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IPRs AND AGRICULTURAL TECHNOLOGY : INTERPLAY AND IMPLICATIONS FOR
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Backdrop:
Technology will
drive future growth in Indian agriculture. In order to push the frontiers of
productivity, generation and harnessing of state-of the-art agricultural
technology becomes inevitable. A just system of incentives, reward and
recognition is characteristic of an effective R&D system. This demands appropriate
investment in agricultural R&D. Studies have indicated impressive rates of
return to investment in agricultural research. An effective and equitable
Intellectual Property Rights (IPR) regime will attract greater investment. IPRs also impact trade relation between countries in myriad
ways. Inter alia, technology development and its
transfer, foreign direct investment, trade flows and rent transfer are
influenced by IPRs.
IPRs and Agricultural Technology: Interplay
Contrary to
popular perception, the consequences of according protection are not simple and
straightforward. Their manifestations are multitudinous and intricate. Three
situations are likely to emerge:
1.
Technology development facilitated by IPRs: The onset of protection
will lead to the emergence of two distinct investment pathways in R&D. In
the first scenario, current research and development efforts will receive a
major boost and technology development processes will be accelerated without
drastic changes in the research paradigm. Plant breeding efforts to produce
hybrids is a case in point, which is likely to spread to newer crops. The
second scenario relates to areas in which fresh private investment will be
driven just because protection is guaranteed. A case in point is the HYVs,
here private investment is bound to take-off especially in pulses. Besides,
investment in technology development and transfer in inputs like feed,
vaccines, and-pesticides will witness increased activity.
While the public sector will concentrate on basic research, the private sector
will focus on applied aspects
2.
Technology development driven by IPRs: The degree and nature
of protection inter alia, will influence investment behaviour in terms of magnitude and pattern. The new regime
necessitates a mechanism for regulation, monitoring, and dispute settlement. A
class of technologies will emerge; therefore. A good example is the growing
awareness and expanded investment in the DMA Finger printing technology, since varietal identification is a pre-requisite for according
protection as well as to settle disputes. This can happen either in the public
or in the private sector. Currently, in the private sector a paltry 0.5 percent
of the net profits are ploughed back into R&D. This figure is likely to be
much lower in agricultural R&D. The new IPR regime will influence
investment decisions in two ways. First, private firms will be compelled to
increase outlays for research, which may lead to innovations. Second, increased
technology transfer through joint ventures (read equity participation) and/or
mergers and acquisitions between domestic and foreign firms.
3.
Technologies that influence 4PR&: An extreme but realistic scenario is one where
technologies are developed to overcome operational difficulties in seeking
protection. Technologies that are likely to render the very framework of IPRs redundant are in the pipeline. Improvement in crop
varieties contributes maximum to growth in productivity and other technologies
revolve around this. Considering the enormous investment that goes into variety
development, investors target market on a global scale. Therefore, innovators
are developing technologies that help overcome operational difficulties in
seeking protection for their novel varieties with or without a strong IPR
regime. Such technologies are collectively called as Genetic Use Restriction
Technologies (GURTs: Box). A number of patents have
already been issued for such technologies. Considering the worldwide opposition
by NGO's and farmer groups, many countries have placed a moratorium on the
introduction and use of such technologies till adequate research data is
available. The government of
Table:
Categorisation Matrix of Interplay
and Implications
|
Technologies |
Intellectual Property Rights applicable |
Investors/Actors |
Implications |
|||
|
Public |
Private |
Social |
Economic |
Ecological |
||
|
A. Crop
Improvement Technologies |
||||||
|
Conventional
Breeding |
Patents. PBRs, TM, TS |
*** |
* |
++ |
++ |
- |
|
Agricultural
Biotechnology |
Patents, PBRs, TM, TS |
** |
*** |
++ |
++ |
-- |
|
Agro-chemicals |
Patents, TM.
ID |
*** |
* |
++ |
++ |
--- |
|
Knowledge
Based Technologies |
Patents &
CR |
*** |
* |
++ |
+ |
+ |
|
B. Crop
Protection Technologies |
||||||
|
Conventional
Breeding |
Patents. PBRs, TM |
*** |
* |
+ |
++ |
++ |
|
Agricultural
Biotechnology |
Patents, PBRs, TM |
* |
*** |
+ - |
++ - |
+ - |
|
Agro-chemicals |
Patents &
TM |
* |
*** |
- + |
-M- - |
--- |
|
Kknowledge Based Technologies |
Patents &
CR |
*** |
|
+ |
+ |
+ |
|
C. Natural
Resource conservation technologies |
||||||
|
Soil & Water
conservation |
Patents &
CR |
*** |
* |
++ |
++ |
+++ |
|
Genetic
resources conservation |
Patents.
Geographic appellation |
*** |
* |
++ |
++ |
+++ |
|
D.
Machinery-based technologies |
||||||
|
Farm
Machinery & Power |
Patents. ID
& TM |
• |
*** |
- + |
++ |
+ - - |
|
Post-Harvest
Technologies |
Patents. ID
& TM |
•• |
• |
++ |
++ |
++ |
|
E..
Livestock and Fisheries |
Patents. PBRs. ID. CR. TM |
** |
•• |
++ - |
++ |
-- |
Source: Authors
NOTE: 1. Number
of asterisks denotes the magnitude of impact.
2. Number of +'s and -'s represents the magnitude of positive and negative
impacts.
Read: crop
improvement (that enhance yield) and crop protection (that prevent yield loss).
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BOX: Genetic Use Restriction Technologies (GURTs): Products of GURTs are crop varieties with traits whose expression is
under the external chemical control. The traits may be germination, viability
of seeds, flowering, nutritional and flavour
qualities, resistance to diseases, pests and herbicides, sterility and
fertility restoration (for hybrid production) etc.... Seeds in possession of
the farmers will be useless, if they don't buy the prescribed chemicals and
use in the appropriate time, thus producing their seeds every year on their
own but compelled to buy the chemical season after season. GURTs 3C not try to prevent unauthorised
use o? seeds, but ensures profits from every user of the seeds, authorised or unauthorised.
Foolproof biological protection that is embodied within the product renders
the legal protection of the ownership completely redundant. Due to its
controversial nature, the subject has been discussed already at various
international forums viz.. Food & Agricultural Organisation
commission on Genetic Resources for Food and Agriculture, Rome, Consultative
Group on International Agicultural Research,
Beijing, United Nations Commission Trade and Development; Subsidiary Body on
Scientific, Technical and Technological Advice of the Convention on Biological
Diversity, Montreal and is slated to be a major issue during the Trade
Related Intellectual Property Rights review in World Trade Organisation. |
Canvas of the Interplay:
The above table
attempts to categorise agricultural technologies in
the scenario of protection. One or more types of IPRs
govern agricultural technologies. Hence, their grouping according to nature of
protection is relevant to understand and appreciate probable stakeholders and
the plausible impacts. Here, agricultural technologies are grouped under
different heads and we explain the heuristic table by taking up two examples.
One from the crop improvement and the other from the crop protection head.
Plant
Breeding and Agricultural Biotechnology : The nucleus of green revolution was HYVs resulting from conventional breeding techniques.
Later, hybrids signalled the arrival of modem
breeding. Agricultural biotechnology, a frontier area, has the capability to
stretch the yield potential further. This can be achieved either through complementing
crop breeding or by plant genetic engineering per se. Conventional breeding and
agricultural biotechnology are good examples of embodied technology. Patents,
Plant Breeders Rights (PBRs), trade secrets (TS) and
trademarks (TM) govern protection of processes and products of breeding and
biotechnology. Patents are often issued to plant varieties, genetic engineering
techniques, isolated DNA sequence, gene constructs and newly transformed plants
in the industrialised countries. This scenario is
unlikely to evolve in our situation. PBRs will be the
predominant instruments through which protection will be awarded to propagating
materials of plant varieties. Trade secrets are accorded for plants for
therapeutic purposes and for parental lines of hybrids. Trademarks go along
with the other three forms of IPRs especially in the
marketing of products like improved seeds and other inputs. The introduction of
IPR regime will not alter the predominant role of the public sector in crop
improvement programmes. New players are unlikely to
venture into basic breeding programs as this entails access to Plant Genetic
Resources (PGRs), huge investments (read
infrastructure like farms and trained work force) and long gestation periods
(on returns to investment). However, trans-boundary transfer of such products
is a distinct scenario. Introduction of protection will kick-start private
investments in activities relating to agricultural biotechnology. Returns to
investment here are faster, higher and assured in relation to conventional
breeding. Private sector will be interested in crop protection technologies
rather than crop improvement technologies. Techno-economic feasibility is the
criterion that determines such investment behaviour.
The protection regime will therefore strengthen the role of private sector in
agricultural biotechnology research. The proposed bill provides protection only
to plant varieties and not to microbes, genes and DNA constructs.
Agro-chemicals: Higher production and
better income can also be achieved by the application of external inputs like fertilisers, insecticides, pesticides, weedicides
and growth regulators. Patents, trademarks and industrial designs (ID) protect
processes and products relating to agrochemicals. Concerning fertilisers, the public sector will continue to dominate
the scenario even after the introduction of IPRs
regime. This is because of the regime's control over the raw materials, pricing
and existing market structure. The reverse holds true for insecticides and
pesticides because of the nature of the products and market potential. The rate
of innovation concerning bio-fertilisers and
bio-pesticides will be faster in the private sector. The table is
self-explanatory and similar inferences can be drawn for other technologies under
different groups.
Implications of IPRs and Agricultural Technology:
The dynamics
and interplay of IPRs and technological innovations
have multiple impacts. These can be categorised into social,
economic and ecological. Due to peculiarities of Indian agriculture, the
magnitude of these impacts will be manifold. The IPR regime not only influences
research portfolio but also the contours of technology development. Primarily,
the underlying motive of protection is to share profits with innovators.
Therefore, the economic implications are not only predominant but also most
obvious. The other two implications of access to newer technologies are on
social and ecological dimensions. These three impacts are not mutually
exclusive and often overlap.
1. Social
implications: Social impact of new technologies is manifested in terms of its
influence on equity. Other important issue pertains to "scale
effect". These issues can be explained by the illustration of Green
Revolution. This seed-fertiliser technology was
predominantly applicable in the areas with assured irrigation. These
technologies contributed to the widening of the regional disparity. Viewed from
a macro-perspective however the revolution was a great success that helped realise cherished goal of self-sufficiency in food grains.
Therefore, the magnitude and nature of social implications vary according to
the category of the technology (Table). Knowledge based technologies and
technologies concerning conservation of natural resources have positive impact
on the society. Because of their nature (public good), the net social welfare
increases manifold. Certain technologies like HYVs
and hybrids require intensive input use and therefore have a mixed impact on
the society. The predominant positive impact (++ -) clouds the negative
effects. Yield enhancement by conventional breeding is an ideal example.
By the same yardstick,
if conventional breeding aims at preventing yield loss (pest and disease
resistant varieties) it becomes cost-reducing and has no negative impact (+).
There are technologies where the negative component impact is marked (- +).
Current levels of technologies (and its costs) in farm machinery and power
precludes their accessibility to small and marginal farmers. There is a
distinct possibility that in the near future farm machinery is tailor-made to
suit smallholdings?
2. Economic
Implications: Most technologies, excluding agricultural biotechnology and crop
protection chemicals have a net positive impact on the economy. There are also
implicit benefits like savings from potential losses due to pests and diseases.
Newer techniques invariably shift production functions thereby improving income
of individuals and that of the nation. Research in the public domain will
concentrate in cost-reducing technologies that are helpful to the weaker
sections. Conservation of genetic resources have huge positive externalities
(both intra and inter generational). Considering the market structure of crop
varieties and crop protection chemicals and the nature of potential
technologies; the scope for market malpractice such as monopoly and cartelisation is real. Generally embodied technologies are
likely to have relatively more apparent impacts. Active presence of the public
sector is vital for the provision of disembodied technologies.
3.
Ecological Implications: Increased use of agrochemicals will accelerate environmental
degradation (- - -). Though biotechnological innovations minimise
the use of agrochemicals to some extent (+ -), they are feared for their
contribution to gene pollution (- ??). Development of such resistant varieties
by conventional breeding has no negative impacts (++). Any technology
encouraging the use of improved varieties is likely to contribute to narrowing
of genetic base (-). Increasingly, the use of antibiotics, hormones,
unconventional feeds and genetic engineering in livestock and fisheries have
raised questions about health hazards and animal biodiversity (- -).
Destruction of soil structure and groundwater depletion are serious ecological
risks associated with the excessive use of technologies associated with farm
machinery and power. Technological advancements in the conservation of soil,
water and genetic resources have profound positive impacts on the ecology
(+++).Being locally evolved and practice based, Knowledge based technologies optimise resource use thereby imparting positive externalities
to the environment.
Parameters of the Debate
In the new
millennium, the research paradigm will undergo significant transformation. The
interplay of IPRs, technology development and
transfer will determine the research contours and portfolio. This interplay is
a dynamic process with one to one, one to many and many to one interaction.
There is no deterministic "cause and effect" relationship in this
process. Availability of protection inter alia is a
crucial determinant of technology development and transfer. The magnitude of
investment, kind of technology, pace of technology development and transfer and
possible actors will be influenced by the nature of the IPR regime. In order to
visualise the likely scenario in the agricultural
R& D, gaining more insights into the IPRs and
related aspects is inevitable. A realistic speculation of plausible scenarios
attempted is however, subject to and dependent on the policy framework. While,
the patents (amendment) and plant varieties & farmers' rights bill have
been referred to a select committee of the parliament; the geographic
appellation bill has been approved. Adequate clauses to safeguard the interests
of the society in general and farmers' and researchers in particular have been
included in the plant varieties & farmers' rights bill. Another highlight
of the bill is the provision of "compulsory licensing" and the clause
relating to the "protection of the security of India". The plant
varieties & farmers' rights protection authority is the institutional response
to the new regime. Constitution of a national gene fund to address issues of
benefit sharing and the conservation and sustainable use of genetic resources
is another feature. Food security-in terms of availability and accessibility
continues to be a national priority. Rapid technological advance holds promise
to break productivity barriers. Against such a backdrop the dynamics of the
interplay between the protection regime and agricultural technology needs
thorough understanding (Diagram). IPRs is one of the
important determinants of technology development, transfer and dissemination.
Institutional arrangements to keep pace with the developments of the new regime
are necessary. Appreciation and understanding the intricacies in its manifold
dimensions is the first in a series of steps to equip us in addressing the
process of change.
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January, 2000 |
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|
A. Ravishankar |
Sunil Archak |
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NCAP has been established by the Indian
Council of Agricultural Research (ICAR) with a view to upgrading agricultural
economics research through integration of economics input in planning, designing,
and evaluation of agricultural research programmes
and strengthening the competence in agricultural policy analysis within the
Council. NCAP Policy Briefs are intended to contribute
to debates on important agricultural policy issues. Opinions expressed are
those of the author(s) and do not necessarily reflect the views of the
Centre. |