India’s agricultural trade and intellectual property rights (IPR)-related policies have come under the international spotlight in recent months. Brazil, Australia and the European Union have questioned the country’s decision in February to grant a subsidy of Rs 3,333 per tonne on raw sugar shipments. The US, Canada and Pakistan have, likewise, raised concerns at the World Trade Organisation (WTO) over India’s exports of subsidised grain from its public stocks. The US Trade Representative has received submissions from its top industry associations for designating India as a Priority Foreign Country, or those with the “most onerous or egregious” IPR protection regimes that could be ‘deserving’ of trade sanctions.

Such positions are motivated largely by business interests. As Commerce Secretary Rajeev Kher pointed out to this newspaper recently, India has become a significant player in the global farm trade over the last few years. Since 2009-10, its agricultural exports have zoomed from under $ 18 billion to reach a likely $ 45 billion this fiscal. India today is the biggest exporter of rice and beef and the second largest in cotton; it is also a major shipper of soyameal, corn, wheat and sugar. It’s hardly surprising then that western exporters feel threatened. In the pharma sector, the western majors are riled by India’s compulsory licence for the domestic manufacture of Nexavar, a cancer drug patented by Bayer, and its denial of a patent to Novartis’ Glivec. Varying interpretations of patentability and provisions for compulsory licensing have resulted in a vibrant domestic generic drugs industry and threatened the interests of western pharma majors. This is at the heart of their lobbying to declare India a serial IPR offender.

What should India’s approach be under the circumstances? On IPR, it needn’t be apologetic. The country’s current patent regime gives 20-years exclusive rights for firms to commercially exploit their inventions, including for products, so long as these embody genuinely new knowledge. For all the noise about compulsory licencing, India has issued this only in the case of a single drug – that too after establishing that the patent-holder wasn’t making it adequately available in the domestic market. On export subsidies, however, the country’s case is much weaker. The depreciation of the rupee has made the bulk of Indian farm exports naturally competitive without the requirement for any subsidy. As for sugar, rice and wheat, it may be claimed that surplus stocks leaves no option but to subsidise exports. This argument though ignores the policy distortions – high minimum support prices of fine cereals – resulting in these surpluses getting built in the first place. If these domestic distortions and politicisation of cane prices go, there would neither be unmanageable surpluses nor need for export subsidy.