corresponding 10-year patents
are granted almost automatically. This has resulted in an enormous increase in the
awareness of the patenting system among domestic Chinese companies, and in 2007
alone, these companies filed almost 99 percent of the 181,324 10-year patent
applications (filed with the SIPO).

About Evalueserve
Evalueserve provides custom research and analytics services to companies worldwide
including Business Research, Market Research, Data & Financial Analytics, Investment
Research, Intellectual Property and Legal Process Services, and access to a global
network of domain experts through Evalueserve Circle of Experts. The firm was
founded by IBM and McKinsey alumni, and has completed over 12,000 client
engagements. The firm currently has over 2,100 professionals located in research
centers in Chile, India, China and New York. Evalueserve's 'in-country' Client
Executives are located in most major business and financial centers globally - from
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Tel: + 91 124 4154000
Although the information contained in this article has been obtained from sources
believed to be reliable, the author and Evalueserve disclaim all warranties as to
the accuracy, completeness or adequacy of such information. The company shall have
no liability for errors, omissions or inadequacies in the information contained
herein or interpretations thereof.

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