India's IP and industrial reforms face funding gaps and patent delays
Topic 1: Audit of Industry & Internal Trade (196th Report of Standing Committee on Commerce)
The Department-related Parliamentary Standing Committee on Commerce, chaired by Ms. Dola Sen, presented its 196th Report on Demands for Grants (2026-27) for the DPIIT.
Budgetary Analysis & Capital Efficiency
- Massive Shortfall: The Committee noted a 28% gap between the Department's demand (₹16,581.10 Cr) and actual allocation (₹11,970.83 Cr). This could stall critical infrastructure projects like Plug and Play Industrial Parks.
- CEEF Framework: Recommended creating a Capital Expenditure Efficiency Framework to prioritize projects based on economic returns, readiness, and asset monetization potential.
- Agro-Focus: Despite being an agrarian country, the panel urged DPIIT to emphasize the establishment of agro-based industries.
Intellectual Property Rights (IPR) Crisis
The report highlighted significant bottlenecks in India's innovation ecosystem: - Declining Global Filings: Patent applications by Indians abroad fell by 7% (from 14,271 in 2023 to 13,253 in 2024). Recommended a Global IP Filing Incentive Scheme to reimburse costs. - Disposal Delays: Average time for final disposal of patents is 35.4 months (grant) and up to 46 months (refusal). - Startup Grant Rate: Despite increased filings, the grant rate for startups plummeted to 19% in 2025. The panel called for a Second-tier Patent Framework for incremental innovations.
Industrial Corridors & Infrastructure
- NICDIT Progress: Noted 20 approved projects with a total outlay of ₹18,161.18 Cr. Urged time-bound implementation of 12 newly approved projects.
- Plug and Play Parks: Concerned that ₹3,000 Cr is allocated for a scheme still at the draft stage. Recommended the "Flatted Factory" model (multi-story industrial units) used globally to save land.
- Leather Sector & CETPs: Urged coordination with MoEFCC for Common Effluent Treatment Plants (CETPs) in leather clusters, citing the successful models of Tamil Nadu and West Bengal.
Make in India & Startups
- Shipping Containers: Recommended a PLI Scheme for shipping-grade containers to reduce logistics vulnerabilities and stabilize freight costs.
- Startup Jobs: Recognized 1.03 lakh startups creating 12 lakh direct jobs. Urged more incentives for startups to set up skill development centers.
- AI & MSMEs: Stressed the need for a workforce capable of working with AI and Robotics. Proposed that vocational skilling qualifications be made at par with university degrees.
Regional Industrial Schemes
- UNNATI 2024 (North East): Flagged low expenditure (only ₹9.28 Cr) and urged proactive outreach to inform eligible units in the NE region.
- J&K Development: Appreciated the upward revision of funds to ₹400 Cr due to a high volume of incentive claims.
UPSC Prelims Fodder: Fact-Check
| Feature | Details | | --- | --- | | DPIIT | Dept for Promotion of Industry and Internal Trade (Ministry of Commerce). | | NICDIT | National Industrial Corridor Development and Implementation Trust. | | FLADP | Footwear, Leather and Accessories Development Programme. | | WPI Revision | Base year being updated to 2022-23. | | Jan Vishwas | Act aimed at decriminalizing minor offenses to improve Ease of Doing Business. |
Conclusion:
The 196th Report warns that a "funding gap" in 2026-27 may hamper India's manufacturing competitiveness.
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