New Delhi:

Implementing data exclusivity could impact India’s pharmaceutical and agricultural sectors and public health, Ashwani Mahajan, the co-convenor of Swadeshi Jagran Manch, has said. In a blog post on data exclusivity, Mr Mahajan said the topic has been a point of contention since the General Agreement on Tariffs and Trade (GATT).

Data exclusivity refers to the period during which a manufacturer cannot rely on existing data to support the approval of a generic or similar product. This prevents companies from introducing generics or biosimilars until the exclusivity period expires. As a result, the introduction of affordable alternatives is delayed, directly impacting the consumer, particularly in sectors like pharmaceuticals, where price reductions post-patent expiry are critical to ensuring affordable access to medicines.

Mr Mahajan says India’s pharmaceutical industry has been able to manufacture generic versions of medicines as soon as patents expire, often reducing the price of medicines by up to 90%. This has led to the establishment of government schemes like the PM Jan Aushadhi Kendras, where generic medicines are sold at discounted rates. The introduction of data exclusivity could put an end to these benefits, forcing consumers to pay much higher prices for medicines.

Despite the government’s clear stance against data exclusivity, multinational corporations (MNCs) and foreign governments continue to push for its inclusion, particularly through Free Trade Agreements (FTAs). While these efforts have been largely unsuccessful for over two decades, recent developments signal a renewed push that could harm domestic industries and public health.

One example, Mr Mahajan points out, is a November 4, 2024, order from the Department of Agriculture and Farmers Welfare. “As per this order a committee has been constituted to explore and examine the provisions related to data protection for agrochemicals. This order, has been issued on the pretext, ‘to study the requirements of regulatory data protection and global best practices on data protection with the intent to introduce new molecules and pesticides that have no alternatives aimed at protecting major crops from these losses due to new invasive pests and diseases’,” he writes.

India has consistently opposed data exclusivity in trade negotiations. Its withdrawal from the 2019 Regional Comprehensive Economic Partnership (RCEP) was partly due to provisions seeking to “extend pharmaceutical corporations’ patent terms beyond the usual 20 years,” says Mahajan, adding that such measures threaten access to affordable medicines.

“In many of the FTAs on table, including UK, USA and EU, this issue of data exclusivity  is definitely, a cause of major concern for Indian industry, especially pharmaceutical and chemicals,” he writes in the blog.

On the official position, Mr Mahajan says that government memorandums, including a 2015 note on the Pesticide Management Bill, have consistently flagged data exclusivity as “TRIPS-plus” and if “this provision is extended to agro-chemicals, there will be pressure from MNCs to extend the same to pharmaceutical products also,” which would delay generic drug entry and inflate prices.

Union Finance Minister Nirmala Sitharaman holding a folder-case containing the Interim Budget 2024.
| Photo Credit: SHIV KUMAR PUSHPAKAR

A ‘robot tax’ to cross-subsidise employees who lose jobs because of the adoption of Artificial Intelligence (AI) by their employers is a key item on the budget wishlist of the Swadeshi Jagran Manch (SJM), which is affiliated with the Rashtriya Swayamsevak Sangh (RSS).

In a pre-Budget meeting of economists with Finance Minister Nirmala Sitharaman last month, the SJM also suggested that tax incentives be given to industries generating more employment, based on an employment-output ratio.

Fund to upskill workers

Ashwani Mahajan, economist and national co-convenor of the SJM, who attended the June 20 meeting told The Hindu that economic measures were needed to cope with the human cost of AI. “We are not against the adoption of cutting-edge technology including AI, but it is a fact that in the short run, this will lead to loss of employment among certain sections of employees, and a ‘robot tax’, as it’s being termed, can be used for creating a fund that would help these workers upskill and adapt to new technologies,” he said, adding that such a tax is under consideration in several other countries as AI-generated disruption is hitting most economies.

A paper released by the International Monetary Fund (IMF) in June also argues that the AI transition will require fiscal incentives and stronger social nets being put in place, for all economies. Last year, Prime Minister Narendra Modi had cautioned people about the perils of misinformation and fake news with regard to AI, but the question of people falling out of the job market and being replaced by robots is a real worry.

‘Incentivise job creation’

Apart from the ‘robot tax’, some concerns raised during the recent parliamentary poll campaign are also reflected in the SJM’s wishlist. With unemployment being a major theme during the campaign, the SJM has suggested that industries be incentivised to create more jobs through tax measures.

With regard to food inflation, SJM proposed that small farmers be given subsidies for micro irrigation projects that they can start on their lands to increase productivity. It also recommended that these micro irrigation projects be made eligible for funding via corporate social responsibility (CSR), by adding them to Schedule VII of the Companies Act, 2013.

Wealth tax

On the issue of housing for all, the SJM suggested that a wealth tax be imposed on those holding “vacant land”, in order to “discourage unneccessary land holding on the pretext of future requirements”.

Ms. Sitharaman and Prime Minister Narendra Modi have been speaking to a range of stakeholders and economists in the run-up to the presentation of the Union Budget, which is expected to take place on July 23. The Budget session of Parliament will begin on July 22 and is expected to end on August 12.