Financial Daily from THE HINDU group of publications
Tuesday, Nov 15, 2005
Financial Daily from THE HINDU group of publications Tuesday, Nov 15, 2005 |
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Marketing
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Piracy `China, biggest source of counterfeit products' Ambrish Jha
Mumbai , Nov. 14 TALK about counterfeit products and one automatically thinks of a few countries. While India is not lagging behind the rest of the pack - mostly developing countries - it is China that is head and shoulder above others in this category. "China is the biggest source of counterfeit goods in Asia and piracy rate in China is more than 90 per cent. As much as 30 per cent of the counterfeit products worldwide is being made in China," said Mr Zaheer Khan, Managing Director, Enforcers of Intellectual property Rights (EIPR), a private investigative agency specialising in anti-counterfeiting solutions. Mr Khan had helped Mumbai police in carrying out a raid on a unit manufacturing duplicate Canon cartridges only a few days ago. The counterfeit goods seized were worth Rs 10 lakh. According to him, all Indian metros have become bases for manufacturing counterfeit products and account for maximum IPR violations. "Delhi is the hub of counterfeit products in India as nearly 70 per cent counterfeit products originate there," he said. Rs 1,000-cr loss: A FICCI survey has estimated the loss of revenue to the Indian exchequer by way of taxes to be roughly around Rs 1,000 crore a year. Rapid advances in technology and liberalisation of the Indian economy has created an ideal market for people trying to misuse existing brand values that have been cultivated and nurtured over a period of time, he said. "FMCG, software, automobile, packaged water, and garments sectors are the most affected by IPR violations," Mr Khan said. According to the International Anti-Counterfeiting Coalition, in the US alone trademark counterfeiting robs the country of $200 billion (Rs 9,20,000 crore) annually. "It is very difficult to reach a consensus on the exact revenue loss to the Indian government," Mr Khan said. The fakes: A recent survey from the US has come out with the finding that worldwide 10 per cent of perfumes and cosmetics, 11 per cent of clothing and footwear and around six per cent of drugs bought by consumers are fakes. The figure rises to a staggering 80 per cent in some developing countries. The Anti-Counterfeiting Group (ACG), organiser of a pan-European survey, put the total loss to the EU economy from counterfeiting and piracy at £250 billion (Rs 20,00,000 crore) per year; of this £30 billion is lost in taxes and excise. Job loss: Another estimate says 4,100 jobs are lost each year in the UK alone because of counterfeiting - wrecking industries and draining funds which otherwise would have reached public services. While no organisation has come up with such an assessment in India so far, a FICCI estimate has put the annual loss of revenue to the Indian companies in excess of Rs 4,000 crore. Individual losses to company vary from 4 per cent to 10 per cent of their annual revenues and profits. "Unknowingly purchasing counterfeit products constitute nearly 95 per cent of the total piracy. No one would like to buy a fake bottle of water or a cold drink or a medicine," Mr Khan said. Fighting fakes: Though there are laws in India against counterfeiting, their enforcement is tedious. "Lengthy legal proceedings often yield no results. So far we are the only such company in India. Therefore, we are in demand. IPR enforcement has a future," he said.
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