A.%20Damodaran

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Researching IP Implications on SMEs
WIPO Expert Group on Internationally Agreed Scope
and Methodology for Undertaking National Surveys
and/Studies on IP and SMEs

• A. Damodaran
• Indian Institute of Management Bangalore

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SMEs in India A Profile

• In India, SME sector is the second largest
  manpower employer, after agriculture
• Nearly 13 million units, employing 31 million
  people
• The output from the SSI sector alone constitutes
  40 percent share of the value added in the
  manufacturing sector
• 39 of countrys Industrial Production and 1/3rd
  of countrys exports
• Very Traditional to High Tech
• Source MSME, Government of India

3
Policy Framework

• GOI enacted the Micro Small and Medium Enterprise
  Development Act, 2006 to address issues of the
  sector
• GOI to do away with 24 ceiling prescribed for
  equity holdings in MSME
• Expected Legislation on Limited Liability
  Partnership to encourage corporatization of SME
  in India
• National Manufacturing Competitiveness Council
  (NMCC) was set up to energize and sustain the
  growth of the manufacturing industry.
• New Promotional Packages for SMEs, and focus on
  development of clusters.
• Steps to enhance access to equity and other funds
  from the markets for SMEs
• Source MSME, Government of India

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Promotional Schemes of MSME

• Revised strategy of lending and introduction of
  newer measures, such as the scheme to establish
  Small Enterprises Financial Centres (SEFC) for
  strategic alliance between branches of banks and
  SIDBI located in 388 clusters identified by
  ministry of SSI.
• SME Fund of US 2.27 billion operationalised.
• Proposal for doubling the credit flow to MSME
  sector in next 5 Yrs.
• Promotion and financial support for
  Credit-cum-Performance Rating in MSME sector in
  India, to facilitate greater and easier flow of
  credit from the banking sector to SMEs.
• Guarantee coverage under Credit Guarantee Fund
  for Small Enterprises expanded substantially
• Credit Linked Capital Subsidy Scheme for
  Technological Upgradation
• Source MSME, Government of India

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Policy

• NMCC has recommended a 5year programme for
  enhancing competitiveness in SMEs
• Programme aimed at improving awareness on IPR for
  SMEs
• Hopes to target 12000 units and 30 MSE clusters
  at a target cost of 55 crores with a private
  contribution of 5 crores
• Source MSME, Government of India

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Geographical Indications

• Tea,West Bengal,Darjeeling Tea (word logo)
• Handicrafts,Kerala,Aranmula Kannadi
• Textiles- Andhra Pradesh Pochampalli Ikat
• Textiles,Tamil Nadu, Salem Fabric
• Textiles, Madhya Pradesh, Chanderi Fabric
• Textiles, Maharashtra, Solapur Chaddar
• Textiles, Maharashtra,Solapur Terry Towel
• Textiles, Orrissa, Kotpad Handloom fabric
• Textiles,Karnataka,Mysore Silk
• Textiles,Rajasthan,Kota Doria

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Geographical Indications

• Incense Sticks, Karnataka,Mysore Agarbathi
• Textiles, Tamil Nadu, Kancheepuram Silk
• Textiles, Carpets, Tamil Nadu, Bhavani Jamakkalam
• Textiles, Himachal Pradesh, Kullu Shawl
• Handicrafts, Karnataka, Bidriware
• Textiles, Tamil Nadu, Madurai Sungudi
• Textiles, Orissa, Orissa Ikat
• Handicrafts, Karnataka, Channapatna Toys Dolls
• Handicrafts, Karnataka, Mysore Rosewood Inlay
• Tea, Himachal Pradesh, Kangra Tea

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GIs

• Wet Grinder, Tamil Nadu, Coimbatore Wet Grinder
• Textiles, Andhra Pradesh, Srikalahasthi Kalamkari
• Essential Oil, Karnataka Mysore Sandalwood Oil
• Soap, Karnataka Mysore Sandal soap
• Embroidery (Textiles), Karnataka Kasuti
  Embroidery
• Paintings, Karnataka Mysore Traditional
  Paintings
• Horticulture Products, Karnataka Coorg Orange
• Horticulture Products, Karnataka, Mysore Betel
  leaf
• Horticulture Products, Karnataka Nanjanagud
  Banana
• Paintings, Bihar Madhubani Paintings

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GIs

• Handicrafts, Andhra Pradesh, Kondapalli Bommallu
• Paintings, Tamil Nadu, Thanjavur Paintings
• Handicrafts, Andhra Pradesh, Silver Filigree of
  Karimnagar
• Coir Products, Kerala, Alleppey Coir
• Textiles, Assam Muga Silk
• Handicrafts, Tamil Nadu, Temple Jewellery of
  Nagercoil
• Horticulture, Karnataka Mysore Jasmine
• Horticulture, Karnataka, Udupi Jasmine
• Horticulture, Karnataka, Hadagali Jasmine
• Agricultural Products,Kerala Navara Rice

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GIs

• Agricultural Products, Kerala Palakkadan Matta
  Rice
• Handicrafts,Tamil Nadu,Thanjavur Art Plate
• Textiles, Karnataka Ilkal Sarees
• Handicrafts, Bihar Applique - Khatwa Patch Work
  of Bihar
• Handicrafts, Bihar, Sujini Embroidery Work of
  Bihar
• Handicrafts, Bihar, Sikki Grass Work of Bihar
• Agricultural Products, Kerala Malabar Pepper
• Guava,Uttar Pradesh, Allahabad Surkha
• Textiles, New Delhi, Nakshi Kantha
• Handicrafts, Karnataka, Ganjifa cards of Mysore
  (Karnataka)

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GIs

• Textiles, Karnataka, Navalgund Durries
• Handicrafts,Karnataka,Karnataka Bronze Ware
• Textiles,Karnataka,Molakalmuru Sarees
• Coffee, Karnataka Monsooned Malabar Arabica
  Coffee
• Coffee Karnataka Monsooned Malabar Robusta Coffee
• Agricultural Products, Kerala Spices - Alleppey
  Green Cardamom
• Agricultural Products, Karnataka Coorg Green
  Cardamom
• E. I. Leather, Tamil Nadu, E. I. Leather
• Textiles and Textile Goods, Tamil Nadu, Salem
  Silk
• Textiles and Textile Goods, Tamil Nadu, Kovai
  Cora Cotton
• Textiles and Textile Goods, Tamil Nadu, Arani
  Silk

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Darjeeling Tea

• The first attempt on the part of the Tea Board of
  India towards protection of the Darjeeling
  brand was undertaken way back in 1983, when the
  Darjeeling logo was created.
• The Tea Board obtained home protection for the
  Darjeeling logo as a certification trade mark
  under the Indian Trade and Merchandise Marks Act
  1958 (now the Trade Marks Act, 1999). The
  registration was granted in class 30 in the name
  of the Tea Board in 1986. In the same year, the
  logo was registered as a trademark in several
  other countries
• In the absence of a separate law dedicated
  exclusively to GIs in India during that time,
  the word Darjeeling was also registered under
  the Trade and Merchandise Marks Act 1958 in class
  30 in the name of Tea Board in 1998.
• Source Government of India

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Knowledge Intensive Sectors

• Biotech including plant biotech , traditional
  medicines and bioinformatics
• IT Software
• Agri-enterprises associated with export based
  products

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Innovation Systems

• Informal Protected as Trade Secrets or
  Confidential Information
• Formal IPRs Filed
• Well Springs of Innovation
• Start up Innovation Firms Vendor of Innovations
  Bioinformatics
• Innovations by Learning by doing Firms
• Cluster Generated Joint Innovations
• Public-Private Innovations

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Typology of Innovations

• Designs
• New Processes
• Products
• Devices

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Access To Patents Transaction Costs

• Prior Art Data Base is Difficult to Access
• Patent processes are too costly for SMEs to
  access
• Transaction Costs of Filing and Getting Patents
  high
• PCT applications are excessively costly

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Defending Patents

• Probability of Infringement Assessment
• Cost of Defending
• Damage Compensation

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Self Assessment

• Capacity for Self Assessment of Innovation
  Quality not there
• Self Assessment involves
• - Determination of Quality of Innovation in
  terms of Prior Art
• - The Depth of the Inventive Step
• - IPR-ability of the Innovation
• - Ramification of the Innovations in terms of
  Applicability and Multiplier Effects
• Assessment of Competitive Advantage afforded by
  innovations

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Standards and SMEs

• SMEs role in Standard setting very limited
• Costs of Compliance with Standards high
• This in turn affects Competitiveness

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Business Models for Technology Transfer

• Business Models that are appropriate to SMEs can
  facilitate transfer of technology and enable
  optimum revenue realization
• This in turn can facilitate iinovation
• Such Models have not been designed

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Cluster Innovations

• Cluster based Innovations are economically viable
  (by promising external economies) and achieve
  innovations that give greater leverage power to
  companies concerned
• Cases to be documented

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Research Issues

• New IP laws like Petty Patents
• Transaction Costs of filing and defending Patents
  and other IPs
• Cluster Innovations
• Economic Analysis of Business Models
• Finance early bird innovations that are promising
• Facilitate Self Assessments through Capacity
  Building
• Financial Mechanisms

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Thank You