A boom in Indian patents: Expanding manpower in the patents office can help India foster innovation

cfoindia August 8, 2022

The scale of patenting activity in India was very small until recently. In 2016-17, only 45,444 patent applications were filed and 9,847 were granted.

The recent data on India’s Intellectual Property Rights (IPR) ecosystem show a significant expansion. The World Intellectual Property Indicators 2023 report published this week shows that India rose to the third position in number of trademark filings in 2022 after the US and China, up from fifth last year. The performance in patents also showed improvement for the sixth straight year. Trends emerging from the first half of 2023-24 suggest that we will do even better this year.

The scale of patenting activity in India was very small until recently. In 2016-17, only 45,444 patent applications were filed and 9,847 were granted. This increased to 82,805 and 34,153 respectively in 2022-23. The provisional data available from Office of Controller General of Patents, Designs and Trademarks (CGPDTM) for the first half of this financial year suggests that we may grant somewhere between 55-60,000 patents this year.

The applications were earlier dominated by MNCs merely regularising their foreign patents in the country. But now, many more Indians are filing applications. In fact, the rise in numbers of patent applications in recent times is mostly due to Indian residents. The resident applications now account for more than half (52.3%) of the total applications in 2022-23, whereas they were just 29% in 2016-17. This increase in patent registration by Indians is important because this is a reflection of greater innovation in the country and not merely registration of foreign patents.

Although there have been signs of improvement in India’s IPR ecosystem, we still lag far behind our global peers both in terms of the number of patent applications and grants, but also in the efficiency of the entire process.

India is at the sixth rank when measured in quantum of patent applications, but the gap with top 5 offices is large. The number of patents filed in China and the US, which are the top two countries, stood at 16,19,268 and 5,94,340 in 2022. Correspondingly, the patents granted in the US and China were 7,98,347 and 3,23,410 respectively. Note that the numbers for China do not include the utility model patents, hence are comparable.

A major hurdle is that it just takes too long to get a patent in India. The average pendency time in India is 4.3 years (51 months) in 2022, as compared to 2 years in the US and 1.4 years in China. Of course, this is an improvement over the 64 months in 2017, but a lot still needs to be done. One thing that has changed in pendency time is the composition. Now all the delay is at the final decision stage, not at the stage of first office action where the average pendency is only 4 months. Note that in 2017, the entire pendency was at the first office action stage (52 months out of total 64).

In the EAC-PM Working Paper from 2022 titled – Why does India need to urgently invest in its IPR ecosystem? We had identified that the primary problem is a severe shortage of manpower. As per the latest numbers, India has close to 900 people in the patent office compared to 13,704 in China and 8,234 in the US.

Some manpower was added at the examiner level few years ago, which merely shifted the bottleneck at the next decision stage, i.e. at the controller level. This is reflected in the reduction in average pendency time for first office action and increase for final disposal. As on March 2023, there were about 1.67 lakh cases pending at the controller level for which preliminary examination has already been done.

Recognising this problem, the sanctioned strength of the patent office has been increased. Hiring over the next three years will more than double the total manpower of patent office to 1,961 (963 controllers and 998 examiners) by 2025-26. Additionally, contractual posts for 210 technical assistants to the controllers and 40 researchers were sanctioned for which hiring has already started. Even for trademarks, 510 contractual posts were sanctioned, on which hiring has already happened.

Note that there should be no fiscal concern about adding manpower in the patent office as this is actually a revenue-generating activity. During the year 2021-22, total revenue generated was Rs 1,093.24 crore, while total expenditure was only Rs 204.07 crore.

Given the current trends and the push to significantly ramp up the size of India’s patent office, India can easily move up the ladder. We expect India to have a capacity to annually grant 1 lakh patents by 2025-26.

Authors Sanjeev Sanyal and Aakanksha Arora, member and joint director, respectively, at EAC-PM, penned this piece for Financial Express.