- Front Page / NATIONAL
- Editorial/OPINION
- ECONOMY
- Indian Express
- Live Mint
- The governance of Reserve Bank of India
- Project Europe moving to a defining year in 2017
- Intellectual property vs competition law
Click here to Download 9 PM Daily Brief PDF (7th Dec. 2016)
Front Page / NATIONAL
[1]. Mongolia seeks support against China’s ‘blockade’
Context
Mongolia has asked for “clear support” from India against a transport-obstruction imposed by China.
What is the issue?
Mongolian capital, Ulan Bator, hosted Dalai Lama in November & retaliating to this event, China hiked tariffs on Mongolian trucks passing through Chinese territory.
Mongolia’s stance
India should come out with clear support against the difficulties that have been imposed on Mongolia by China, which is an overreaction to the religious visit by His Holiness Dalai Lama. We have not changed our ‘One China’ policy, so Beijing’s response to Mongolia hosting the spiritual leader is really not justifiable
- Arbitrary charges: Mongolia pointed out that its vehicles were being arbitrarily charged for over-land transit and China’s province of Inner Mongolia had begun to charge trucks carrying minerals a provincial tariff
- Humanitarian crisis: With winter temperature already around minus-20 degrees, transport obstruction by China is likely to create a humanitarian crisis in Mongolia as these measures will hurt the flow of essential commodities
What is China saying?
China said that the erroneous action taken by the Mongolian side on Dalai’s visit hurt the political foundation of China-Mongolia relations and exerted negative impact on the development of bilateral relations. The Chinese side requires the Mongolian side to genuinely respect China’s core interests and major concerns, take effective means to remove the negative impact caused by its erroneous action and bring China-Mongolia relations back to the track of sound and steady growth.
Editorial/OPINION
[1]. Working with the right numbers
Context
An Inter-Agency and Expert Group on Sustainable Development Goal Indicators (IAEG-SDGs) recently met in Geneva to finalise the categorisation of indicators across the 17 global Sustainable Development Goals (SDGs). The UN Statistical Commission’s 48th session in March 2017 will take it forward.
Meanwhile in India
The NITI Aayog and other government agencies are involved in a consultative process to prepare a 15-year vision, a seven-year strategy, and a three-year action plan defining the country’s development trajectory ahead
Point to note: For above exercise India has accepted the SDGs as the guiding framework
Areas in which India lags
As per author two areas where India could not achieve much success during the era of Millennium development Goals are,
- Health
- Nutrition
Health
A health SDG index released in September 2016 by The Lancet ranked India at 143 among 188 countries
Nutrition
In the Global Hunger Index published by the International Food Policy Research Institute in October 2016, India is ranked 97th among a total of 118 countries
- Such a ranking shows high level of hunger and under nutrition
Transitions are happening
Author brings out some transitions that India is undergoing both in health & nutrition scenarios
- Health: The epidemiological transition involves a double burden of communicable (tuberculosis, malaria, AIDS, leprosy, dengue, diarrhoeal diseases, etc.) and non-communicable diseases (heart and lung diseases, stroke, cancer, diabetes, etc.)
Epidemiology: It is the branch of medicine which deals with the incidence, distribution, and possible control of diseases and other factors relating to health. Epidemiological is its adjective form.
- Nutrition: A nutritional transition is happening in parallel. Now, we are witnessing a double burden of undernutrition and overnutrition
- Excess weight & obesity contribute to the non-communicable disease burden in a big way
- National Family Health Survey 2015-16 (NFHS-4) shows that in most of the States for which data is available, overweight men and women far outnumber underweight ones, in some instances double the number
So, what do we learn from above?
The simple lesson is that policy and planning initiatives should be designed keeping in mind the actual situation and ground level requirements. A simultaneous occurrence of undernutrition and overnutrition can be dealt by carving out state and district specific policies, which is only possible if frequent and reliable data is available.
Author now talks about the recommendations listed in a report titled “Tracking health and nutrition targets: four recommendations for India”. This report has been released by Observer Research Foundation (ORF), a think tank
Streamlining Data
The report identifies gaps and makes four recommendations to improvetracking of health and nutrition targets
- Transforming CRVS systems: There is a need to transform civil registration and vital statistics (CRVS) systems in India. India relies on sample registration and surveys to track mortality-related goals because of inadequate coverage of its Civil Registration System (CRS)
Stats: Overall, birth and death registrations in India stood at 85.5 per cent and 70.7 per cent, respectively, in 2013. Ensuring universal registration of births and deaths by the year 2020, promised in the “Vision 2020” plan announced in 2014, is a policy imperative.
As per WHO,
A well-functioning civil registration and vital statistics (CRVS) system registers all births and deaths, issues birth and death certificates, and compiles and disseminates vital statistics, including cause of death information. It may also record marriages and divorces.
- Pooling state and central data: Unit-level data from India’s sample surveys are an underutilized resource, and some data that are collected spending vast amounts of tax money are not available for public use at all. The National Sample Survey’s (NSS) ‘State sample’ data are a case in point. Pooling of Central and State samples will enhance the policy relevance of NSS data, as the data can then be used to arrive at district-level estimates.
- Streamlining the surveys: Comprehensive assessment of existing surveys should be conducted with the aim of streamlining a set of health and nutrition indicators to continuously track the national targets. Overall surveys can also be strengthened, keeping in mind India’s double burden of communicable and non-communicable diseases
- Reforming HIMS: The national Health Management Information System (HMIS), which serves as the backbone for monitoring results of the National Health Mission, needs reform.
- Expanding HMIS: Like the District Information System for Education (DISE), the HMIS needs to be expanded to integrate the vast private healthcare delivery system in order to enhance policy relevance; the HMIS currently captures only 12.7 per cent of the annual estimated infant deaths and 24.8 per cent of the annual estimated maternal deaths in the country
- National Forum on Health and Nutrition Statistics: The ORF report recommends setting up of a national forum on health and nutrition statistics in line with the Federal Interagency Forum on Child and Family Statistics of the U.S.
- Constituents of the forum: This mechanism will comprise of Central government agencies and ministries which currently collect, store, analyse and distribute different sets of health and nutrition data
- Mission: Its mission should be to foster coordination and collaboration and to enhance consistency in the collection and reporting of health and nutrition data
Read More: ORF, DISE, SDG, IAEG
ECONOMY
[1]. Pradhan moots Asian buyers forum to counter OPEC clout
Context
Article talks about recent idea floated by MoS for P&NG for a large Asian LNG Buyer’s forum.
What has happened?
Minister of State for Petroleum and Natural Gas Dharmendra Pradhan has suggested the idea of a large Asian LNG buyer’s forum to negotiate more equitable trade deals and balance the influence of the Organisation of Petroleum Exporting Countries (OPEC).
Significance of the announcement
The announcement assumes significance in light of the ongoing increase in oil prices resulting in an adverse impact on the Indian exchequer and the government’s commitment to move towards a gas-based economy
No Unity
Idea of such a forum is the one which India has been exploring for quite some time now.
- Lack of unity: Today a large number of LNG deals are linked to oil prices. Only geographies with LNG hubs have prices lower than the oil-linked prices& rest of the regions have to pay a higher price. Similarly Asian LNG buyers pay higher rates since there is no LNG hub in Asia and there is no unity among consumers. That is what India is trying to capitalise on
Counter view
Not all experts are convinced that cooperation between LNG buyers will yield any significant results since the market for the gas is already dominated by the buyers
Read More: OPEC
Indian Express
[1]. Not Constitutional
Context
In the light of recent interim order of SC mandating playing of national anthem in cinema halls, author tries to ascertain whether it is a step in the right direction or not. Read on to find out.
Term constitutional patriotism has been used in the article. Let us see what it actually means.
Constitutional patriotism
In the mid-1980s, the German political philosopher Jürgen Habermas popularized the concept of constitutional patriotism
- The idea was born in postwar West Germany. The political philosopher DolfSternberger, a pupil of Hannah Arendt’s, coined it in the late 1970s. It was subsequently taken up by Jürgen Habermas, and through his work became better known in the English-speaking world
- This concept talks about loyalty towards constitution
- This concept requires citizens to be socialized into a common political culture on the basis of liberal constitutional principles such as individual autonomy, critical rationality and diversity.
Explanation: The concept of constitutional patriotism has been proposed as an idea to unite a society which is multicultural, multiethnic and multilingual. Herein citizens are asked to show solidarity towards common political values rather than the values of the majority. Some groups living in a country might not be able to associate themselves with the culture or values of the majority. In such cases, constitutional patriotism can effectively bring together diverse groups under one roof wherein loyalty is not attached with the culture of the majority but to a liberal political document like constitution.
Prevention of Insults to National Honors Act
The Prevention of Insults to National Honors Act,1971 neither mandates the singing of the national anthem nor does it demand that people stand up when it is being sung.
- The Act merely punishes those who intentionally prevent the singing of the national anthem or disturb an assembly where it’s being sung
Judicial law making
Curtailment of fundamental freedoms without enacting a law by the parliament tantamounts to judicial law making which is wrong because under Article 13(3) expression law doesn’t cover judicial law making
Article 13(3)
- Definition of law: In this article, unless the context otherwise requires law includes any Ordinance, order, bye law, rule, regulation, notification, custom or usages having in the territory of India the force of law; laws in force includes laws passed or made by Legislature or other competent authority in the territory of India before the commencement of this Constitution and not previously repealed, notwithstanding that any such law or any part thereof may not be then in operation either at all or in particular areas
Right to silence
Author points out that after the order it is hoped that people who cannot or do not want to stand for national anthem would not be targeted because right to silence is as necessary as is right to speech
- In the national anthem case, when three students from the Jehovah Witness sect were expelled from the school for not singing national anthem, the Supreme Court held that these children were exercising their right to silence, which is implicit in the freedom of speech. The court said: “Our tradition teaches tolerance, our constitution preaches tolerance. Let us not dilute it
Read More: SC’s interim order,
[2]. A layman’s lament
Context
Banks charge us for insufficient funds in our accounts, then why can’t we charge them for insufficient cash?
In the post demonetization scenario, author poses some tough questions,
Q: How fair is it for the government to dish out the kind of treatment meted out to the common man with the lack of cash in banks?
Q: When I need my hard earned money in cash, I am denied and at best given a pittance of what I asked for. I am denied my right. It’s a failing of a contractual term. What’s the compensation I get in turn? Zero.
Q: Banks charge us for insufficient funds in our accounts, then why can’t I charge them for insufficient cash?
Pay the penalty
Author states that less funds in one’s account attracts penalty. Similarly banks should also pay penalty when they lack cash to pay
In the last few paragraphs author states that for India to be a cash-less or less-cash society, at least the following needs to be in place,
- Certain level of literacy and infrastructure
- Cyber security
Give it a go through once.
Live Mint
[1]. The governance of Reserve Bank of India
Context
If the central bank’s board rubber-stamped the currency exchange decision, it is clear then that RBI’s autonomy has been compromised.
Inclusivity starts at home
Q: RBI is not just a monetary authority with worried exclusively about issues of inflation, but much beyond. Analyse
RBI not only has a central board, but also has four regional boards. The regional boards are required to look at issues that come up in the respective regions, and deal with local financial institutions like cooperatives
- The chairs of the regional boards are on the central board. In addition to these four people, the Union government nominates 10 more directors on the central board
- The RBI board has representatives from agriculture, social services and even scientists
A shrinking Central Board
The central board of RBI, in the past three years, is shrinking.
Central Board: In the central board, everybody appointed by the previous government has demitted office. The current government in its tenure has made only 3 appointments to those 10 positions and the rest have remained vacant for a very long time.
- In addition, one position on the board from the side of officials—that of a deputy governor is also lying vacant after Urjit Patel assumed governor’s office. Thus, the RBI is operating with less than half of its board size; and less than a third of its size for independent members.
Local boards: There have been no new appointments to the local boards under the current government.
- The last appointment to a regional board was that of NachiketMor, who was appointed chair of the board of eastern region by the previous government. Thus, we have one representative from the local boards on the central board as against four positions.
Demonetization: Fair?
Author points out that the gazette notification that withdraws the legal tender status in the preamble states that the decision of the government has been on the recommendation of the central board of directors of the RBI.
- Author asks whether it is fair for a board, which has pending vacancies and which is not functioning at full capacity, to take a call on such an important economic policy matter?
Autonomy compromised
Author states that if RBI board was not consulted, due to secrecy concerns, before decision to demonetize was arrived at then it is a breach of RBI’s autonomy
- Secrecy cannot be a foil for breaking down the governance structures.
Concludes
Author concludes by saying that RBI is a classic case of minimum governance maximum government, exactly the opposite of what the honourable Prime Minister—when he was a candidate—promised.
[2]. Project Europe moving to a defining year in 2017
Context
A new band of leaders in Europe could potentially change the European Union as it exists today with its common currency and open borders.
Euroscepticism expands
Author begins the article by alluding to the BREXIT & President Elect Trump’s view on EU. He then states the political situation in Italy where the constitutional reform plan, which intended to streamline Italy’s political system by bringing it closer to European norms, of PM Renzi was rejected by Italian voters.
- This latest development has brought to the forefront the economic and political uncertainties not just for Italy but equally for the Eurozone, of which Italy is the third-largest economy after Germany and France.
- Renzi’s exit has opened doors for the five star movement which started as an anti-corruption movement. It has called for reworking Italy’s fiscal relationship with the EU and promised a referendum on the country’s EU membership.
Project Europe in danger
Author states that the referendum in Italy offers a less-than-optimistic preview of Project Europe in 2017—when three of the grouping’s founding members—France, Germany and the Netherlands—are scheduled to hold national elections.
- Anti-EU leaders and parties are on the rise in all four countries and, irrespective of whether they secure power (if there is one thing that recent elections have taught us, it is to be wary of predicting a popular vote), there is no doubt that they are a formidable force on the European political scene
Rising anti-Europe sentiment
Author points to the fact that fringe political outfits with anti-EU agenda are fast gaining mileage in Europe. He cites examples,
- France: The national front party, once a fringe group has now won almost 28% of the vote compared to the less than 14% it had secured in 2012 parliamentary poll or the 4.3% it had in 2007 national election. It has called for re-negotiating the EU’s founding treaties, reviewing France’s budgetary contributions to the EU, and more strictly regulating movement with the union
- Netherlands: In Netherlands, it has been predicted that Geert Wilders and his Party for Freedom (PVV) would win the national election if it were to be held today. It should be noted that Wilders has previously called for a break with the EU, campaigned on a strong anti-immigration platform and has been vocal in his opposition to what he sees as the “Islamization of Europe”
- Germany: Angela Merkel, the pro-Euro leader, is also facing heat in Germany. She faces a growing threat from the anti-immigration, eurosceptic party, the Alternative for Germany (AfD). Formed in 2013 to oppose Merkel’s response to the eurozone crisis, the AfD has now turned its attention to the refugee crisis and specifically, the chancellor’s open-door policy.
Austria: The exception
Author states that only Austria seems to be going against the trend where a pro pro-Europe candidate Alexander Van der Bellen defeated far-right politician Norbert Hofer in the presidential election. Here too, however, the eurosceptics put up an impressive show and are expected to be a potent force in the 2018 parliamentary election which may, in fact, also be held in 2017 itself.
Interesting Read: Is Project Europe doomed?
[3]. Intellectual property vs competition law
Context
The competition cure may well be worse than the patent plague that it was meant to heal.
Author has used two terms, Intellectual property (IP) & competition law upfront. Let us see what they mean.
What is Intellectual property?
As per World Intellectual Property Organization (WIPO), Intellectual Property (IP) can be referred to as,
“Creations of the mind, such as inventions; literary and artistic works; designs; and symbols, names and images used in commerce”
It is an asset, albeit not a physical one i.e. an intangible asset & an offshoot of one’s intellect. Intellectual property can mean different things for different people. Patents, trademarks, copyrights, trade-secrets etc. all form a part of IP framework.
What is competition?
Competition is a process of economic rivalry between market players to attract customers. Competition also refers to a situation in a business environment where businesses independently strive for the patronage of customers in order to achieve their business objective. Free and fair competition is one of the pillars of an efficient business environment
Competition Law
It is a law that promotes or seeks to maintain market competitionby regulating anti-competitive conduct by companies. Competition law is implemented through public and private enforcement. Competition law is known as anti-trust law in the United States, and as anti-monopoly law in China and Russia
- In India the first competition law was enacted in 1969 i.e. Monopolies and Restrictive Trade Practices Act, 1969 (MRTP Act, 1969)
- The Monopolies and Restrictive Trade Practices Act, 1969 (MRTP Act) repealed and was replaced by the Competition Act, 2002, with effect from 1 September, 2009
- The Act was subsequently amended by the Competition (Amendment) Act, 2007 and Competition (Amendment) Act, 2009.
Competition Commission of India (CCI)
The Competition Act, 2002 came into existence in January, 2003 and the Competition Commission of India (CCI) was established on 14 October, 2003.
- Members of CCI: CCI consists of a Chairperson and 6 Members appointed by the Central Government.
- Function of CCI:CCI functions as market regulator for preventing and regulating anti – competitive practices in the country
Competition Appellate Tribunal
A Competition Appellate Tribunal was also established, which is a quasi-judicial body established to hear and dispose of appeals against any direction issued, or decision made by the CCI.
Source: Info related to Competition Act has been sourced from here
Author begins his article by asking a question,
To what extent should competition law be permitted to intrude into the hallowed halls of IP? In simple terms, is it IP regime currently prevalent enough to prevent creation of rigid monopolies?
Examples of monopolies under IP: Excessive pricing or a refusal to supply the patented invention in quantities sufficient enough to fulfill market demand
What is Compulsory licensing?
Under conditions of undue monopolies or abuse of IP, India has a provision of compulsory license.
As per WTO,
Compulsory licensing is when a government authorizes a party other than the patent owner to produce the patented product or process, without the patent owner’s consent.
When can compulsory license be granted or laws governing Compulsory Licenses?
Under Indian Patent Act, 1970, the provision with regard to compulsory licensing is specifically given under Chapter XVI. The conditions which need to be fulfilled in order for a compulsory license to be granted are also laid down under Sections 84 and 92 of the Act.
1). Under Section 84 (1) of the Indian Patent Act, any person may request a compulsory license (CL) if,
- After three years from the date of the grant of a patent, the needs of the public to be covered by the invention have not been satisfied;
- the invention is not available to the public at an affordable price;
- the patented invention is not “worked in,” or manufactured in the country, to the fullest extent possible
2). India’s National Manufacturing Policy (NMP) also supports the application of CL across different manufacturing sectors, more specifically to ensure access to the latest green technologies that are patented.
3). The NMP provides the “option” to entities such as the Technology Acquisition and Development Fund “to approach the government for issue of a CL for the technology which is not being provided by the patent holder at reasonable rates or is not being ‘worked in India’ to meet the domestic demand in a satisfactory manner.”
Nexavar Case
India has invoked this provision once only in a case involving Bayer, a German multinational pharmaceutical company, against Natco Pharma Ltd, an Indian generic company.
- Excessively priced: Natco had petitioned the patent office arguing that Bayer’s price for its patented anti-cancer drug, Nexavar, was exorbitant at Rs2.8 lakh and unaffordable to a large segment of the patient population and that it was willing to supply the drug at less than 1/30th of the patented price, i.e. at Rs8800. The patent office ruled in favour of Natco, holding in pertinent part that Bayer’s price was excessive
Why a more rigorous framework is necessary?
Because even in the Nexavar case, patent office had relied on Bayer company’s own admission. Bayer had admitted that the drug reached only 2% of the patient population. Patent office thereby concluded that the drug was unaffordable for the other 98% populace.
- This might have worked in one case but for future cases, a proper system for determining “excessive” or “unaffordable” pricing; one built on a nuanced understanding of the healthcare market, purchasing power, insurance schemes is needed
Author poses another question,
Q: Are patent offices competent enough to make this complex evaluation?
A: Not quite, given the eternal problems with getting even basic patent examination right!
So, is this complex evaluation better performed by a competition agency?
Author doesn’t think so. He cites the example of CCI’s faulty decisions and resorts to Shamsher Kataria case.
Shamsher Kataria Case
In the case involving automobile spare parts, the CCI confidently pronounced that there can be no copyright protection over industrial drawings that underlie spare parts, when our courts have been struggling with this very issue for years on end.
Author concludes ruefully that we are stuck between two equally bad choices. So, what is the solution then?
Way ahead
Author proposes following suggestions,
- Training in economics: We can begin by infusing our IP offices with in-house competence in economics by recruiting ad hoc experts as an ex-post evaluation of a claimed patent abuse has less to do with measuring the technical merit of an invention (requiring some competence in science/technology) and more to do with economics and the like
- Progressive sharing regime: IP owners instead of being granted absolute protection can be granted a right to share the royalties that originate from the usage of their copyrighted content. Reasonable royalties can be fixed after appropriate deliberations.
Conclusion
Author concludes by stating that the inherent value of patent is indeterminate as a later discovery of a historical piece might void it altogether. Hence, courts are free to decide the cases by taking into account social interests and public policy.
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