“This has reference to the meeting in your esteemed office on 20th instant on the subject cited above. The views of this confederation in this matter are as under:

The European Union is lobbying hard at the Government level for inclusion of certain IPR related clauses and amendment of Indian patenting standards. E.U. wants India to define the period for data exclusivity and Supplementary Protection Certificate ( for 5 years from the date of expiry of patent). These demands, if accepted will hurt the Indian Pharmaceutical Industry most. This will result in ever greening of patents which is being opposed by all the developing countries. It will also delay the entry of indigenous generics after expiry of the patent. Further, their demand that the data exclusivity shall not be restricted to New Chemical Entities only but shall also be extended to other pharmaceutical products will hurt the R&D efforts of Indian Pharmaceutical Industry. These two factors in combination will dilute the Government’s ability to invoke compulsory licensing.

It may also be noted that the consignments of genuine Indian generics have been confiscated and in spite of best efforts, the problem has not been resolved so far.

We hope the views of this confederation will be taken in to consideration in your note to the Ministry of Commerce.”

2. FDI (Foreign Direct Investment) in Drugs & Pharmaceutical Industry: In response to a call from the Department of Pharmaceuticals, Ministry of Chemicals & Fertilizers, the views of CIPI in this matter has been forwarded to the Ministry as under:

“In the past some of the leading Indian pharmaceutical companies have been acquired by multinational companies taking advantage of the present policy of the Department of Industrial Policy and Promotion, Government of India which permits 100% direct foreign investment in this sector through automatic route. This route does not require any prior permission of the Government by the target company or the acquirer. In the present scenario, after completing the deal, only intimation is required to be filed with the Reserve Bank of India.

The MNCs probably have the following short term and long term objectives in such deals:

1. To have an access to cheap Indian manpower cost,
2. To have a controlling say in Indian generic market by acquiring or having tie up with Indian companies which are strong and swift in bringing out genuine generics,
3. To ultimately promote their patented drugs, and also
4. To have a bigger share in the fast expending Indian health care segment.

In long term, this will result in shrinkage in the availability of the cheap generic products, reduced competitiveness in the pharmaceutical sector and higher cost to the patients.

In our views this may be curtailed in the following manner without hurting the image of the Country:

1. 100 % FDI when introduced long back was intended for bringing new technology to this sector by MNCs.
2. We feel that it was never intended by the Government that the same may be used as a take over tool and was only for the purpose of bringing in investment in new units to be established in the Country with technology transfer,
3. If the Government wants to continue with the 100 % FDI, the notification may be amended in such a way so that it is not applicable for take over deals,
4. An other set of guidelines may be issued incorporating Government’s approval for take over where minority share holders may also have a say,
5. Pharmaceutical industry of the Country is given the same status as enjoyed by the IT industry with liberal incentives for R&D targeted at the development of NCEs being the thrust area.

3. Simplification of export related procedures by DGFT: Mr. Anup K. Pujari, Director General of Foreign Trade has stated that his office is working on a scheme / system where paper work relating to advance licensing, export promotion and capital goods licenses will be reduced drastically. The proposed system will work on trust –based self certification by the stake holders duly certified by a chartered accountant on the basis of which the Department will act and take decisions. A dialogue is taking place with the stake holders on this subject and CIPI has also requested to be called so to understand the proposed system and to express its views.

4. AEO (Authorized Economic Operator) for entities involved in international trade: The Government is planning to introduce a security system for the entities involved in international trade such as importers, exporters, warehouse owners and custom-house agents. The system which is called AEO (Authorized Economic Operator) is in lines with the policies of the World Customs Organization. Under the system the entities involved in the international trade will be give internationally recognized quality mark tagging them ‘safe’ and ‘compliant’ in international supply chain. This status will ensure reduced customs intervention by way of inspection and clearance of cargo before payment of duty. Exporters having such a status will be able to clear export consignments on the basis of export declarations with out bringing the goods into customs area. Warehouses owners with this tag will get faster clearance for establishing new warehouses and reduced audit. The scheme is being examined by the Ministry of Finance at present.

5.Black money stashed away in Swiss Banks ( FE Editorial dated 26.01.2011):
“……………… Instead of just taking the Government’s words that it is going to get at the black money, let’s examine its record. As compared to its projected tax collections of Rs. 7,47,000 crore in 2010-11, tax arrears add up to Rs.1,17,000 crore. These are amounts owned by persons the Government knows the names of, and none of them are protected by any tax treaty; these are the amounts where tax demand has already been raised; Rs. 46,000 crore of this is not even under any form of depute; around Rs. 29,000 crore has been due for more than 5 years. Or take the celebrated VDIS in 1997-as against 35% tax to be paid, enough loopholes were left to allow peoples to pay 5%-10% tax and get away, but no action ever got taken against officials who allowed this; ……………….Mauritius has long been seen as an entry point for India’s black money to come back tax-free, but little has been done it all these years……Why we are so focused on money stashed abroad?”