Recent news that India’s Supreme Court denied the biopharmaceutical company Novartis a patent for a major cancer drug sent shock waves through the international trade community, as it signified the latest disturbing development in a series of protectionist actions by India’s government.
For U.S. manufacturers, workers and innovators alike, it’s a sign of what’s to come if India is bent on pursuing this kind of overt protectionism. Not only will we continue to lose access to one of the world’s largest markets, but more Americans will lose their jobs and our economic well-being will suffer. It is time for Congress and the Obama administration to act to ensure that doesn’t happen.
The patent denial just the latest in a series of blatant intellectual property violations meant to bolster India’s domestic industries at the expense of the outside world. Congress, to its credit, has taken notice. A recent House Ways and Means Trade Subcommittee hearing shone a light on how India has been systematically shutting innovators out of its marketplace, with committee members signaling increasing frustrations with India’s behavior. In the Senate Finance Committee’s hearing on President Barack Obama’s trade priorities, Republicans and Democrats alike spoke of the growing problems the U.S. faces with India and questioned acting U.S. Trade Representative Demetrios Marantis on what the administration is doing about it.
They’re right to be concerned. But on such an important issue that directly affects American jobs, something more than rhetoric is needed. While the USTR is pondering what, if any, action to take on India, Congress should consider our past mistakes on trade issues, remember that free trade works only if all parties play by the same rules, and work toward finding solutions to this growing problem.
Perhaps recognizing that it is far too valuable a diplomatic ally for the U.S. to make any real waves on the trade front, India has taken increasing liberties with international law at our expense. Essentially, India is angling for short-term gains that benefit a few local companies but also severely curtail imports, hurting Indian consumers and American jobs in the process.
Case in point: While exports of Indian drugs to the United States are booming, India routinely has undermined trade rules in order to bolster its pharmaceutical industry at our expense. When India closes markets to the U.S., a domino effect ensues whereby Indian patients no longer have access to the newest medicines, innovation is stifled and jobs that rely on research and development eventually will be lost. And in the tech sector, although India has profited greatly from a strong information technology software and services industry, it is now pursuing an anti-competitive trade agenda that effectively locks U.S. firms out and risks stifling its own economic growth in the process.
Senate Minority Leader Mitch McConnell, R-Ky., carries a musket on stage as he speaks during the American Conservative Union's Conservative Political Action Conference (CPAC) at National Harbor, Md., on Thursday March 6, 2014.